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4 February 2016Big PharmaSam Bailey

Uncertainties in the SPC field

Supplementary protection certificates (SPCs) offer valuable extensions to the protection offered by the patent system for new pharmaceuticals and plant protection products in Europe. They have the potential to provide up to five years of additional protection for the product on the expiry of the basic patent to compensate the innovator for the delay in commercial exploitation due to extended authorisation procedures required to bring these products to market.

When the SPC regulation came into force in 1993, a large portion of new pharmaceutical products were small molecule therapeutics with easily defined chemical structures. However, recent trends towards more complex therapeutic products including antibodies, vaccines, combination therapies, and biologics in general are presenting severe tests to both the wording of the SPC regulation and the legal reasoning of the national and European courts.

A case from the Oslo District Court, Pharmaq v Intervet International (August 2015), has attracted interest in the SPC field not least due to the unusual reference to the European Free Trade Association (EFTA) Court for clarification on interpretation of SPC law, but also due to the broad interpretation of the scope of SPCs for vaccines to encompass the exact product and also therapeutic equivalents. While this decision is clearly in favour of the holders of SPCs for therapeutic biologics, it also presents significant uncertainties about the exact scope of protection of an SPC which will certainly occupy the appeals court in this case and seems likely to arise again in EU court proceedings in the future.

The case concerns vaccines against salmon pancreatic disease caused by salmon pancreas disease virus (SPDV). There are six genetic subtypes of SPDV with SAV-1 predominantly causing pancreatic disease in Scotland and Ireland, and SAV-3 occurring predominantly in Norway.

Intervet holds a Norwegian patent covering all genetic subtypes of the virus and vaccines containing inactivated virus. The company obtained a marketing authorisation for the SAV‑1 strain and on the basis of that obtained an SPC. The product definition in the SPC includes both the specific SAV-1 strain “or closely related strains which share similar genotypic and phenotypic characteristics” and a definition of the therapeutic activity that mirrors the language of the claims in the patent. Pharmaq has also developed a vaccine based on the SAV-3 virus strain.

In the case at the Oslo court, Pharmaq challenged the validity of the Intervet SPC on various grounds. The case is complex and a full dissection of the various legal and practical implications is beyond this article. However, a key issue in the case concerns discussions about the exact scope of SPCs for biologics and coverage of therapeutic equivalents.

Despite this decision originating in Norway, the Oslo court referred questions about interpretation of SPC law up to the EFTA Court and the case was important enough to attract observations from both the UK government and the European Commission. The decision also refers repeatedly to case law from the Court of Justice of the European Union (CJEU), so it seems likely that it will carry some weight in future decisions on SPCs regardless of their territorial coverage.

Intervet said its SPC was infringed through the sale of the Pharmaq vaccine based on SAV-3, while Pharmaq argued that it did not infringe the SPC because its vaccine had a different active ingredient and further that the Intervet SPC was invalid because the product in the SPC was defined more broadly than the product for which it had received marketing authorisation.


Article 4 of the SPC regulation requires that within the limits of the underlying patent, the scope of the SPC extends only to the “product” covered by the marketing authorisation. The meaning of the term “product” has been the subject of a number of CJEU cases. Although it is defined in article 1(b) of this regulation as “the active ingredient or combination of active ingredients of a medicinal product”, the term “active ingredient” is not defined in the SPC regulation and has required judicial input to try to clarify it. The CJEU’s 2015 Arne Forsgren v Österreichisches Patentamt case gave guidance about the interpretation of this term as referring to “substances producing a pharmacological, immunological or metabolic action of their own”.

The question in the present case amounted to whether the term “product” refers only to the specific vaccine strain SAV-1 mentioned in the SPC product definition or whether it extends to encompass other SPDV strains due to the therapeutic activity statements in the SPC product definition.

Pharmaq argued that the SPC cannot encompass virus strains other than the SAV-1 specified in the product definition. This argument was largely based on a combination of a memorandum from the preparatory stages of drafting the SPC regulation and the preamble to the regulation itself.

“The products cannot possibly be the same because as a matter of fact they have different genetic sequences and therefore must at some level exhibit therapeutic differences.”

Recital 9 of the preamble to the SPC Regulation states that “the protection granted should furthermore be strictly confined to the product which obtained authorisation to be placed on the market as a medicinal product. This is further emphasised in the preparatory memorandum, which comments that “the product shall be delimited from other potential products that are encompassed by the basic patent, but which have not obtained a market authorisation”.

Pharmaq was of the opinion that this strict approach is the clear intention from the regulation and the preparations for its drafting. It also commented that following this strict approach and requiring a distinction in the protection offered between the authorised product and other non-authorised products also covered by the underlying patent, the SPC holder would still be given sufficient protection against generic competition by preventing the sale of a product based on the same active ingredient; in this case the same virus strain.

However, Intervet replied that the underlying intention of the SPC regulation is to provide effective market exclusivity to the SPC holder. It commented that this would not be the case under the strict regime proposed by Pharmaq because a competitor could enter the market using a different strain of the same virus but having essentially equivalent therapeutic behaviour. This is practically indistinguishable from a generic competitor so it does not establish the intended effective market exclusivity.

The court examined earlier SPC case law from the CJEU and national courts, and was guided by the opinion of the EFTA Court in reaching its conclusion that the scope of protection should be limited to vaccines containing the same active ingredient with a similar therapeutic effect. This conclusion is supported by the CJEU’s Farmitalia case which held, based on the concept of effective market exclusivity, that the scope of an SPC for a particular chemical compound extended to all salts and esters of that molecule despite the marketing authorisation being issued for the hydrochloride salt alone. The Oslo court further commented that the principles of that decision have been followed in a number of national SPC decisions lending weight to a broad interpretation of the scope of the active ingredient and including the concept of therapeutic equivalence.

The court also heard extensive evidence about testing for therapeutic equivalence including efficacy, serological studies, and epitope mapping, none of which were held to show significant therapeutic differences between virus strains.

Difference of opinion

The Oslo court’s decision is a majority decision by two of the judges with a third presenting a dissenting minority opinion. The majority held that no significant difference had been demonstrated between the two virus strains and that both vaccines behaved in a therapeutically equivalent manner. Therefore, the judges held that the scope of protection for Intervet’s SPC extended to cover the Pharmaq product despite the apparent difference in virus strain.

This decision is clearly a welcome one for holders of SPCs covering vaccines and biologics in general due to the indication that the scope of protection may be interpreted as covering some therapeutically equivalent products that are not explicitly mentioned in the marketing authorisation. However, the dissenting minority opinion in the decision advocates a stricter approach aligning more with the Pharmaq arguments set out above.

Of concern to biologics innovators may also be that this minority opinion is in line with the observations presented to the EFTA Court by the European Commission. The commission argued that to infringe an SPC for a vaccine, the allegedly infringing product must be “marketable under the marketing authorisation covering the patented strain” and “therapeutically equivalent to the latter”, effectively limiting protection to vaccines based on the identified strain alone.

Despite attempting to balance the protection for the innovator company with the interests of generics manufacturers and public interest in competition in the pharmaceutical market, this decision leaves open the question of just how similar to the authorised active ingredient a “copycat” product needs to be to be encompassed by an SPC. In the present case, the vaccines based on SAV-1 and SAV-3 viruses were held to be “the same product” and to have indistinguishable therapeutic activity. However, the minority dissenting opinion takes the alternative view that the products cannot possibly be the same because as a matter of fact they have different genetic sequences and therefore must at some level exhibit therapeutic differences.

Unfortunately the decision gives no guidance about assessment of similarity in the active ingredients and the presentation in the judgment of two conflicting views, both of which include logical and reasonable arguments, only worsens the uncertainty for parties with an interest in the biologics market; such uncertainties are thoroughly unwelcome for SPC holders and generics manufacturers alike.

The present decision of the Oslo court is weighted in favour of the holders of SPCs for biologics. However, this decision is the subject of an appeal which is expected to be heard later this year. It is to be hoped that the appeal decision will go some way towards resolving the uncertainties introduced into the SPC field by the present decision.

Sam Bailey is a partner at  Mewburn Ellis. He can be contacted at: sam.bailey@mewburn.com

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