The European pharmaceutical legislation is to be fundamentally changed. The changes concern the protection of innovations in drug development and are intended to strike a balance between promoting innovation and ensuring access to affordable medicines. But what exactly is changing? And what are the implications for patients and manufacturers?

The pharmaceutical package presented by the EU Commission on 26 April 2023 contains far-reaching changes to the regulations on data protection and market exclusivity.
These are implemented via the proposal of the revision of Directive 2001/83/EC (hereinafter: Directive-Draft 2023/0132 (COD)) and the proposal for a new Regulation laying down Union procedures for the authorisation and supervision of medicinal products for human use and establishing the European Medicines Agency, amending Regulation (EC) No 1394/2007 and Regulation (EU) No 536/2014 and repealing Regulation (EC) No 726/2004, Regulation (EC) No 141/2000 and Regulation (EC) No 1901/2006 (hereinafter: Regulation-Draft 2023/0131 (COD)).

General regulations

According to the current legal situation, data protection and market exclusivity are governed by Section 24b para. 1 of the German Medicinal Products Act (AMG). This implemented the previous Article 10 of Directive 2001/83/EC. According to this, the data protection for all medicinal products comprises eight (8) years from the date of the marketing authorisation. This is followed by further two (2) years of marketing protection, during which manufacturers of generics and biosimilars can apply for and obtain marketing authorisations for their products with reference to the documents of the original manufacturer, but with the obligation to wait until the end of this period before marketing them, cf. § 24 para. 1 sentence 2 AMG.

With the new directive, this is to be fundamentally changed. Under the proposed reform, a standard period of regulatory protection will apply to innovative medicinal products, which is slightly shorter than today, but can be extended if the product achieves certain public health objectives. Data protection will be reduced from eight (8) to six (6) years by default, cf. Article 81 Directive-Draft 2023/0132 (COD). This data protection is followed by unchanged two (2) years of marketing protection.

According to the current legal situation, marketing protection can be extended by one (1) further year if a new indication for the active substance is approved in the first eight years and a clinical additional benefit compared to existing therapies is confirmed in the approval procedure, cf. section 24b para. 1 sentence 3 AMG. This is called the "8+2+1 rule".

This is also changed by the new directive. Companies are given the opportunity to achieve a period of protection of up to twelve (12) years (as opposed to the maximum of 11 years currently possible) by achieving certain public health objectives.
The Commission has set out the following objectives in Article 81 para. 2 Directive-Draft 2023/0132 (COD):

• Two (2) year extension if a pharmaceutical is placed on the market by a company in all Member States within two years, or within three years for companies with limited experience in the EU system;
• Six (6) months extension if the medicinal product covers an unmet medical need;
• Six (6) months extension if comparative clinical trials are conducted;
• One (1) year extension if a new indication is authorised for the medicinal product within the protection period, provided that a significant benefit can be achieved in comparison with existing therapies.
  
  

Article 84 Directive-Draft 2023/0132 (COD) introduces a new protection period of four (4) years for medicinal products for which a new therapeutic use has been identified (repurposing). The prerequisite is that the medicinal product in question has already been authorised for at least 25 years or that no data protection previously existed for the medicinal product.

Medicinal products for orphan diseases

Up to now, orphan medicinal products have been regulated by Regulation (EC) No 141/2000. According to this regulation, these medicinal products benefited from a period of market exclusivity of ten (10) years, cf. Article 8 Regulation (EC) No 141/2000.

However, this period can currently be shortened to six (6) years if at the end of the fifth year it is established with regard to the medicinal product concerned that the profitability is so sufficient that the maintenance of the market exclusivity right is not justified.

Special features currently exist, in addition, insofar as a paediatric orphan medicinal product is concerned. Provided that an application for marketing authorisation pursuant to Articles 7 or 8 of Regulation (EC) No. 1901/2006 on medicinal products for paediatric use includes the results of all studies conducted in accordance with an approved Paediatric Investigation Plan (PIP), the ten-year exclusivity period pursuant to Article 8 Para. 1 Regulation (EC) No. 141/2000 is extended by two (2) years to twelve (12) years for medicinal products designated as orphan medicinal products (Article 37 Para. 1 Regulation (EC) No. 1901/2006).
The new regulation will change this. It repeals both Regulation (EC) No 141/2000 on orphan medicinal products and Regulation (EC) No 1901/2006 on medicinal products for paediatric use and revises the regulations.

For orphan medicinal products, the duration of market exclusivity is now in principle nine (9) years. Article 71 Regulation-Draft 2023/0131 (COD) also regulates special periods in paragraph 2 b) and c):

• ten (10) years for orphan medicinal products for which there is a high unmet medical need within the meaning of Article 70;
• five (5) years for orphan medicinal products authorised through a marketing authorisation based on bibliographic data.
  
  

Another change is that the possibility to review the criteria for market exclusivity after six (6) years after authorisation has been removed to ensure better predictability for developers.

Companies may continue to benefit from additional market exclusivity periods (cf. Art 72 Regulation-Draft 2023/0131 (COD)):

• One (1) year extension if the company places the medicinal product on the market in all Member States;
• Up to two (2) additional years if the company develops new therapeutic indications for an already authorised orphan medicinal product.
  
  

An extension of market exclusivity for paediatric medicinal products that are also orphan medicinal products is no longer intended.

Market exclusivity can thus add up to a maximum of thirteen (13) years, whereas today it is still capped at ten (10) years (for paediatric medicines at twelve (12) years).

It should be noted that the market exclusivity right of the orphan medicinal product does not prevent the submission, validation and assessment of an application for marketing authorisation of a similar medicinal product, including generics and biosimilars, if the remaining duration of the market exclusivity right is less than two (2) years, cf. Article 71 para. 6 Regulation-Draft 2023/0131 (COD).

Antimicrobials

Until now, special requirements or reward systems for the development of antimicrobial agents were not in place. As a result of rising antibiotic resistance in the EU, a "voucher system" for rewarding research and development of such agents has been created under Regulation E 2023/0131 (COD).

The system works in such a way that the developers of novel, "revolutionary" antimicrobial agents receive transferable vouchers for data protection. The holder of the voucher can then use it for the antimicrobial agents themselves, but also for other of their medicinal products or even transfer it once to other manufacturers, cf. Article 41 Regulation-Draft 2023/0131 (COD). A voucher grants the holder one (1) additional year of data protection against competitors, cf. Article 40 para. 2 Regulation-Draft 2023/0131 (COD).

The vouchers are issued and used only under strict conditions. In particular, a voucher may only be used once and only in relation to a single centrally authorised medicinal product and only if this medicinal product is within the first four years of the statutory data protection. In addition, use will be limited to cases where the marketing authorisation of the priority antimicrobial for which the right was originally granted has not been withdrawn.

It should be noted that the voucher provisions apply until 15 years after the entry into force of the Regulation or until the date on which the Commission has granted a total of 10 vouchers under this chapter, whichever is the earlier, cf. Article 43 Regulation-Draft 2023/0131 (COD).

Medicinal products for children

Up to now, medicinal products for children have been regulated by Regulation (EC) No 1901/2006 on medicinal products for paediatric use. This regulation is to be repealed by the new regulation proposal.

According to this, the general protection periods of Directive 2001/83/EC were applicable, although not explicitly, but by way of systematics - and only for the authorisation of a new active substance. According to Article 93 of the Draft Regulation 2023/0131 (COD), the general protection periods according to Articles 80 and 81 of the Draft Directive 2023/0132 (COD) shall now also apply to so-called "paediatric use marketing authorisations". These are marketing authorisations for a medicinal product for human use that is not protected by a supplementary protection certificate (SPC) or by a patent that qualifies for the grant of the SPC and covers therapeutic indications that are exclusively relevant for use in children. A prerequisite for the application of the general terms of protection is that the application for a paediatric use marketing authorisation is accompanied by the results of all studies conducted in compliance with an agreed paediatric investigation plan.
Article 36 of Regulation (EC) No 1901/2006 provides that if an application for a marketing authorisation under Articles 7 or 8 includes the results of all studies conducted in compliance with an agreed paediatric investigation plan, the holder of the patent or supplementary protection certificate shall be granted a six-month extension of the SPC.

The draft Directive essentially takes over this provision in its Article 86, according to which the holder of the patent or supplementary protection certificate will be granted a six-month extension of the time limit (five (5) years) referred to in Article 13 para. 1 and 2 of Regulation (EC) No 469/2009 if the marketing authorisation application includes the results of all studies conducted in compliance with an agreed paediatric investigation plan. It should be noted, however, that this extension cannot be claimed if the one (1) year extension of data protection due to an additional indication has already been claimed, cf. Article 86 para. 1 and 4 Directive-Draft 2023/0132 (COD). A six month extension of the SPC is, however, also not possible in the case of "paediatric use marketing authorisations", as these may not be protected by an SPC by definition.

Compulsory licences

Closely related to the issue of document and marketing protection are the compulsory licences included by the Commission in the reform. If the statutory data protection were to remain in force, this would prevent effective use of compulsory licensing, as it would hinder the approval of generic medicines. This would have serious negative consequences for compulsory licences granted to address a crisis, as access to the medicines needed to address the crisis could be impeded. The new Article 80 para. 4 Directive-Draft 2023/0132 (COD) therefore provides that the document and marketing protection in relation to a party in whose favour the competent authority has granted a compulsory licence shall be suspended for the duration of the compulsory licence if a compulsory licence has been granted to deal with a public health emergency. The suspension means that document and marketing protection shall have no effect in relation to the licensee of the compulsory licence while that licence is in force. When the compulsory licence ends, data exclusivity and market protection will resume. It should be noted, however, that the suspension should not lead to an extension of the original duration of the statutory protection periods. The possibility of granting compulsory licences is taken up in the EU Commission's new draft regulation of 27 April 2023 on compulsory licences for crisis management and amending Regulation (EC) 816/2006.