Can an SPC have a negative term? Court of Justice to decide

During the often lengthy time a medicinal or plant protection product takes to obtain marketing authorisation, the product cannot be sold and the patent owner will be unable to exploit their exclusivity in the marketplace, sometimes for a significant portion of the life of the patent. In order to mitigate this, in European countries a Supplementary Protection Certificate (SPC) can be applied for. An SPC comes into effect on expiry of the patent and protects the product in question for a further period of up to five years. The duration of the SPC is calculated such that the patent owner has fifteen years of exclusivity, but subject to a maximum SPC term of five years.

As there would be no benefit to obtaining an SPC which was incapable of extending the term of protection of a patent, SPCs were only granted to products for which marketing authorisation was obtained more than five years after the filing date of the patent.

In 2007, new EU legislation which provided for a six month extension of an SPC for paediatric medicines potentially changed this, and has started a debate over whether zero or negative term SPCs should be allowed. Their usefulness lies in the fact that an SPC which on its own would not extend the term of protection of a patent may do so with the addition of the six month extension. In other words, an SPC for which the normal term would expire less than six months before patent expiry would be of some value if it were extended by six months.

In April 2008, the UKIPO granted the first negative term SPC in the UK on the basis that the six month paediatric extension, if granted, would provide the SPC with a positive term of around 2.5 months (BL O/108/08). They also concluded that, since the application fulfilled all the criteria for an SPC, there was no basis in law to refuse the application. A number of other Patent Offices in Europe (The Netherlands and Bulgaria) have also granted negative term SPCs to this patent, and Greece has granted it a zero term SPC. However, the court in Germany appeared inclined to decide the opposite as they considered that a ‘period of time’ (ie that during which an SPC is active) cannot be negative. In the interests of promoting uniform interpretation of Community law across Europe the German court has now referred the following question to the Court of Justice (referral number C-125/10):

“Can a supplementary protection certificate for medicinal products be granted if the period of time between the filing of the application for the basic patent and the date of the first authorisation for marketing in the Community is shorter than five years?”

A negative answer to this question will mean that the owners of products gaining faster marketing authorisation will lose out relative to those whose marketing authorisations are granted more slowly (for example, if gaining authorisation takes 5 years and 3 months, the period of exclusivity from grant of the marketing authorisation could be up to 15 years and 6 months, whereas if authorisation was faster, taking 4 years and 9 months, the period of exclusivity from marketing authorisation would be 15 years and 3 months). A positive answer seems likely to spark a new debate over whether the six month paediatric extension should be calculated from the nominal expiry date of the (negative term) SPC, or whether a negative term should be rounded up to zero and the SPC therefore entitled to a six month extension from the expiry date of the patent.

11 June 2010