A forgotten exception to patent rights achieves unexpected popularity.

It is well known that in order to strike a balance between the interests of right holders, third parties and society at large, most national patent laws include exceptions and limitations to patent rights.

In this entry I am going to focus on one of the lesser-known exceptions,
the so-called pharmacy or prescription exception, present in most patent laws and which has been on the news recently . For instance, in Spain that exception is defined in Art. 61.4  of Patent law 24/2015:

“The rights conferred by the patent do not extend:

d) To the preparation of medicines carried out in pharmacies extemporaneously and by unit in execution of a medical prescription nor to the acts related to the medicines thus prepared.”

The underlying policy objective for providing this exception is that pharmacists should be free to make individual medical preparations as prescribed by a doctor without the threat of patent infringement.

Source: Wikipedia

The use of this exception is very low, since in most countries the preparation of medicines in pharmacies is no longer common.

Unlike most patent laws, the Dutch Patent Act did not have this exception. Nevertheless, it has been recently included as one of the measures taken by the Dutch Government in the context of the growing concern about the increase in the cost of medicines. A worry that formerly was limited to developing and least developed countries and now is present in all States, independently of their level of development.

The pharmacy exception was included in Art.53(3):

“The exclusive right…does not extend to the preparation for immediate use for individuals on the basis of a medical prescription of medicines in pharmacies, nor acts concerning the medicines so prepared.”

Ten years ago, the Italian Supreme Court clarified the scope of this exception and stated that it can only be applied in Italy when the patented active substance is not industrially produced.

The Standing Committee on the Law of Patents of WIPO (World Intellectual Property Organization), also known as SCP, is drafting a series of reference documents on “exceptions and limitations to patent rights” following a proposal by Brazil. Reference documents on “Research exception” and on “Acts for obtaining regulatory approval from authorities” have already been published. During the next session of the SCP, late in June, a reference document on “compulsory licensing” will presented by the Secretary. Hopefully, a reference document on the “prescription exception” will also be drafted by WIPO in the future.

Despite being regarded as one of the richest European States, the Netherlands are very active in the “fight” against the high prices of new drugs that hinder access to them and cause a huge increase of already inflated national deficits. The Dutch Health Minister has made several statements in that regard, and last November a teaching hospital was given green light to make its own version of a patented drug. In fact, in the Netherlands, unlike in most countries, pharmacists have a long tradition of producing low-cost medicines.

The inclusion in the Dutch legislation of this exception can be regarded as one more of the measures being taken around the world to tackle the soaring prices of new drugs by manufacturing them without infringing patents. For instance, last February it was known that for the first time the NGO DNDi had been able to develop a new drug from scratch: fexinidazole, for the treatment of the neglected disease “sleeping sickness”. It’s worth noting that one of the organizations that economically support this programme is the AECID (Spanish Agency for International Development Cooperation).

In a post I wrote for the SPTO Blog some weeks ago, I dealt with a conference about the patentability of CAR-T therapies, with prices in excess of 300,000 US$. Recently, it has also been known that the Hospital Clinic in Barcelona has developed its own version of the treatment, but much cheaper (50,000 – 60,000 euros). The main change lies in the replacement of the virus vector used for the introduction of foreign DNA into the cells (transduction) The Hospital has stated that it has no intention of patenting it.

Conclusion

Extremely high prices of new drugs are already taking a toll on the budgets of most developed countries. As a result, several initiatives are under way to tackle this problem. The development and manufacture of drugs not protected by patent rights is one of the ways to deal with it.

En español

Leopoldo Belda-Soriano

Proofread by Ben Rodway

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