The two companies, who represent both sides of the pharmaceutical industry, sponsored a conference at UCL IBIL in London this week, attended by a mix of lawyers, judges, regulators and industry representatives.
In summary, the problem is: is there sufficient incentive to encourage research into second and subsequent medical uses of known compounds? While second medical uses can in principle be protected by so-called intended use claims, these may be of limited value. That’s because as soon as the first patent (or SPC) expires, generics can enter the market with competing products – and it is almost inevitable that some of these will be prescribed or used for treatments that infringe the second medical use patent.
Such off-label prescriptions may not be approved by the generic (and scrupulous manufacturers will ensure their packaging and information make clear what their products are and are not approved for). But they are unavoidable, given the price difference between branded and generic products and the pressures from payers (governments and health insurers).
The result is everyone loses. Innovative companies lose sales and may decide it is not worth investing in research on new uses, meaning that patients are deprived of new products. Generics are putting themselves at risk of indirectly infringing patents even though they are producing drugs legally. And patients may not be getting the latest, best treatments for their conditions. The only potential winners – at least in the short term – are the people paying the bills.
What’s more, the courts may not be able to provide an answer. Patent owners won’t sue pharmacists, doctors or patients. That leaves the generics, who may be secondarily liable. But the law on secondary liability in Europe is unclear and continental judges (at least) are unlikely to grant an injunction in cases where a generic has clearly carved out certain indications. Judges in the UK may be more flexible: one suggestion is that an injunction could be suspended provided a generic pays a royalty to compensate the patent owner for off-label sales. That’s neat, but it’s effectively compulsory licensing. And it raises further questions about what would be appropriate compensation (and potentially competition issues).
Just to complicate things there is a widely shared recognition that second medical use patents may be found invalid anyway when they come before a court. (If you have a drug that is effective in treating colon cancer, it’s arguably obvious to see if it works against other forms of cancer too.) That was the fate of Merck’s patent for alendronate 10 years ago: in the UK litigation Sir Robin Jacob (who coincidentally hosted this week’s conference at UCL) wrote: "[T]he patent system does not confer monopolies on those who develop obvious or old products, even if they have never been exploited. A workable system for that might be a good idea, particularly in the field of medicine and analogous fields.”
The patent problem creates a societal problem: potentially useful medicines may not be researched and produced. And it may be a problem that the patent system itself can’t solve. Alternative suggestions include some sort of industry agreement to redistribute earnings from generics to innovators; creating a new (quasi-)IP right similar to SPCs; and beefing up regulatory data protection.
This week’s conference showed that there is broad agreement within industry that something needs to be done, and there are some constructive suggestions. But whatever concrete proposals emerge, they will have to be sold to governments and society at large – and that will be tough, especially in today’s economic climate.