EU Pharma Patent Settlements Still Limiting Entry of Generics

Regulatory NewsRegulatory News | 13 December 2016 |  By 

Almost three-quarters of 125 patent settlements in the EU in 2015 between originator pharmaceutical and their generic competitors resulted in a lengthening of time to bring the cheaper generic version to market.

But of those 74%, only 10% were settlements limiting generic market entry and including a payment or transfer of value from originator to generic company, while 64% were settlements limiting generic entry but with no value transfer. The remaining 26% of settlements were those that did not limit generic market entry, according to a new European Commission report released Tuesday.

The 125 settlements in 2015 is up sharply from years prior, as from 1 January 2000 to 30 June 2008 there were a total of 207 settlements (in eight and a half years).


Also, the number of international non-proprietary names for a pharmaceutical substance (INNs) which were the subject of settlements increased significantly from less than 10 INNs in the first three years of the millennium to 53 in 2015.


The findings were the result of a monitoring exercise by the European Commission launched in February 2016 and covered the period from 1 January 2015 to 31 December 2015.

In total, 58 originator and 50 generic companies replied to the commission’s request to submit a copy of all patent settlement agreements relevant for the EU/EEA markets, and which the EC said constitutes a representative sample of the industry.

“The value transfer flowing to generic companies in the settlement agreements took different forms, sometimes in various combinations: early entry and a licence or payment. Of the 13 B.II agreements for the 2015 period, 5 (38%) enabled early entry without a licence or a distribution agreement, 6 (46%) combined early entry with a licence to the generic company, 1 (8%) only included a licence, and 1 (8%) included a payment to the generic company to compensate for damages,” the report says.

In terms of where 2015 stacks up with recent years, the commission notes, “At the beginning of the monitoring period the number of patent settlement agreements was comparatively low, whereas after 2008 an increase can be observed, with a peak of 183 in 2012. Thereafter the number of settlements again decreased, remaining however clearly higher than the average of 24 in the period 2000-2008.”


In the past, the commission has taken action against pharmaceutical companies for delaying generic entry, including fining Servier €330 million and several producers of generic medicines €97 million in 2014 for delaying market entry of generic high blood pressure medicine perindopril, fining Johnson & Johnson and Novartis €16 million in 2013 for delaying market entry of generic pain-killer fentanyl and fining Lundbeck €93.8 million and several producers of generic medicines €52.2 million in 2013 for delaying market entry of generic antidepressant citalopram.



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