Hogan Lovells

SPCS & The Proposed Unitary Patent

This note considers the proposals for a new unitary patent covering the EU (the "Unitary Patent"), the current provisions regarding supplementary protection certificates ("SPCs") for the Unitary Patent, and how the existing SPC system could be arranged with the minimum renegotiation of the proposals to provide for SPCs for Unitary Patents.
 
1. BACKGROUND

Regulation 469/2009 (the "SPC Regulation") lays down a system for the provision of SPCs in the EU.  SPC were introduced to compensate for the loss of effective patent term caused by the delay in obtaining marketing authorisation ("MA") for a pharmaceutical product.  The system currently allows for the grant by national industrial patent offices of SPCs for national patents and for EP patents designated for that country.

The proposed legislation for the Unitary Patent is in the form of an EU Regulation (the "UP Regulation").  The UP Regulation does not currently include provision for SPCs.  However, it would be a major disincentive for pharmaceutical companies to seek a Unitary Patent if it would not provide a basis for an SPC.

Currently the UP Regulation is being developed on the basis of enhanced cooperation between all EU Member States except for Spain and Italy (the "UP States").  Therefore any proposal for SPCs for Unitary Patents would not extend to Spain or Italy.

2. ISSUES TO CONSIDER

2.1 Should a single "Unitary SPC" be granted, or a bundle of national SPCs?

It is a prerequisite for an SPC that an MA has been granted in the jurisdiction where the SPC is sought (Article 3(b) of the SPC Regulation).  The new question raised by the possibility of a "Unitary SPC" is to what extent the territory covered by the granted MAs needs to match the territory covered by a "Unitary SPC" in order to satisfy Article 3(b).
 
Although it is possible to obtain a single MA covering the EU (through the Centralised procedure), there is no link between on the one hand, the basis for obtaining an MA via the Centralised procedure (as opposed to the national, Decentralised, or Mutual Recognition procedures), and on the other hand, the basis for seeking a Unitary Patent (as opposed to a national or European patent).
   
Unitary SPC? 
 
Therefore in order to offer a "Unitary SPC" either:

(a) Allowance would be needed for a "Unitary SPC" to be granted based on any EU MA, regardless of the procedure used to obtain the MA.  However, this could represent a significant relaxation of the current requirements if it allowed grant of a "Unitary SPC" (that inherently covered all UP States) where the authorisation to place the product on the market did not extend to all UP States (e.g. where there are national MAs for some, but not all, UP States).  This proposal would not therefore be viable.

(b) A "Unitary SPC" would only be available where either an MA had been obtained via the Centralised procedure (and had not been suspended or revoked in any jurisdiction), or MAs had otherwise been obtained in all UP States.  However, this requirement is very onerous, and would provide a disincentive for pharmaceutical companies to seek Unitary Patents.  There would also be issues arising due to the difference in timing of Member States giving effect to central decisions to approve products.

It does not, therefore seem viable to provide for a "Unitary SPC" without having to alter the balance of the current system.

National SPCs based on a Unitary Patent?

The alternative would be to allow the Unitary Patent to be used as the basis for seeking national SPCs under the current system.  The definition of "basic patent" in the SPC Regulation would encompass a Unitary Patent:

"(c) 'basic patent' means a patent which protects a product as such, a process to obtain a product or an application of a product, and which is designated by its holder for the purpose of the procedure for grant of a certificate"

There is nothing in this definition to exclude a Unitary Patent counting as a "basic patent".  In fact, setting up a system of national SPCs based upon Unitary Patents would simply require a few tweaks to the existing SPC Regulation.  This approach has the advantage that:

(a) it allows for and works with the various procedures for grant of an MA; and

(b) it builds on the existing system, and so should not require significant negotiation or implementation.

2.2 Who should be responsible for examination of the SPC applications and grant of the SPCs?

Article 9(1) of the SPC Regulation provides that:

"The application for a certificate shall be lodged with the competent industrial property office of the Member State which granted the basic patent or on whose behalf it was granted and in which the authorisation referred to in Article 3(b) to place the product on the market was obtained, unless the Member State designates another authority for the purpose."

Unitary Patents will, however, be granted by the EPO rather than by the industrial property office of a Member State.  The SPC for a Unitary Patent could either be granted by the EPO, or by the national patent office.  In principle, if SPCs are to be granted on a national basis, it would be preferable for examination and grant to be carried out by national patent offices.  This would avoid any change to existing procedures, save that an SPC application could designate a Unitary Patent as the basic patent.

However, Article 9(1) does not currently cover this position because there is no "competent industrial property office of the Member State which granted the basic patent"; Unitary Patents will be granted by the EPO.  Similarly, although Article 9(1) allows "the Member State [to] designates another authority for the purpose", there is not as such a Member States associated with the grant of the Unitary Patent by the EPO (although arguably all Member States could together designate another authority).    

Therefore, to deal with this problem, a slight amendment to this wording would be required with respect to applications for a national SPC for a Unitary Patent.  For example:

"In the case of an application for a certificate where the basic patent is a patent granted pursuant to [the UP Regulation], the application shall be lodged with the competent industrial property office of the Member State in which the certificate is sought and in which the authorisation referred to in Article 3(b) to place the product on the market was obtained, unless the Member State designates another authority for the purpose."

2.3 What about the Paediatric Regulation?

As with SPCs, it would be a major disincentive for pharmaceutical companies to seek a Unitary Patent if it would not provide a basis for a paediatric SPC extension.  The proposals in this note regarding SPCs should extend to paediatric SPC extensions.

2.4 What about Spain and Italy?

As Spain and Italy are not currently participating in the Enhanced Cooperation developing the Unitary Patent, no Unitary Patent will be granted in Spain or Italy, and therefore the Unitary Patent will not provide a basis for the grant of SPCs in Spain or Italy. 

2.5 How would the changes to the SPC Regulation be implemented?

An EU Regulation can amend an existing EU Regulation.  For example, the Paediatric Regulation  has already amended the SPC Regulation.  Therefore, the proposed UP Regulation could include provisions amending the SPC Regulation to extend its application to SPCs where the basic patent was a Unitary Patent.
 
2.6 Where would litigation on the new SPCs take place?

Issues regarding SPCs are very closely tied to the underlying patent.  For this reason, it would be sensible for litigation relating to the SPC to take place in the same forum as litigation relating to the Unitary Patent.  This would be the proposed Unified Patent Court "UPC").
 
This is position is already covered by the draft Agreement on a UPC which defines "Supplementary protection certificate" as an SPC under the SPC Regulation or SPC Plant Protection Regulation 1610/96 , and states that the Agreement covers SPCs issued for a European patent or a Unitary Patent.

The UPC has exclusive competence in respect of actions for actual or threatened infringements of SPCs and related defences, including counterclaims concerning licences .  The draft Rules of Procedure for the UPC appear to extend the general jurisdiction of the UPC to SPCs by stating that references in the Rules to "patent" and "proprietor" shall when appropriate include SPCs.

3. OTHER PROVISIONS OF THE SPC REGULATION THAT MAY NEED TO BE AMENDED

The SPC Regulation makes a number of references to "Member States" and "the authority referred to in paragraph (9)1" (which is the national patent office).  Generally these references would continue to work with respect to SPCs for Unitary Patents.  However, there are a few Articles of the SPC Regulation which refer to national law and which would need to be clarified to allow for the grant of SPCs where the basic patent is a Unitary Patent. 

In light of the teleological approach to interpretation of the SPC Regulation, the amendments should include new Recitals to explain the need for SPCs to be available for Unitary Patents.  In addition to the proposed amendments to article 9(1) of the SPC Regulation above, some further amendments would be required as follows:
 
3.1 Articles 15 & 16 - Invalidity of the certificate & Revocation of an extension of the duration

The provisions state that:

"15(2) - Any person may submit an application or bring an action for a declaration of invalidity of the certificate before the body responsible under national law for the revocation of the corresponding basic patent."

"16(2) - Any person may submit an application for revocation of the extension of the duration to the body responsible under national law for the revocation of the corresponding basic patent."

As the UP Regulation would have direct effect in each country, then generally the body responsible under national law for revocation of the Unitary Patent would be the UPC.  However, there could be some confusion because the EPO can also be responsible for revocation of the patent in opposition proceedings.  The EPO plays no part in the grant of SPCs, and therefore ideally should not be involved in their revocation.  Note that this issue already arises with respect to SPCs for European patents.

Nonetheless, it might be worth clarifying the position by simply stating that:

"Any person may submit an application or bring an action for [a declaration of invalidity of the certificate][revocation of the extension of the duration] before the Unified Patent Court where the basic patent is a Unitary Patent."

3.2 Article 18 - Appeals

With respect to appeals, the SPC Regulation refers to national law:

"The decisions of the authority referred to in Article 9(1) or of the bodies referred to in Articles 15(2) and 16(2) taken under this Regulation shall be open to the same appeals as those provided for in national law against similar decisions taken in respect of national patents."

This should be clarified to refer to the UPC Agreement and Rules (which would then provide for appeal to the CJEU as the SPC Regulation is EU law):

"The decisions of the authority referred to in Article 9(1) or of the Unified Patent Court taken under this Regulation shall be open to the same appeals as those provided for in the Agreement and Rules of Procedure of the Unified Patent Court."

3.3 Article 19 - Procedure

With respect to procedure, the SPC Regulation refers to national law:

"(1) In the absence of procedural provisions in this Regulation, the procedural provisions applicable under national law to the corresponding basic patent shall apply to the certificate, unless the national law lays down special procedural provisions for certificates."

This should be clarified to refer to the UPC Agreement and Rules:

"In the absence of procedural provisions in this Regulation, the procedural provisions applicable under the Agreement and Rules of Procedure of the Unified Patent Court shall apply to the certificate."

4. CONCLUSIONS

4.1 SPCs should be available based on Unitary Patents, otherwise the lack of SPC will discourage application for Unitary Patents if the applicant would otherwise be eligible for an SPC on a national or European patent.
 
4.2 SPCs should continue to be provided on a national basis, but with the "basic patent" being the Unitary Patent.

4.3 It would be relatively straightforward to implement this proposal.  A few minor clarifications would be required to the SPC Regulation, which could be set out in the UP Regulation.
 
4.4 SPCs based on Unitary Patents should be litigated in the same forum as the underlying Unitary Patent - i.e. in the proposed new Unified Patent Court.

By Katie McConnell, Of Counsel
Hogan Lovells International LLP

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