EU pharma package: bolar exemption

The Bolar exemption traditionally allows manufacturers of generic medicines to benefit from a patent law exemption in certain circumstances. Over the years, this exemption, which originated in the United States, has been introduced in Europe, notably through national case law.

The Bolar exemption was enshrined by the European legislator in Article 10(6) of Directive 2001/83/EC, as amended by Directive 2004/27/EC, with the aim of not significantly delaying the arrival of generic medicinal products on the market: "Conducting the necessary studies and trials with a view to the application of paragraphs 1, 2, 3 and 4 [related to generic medicinal products and biological medicinal products] and the consequential practical requirements shall not be regarded as contrary to patent rights or to supplementary protection certificates for medicinal products."

Given that Article 10(6) was not very precise, and that some legislators were keen to encourage the arrival of generic and biosimilar medicinal products on the market, this Article has been transposed into the national legislations more or less extensively (see for instance Olivier Mignolet, François Jonquères, Estelle Thiebaut & Hannelore Daems, “Chapter 22 - Research and Bolar exemptions from UPC, Belgian and French perspectives”, in The Unitary Patent Package & Unified Patent Court, L. Desaunettes-Barbero, F. de Visscher, A. Strowel & V. Cassiers (ed.), Ledizioni, 2023, p. 493 et seq.).

The result today is a lack of harmonisation across the various European countries. For example, in some countries, Bolar has been implemented broadly to cover trials for new, as well as generic and biosimilar, medicines, and can be relied on for studies directed to non-EU regulatory approval. In other countries, however, Bolar remains limited to studies directed to regulatory approval in the EU and/or to generic and biosimilar medicines, with innovators required to rely on the relatively narrow exemption for research relating to the subject-matter of a patented invention. There are also long running uncertainties as to who may benefit from the exemption. Article 27(d) of the Unified Patent Court Agreement dealing with the Bolar exemption is also based on the terms of Article 10(6).

On April 26, 2023, the Commission published the so-called ‘EU Pharma Package’, including a proposal for a Pharmaceutical Regulation as well as a proposal for a Phamaceutical Directive (the “Directive”) (on the Union code relating to medicinal products for human use) that in particular addresses the Bolar issue.

Through Article 85 of the proposal for a Directive, the Commission aims to extend the scope of the Bolar exemption, and clarify some of the uncertainties, by providing that the following acts would not be considered as infringing acts:

• studies, trials and other activities conducted to generate data for an application for:
  • (i) a marketing authorisation of generic, biosimilar, hybrid or bio-hybrid medicinal products and for subsequent variations;
  • (ii) health technology assessment as defined in Regulation (EU) 2021/2282;
  • (iii) pricing and reimbursement.

1) Extent of acts covered by the Bolar exemption

First of all, the new draft Directive provides that the Bolar exemption covers studies and trials and other activities carried out to obtain the information required in the context of marketing authorisation applications for the following medicinal products: "generic, biosimilar, hybrid or bio-hybrid medicinal products and for subsequent variations". The amendment appears intended to clarify that ‘hybrid’ medicines (which are similar to the reference product, but with certain differences such as in their strength, indication or pharmaceutical form) and ‘bio-hybrids’ (biosimilars with changes to strength, indication or pharmaceutical form) are also covered. According to the Commission’s explanatory memorandum, the aim is to address differences in implementation across Europe, to encourage earlier generic and biosimilar access and to increase availability of more affordable drugs.

However, unlike the approach taken by some national legislators in some EU and other European countries, the Commission’s proposal remains limited essentially to generic and biosimilar medicinal products. By contrast, when implementing the existing Bolar provisions into national law, the French legislator chose to refer to medicinal products in a more general way, which thus includes all types of medicinal products, including innovative medicinal products. In Belgium, a majority of authors consider also that only generics and biosimilars are referred to in the Belgian provisions on Bolar, but a recent legislative amendment has significantly extended the research exemption in the field of pharmaceuticals to include “all acts carried out for the evaluation of medicinal products” also for innovative medicinal products (see in that respect Olivier Mignolet, François Jonquères, Estelle Thiebaut & Hannelore Daems, ”Chapter 22 - Research and Bolar exemptions from UPC, Belgian and French perspectives”, op. cit., p. 505). The UK has taken a similar approach, having originally implemented the Bolar provision narrowly, but in 2014 amending national law to deem anything carried out in or for the purposes of a ‘medicinal product assessment’ as falling within the research exemption. The 2014 law broadly defines ‘medicinal product assessment’ as covering tests or other activities to obtain or vary a marketing authorisation, to comply with related regulatory requirements, or to seek health-economic approval for a medicinal product from public authorities, each whether in the UK or elsewhere.

Therefore, the Commission’s proposal will still leave inconsistency within the EU, as well as with the EU’s neighbours, when it comes to new drugs. In countries where Bolar remains limited to generics and biosimilars, trials of new drugs will need to continue to rely on the research exemption. That covers research into something unknown about the subject matter of the patented invention, but not merely obtaining data to satisfy a regulator. There may therefore remain a degree of uncertainty as which side of the line some trials fall (e.g. if a regulator requires a confirmatory trial), and the research exemption may also not cover the use of patented research tools or comparator drugs in trials of new drugs.

It is still not clear in the draft Directive if the exemption could cover acts carried out in the context of an application for marketing authorisation made outside of the EU territory.

In addition, Article 85 explicitly states that certain other acts (apart from those strictly related to the marketing authorisation application) will also be covered by the exemption. In this respect, the draft Directive states that pricing and reimbursement applications, as well as the procedures required for health technology assessment (defined in Regulation 2021/2282 as “a multidisciplinary process that summarises information about the medical, patient and social aspects and the economic and ethical issues related to the use of a health technology in a systematic, transparent, unbiased and robust manner”), are also covered by the exemption. This is similar to the UK’s ‘medicinal product assessment’ exemption in extending the exemption to health-economic approval, although the Commission’s proposal does not extend to new drugs.

If such a text were to be adopted, it would have a more or less significant impact in the various national jurisdictions insofar as the various European legislations have not necessarily precisely identified the acts covered by the Bolar exemption. Moreover, this could also have an impact on the assessment of requests for preliminary injunctions in certain countries, if the non-infringing nature of the pricing and reimbursement claims were clearly specified.

2) Extent of beneficiaries covered by the Bolar exemption

The Bolar exemption provided for in Article 10(6) necessarily protected the applicant for marketing authorisation. For a long time, legal doctrine and case law had debated whether entities other than marketing authorisation applicants could benefit from the Bolar exemption, for example, where the third party supplied the applicant with patented product for use in trials or carried out trials on its behalf.

On this point, two contradictory decisions have been handed down in Europe between Astellas and Polpharma, one by the Polish Supreme Court and a second by the Dusseldorf Court of Appeal. Unfortunately, although this question was referred to the CJEU, no response was provided by the CJEU since the proceedings were settled.

The Commission, for its part, has made a clear decision since the draft Directive clearly states the proposal will cover the dealing in and use of patented medicinal products or processes “including by third party suppliers and service providers”.

If such a proposal were to be retained, it would have an important impact on a large number of national territories. For instance, in France and Belgium, it is uncertain under current legislations that third parties could also benefit from the exemption. Such a solution would provide security for third parties involved in the manufacture of generic, biosimilar, hybrid or bio-hybrid medicinal products, who would henceforth be able to operate on European territory.

3) Products made during regulatory testing

Finally, while it is not addressed in the provisions of the draft Directive, Recital 63 states that studies and trials carried out under the Bolar exemption for regulatory purposes may require “substantial amounts of test production” to demonstrate reliable manufacturing. The recital continues that there can be no commercial use of the medicinal products produced for the regulatory approval process during the term of the patent or SPC while Article 85 mentions that the exemption “shall not cover the placing on the market of the medicinal products” resulting from the activities conducted for the purposes set out in point a). While it is not stated, the implication is that commercial use of such product may be made after patent or SPC expiry. That interpretation would avoid a requirement to dispose of potentially valuable product made to satisfy regulatory requirements but not used up in the regulatory testing, and would appear aligned with the stated aim of promoting earlier generic and biosimilar entry.

We are still at an early stage of this reform and this proposal must now be discussed by the European Parliament and the Council. No timetable has yet been adopted which suggests that the final draft will not be adopted for several years.