Guest column : Is “evergreening” of drug patents all bad?

23 Oct

A recent article in Health Affairs considers how secondary patenting can extend market exclusivity and delay generic competition.  Amin and Kesselheim examine two key anti-HIV drugs Norvir and Kaletra.

Through the analysis of 108 patents, they find generic competition could be delayed for an additional twelve years beyond the expiration of the patents on the drugs’ base compounds. 

The evergreening of pharmaceutical patents is a contentious issue at the intersection of intellectual property rights (IPR) and public health. Critics maintain that the practice extends the period of market exclusivity, delays the introduction of generic competition, and negatively impacts public health. Alternatively, advocates assert that technological progress occurs incrementally and effective IP policy provides for patents on improvement inventions.

The authors make a heroic effort to explore a thorny issue focusing on patents on features other than the active drug ingredient, such as new formulations, new delivery systems, new methods of manufacture, and chemical intermediates.

They propose increased transparency for related patents, enhanced patentability standards, and additional post-patent-grant opposition opportunities to increase the efficiency of the patent system and speed generic competition.

Found wanting

Yet, even as they bring novel empirical evidence, their discussion fails to account for a significant number of issues that are essential to fully understanding the controversy surrounding secondary patents.

These are that a sound IP system will incentivise new testing and clinical trials for existing treatments that find secondary applications;  follow-on research is less costly than developing new therapies, but still expensive;  firms must have financial reward to cover the additional development and clinical trial costs.

In addition, new formulations (the authors specifically mention a modified heat-stable formulation) should be encouraged if medically valuable.  They may cause fewer side effects over an existing treatment or make it easier to use, increasing patient compliance.

In a 2009 Congressional Research Service Report, Thomas makes a particularly strong case for the value of incremental innovation, citing Jeanne C. Fromer of Fordham Law School, “while there are a rising number of patents for incremental technical advances, which individually might not be commercially or informationally valuable, the collectivity of incremental advances provides essential information for further innovation in many areas.” The value of incremental innovation is cumulative and society benefits from rewarding the development of these small steps.

In addition to recognizing the value of incremental innovations it is important to recognize who develops these innovations.  Amin and Kesselheim fail to discuss the possibility that the incremental innovation may be developed by an entity different from the developer of the original innovation.  In this context, secondary patents encourage competition.

Moreover, the authors overlook the fact that secondary patents may not impede the ability of competitors to bring products to market that were covered by expired patents on original technologies.  In the case of secondary patents protecting the modified heat-stable formulation, generic competitors could market the original formulation following expiry of the original patent until the secondary patent expires at which time generic versions of the modified heat-stable formulation could be marketed.

Finally, the study only examines two drugs.  A wider sample size would be helpful in determining whether secondary patents actually impede generic entry and harm public health.  It would be valuable to know more about the rise of this strategy, how frequently it is employed and whether generic competition has truly been delayed.

With some evidence of the true cost to society, it would be possible to evaluate whether IP protection should be altered.

This is especially important in the context of recent legal findings.  Thomas notes that many scholars believe that the 2007 opinion of the U.S. Supreme Court in KSR International Co. v. Teleflex Inc. raised the standard of non-obviousness, increasing the difficulty of obtaining a patent.

Maintaining balance

While the authors miss the mark on several counts, they do raise a number of important issues.  First, although their sample size is small, the authors present some evidence that the system may not prevent abuse, suggesting that a reevaluation needs to be undertaken. Perhaps more importantly, secondary patents complicate the minefield of existing IPRs that competitor firms must navigate when endeavoring to bring a generic to market.

In addition, the authors advocate for increased transparency. (Their own research is complicated by the difficulties of discovering the full set of patents protecting a particular drug).  The beauty of this suggestion is its simplicity.  As part of the public record, the patent protection specific to a particular drug should be readily available.  In the interest of both innovation and public health, it is both efficient and reasonable to expect manufacturers will publicly identify all patents related to a specific compound.

At the end of the day, we all hope to balance the incentives for innovation against the market exclusivity that patents guarantee.  At its worst, the critics are right and evergreening is solely a strategy to delay generic entry.  At its best, evergreening allows for continuing innovation and improved treatments.

Dr Kristina Lybecker is Associate Professor of Economics at Colorado College in Colorado Springs. Kristina is an economist with a PhD from the University of California at Berkeley. She specialises in innovation and intellectual property rights and has been writing on these issues for 12 years. She is currently employed full-time at Colorado College. In the interests of transparency, the writer states that she has been commissioned to work for the pharmaceutical industry on issues of innovation, corruption, counterfeiting and intellectual property rights. However, she has not been compensated or otherwise rewarded for this piece which stems from her intellectual interest in the topic and closely relates to her academic research.

Pic sourced from http://www.coloradocollege.edu

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2 Responses to “Guest column : Is “evergreening” of drug patents all bad?”

  1. Shahani, Ranjit October 23, 2012 at 3:53 pm #

    Dear Gauri

    It is not “ever greening” of patents which is good or bad – it is the “ever delaying” of patents in the ecosystem which exists in India is what catches my goat !!

    Ranjit Shahani
    Country President
    Novartis India

    Like

    • Gauri Kamath October 23, 2012 at 7:31 pm #

      Mr Shahani, the mills of justice, it is said, grind slowly. But they grind exceedingly fine! Any solace in that?

      Like

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