On 6 May 2021, the European Commission published its “EU Strategy on COVID-19 Therapeutics” (the “Strategy”).  With the vaccination programme now under way, the EU is shifting focus towards the development, approval and procurement of COVID-19 therapeutic products.  The Commission intends to build on the experience from the EU vaccines strategy.  In particular, the aim is to have three new therapeutics available by October 2021 and possibly two further products by the end of the year.

The Strategy touches on a number of key areas for both biotechnology and pharmaceutical companies operating in the space: Continue Reading European Commission outlines Strategy on COVID-19 Therapeutics

On March 4, 2021, Brazil deposited with the United Nations its ratification of the Nagoya Protocol (“Protocol”) (see here the announcement of Brazil’s Ministry of Foreign Affairs).  This represents Brazil’s formal commitment to be bound by the Protocol.

On August 6, 2020, the Brazilian Senate passed a Decree that ratifies the Nagoya Protocol. The Protocol complements Brazil’s existing access and benefit sharing rules relating to Brazil’s genetic heritage and associated traditional knowledge (“ABS Framework”).  One important effect of this ratification is that other countries parties to the Protocol will have to ensure that users of Brazilian genetic heritage and associated traditional knowledge comply with the Brazilian ABS Framework.  However, the inverse is also true.  Brazil will need to ensure that Brazilian users of foreign genetic heritage and associated traditional knowledge comply with the access and benefit sharing regime of the country of origin. Continue Reading Brazil Ratifies the Nagoya Protocol

On 27 January 2021, the German Parliament discussed a draft law that would limit a patent owner’s ability to stop the production and distribution of an infringing product. The new law would enable the infringer to rely on a defence of “disproportionate hardship” against an otherwise justified cease-and-desist claim. While the German Association of the Automotive Industry welcomes these changes, citing “unreasonable” royalty demands for standard essential patents for information and communications technology used in cars, the Association of the German Chemical Industry (VCI) and the Association of Research-Based Pharmaceutical Companies (VFA) have argued in a joint statement that the proposed changes go too far.

Scope of the Proposed Disproportionality Defence

The German Federal Government intends to amend several intellectual property laws by the “Second Act on the Simplification and Modernisation of Patent Law”. While the proposed amendments mostly relate to procedural and cost provisions, the draft would also modify the substantive law on a patent owner’s cease-and-desist claim against an infringer. Continue Reading German Patent Law Reform Would Introduce “Disproportionality” Defence

On January 30, 2021, the European Commission published the Regulation establishing an export authorization and notification scheme relating to COVID-19 vaccines and their active substances.  It applies “for a limited duration” to COVID-19 vaccines covered by Advanced Purchased Agreements (“APAs”) concluded with the Union.  As regards APAs contracted by third countries, “the Commission will endeavour that the expectations of these countries to obtain their deliveries will be met as much as possible.”  This post briefly outlines the key elements of the export authorization and notification scheme that require further scrutiny.

Continue Reading EU Adopts Export Authorization Scheme for COVID-19 Vaccines and their Active Substances

On 13 December 2020, Belgium amended its rules regarding compassionate use and medical need programs to confirm that authorized programs can continue to operate after the marketing authorization for the concerned product has been granted but while the decision on reimbursement is still pending.

The Law of 25 March 1964 (“Medicines Law”) regulates the use of medicinal products that have not (yet) received a marketing authorization (“compassionate use”, “CU”) and for off-label use (“medical need”, “MNP”). The Belgian Federal Agency for Medicines and Health Products (“FAMHP”) must grant an authorization to allow the use of medicinal products in a compassionate or medical need context Continue Reading Belgium Amends Compassionate Use and Medical Need Program Rules to Expand Access

In addition to releasing the new EU Cybersecurity Strategy before the holidays (see our post here), the Commission published a revised Directive on measures for high common level of cybersecurity across the Union (“NIS2”) and a Directive on the resilience of critical entities (“Critical Entities Resilience Directive”). In this blog post, we summarize key points relating to NIS2, including more onerous security and incident reporting requirements; extending requirements to companies in the food, pharma, medical device, and chemical sectors, among others; and increased powers for regulators, including the ability to impose multi-million Euro fines.

The Commission is seeking feedback on NIS2 and the Critical Entities Resilience Directive, and recently extended its original deadline of early February to March 11, 2021 (responses can be submitted here and here). Continue Reading Proposed New EU Cyber Rules Introduce More Onerous Requirements and Extend to More Sectors

In a landmark judgment on 19 November 2020, the CJEU ruled in Case C-663/18 that cannabidiol (“CBD”) is not a narcotic drug under the UN Conventions.  This is the case even where the CBD is derived from the whole cannabis plant.  The ruling provides clarity on the non-controlled status of CBD and the free movement of CBD products within the Union.  This is likely to have wide implications for the CBD industry. Continue Reading CJEU Confirms that CBD is Not a Narcotic Drug

On 11 November 2020, the European Commission has announced a range of proposals to build a European Health Union.  The proposed measures reflect on the learnings from the current COVID-19 and previous influenza pandemics and seek to enhance Member States’ preparedness for future health crises, which also includes a greater involvement of the EU.  As part of its set of measures, the Commission is proposing to revise the current EU joint procurement framework.

  1. Current Joint Procurement Framework

In 2010, as part of its “lessons learnt from the A/H1N1 pandemic”, the European Council called for the development of a joint procurement framework for vaccines and antiviral medication.  Subsequently, the European Parliament and Council adopted Decision 1082/2013/EU (the “Decision”) on serious cross-border threats to health, which, among others, provides that the EU and any interested Member States may conduct a joint procurement procedure.  The detailed procedure was then agreed between the Commission and the Member States in the Joint Procurement Agreement (the “JPA”). Continue Reading European Health Union: European Commission proposes Changes to the Joint Procurement Agreement

Today, October 1st 2020, the updated anti-gift scheme in France enters into force.  The anti-gift rules impose obligations on pharmaceutical, medical device and cosmetics companies when interacting with healthcare professionals (“HCPs”) and healthcare organizations (“HCOs”) in France.  The updated framework was foreseen in the adoption of Ordinance 2017-49 of 19 January 2017 and Decree 2020-730 of 15 June 2020.  This blog summarizes the new French rules.

Continue Reading Entry Into Force of Reinforced Anti-gift Rules in France

On 10 September 2020, the German Federal Social Court (Bundessozialgericht – “BSG”) has issued an important decision with significant impact on the drug pricing and reimbursement system. It ruled that a pharmaceutical company can file a direct legal action against the early benefit assessment in the so-called AMNOG process. This was not possible so far. The decision therefore significantly broadens the legal redress possibilities of pharmaceutical companies under the German drug pricing and reimbursement regulation.

For drugs with new active substances, the pricing and reimbursement process has three steps: First, an early benefit assessment is performed by the Joint Federal Committee (Gemeinsamer Bundesausschuss – “GBA”) to assess the drug’s “additional benefit” against the relevant comparator therapy. Second, the drug company negotiates the reimbursement price with the health insurances association based on the outcome of the early benefit assessment. If they cannot agree to a price, the third step is an arbitration process. The applicable Social Code V (“SGB V”) allowed legal actions against the arbitration decision and excluded isolated legal actions against the early benefit assessment (Section 35a (8) SGB V).

In this lawsuit, a drug company had launched a prescription drug with an off-patent generic active substance for a skin disease based on own clinical trials. The GBA took the view that the drug has a new active substance and must undergo the early benefit assessment and the AMNOG process. However, the drug company took the position that the product does not have a new active substance and did not submit a product dossier for the early benefit assessment. The GBA nevertheless conducted the early benefit assessment and came to a negative benefit assessment decision. The company filed an action against this decision but during the lawsuit it agreed on a reimbursed price with the health insurance association in order to prevent disadvantages and enable the reimbursement of the drug.

The first instance court (Landessozialgericht Berlin Brandenburg – “LSG”) rejected the action of the company as “inadmissible” and referred to the above mentioned Section 35a (8) SGB V. In contrast, the BSG ruled that despite Section 35 (8) SGB V, a drug company must be allowed to file a legal action against the early benefit assessment even if the company has subsequently agreed to a reimbursement price. Therefore, the BSG annulled the earlier decision of the LSG and referred the matter back to the lower court. The LSG will now have to decide whether the drug indeed had a new active substance and was rightly subjected to the AMNOG process.

The BSG’s full decision has not been published yet but in its press release about the decision, the BSG has summarized its view by referring to the significant legal effects of this benefit assessment to the drug company and finds that Section 35a (8) SGB V does not generally exclude all legal redress options against early benefit assessments in each scenario.

For this particular case, the BSG also noted that it appears possible that the active substance of the drug is not a new active substance. Against this background, the BSG found that blocking all legal redress against an early benefit assessment in all scenarios would violate the constitutional rights of the pharmaceutical companies. In contrast to earlier decisions of German courts in other pricing and reimbursement disputes, this decision appears to put a lot more emphasis on the constitutional rights of the pharmaceutical companies.

Before this decision, a pharmaceutical company could not seek separate legal redress against the early benefit assessment even if it was already contested whether the drug has a new active substance or not. The GBA had the power to just make that assumption and to subject a medicine to the AMNOG process without facing the risk of being exposed to direct legal action. The system required the drug company to wait until the entire AMNOG process of benefit assessment, price negotiation and arbitration is completed before it could file a lawsuit against the arbitration decision. That caused the companies to lose significant time before it could seek legal redress. Further, a drug company had to tolerate that throughout this time and until it obtained a court decision, the negative benefit assessment was made public and harmed its product plus the product was only reimbursed at a low price level because of the negative benefit assessment.

Overall, this new judgment of the BSG clearly strengthens the position of pharmaceutical companies in the AMNOG process and offers a new opportunity to legally challenge the early benefit assessment. The court has particularly stressed the constitutional rights of the pharmaceutical company. It will be interesting how this particular case will continue and which claims the company could make if the lawsuit finds that the drug was unlawfully subjected to the AMNOG process. Further, and beyond this particular case, it appears possible that the principles and arguments of this BSG decision can also be invoked in other disputes in the German drug pricing and reimbursement system.

This BSG decision will have a significant impact to the German drug pricing and reimbursement system and the respective judicature of social courts. Pharmaceutical companies should carefully analyze the full reasoning of the BSG as soon as the complete judgment is available.

The Covington team in Frankfurt, Germany, will continue following and discussing these and other developments on the “Inside EU Life Sciences” blog.