EU policymakers have unveiled plans to allow manufacturers of medicines developed using biotechnology to enjoy a period of competition-free market access in the EU for one year longer than current policies permit. The proposal to extend the Supplementary Protection Certificate (SPC) for "best-in-class biotech medicines" developed within the EU is included in the new European Biotech Act proposed by the European Commission.

    This 258-page draft legislation serves as the centerpiece of a package of measures proposed by the European Commission, aimed at making the EU healthcare sector "more innovative, competitive, and resilient." The draft also encompasses plans to simplify EU medical device regulations and specific measures targeting treatments for heart disease.

    Under EU law, pharmaceutical companies can effectively extend the period during which they exercise monopoly rights over the sale of medicines—into which they have invested significant time and capital—by obtaining a Supplementary Protection Certificate (SPC).

    Although the patent protection term is 20 years, it takes pharmaceutical companies several years to develop new drugs, complete mandatory clinical trials, and obtain marketing authorizations. This means that the actual patent protection period during which companies can commercialize their products is often significantly shorter than in other less-regulated industries. The SPC system was established precisely to bridge this gap, allowing for up to an additional five years of market exclusivity after the patent expires.

    According to the European Commission's plan, drug manufacturers must meet a set of criteria to qualify for the additional one-year protection provided by the SPC.

    The product must not only be "developed through biotechnological processes" but also contain an "entirely new active ingredient that is significantly different from any medicine approved in the EU." Furthermore, the product must possess a "significantly different mechanism of action and demonstrate a level of safety and efficacy at least equivalent to any medicine approved in the EU for the same disease." Clinical trials for the product must be conducted in more than two EU Member States, and at least one "production step (excluding packaging)" as well as "quality testing and certification" must be completed within the EU.

    Lawyer Carly van der Beek stated: "Despite the stringent eligibility criteria, this measure could serve as a significant incentive for companies developing advanced therapies and biotech-derived medicines by providing additional protection to offset long R&D cycles. The European Commission's intention to boost competitiveness is clear, but the potential impact is the pressure it may place on healthcare budgets. This measure is likely to become a hot topic of discussion in the European Council and the European Parliament."

    Lawyer Catherine Drew added that the current draft introduces uncertainty regarding the concept of a "new active substance" in the marketing authorization assessment procedure.

    "Under the current system, the European Medicines Agency (EMA) primarily relies on whether a medicine contains a new active substance when determining the existence and scope of a global marketing authorization. Notably, this assessment does not consider whether the active ingredient is 'significantly different' from others, nor does it evaluate whether its mechanism of action is 'significantly different' from other medicines. Consequently, questions arise regarding the assessment mechanism itself and the correlation between the assessment for an SPC extension and the routine marketing authorization assessment," she said.

    Drew added: "Given the controversies surrounding 'new active substances' in the regulatory field over the years, if the final act fails to further clarify the relevant provisions, we may see similar disputes arise around these criteria when valuable periods of exclusive sales are at stake."

    This measure is one of several proposals put forward by the European Commission to address the EU's current situation of lagging behind other geographic markets in supporting the biotechnology industry. The European Commission acknowledged that the 2024 EU Competitiveness Report identified issues including insufficient funding, regulatory bottlenecks, and barriers to innovation.

    In addition to extending the SPC term for biotech pharmaceutical companies, the European Commission also hopes to shorten the approval time for clinical trials and provide support for specific biotech-related projects, including funding and priority licensing.

    Regarding financing, the draft legislation proposes the establishment of a two-year EU Health Biotech Investment Pilot Program. Under this program, biotech companies can receive financial support at different stages of development: for instance, "early-stage applied research and innovation, technology transfer, and spin-off projects" may receive equity investment, while later-stage companies can expand production capacity through venture loans. Investment forms are diverse, including implementation through channels such as the European Investment Bank.

    The core objective of these proposals is to enhance biotech manufacturing capacity within the EU—not only aimed at unlocking its potential to improve patient access to innovative treatments such as cell and gene therapies but also to realize the economic benefits of the sector and reduce dependence on biotech products from other parts of the world. The European Commission further proposed measures to ensure "biosecurity" and strengthen the EU's bio-defense capabilities.

    If the European Commission's proposals are translated into EU law, biotech companies will see a series of new guidelines issued by the European Medicines Agency (EMA).

    Under the proposed Biotech Act, the EMA will assume a statutory duty to "develop and update non-binding guidelines on tailored regulatory approaches for the development of biosimilars to reflect technological progress in the fields of production and analytical testing." In April 2025, the EMA released its first draft reflection paper on this matter.

    Biosimilars compete with original biological products, which are medicines containing active substances derived from biological sources. Unlike small-molecule generic drugs, whose active ingredients are chemically identical to the original drug, biosimilars are highly similar to the original biological product but can never be exactly identical to the reference biological medicine. This scientific reality affects the regulatory hurdles that biosimilar developers must clear to obtain marketing authorization.

    According to the European Commission's proposal, the EMA's new biosimilar guidelines should "consider reducing the volume of clinical data required for the development and approval of biosimilars, without prejudice to quality, safety, and efficacy."

    The EMA is also required to issue separate guidelines to "regulate the deployment and use of systems based on advanced technologies (including artificial intelligence) throughout the lifecycle of drug research and development."

Source:https://ipr.mofcom.gov.cn/article/gjxw/gbhj/om/oum/202601/1994893.html