Kou Fei
The new Implementation Regulations of Patent Law (hereinafter referred to as the "new regulations") were promulgated on December 21, 2023, and are set to come into effect on January 20, 2024. The new regulations introduce a new chapter, "Patent Term Compensation," specifically detailing Patent Term Adjustment (PTA) under Article 42(2) and Patent Term Extension (PTE) for pharmaceuticals under Article 42(3). This has garnered widespread attention from innovators, particularly pharmaceutical companies.
1. "Global-First" and "China-First" Criteria Still Undefined in the New Regulations and Guidelines
The long-standing dispute over the " Global-First" and " China-First" criteria of PTE has finally seen some clarity in the new regulations. Unfortunately, there is still no explicit definition of the scope of "new drugs" eligible for PTE. The new guidelines maintain a requirement for the definition of innovative drugs to follow relevant laws and regulations and be determined in accordance with the regulations of the National Medical Products Administration (NMPA). This ambiguous wording leaves questions unanswered till practice.
2. Preliminary Clarification of "Global-First" Criteria through CNIPA's Seminar
During the seminar on the new regulations and guidelines held by the China National Intellectual Property Administration (CNIPA) on January 2, 2024, the CNIPA, in explaining the concept of new drugs in PTE, explicitly referenced the provisions in the "Opinions of the State Council on Reforming the Review and Approval System for Drugs and Medical Devices (State Council [2015] No. 44)" (https://www.gov.cn/zhengce/content/2015-08/18/content_10101.htm). This document classifies drugs into new drugs and generic drugs, adjusting the definition of new drugs from "drugs not yet marketed in China" to "drugs not yet marketed both domestically and internationally." According to the document, new drugs are further categorized into innovative drugs and improved new drugs based on the originality and novelty of the entity.
During the seminar, it was also clarified that eligible innovative drugs for PTE are further defined as Class 1.1 new drugs. This provides a preliminary answer to the dispute over "Global-First" and " China-First".
3. Contradiction Exists Between State Council Regulatory Documents and Administrative Regulations
The issue lies in the fact that the above-mentioned State Council Document [2015] No. 44 is a regulatory document of the State Council, conflicting with the explicit provision in Article 77 of the currently effective "Regulations for the Implementation of the Drug Administration Law" (2019), which defines new drugs as "drugs not yet marketed in China." According to the new guidelines, the determination of the definition of innovative drugs should follow relevant laws and regulations and be based on the regulations of the NMPA. This raises a practical dispute about whether to refer to the 2015 State Council regulatory document or the administrative regulations (2019).
4. No Retroactive Effect for Drugs Approved for Market before June 1, 2021
Regarding retroactivity, the seminar further clarified that only drugs approved for marketing after June 1, 2021, may be eligible for PTE. According to the legislative principle of non-retroactivity stipulated in the Legislation Law, strictly speaking, patents eligible for PTE should be those filed after June 1, 2021. According to the provisions of the "Transitional Measures for Implementing the Amended Patent Law and its Implementation Regulations," both PTA and PTE have been retroactively implemented, specifically allowing patents filed and granted before June 1, 2021, to enjoy PTA or PTE.
5. Remedies and Recommendations
Previously submitted PTE requests are currently in a suspended state. After the new regulations and guidelines take effect on January 20, the corresponding examination work will commence. For those not meeting the compensation conditions, the CNIPA will make decisions on refusing patent term compensation. The nature of this administrative decision, the existence of remedies or not, and the specific remedial measures are not explicitly stated in the new regulations and guidelines. However, it is believed that the decisions will provide clear guidance.
In our earlier submissions to the CNIPA regarding the revisions to the guidelines on PTA and PTE, we suggested resorting to the administrative reconsideration procedure to seek relief for decisions denying patent term compensation. This aligns with the scope of reconsideration defined in Article 6(8) of the Administrative Reconsideration Law and Article 4(1) of the CNIPA Administrative Reconsideration Regulations. According to Article 10.3 of the Administrative Reconsideration Law and Article 6.2 of the CNIPA Administrative Reconsideration Regulations, interested parties can apply for administrative reconsideration or participate as a third party. Specific reconsideration procedures should follow the provisions of the Administrative Reconsideration Law and relevant regulations and rules. If the applicant is dissatisfied with the administrative reconsideration decision, they can initiate administrative litigation according to the provisions of the Administrative Litigation Law. Of course, the final remedial measures are subject to official confirmation from the CNIPA.
For future approvals of Class 5.1 new drugs, considering the ongoing disputes and the significance of PTE for pharmaceutical companies, we still recommend that pharmaceutical companies submit PTE requests in a timely manner to exchange time for opportunities and maximize the protection of their legitimate rights and interests.
Kou Fei
Dr. Kou joined NTD as a patent attorney in 2014 and handled patent filings and prosecuting cases. He became a patent litigator in 2016 and provides legal services relating to patent invalidation, administrative litigation, civil litigation, FTO search, patent landscape analysis, IP strategy consulting, etc. in various practice areas including Pharmaceuticals & Medical, Life Health, New plant variety, Chemistry, etc.
Before joining NTD, Dr. Kou started his career as a patent examiner in China National Intellectual Property Administration, where he received professional training of IP and handled hundreds of patent examination on medical apparatus, analytical and detecting instruments, biological detection, etc. for four years.
After the role transitions among scientific researcher, patent examiner, patent attorney and patent litigator as well as more than ten years of IP practicing experience, Dr. Kou is committed to customizing strategy and comprehensive problem solutions from an entire perspective for various clients like Pfizer, Novartis, Roche, DuPont, Veeco, etc.
