Issue No. 2009/01
This EU Pharma & Life Sciences e-bulletin contains summaries of recent developments in European and Belgian law.
European Court of Justice
This judgement provides useful although incomplete guidance to differentiate medicinal products and food supplements in borderline situations. It notably rules that a product which includes a low dosage of an active ingredient, which is incapable of appreciably affecting physiological functions, cannot be qualified as a pharmaceutical product and that Directive 2001/83 does not apply to a product of which it has not been scientifically established that it is a medicinal product by function.
Hecht-Pharma marketed in Germany, as a food supplement, a product composed of fermented red rice under the name of ‘Red Rice 330 mg capsules’ which stated that one capsule corresponds to 1.33 mg of monacolin k and recommended one capsule one to three times a day.
The German Court prohibited the product on the grounds that it was a medicinal product, as the monacolin k is an inhibitor of cholesterol synthesis called lovastine and is included, as an active substance, in a number of prescription medicinal products. It concluded that this product is liable to lower cholesterol levels and therefore contributes to a therapeutic objective and that the substance could also have serious, undesirable side-effects. For the German Court it could not be considered that monacolin k had no pharmacological effect based on the fact that the recommended dose amounting to a daily consumption (4 mg maximum) is low in comparison with the daily consumption of 10 to 80 mg recommended for the same substance included in the prescription products, particularly in a context where food supplements are taken unsupervised and in greater quantities than the recommended dose. The Court also considered that since no pharmacological action had been demonstrated with certainty, Article 2(2) of Directive 2001/83, which provides that the pharmaceutical legislation applies when a product may fall within the definition of both a medicinal product and of a product covered by other Community legislation, is applicable.
The ECJ judgement
The matter was referred to the ECJ which took a totally different view. First, it considered that Article 2(2) of Directive 2001/83 must be interpreted strictly i.e. that this Directive did not apply to a product of which it had not been scientifically established that it was a medicinal product by function, without it being possible to exclude that possibility. The ECJ noticed that the interpretation of the Directive could not result in obstacles to the free movement of goods which were entirely disproportionate to the pursued aim of protecting health.
The ECJ did not exclude that one Member State may consider a product as a medicinal product by function whereas another Member State may take the opposite view. The national authorities must decide on a case-by-case basis1, taking into account all the characteristics of the product, in particular its composition, its pharmacological, immunological or metabolic properties, to the extent to which they can be established in the present state of scientific knowledge, the manner in which it is used, the extent of its distribution, its familiarity to consumers and the risks which its use may entail.
It is noticeable that in the context of the amended Article 1(2)(b) of Directive 2001/83, which includes a revised definition of medicinal product, the ECJ confirmed the relevance of its previous case law, which refers to the characteristics of the manner in which a product is used, the extent of its distribution, its familiarity to consumers and the risks which its use may entail, to determine whether a product is a medicinal product by function.
More importantly, the ECJ held that a product could not be regarded as being a medicinal product by function where, with regard to its composition – including its content in active substances – and if used as intended, it is incapable of appreciably restoring, correcting or modifying physiological functions in human beings.
In December 2008, the Law of 14 July 1994 which notably relates to the reimbursement of medicinal products, was amended. The amendment stipulates that on the one hand, an originator company which has initiated a patent litigation against a generic company will have more possibilities to avoid a decrease of the reimbursement basis for its product. On the other hand, the generic company which is prevented from entering the market will no longer lose the benefit of the reimbursement almost immediately once it is granted.
Patent litigations and reimbursement of the originator’s product
The reimbursement of a pharmaceutical product – either generic or original - is materialised by its inclusion in an official reimbursement list. When a generic product is reimbursed, the reimbursement basis of its reference product will also have to be reduced accordingly on the following 1 January or 1 July. As a consequence, if the originator’s company maintains its price, the patient will have to pay the difference between the price and the reduced reimbursement basis. Therefore, the originator runs the risk that generic competing products reduce more significantly both its market share and revenues.
As of 2009, the reduction of the reimbursement basis will also take place on 1 April and 1 October. However, the reduction of the reimbursement basis of the originator’s product is postponed in the following circumstances:
1) If the generic product is not available at least 20 days before the reduced reimbursement basis of originator’s product comes into effect, the previous reimbursement basis of the latter is maintained until the generic product becomes available. Such a situation could be caused by a patent litigation but also by any other reason.
2) If the originator initiates a Court action based on urgency (action en référé / kortgeding) or a cease and desist action (action en cessation/stakingvordering) which claims that the generic product infringes “the patent on the main active principle/substance[of the originator’s product]” the reimbursement basis of the original/reference product is also maintained. The reduction of the reimbursement basis is postponed “until an executory judgement is rendered on the dispute at stake and authorises the marketing of the generic product”.
However, the judgement may not clearly authorise the marketing of the generic product. The revised law refers to “the patent on the main active principle” and it is unclear whether this relates to the basic patent product. Should this be the case, this provision is not likely to raise many issues because patent litigation mainly relates to follow-on patents. The provision specifically refers to “the patent”, which may suggest that only one patent – presumably the basic patent product - can trigger it. In case of dispute, the final word rests with Courts.
Maintaining the reimbursement of a generic product in the absence of effective marketing
The system as it existed prior to the recent amendment, provided that the generic product had to be marketed within a 3-month period from the granting of a reimbursement basis, otherwise the reimbursement was lost and the generic company had to reinitiate the procedure. The revised provision replaces the 3-month period by a 12-month period. In addition, in case of patent litigation based on an alleged infringement, it seems that now even after the 12-month period, the reimbursement of the generic product is automatically reinstalled when the generic can come on the market.
1 - Belgium has recently set up a Joint Committee composed of representatives of relevant ministries, which provides to the Minister of Health opinion on borderline situations. Companies can also solicit the opinion of the Committee (Royal Decrees of 28 October 2008 and of 11 January 2009).
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