Strengthening Turkey’s pharma industry with IP
Turkey has become an emerging market for the pharmaceutical industry in the past few decades, and with more than 300 local and international firms based there, it has an important growth potential. The Turkish government aims to make Turkey one of the world’s top ten health economies by 2023. According to Turkey’s Pharmaceutical Sector Vision 2023 Report, prepared by professional services company PwC for the Association of Research-Based Pharmaceutical Companies, Turkey now has the strongest, most dynamic economy in the region, and can become a global player in the pharmaceutical industry because it has the necessary knowledge base, infrastructure, and geostrategic location to attract global pharmaceutical R&D.
The government’s plans to attract global pharmaceutical R&D should accompany a strategic plan to strengthen the protection of pharmaceutical patents so that R&D investments are supported and sufficiently protected.
It would be unfair to say that Turkish patent law lacks sufficient legal basis for strong protection. In fact, all of Turkey’s IP-related laws and regulations, including the Decree Law No 551 Pertaining to the Protection of Patents (Patent Law), have become fully compliant with EU legislation and international treaties since the mid-1990s. The establishment of specialised IP courts has enhanced this practice. However, there are some pitfalls in practice and some gaps in the legislation that may sometimes reduce its ability to provide effective protection.
The most important factor weakening the strong protection is the peculiar application by Turkey’s specialised IP courts of the so-called Bolar exemption. The exemption, which is an exception granted for research activities, aims to allow researchers to use a patented invention to develop further technologies without fear of infringement. In Turkey, the Bolar exemption was introduced to Turkish Law with an amendment in 2004—article 75(f) of Turkish patent law exempts acts for trial purposes including tests and experiments needed for obtaining the marketing authorisation (MA) for a pharmaceutical product.
Under Turkish pharmaceutical law, a MA for pharmaceutical products may be obtained through a normal or abridged procedure. A normal procedure is for innovative products where the creation and submission of the date of pharmacological and toxicological tests, and clinical trials, is required. For generic drugs, abridged applications are permitted provided that the product is essentially similar to the original licensed product, and the bioequivalency is proven. There is no supplementary protection period for pharmaceutical patents. Also, there is no connection between the administrative rules for granting the MA and the Patent Law. The patent rights are not considered while granting the MA for generic drugs. On the contrary, the Bolar exemption makes it impossible to interfere with generic applications that would normally infringe patent rights.
There are different approaches to the application of the Bolar exemption, some of which allow generic companies to use it as a safe harbour. While some courts believe that the exemption should not apply once the MA for the generic drug is granted, others have a broader interpretation and believe the exemption should apply until the generic product is launched on the market. However, such a broad interpretation makes it more difficult for innovators to seek remedies to prevent infringement before the infringement has occurred, as remedies can be sought only once the generic is on the market—when the innovator has already started incurring damages. Indeed, once the infringing generic is launched on the market and listed within the reimbursement list of the Social Security Institute, the price of the original is automatically reduced by 40%. This means that the innovator is deprived of exploiting the patent rights before the expiration date of the patent, as the time and opportunities that are lost in infringement cannot be reinstated or repaired.
Accordingly, a first step to increasing R&D activities in the pharmaceutical industry should be to ensure that the Bolar exemption is applied within the strictest meaning possible and that the patent owner should be allowed to stop any infringing activities at an early stage.
Access to the dossier
Another difficulty in pharmaceutical patent litigation is gaining access to the dossier of infringing (or possibly infringing) products. The confidential MA dossier is kept by the Ministry of Health. The patent owner is not allowed to access the file’s content without having a court order unless—in very exceptional circumstances—the counter party gives consent. This means that the patent owner is not allowed to gather materials to make an accurate assessment of infringement and decide whether to act, but instead has to ask a court for a determination of evidence (DoE application).
Further, because there is no procedural law obliging the defendant to disclose all the materials at hand, the DoE applications are always problematic. The DoE procedure is strongly objected to by generic companies on the basis of article 39 of the agreement of the Trade-Related Aspects of Intellectual Property Rights, as they argue that data contained in a MA dossier should be kept confidential.
However, article 39 relates to the protection of data obtained through lengthy and expensive investments, and does not apply to generic companies. Also, in some cases even the DoE applications are rejected because of the court’s interpretation of the Bolar exemption, and this prevents the patent owners from making an accurate assessment of infringement before the generic product is on the market. This attitude should be changed and the access to MA files subject to infringement claims should be less problematic.
Expert examinations may also be sometimes quite problematic in patent litigation. The Turkish IP courts, despite their rich experience in deciding the legal aspects of patent litigation, require an expert examination as the judges do not have technical backgrounds. Although expert examination is a must in patent litigation cases, it is not always easy to find the most skilled expert for the relevant field of pharmaceutical technology. This difficulty causes some delays in litigation and also affects the quality of the prepared expert reports, which are crucial for the court to make an assessment of infringement. Therefore, the quality of expert examinations should also be developed.
European problem
There is another peculiar situation that affects the protection of European patents filed through the European Patent Convention. Under Turkish patent law, there is no opposition phase for national patents. Instead, third party observations can be filed and once the patent is granted it is not possible to amend its claims. When someone applies for the national phase of a European patent at the Turkish Patent Institute (TPI), the TPI grants the patent without waiting for the outcome of any opposition, limitation or revocation proceedings before the European Patent Office (EPO).
"There is another peculiar situation that affects the protection of European patents filed through the European Patent Convention."
Only after the whole procedure is completed before the EPO does the TPI retroactively implement the final scope of protection conferred by the European patent application. This means that while the EPO continues to deal with the European patent application and the patentability question, the patent will be granted in Turkey and third parties are allowed to file invalidation actions, despite the final scope of protection conferred by the European patent application not being finally determined.
Normally Turkish courts are expected to decide the stay of an invalidation procedure after the final scope of a European patent is determined and reflected in the national registry.
However, because the TPI believes European patent applications should be registered in TPI records after the examining division’s decision to grant the patent, the courts also assess patentability. In some cases the court invalidates a patent even though the same patent will be granted after some amendments and/or limitations before the EPO.
Accordingly this practice creates problems for patent holders as they may lose their rights because of a patentability assessment made on the basis of the initial filing, even though the rights could be maintained by making some amendments and/or limitations. In order to solve this problem, European patents should be kept in application status in the TPI’s records until the whole process before the EPO is completed.
While Turkey is on a path to becoming a global player in the research-based pharmaceutical industry, the legal environment should be strengthened with some auxiliary regulations to develop effective patent protection. There is a bill to amend some provisions of Turkish patent law. However, the bill does not contain any provisions to eliminate the discrepancies. Although it has not yet been enacted, it can provide an opportunity to develop stronger patent protection in Turkey, which is indispensable for a research-based industry.
Hande Hançer is a partner at Gün & Partners. She can be contacted at: hande.hancer@gun.av.tr
Selin Sinem Erciyas is a partner at Gün & Partners. She can be contacted at: selin.yalincakli@gun.av.tr
