What is an ‘evergreen patent’?

In the first lines of this article, I would like to note that the concept of an “evergreen patent” refers mainly to the field of the pharmaceutical industry.

The term “evergreen patent” implies a patenting strategy, under which the maximum extension of the validity of the exclusive rights to some subject matter is ensured, in particular, to a product, a technology through updating systematically the legal protection by obtaining new patents.  Such patents may protect new modifications, properties, application methods and other characteristics of the products patented previously. The main goal of such strategy is to increase the company's profits by eliminating competition and extending the period of the payments of license fees.

This strategy is a standard practice for large pharmaceutical companies around the world, especially for the Western ones. Using them, the pharmaceutical companies hold the market monopolies for vital drugs and eliminate competition in various markets.

The availability of such patents allows the patent holder companies not to develop new technologies and not to release new drugs to the markets before the expiration of the old patents, thereby holding back artificially the development of new drugs and getting the maximum profits from the patients being in need of them. According to the statistics, there are more than 75% of such secondary “evergreen patents” in pharmacology.

Let us find out a reason for that. When the validity of the patent expires, the price for the pharmaceutical drug in pharmacies falls rapidly, and therefore the value of the drug for the company is reduced significantly. Therefore, the pharmaceutical company wonders naturally what it should do to extend maximally the validity period of the patent. Thus, the patent holder has a desire, in addition to the very formula of a chemical substance or a pharmaceutical composition, to patent a method of the manufacture, a method of the application, an application according to new treatment groups, an application in combination with other drugs, an application according to a new purpose, for example for the treatment of new diseases, etc. In fact, this pharmaceutical company re-patents its drug and then sets again a high price for it, while developing the market by launching aggressive advertising or distributing the drug through medical institutions and doctors.

However, the patent, which validity has expired, begins to be of great interest to smaller manufacturers having the technical ability to copy the product by creating the so-called “generics.”

For your reference, a “generic” is a drug containing a chemical, an active pharmaceutical ingredient being identical to the one patented by the company – the original drug developer. The “generics” are manufactured and sold after the expiration of the validity period of the patent and, accordingly, the monopoly of the patent holder company, by other manufacturers under an international nonproprietary name or under a commercial name, which is different from the brand name of the drug developer. For example, the patented drug Mezym has a “generic” – Pancreatin; Imodium – Loperamide; No-Spa – Drotaverine, respectively, while the price for the original drug and the “generic” may differ by ten folds.

In the Russian Federation, the key issue is the quality of the “generics” manufactured, since, unlike in the European countries, where the manufacturers, if necessary, carry out tests for bioequivalence in vivo, the manufacturers of the Russian Federation confine themselves only to the pharmacopoeial methods in vitro.

According to the law, in order to release the “generic” to the Russian market, it is enough for the drug manufacturer to carry out a study of bioequivalence in vitro, the very significant deviations from the standard, i.e. the original brand, being allowed: from minus 20% to plus 25%.

The quality of the “generics” is far from being perfect, but they have a low cost due to the lack of the costs for the development, the clinical trials or the license fees, as well as the already available results of the clinical trials and the already accumulated experience of the practical application of the drug in the form of the original drug being copied by the “generic.”

It would seem that obtaining a new “evergreen patent” will not save the manufacturer of the original drug. But it is not so; in practice, the market is simply redistributed, since the need for a better product is always preserved, and the investments of the patent holder are not in vain. Proceeding from the state interests, there is a centralized drug procurement, what, as a rule, does not lead to a fall in the price, but only to a redistribution of the money flows. In the majority of cases, obtaining such patents preserves a balance between the main developers and the manufacturers of the analogues and it does not pose a threat to the development of the pharmaceutical market as a whole.

However, the long-term patent defense of the drugs nevertheless violates the interests of the companies – the manufacturers of the analogues of these drugs. Therefore, filing objections with Rospatent, which are aimed at cancelling the patents protecting the most popular and expensive drugs is a very common practice.

It should be noted that the process of the development leads in any case to the fact that some day a breakthrough innovative idea will be finalized and improved by someone. Therefore, it is not possible to prohibit obtaining the patents, for example, for various polymorphic (crystalline) forms of the known active substance constituting a basis of the drug; pharmaceutical compositions based on the active substance in order to increase stability, solubility, bioavailability, etc.; new dosage forms based on the active substance; the most effective dosages and the administration modes of the pharmaceutical compositions; an application of the known compounds or the pharmaceutical compositions according to a new purpose.

Obtaining the “evergreen patents” is also associated with the high costs for patent holders for carrying out the long-term clinical studies and providing an evidence basis, and as to the patent protection ensured by such patents, it covers a rather narrow field of technology, i.e. it has a small scope of claiming, without preventing directly the use of the known active substance by another method or for another purpose. Thus, the pharmaceutical companies are forced to obtain the long-term defense for their drugs to recoup their investments.

Currently, the concept of the “evergreen patent” has no legal force, so the states can not refuse legally granting such patents. In particular, there are not any restrictions to grant them so far in the Russian Federation, the main thing is the compliance of the claimed solution (product/method) to the patentability criteria established by the legislation: a “novelty” an “inventive step” and an “industrial applicability.” However, for example, Europe, Canada, China and India have resorted to the restrictions to patenting the methods of treatments, in order to control the possibility of granting the unreasonably long-term monopolies for the vital drugs to the pharmaceutical companies. In the USA, the laws aimed at preventing the aggressive judicial activity of “patent trolls” have been created in the majority of the States, which also can be applied to the unfair pharmaceutical companies.