Mexican Supreme Court Rules in Favour of Branded Drugs and Clarifies Criteria for Patents

The Mexican Supreme Court has ruled in favour of introducing a new criterion for the patent publishing process and implemented novel guidelines which extend patent protection opportunities for branded medications in the country, reports El Norte. This new rule goes against IMPI's (the Mexican Institute of Mexican Industrial Property) request to limit patent protection rights to a maximum of 20 years, even if the active ingredient is later used as a combination treatment with another substance. The revision of publishing criteria follows Novartis's (Switzerland) legal fight to protect a medical treatment which contains cyclosporine, whose patent protection has not been valid since 1978.

The Supreme Court's decision clarifies article 47 of Mexico's Industrial Property Law (2003, President Vicente Fox), which has influenced a series of problems of interpretation related to the limits and characteristics of the processes of patent registration, publishing and protection in Mexico. This article, in conjunction with the regulation for health consumables (sanitary registrations are only available for products which do not violate drugs' published patents), provide the foundation for patent protection guidelines in Mexico.

Opposition

As stated by this source, the court ruling could benefit companies whose product patents could be expanded and used in the registration of new formulations. Conversely, this decision could make it more difficult for generics to break into the market and obtain the required sanitary registration to commercialise their products in the country.

According to the Mexican Association of pharmaceutical laboratories (AMELAF), this situation could bring a negative effect on treatment accessibility for 40 million Mexicans with no healthcare coverage in the country, as well as the expansion process of the national generics' industry and the finances of the public sector (eg IMSS and ISSSTE; Servicio Universal de Noticias). AMELAF is currently working to rectify this measure and is seeking assistance from the union congress.

Generics Participation in Mexico

As of today, 13% of total consumed drugs in Mexico are generics. Looking into the catalogue of generics in the country, it becomes evident that the penetration of this type of product into the Mexican market has experienced a significant boom in recent years.

To access a full list of generics products available in Mexico, please click here (in Spanish).

Outlook and Implications

The court's decision complicates the government's plans to enhance the availability and accessibility of medical treatment in the country, where they have been highly concentrated upon the introduction of low-cost products such as generics. This step not only defies government plans to reduce pharmaceutical expenditure in the country, but rarely enough, goes against any requirement of strengthening IP laws brought by the free trade agreement with the United States.

Following these guidelines changes, IMPI will be required to expand patent protection rights from innovative medications to combination treatments, which include non-innovative active ingredients. While this brings a significant breather for companies whose products were on the verge of losing market exclusivity in the country, it also provides a difficult terrain for generics firms who are facing increasing competition from imports (following the elimination of plant requirements in the country) and growing investment requirements to comply with rising regulatory guidelines (eg bioequivalence tests; see Mexico: 4 December 2009: Mexico's Drug Imports Grow by 30% Following Elimination of Plant Requirement and Mexico: 15 December 2009: Drug Registration Process to Reduce Medications by 35% in Mexico).

Looking into the future, while generics demand is expected to continue rising in the country, the rate of growth, as well as the profitability of the sector could be somewhat affected by these rising changes in the sector. Increasing competition, tougher regulations and fewer opportunities for market penetration could be the main problems.