Biotech Starter Kit – Compulsory Licensing for Crisis Management
FACTSHEET
Compulsory Licensing for Crisis Management
Compulsory licensing (CL) permits third-party patent use without the rights-holder's authorization under conditions. All EU Member States have national frameworks complying with the TRIPS Agreement.
Intellectual Property Rights (IPR) are crucial for translating biotech innovation into practical applications. They encourage industrial applications, protect research investments, and help smaller companies access finance in the competitive European venture capital landscape.
The COVID-19 pandemic has shown that IPR are not barriers to access. Vaccines and therapeutics were delivered in sufficient quantities to and from the EU without the use of compulsory licensing.
What is the Compulsory Licensing for Crisis Management Regulation?
On 27 April 2023, the Commission proposed a new EU-wide compulsory licensing for crisis management. The EU CL would be triggered following the declaration of a cross-border crisis and apply to "crisis-relevant products", including medicines. The EU CL would apply to products covered by patents, patent applications, supplementary protection certificates and utility models.
For innovative medicines, data and market protection would also be suspended for the duration of the CL based on the Commission proposals to revise the EU General Pharmaceutical Legislation.
The Parliament adopted its position on the text on 13 March 2024. New Shadows will need to be named before trilogues start.
EuropaBio’s Position
EuropaBio is concerned that the proposal would weaken IPRs for biotech innovation, even as it is designated as a critical technology for EU economic security. The EU must protect innovation with CL being used as a last resort option under proper judicial oversight. EuropaBio suggests enhancing collaborative networks for rapid responses to health crises and boosting Europe's biomanufacturing capacity for quick production of medical countermeasures.
The proposed Regulation will have a significant impact on SMEs, as patents are crucial for their existence and ability to attract investments. SMEs’ licensed patents would also be affected by CLs issued to other companies, putting their existence at risk.
