Taiwan’s Patent Linkage System Finally Comes Into Effect

On December 29, 2017, the Legislative Yuan of the Republic of China (Taiwan) passed an Amendment to the Pharmaceutical Affairs Act (PAA) establishing a patent linkage system.   On August 20, 2019, Taiwan’s long-awaited patent linkage system finally came into effect.

Beginning August 20, 2019, new drug marketing approval holders (new drug MA holders) can list any patents covering their products and assert those patents against generic drug applicants in patent litigation actions.  New drug MA holders who obtained marketing approval prior to August 20, 2019 will be entitled to list their patent(s) within 3 months from the date of implementation and be able to enter the patent linkage system (e.g., sue generic drug applicants).  By way of example, a new drug MA holder who obtained marketing approval for a new drug sometime in May 2014, will be allowed to list its patents in the new linkage system, provided that such a listing is made on or before November 20, 2019.

Summary of Taiwan’s Patent Linkage System

Responsibility for Patent Listing:  Patent listings will be the responsibility of a new drug MA holder.

Timing Frame for Listing:  The time frame for listing a patent is as follows:

  1. A new drug MA holder must list any patents considered to cover a new drug within 45 days after the date of receipt of a drug permit (e.g., marketing approval).
  2. Patents granted after receipt of a drug permit must be listed by a new drug MA holder within 45 days after issuance (e.g., the issue date).

For more information, see Articles 48-3(1) and 48-5 of the PPA (an English copy of which can be found at:  https://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?pcode=L0030001).

Types of Patents Eligible for Listing:

  1. The only patents eligible for listing are those that claim:
    • a substance (“substance” refers to the active ingredient(s) of a drug preparation, including inventions directed to different forms of a polymorph of a compound);
    • a composition or formulation (“composition or formulation” refers to the combination or formulation of the active ingredient(s) of a drug preparation); and/or
    • a medical use (“medical use” refers to the use corresponding to all or part of the indications identified on a drug permit).
  2.  Information that must be provided includes:
    • Patent number(s).  With respect to medical use patents, not only must the patent number be provided, but also the specific claims covered by the asserted medical use.
    • Expiration date of the patent(s).
    • Patentee’s name, nationality, place of domicile or business office.  For patentees having a legal representative, the name of the legal representative.  For patents that have been exclusively licensed and recorded in accordance with the Taiwanese Patent Act, information on the exclusive licensee must be provided.
    • If the patentee or the exclusive licensee does not have a domicile or a business office in the R.O.C., an agent must be appointed and the appointed agent’s name, place of domicile or business office provided.

For more information, see Articles 48-3 and 48-4 of the PPA. 

Making Changes, Deletions, and Corrections to a Listing:

  1. In the event that any information included in a listing needs to be changed (e.g., receipt of approval of a patent term extension for a listed patent, transfer or other assignment of a patent right, patent expiration, etc.),  the new drug MA holder must proactively request a change or deletion of the information within 45 days after the date on which the change event occurred.
  2. If the patent listed is unrelated to a new drug, is directed to ineligible subject matter (e.g., a method of manufacturing the new drug), if the listing contains incorrect information, or if a change or correction of information is not timely made, any party may notify the Taiwan Food and Drug Administration (TFDA) with a written explanation regarding the incorrectly listed information and provide evidence in support thereof.  Upon receipt of such an explanation, the TFDA will serve the new drug MA holder with a copy of the third party’s written explanation and supporting evidence within 20 days of receipt.  The new drug MA holder must file a written reply and, if necessary, correct or delete the information with the TFDA within 45 days after receipt of service.
  3. The PPA does not provide any penalty if a patent listing made by a new drug MA holder contains incorrect information. Nevertheless, if a new drug MA holder intentionally lists incorrect information that is deemed to be fraudulent, such actions may result in criminal liability for the MA holder.

For more information, see Articles 48-6, 48-7, and 100-1 of the PPA.

Required Certifications by a Generic Drug Applicants:

Under the new linkage system, generic drug applicants submitting an applications for a new generic drug permit (NGDP) are required to state whether their proposed products will infringe any patents listed by a new drug MA holder.  Much like Hatch-Waxman in the United States (U.S.), generic drug applicants will be required to make one of the following certifications:

  • (1) The drug has not been listed with any patents;
  • (2) The patents have already expired;
  • (3) The drug permit (e.g., marketing approval) for the proposed product will be issued by the TFDA after the patents have expired; or
  • (4) The patents are not infringed and/or invalid.

Generic drug applicants that certify that any listed patents are not infringed and/or are invalid are required to notify the TFDA and the new drug MA holder of the certification and provide evidence supporting their non-infringement and/or invalidity positions within 20 days after the TFDA notifies the generic applicant that all the documents required for an application of drug permit have been duly prepared.

For more information, see Articles 48-9 and 48-12 of the PPA.

Consequences of Certification:

  1. For NGDPs that contain a certification under sections (1) or (2), once the application is examined and approved, the drug permit (e.g., marketing approval) will be issued by the TFDA.
  2. For NGDPs that contain a certification under section (3), once the application is examined and approved, the drug permit will be withheld by the TFDA until the listed patents expire.  
  3. For NGDPs that contain a certification under section (4), the issuance of marketing approval will depend on the response of the patent owner of the listed patents.  If the patent owner files a patent infringement action within 45 days after receipt of notification by the generic drug applicant, the TFDA will withhold the drug permit for up to 12 months after receipt of notification from the drug MA holder.

For more information see, Articles 48-10, 48-11, 48-12, and 48-13 of the PPA.

Reward for Generic Drug Applicants Making a Certification Under Section (4):   

  1. The first holder of a NGDP who successfully defends a patent infringement suit is granted a 12-month period of marketing exclusivity.  The TFDA will not issue a drug permit to other applicants for a NGDP until the expiration of this 12-month period.  
  2. The marketing exclusivity period will begin on the date of actual marketing of the generic product. 
  3. The holder of a generic drug permit is required to begin selling its product no later than 6 months after the date on which marketing approval is received.  The generic drug holder is required to provide evidence of the actual marketing date to the TFDA. 
  4. If more than one application for a NGDP complies with the requirements regarding the earliest duly prepared application documents and the applications are filed on the same day, each of the applications will be subject to the 12-month marketing exclusivity period.

For more information, see Articles 48-16 and 48-17 of the PPA.

Possible Competition Concerns:

The TFDA should be notified of any settlement agreement on patent linkage-related arrangements between the MA holder and the generic drug applicant or the first NGDP holder.  The TFDA has established guidelines on the details of such notification.  If the TFDA notices any potential anti-competition arrangements in such agreements, it will transfer the matter to the Taiwan Fair Trade Commission for handling. 

Brief Comparison of the U.S. Hatch-Waxman System and the Taiwan Patent Linkage System:

  U.S. Hatch-Waxman System Taiwan Patent Linkage
Types of Medicinal products Chemical (small molecule) drugs;
protein drugs (biologics) are not included
Chemical (small molecule) drugs; protein drugs (biologics) are included
Patents eligible for listing Substance (e.g., compound), composition, formulation, and methods of treatment patents Substance (e.g., compound), composition, formulation, and medical use
Stay of generic drug marketing approval under section (4) (e.g., paragraph 4) 30 months 12 months
Marketing exclusivity for the first generic drug applicant 180 days 12 months

Please continue to watch BRICS & Beyond for more updates on Taiwan’s patent linkage system.

This post was written by Lisa Mueller and Frank Lu and Jason Liou of Formosa Transnational Attorneys at Law.