The Bolar exemption is a legal provision that allows for the use of a patented medicine without the patent owner’s consent, for research acts pertaining to marketing-authorisation applications (MAAs). Depending on the jurisdiction, it can be based in legislation or in case law. Its goal is to prevent excessive restrictions and litigation against innovators using patented medicines without infringing on reasonable prerogatives of the patent owner.
Pharmaceutical patents are the object of specific exemptions which take into account delays caused by the regulatory review of medicines. A patent’s vocation is to grant commercial exclusivity for the exact duration of the patent – no more and no less. However, the commercialisation of drugs is subject to marketing authorisation by a regulatory agency, whose purpose is to ensure that the risks of a drug are reasonable, that they are outweighed by its benefits, and that consumers are adequately informed. In the United States, the Food and Drug Administration (FDA) is in charge of reviewing MAAs, but also of legislating and enforcing authorisations. Similarly, the European Medicines Agency (EMA) reviews the majority of European drugs; it then issues a recommendation to the European Commission, whose authorisation decisions are legally binding across the European Union as well as the European Economic Area. The road to marketing authorisation for drugs is long and arduous, consisting of an expensive reviewing process at the end of which success is never certain. Estimates of the average time between the start of clinical trials and the date of approval range between eight and twelve years in the United States.
Generic drugs, which are equivalent or similar to brand-name drugs, also require MAAs. However, generic manufacturers need only prove that their drug is sufficiently biosimilar to the brand-name drug it emulates, since those already meets the regulator’s conditions. Whilst the procedure is lighter, it still requires carrying out a battery of clinical trials using the previously approved drug. This creates an incentive for a patent owner’s competitor to begin experimenting on the patented drug before patent expiry, in order to collect evidence ahead of an application for regulatory approval.
The moral and economic cases for establishing this incentive are clear, since delays in the approval of generic drug afford the patent owner a longer monopoly. However, the legal case was not established until the 1984 Drug Price Competition and Patent Term Restoration Act (Public Law 98-417) in the United States. This piece of legislation, also known as the Hatch-Waxman Act, allowed non–patent owners to conduct research strictly necessary to obtain approval for a generic drug. This was explicitly in response to a court case earlier in 1984, Roche v. Bolar, and became known as the Bolar exemption (or sometimes the regulatory review defense).1
Crucially, under the Hatch-Waxman Act and associated US case law, research activities which use a patented drug for the purpose of developing an innovative drug (as opposed to a generic) remain a prerogative of the patent owner alone. This characterises a narrow interpretation of the Bolar exemption. However, some jurisdictions have taken a less restrictive stance on what constitutes an infringement. In particular, a broad Bolar exemption allows anyone to experiment on a patented drug in order to develop an innovative drug.
In the case of EU states, Union law exerts an influence on national patent rules through directives. In particular, the Bolar exemption is defined in Union law by the 2001 Veterinary Medicines Directive (2001/82/EC) and Human Medicines Directive (2001/83/EC), as well as amendments by Directive 2004/27/EC. Article 10(6) of the Human Medicines Directive exempts from infringement “the necessary studies and trials” only for approval of a generic drug by the EMA.
What this means in practice is that national implementations of the Directive can interpret the Bolar exemption with a scope no narrower than the standards defined at the EU level. If a state were to regard experimental use for generic approval as an infringement, then it would stand in violation of Union law. However, nothing in the Directive prevents national courts and lawmakers from defining exemptions in a broader sense.
This gives rise to a two-speed system within the EU. In Belgium, Bulgaria, Cyprus, Greece, Luxembourg, and the Netherlands, lawmakers and courts uphold a narrow interpretation of the Bolar exemption. However, in other EU member states, as well as in the United Kingdom, legislation and case law have established a broad construal of the exemption. This inconsistency poses challenges for pharmaceutical companies, especially in planning clinical trials and developing new products.
The Bolar exemption significantly influences the pharmaceutical market. Its primary role is to foster competition, which can lead to lower drug prices and enhanced access for patients. In healthcare environments where cost is a critical concern, this exemption is vital. It speeds up the entry of generic drugs into the market, playing a key role in controlling healthcare expenses. By enabling generics to enter the market sooner, it challenges the price-setting power of patent owners, making medications more affordable.
This aspect of the exemption is not merely economically advantageous but also crucial for public health. It ensures that essential medicines are accessible to a broader segment of the population, particularly those in financially constrained settings. This makes it a central element in healthcare cost management strategies, directly impacting medication affordability and accessibility.
The Bolar exemption also interacts with patent law, particularly concerning Supplementary Protection Certificates (SPCs). These certificates extend patent protection for drugs, typically due to regulatory delays. The exemption counterbalances this extension, ensuring that SPCs do not hinder the development and market entry of generic alternatives. This interaction is pivotal in maintaining the balance between protecting innovation and facilitating access to affordable medicines.
The Bolar exemption shapes the dynamics of pharmaceutical innovation and public healthcare provision. As a central element in healthcare cost management strategies, it directly impacts medication affordability and accessibility. The delicate equilibrium it maintains between protecting pharmaceutical innovations and ensuring public access to less expensive medication options is a testament to its importance in the pharmaceutical sector.
Posterity is of little comfort to Bolar Pharmaceutical Co. After Roche Products appealed a District Court ruling which had been favourable to Bolar, the United State Court of Appeals ruled that Bolar’s use of Roche Products’s patented drug, Dalmane, was outside the scope of experimental use under existing legislation, owing to the business purpose inherent in a New Drug Application. ↩︎