E cdip/15/inf/2 original: english date: january 8, 2015 Committee on Development and Intellectual Property (cdip) Fifteenth Session Geneva, April 20 to 24, 2015

IV. Regulatory framework

Registration of pharmaceutical products

Any drug marketed in Chile has to be registered with the Public Health Institute (ISP) – a government agency (Decree of the Health Ministry No. 1876 from 1995). The same rules apply regardless of whether the drug is imported or locally produced.

For new drugs, the first step in the process is to request a new pharmaceutical product application (Solicitud para el Registro de un Producto Farmaceutico Nuevo). The ISP reviews the application on formal grounds. If the application complies with the ISP regulations, the applicant has to request an assessment of the drug at the pre-admittance unit of the national control department. For registration, product samples have to be provided, as well as detailed qualitative and quantitative formulae, all drug related studies, tests, and documentation on clinical trials.¹⁵ If approved, the applicant can request registration of the drug on the ISP register. Registration of new drugs takes on average between 6 and 18 months. Registration fees are moderate (around US$2,300) and registrations have to be renewed after five years.
If a drug has already been registered on the ISP register, a company that wants to register a generic version can rely on the studies submitted for the first registration as proof of safety and efficacy provided the period of data exclusivity has expired. Also, since July 2008 (Resolution No. 3225/08), the ISP started requiring proof of bioequivalence for products that contain certain active ingredients. The number of affected active ingredients remained small during the period that we study (up to 2010), but has increased substantially since 2011.¹⁶ For these products, the second party to register a drug has to submit studies of bioequivalence. However, because most drugs are still exempt from proving bioequivalence, most generics do not necessarily satisfy bioequivalence despite being pharmaceutically equivalent.¹⁷

Patent protection is irrelevant for registration at the ISP. In contrast to the U.S. FDA for example, in Chile patent information concerning a new drug is neither requested nor verified when marketing approval is granted.¹⁸

Apart from patent protection, the regulatory system in Chile also offers additional means for achieving exclusivity for new drugs. Data related to the safety and efficacy of new chemical entities provided for approval of new chemical entities is granted a five-year exclusivity period (see also below), in cases where protection is requested by the applicant and granted by the ISP. This means that after this term, generics companies can use the data that was previously submitted for the registration of the new drug, so they do not have to perform any clinical trials on their own. The 5-year limit on exclusivity thus helps avoiding inefficient duplication of expensive and time-consuming safety and efficacy tests.

Patents

Pharmaceutical drugs became patentable Chile in 1991 through Law 19.039.¹⁹ The law offers patent protection for both products and processes and initially provided a statutory patent life of 15 years from the date the patent was granted, regardless of subject matter.²⁰ The law excluded, however, all patents that had been applied for anywhere else in the world before the law came into force. Although the law still offered a way to obtain patent protection in Chile even if a patent had been granted in another jurisdiction before Law 19.039 entered into force (Law 19.039, Article 39),²¹ pharmaceutical patents were specifically exempted from this provision.²² As we will show further below, this often explains why there is no primary patent but only secondary patents associated with a drug in Chile.

Law 19.039 was amended several times during the period that we study (up to 2010): in 2005 by Law 19.996 and in 2007 by Law 20.160.²³ The amendments brought Chile’s IP legal framework inline with TRIPS (taking advantage of the 10-year transition period for developing countries under TRIPS) and Chile’s obligations under FTAs with the U.S. and the European Free Trade Association (EFTA). Apart from a general extension of the patent term from 15 years from the date the patent was granted to 20 years from the application date, the most relevant changes affecting specifically pharmaceutical patents are the introduction of supplementary patent protection due to delays in the granting of a patent or the sanitary registration (Law 20.160, Article 53),²⁴ the 5-year data exclusivity mentioned above (Law 19.996, Article 89),²⁵ a Bolar exemption (Law 20.160, Article 49), a softening of restrictions on second use patents (Law 19.996, Article 37e),²⁶ and international exhaustion of patent rights (Law 19.996, Article 49).²⁷
Finally, Chile joined the PCT system in 2009, which facilitates the international filing of patents.²⁸ Although Chile’s accession to the PCT is likely to have had some effect on patent filings by foreign pharmaceutical companies in Chile, the change occurred in June 2009, which means it does not affect patent filings observed in our dataset.

V. Data description

To construct a dataset that combines patents and trademarks at the product level, we rely on a dataset that contains the universe of patents and trademarks filed with the Chilean patent registrar (prior to 2009) and INAPI (after 2008). This includes all patent and trademark applications by domestic as well as foreign entities, regardless of whether or not they have been granted.

To map patents to pharmaceutical products, we rely on data available at the ISP. The institute maintains a database that links all registered drugs in Chile to the pharmaceutical compounds that they contain. The database also contains additional information on the drug (e.g. when it was registered), the owner of the drug, whether the drug is produced domestically or abroad. We use the bridge between compounds and drugs contained in ISP’s database to link patents and trademarks at the product-level. Patents are linked to active ingredients whereas trademarks are linked to drug names. The link between patents and drugs represents a challenge as there is usually no explicit mentioning of the specific compounds in patent claims. Patents use the IUPAC (International Union of Pure and Applied Chemistry) classification to identify compounds whereas drugs rely on WHO’s INN (International Nonproprietary Name).²⁹ Although compounds are usually described by a Markush structure in the patent,³⁰ the same structure comprises often many functionally equivalent active ingredients; only the combination of specific examples provided in the patent and the Markush structure reveals the specific active ingredient protected by the patent (see Appendix A for details).

We address this problem in three ways. First, we use a dataset compiled by INAPI that contains the compound-patent mapping for all new compounds registered with the ISP between 2005 and 2010. The mapping was undertaken by patent examiners specialized in pharmaceutical patents. Second, for all other compounds, we rely on the Orange Book of the U.S. Food and Drug Administration (FDA) to identify U.S. patents on the compounds registered in Chile. We then construct patent families for these U.S. patents and verify whether there are any Chilean equivalents. Similarly, we undertake the same exercise using the Merck Index, which provides information on patents worldwide. Third, we asked specialists in pharmaceutical patents in Chile to match the remaining set of granted Chilean patents (nearly 3,000 patents) to our list of ISP products directly.

The mapping between drugs and trademarks is more straightforward as the ISP database provides the names under which drugs are marketed, which we use to search for these drug names in our trademark database. In addition to matching drug names, we also match the names of all companies in the ISP database with the trademark register. Especially in the case of generics companies, individual drugs may not be trademarked, but the name of the company – which presumably appears on the packaging -- still is.
Appendix A describes the data construction in more detail and Table 1 gives a summary of our patent-trademark match to the ISP register. Of 12,116 unique products registered at the ISP, 3,709 match to at least one Chilean patent, whereas 9,273 match to at least one Chilean trademark. After cleaning and translation of the active ingredients (including some standardization of names), there are far fewer active ingredients than products, as one might have expected. Of the 2,630 distinct active ingredients (many of which are common chemical compounds, that is, generics – for example vitamins), 322 match to at least one Chilean patent (504 distinct patents) and 2,630 match at to at least one Chilean trademark (10,461 distinct trademarks). Overall 82 per cent of the products and 91 per cent of the active ingredients are associated with some form of IP protection, more often trademark than patent.

Table 1