The European Commission has recently published draft proposals for the introduction of a manufacturing exemption for export purposes during the term of an SPC.The current SPC regulations prohibit the manufacture of a product covered by an SPC for any purpose. This means that EU-based manufacturers are not able to export generics and biosimilars to non-EU countries during the SPC term, nor place generics and biosimilars on the EU market immediately following expiry of the SPC term (‘day-1’ entry).This is believed to place EU-based manufacturers at a competitive disadvantage as compared to manufactures outside the EU.The proposed legislation is intended to address these problems by introducing an exemption from infringement for “making [a product] for the exclusive purpose of export to third countries” and “any related act that is strictly necessary for that making or for the actual export itself” during the term of the SPC. Interestingly, the proposed legislation has not provided an exemption for manufacturing in preparation for day-1 entry and, as such, is not as wide-ranging as it could have been.The proposals also include measures which promote transparency and safeguard SPC holders from their product being diverted onto the EU market including the setting up of a public register which holds information on manufacturers making use of the exemption, a requirement to label the exported products, and a requirement that any contractors with which a manufacturer works be made aware of the manufacturing exemption and its limitations.The manufacturing exception will only apply to SPCs that have not yet granted, with transitional provisions applied for SPC applications already pending on the (yet to be determined) date of entry into force of the new regulations.The European Commission hope that the exemption will provide opportunities for growth and jobs within the EU, particularly with the first generation of blockbuster biologics coming off patent in the next few years.For queries or advice about SPCs, please contact James Wilding via [email protected]