The A to Z: patent, SPC, licensing, regulatory, trade and pricing terms, defined plainly

Terms are grouped by letter. Each definition is one or two sentences; where a piece on this site explains the term in full, it is linked.

A

Active ingredient (active substance). The substance in a medicine that produces the therapeutic effect. For an SPC, the “product” is the active ingredient or combination of active ingredients, as the marketing authorisation describes it; an excipient is not one, even an enzyme that makes a subcutaneous injection possible (see the Keytruda SC note).

Added matter. A ground of invalidity: the granted claims cover something the application as filed did not disclose. The ground on which the nivolumab flat-dose patent and the Tecfidera dosage patent fell at the EPO.

AMNOG. Germany’s benefit-assessment system for new medicines, which sets a negotiated reimbursement amount after the first year on the market.

Anti-tampering device. The seal on a medicine pack required by the Falsified Medicines Directive. A parallel importer who opens the pack must replace it with an equally effective one; it need not look like the original (Denmark 2026).

Article 3(a), (b), (c), (d). The four conditions for an SPC in Regulation 469/2009: the product must be protected by a basic patent in force (a); have a valid marketing authorisation (b); not already have an SPC (c); and that authorisation must be the first for the product (d). Most SPC litigation is about (a) and (d).

Aut idem. The German prescription marking by which a doctor excludes pharmacy substitution.

AVP, AIP, AEP. German price levels: pharmacy selling price (Apothekenverkaufspreis), pharmacy purchase price (Apothekeneinkaufspreis), manufacturer’s price (Abgabepreis des pharmazeutischen Unternehmers). See which price is which.

B

BMS conditions. The five conditions from Bristol-Myers Squibb v Paranova (1996) under which a trade-mark owner cannot stop a repackaged parallel import: necessity, product untouched, repackager and manufacturer named, no damage to the mark’s reputation, and prior notice with a specimen on request (the case).

Basic patent. The patent an SPC is based on, which must protect the product; in practice almost always the compound patent.

Bifurcation. Deciding infringement and validity in separate proceedings or courts, as Germany does; the UPC may bifurcate but usually does not.

Biosimilar. A biological medicine shown to be highly similar to an already authorised biologic (the reference product), with no clinically meaningful differences. Not identical, which is why process and formulation patents matter more for biosimilars than for generics (how strong is each kind of patent).

Bolar exemption. The rule that studies and trials needed to obtain a marketing authorisation do not infringe a patent or SPC; named after the 1984 US case it reversed. Wider in the UK and Germany than in the Directive; it never covers commercial stock, and today not the pricing step either. The EU pharmaceutical package widens it to pricing, reimbursement and tender submissions and to active-ingredient suppliers (the Bolar exemption; Astellas v Polpharma).

C

Category M. The part of the England and Wales Drug Tariff in which the reimbursement price of a generic is set quarterly from suppliers’ actual selling prices; the mechanism that makes a UK generic price fall within months of launch.

Centralised procedure. Authorisation by the European Commission on the EMA’s opinion, valid in every EU country at once; the route for most new biologics and many new small molecules.

Clawback (clause de sauvegarde, payback). A levy that takes back from manufacturers a share of medicines spending above a national threshold. France’s excludes generics and biosimilars from 2026; Italy’s hospital payback is contested.

Clearing the way. A generic company’s practice of attacking the patents before launch, so that it launches into a cleared field rather than at risk; the UK courts expect it and penalise a company that “jumps the gun” (clearing the path and launching at risk).

Combination patent, combination SPC. A patent on two actives together, and the certificate that may be granted on it. The CJEU’s 2024 test requires the combination to fall under the patent’s invention; national courts have been refusing combination certificates since (combination SPCs).

Compound patent (product patent). The patent on the molecule itself; the strongest kind, and the basic patent for the SPC.

Critical Medicines Act. The EU regulation, agreed in 2026, that lets public procurement weigh security of supply and EU manufacturing, and supports strategic projects for critical medicines.

Cross-undertaking in damages. The promise a patentee makes when it obtains an interim injunction: to compensate the enjoined party if the patent later falls. In the UK the compensation is the enjoined party’s own loss, not the patentee’s profit (rivaroxaban).

D

Data exclusivity (regulatory data protection). The period after a product’s first EU authorisation during which a generic application may not refer to its data: eight years in the EU and UK. See the five clocks.

Decentralised procedure (DCP), mutual recognition (MRP). National authorisations coordinated across chosen EU countries, the common routes for generics (four routes).

Decommissioning. Marking a pack’s unique identifier as supplied or exported in the EU verification system so that it cannot be dispensed again; required of EEA suppliers for packs exported to the UK.

Designated states. The countries in which a European patent was requested and, after validation, is in force. A European patent is a bundle of national patents, not one right.

Dosing-regimen patent. A use patent claiming how much of a known compound to give and how often; often found obvious over the published trial that tested the regimen.

Drug Tariff. The monthly list of what the NHS reimburses community pharmacies for each medicine in England and Wales; Scotland and Northern Ireland have their own.

E

EMA, EPAR. The European Medicines Agency and the public assessment report it publishes for each centrally authorised product, whose “authorisation issued” date starts the regulatory clocks.

Enantiomer patent. A patent on one mirror-image form of a molecule previously known as a mixture; attacked as obvious, often successfully.

EPO opposition. The procedure, open for nine months after grant, by which anyone may ask the European Patent Office to revoke or amend a European patent; the generics industry’s standard first attack, often through a patent attorney filing anonymously (a “straw man”).

Exhaustion. The rule that a product sold with the rights holder’s consent may be resold without infringing. The EEA is one exhaustion area; the UK applies “UK+”, which admits EEA-sourced imports but not the reverse (UK exhaustion).

Ex-factory price. The manufacturer’s selling price before wholesale and pharmacy margins and VAT; the level most reference-pricing systems compare.

Export ban, export restriction. A national measure stopping wholesalers from exporting a medicine in short supply (the UK list; Europe by country).

External reference pricing (ERP). Setting a national price by reference to prices in a basket of other countries.

F

Falsified Medicines Directive (FMD). The EU rules requiring a unique identifier and anti-tampering device on prescription medicines and their verification at dispensing. Northern Ireland left the EU system on 1 January 2025 (Windsor Framework).

First authorisation date. The date of the first marketing authorisation of a product in the EEA; the start of the regulatory clocks and the second input to the SPC term (SPC term).

Formulation patent. A patent on a particular pharmaceutical form of a known compound: a release profile, an excipient system, a stable solution. Weak for ordinary tablets, strong for biologics.

G

Generic. A medicine with the same active substance, strength and form as a reference product, shown to be bioequivalent to it, and authorised by reference to the reference product’s data once data exclusivity has run.

Global marketing authorisation. The EU concept that a product’s later strengths, forms and indications belong to the original authorisation and share its regulatory protection, so a new product does not restart the clock unless it is genuinely different (Tecfidera).

H

Hoarding restriction. The UK rule that wholesalers may not hold listed shortage medicines beyond normal demand; the companion of the export ban.

Hybrid application. A generic-type application under Article 10(3) that departs from the reference product (a new strength, form or route) and so needs some of its own data (legal bases).

I

Imminent infringement. The point at which a generic’s preparations to launch justify an injunction before any sale. At the UPC, holding a marketing authorisation is not enough; completing the pricing step that allows immediate sale can be (nintedanib; fampridine).

INN. International non-proprietary name: the generic name of the active substance (apixaban, not Eliquis).

Interim (preliminary) injunction. A court order keeping a product off the market until trial. In the UK the court asks whether damages would be an adequate remedy and whether the generic cleared the way; in Germany, whether the patent has survived opposition; at the UPC, whether validity is sufficiently certain.

Inventive step (obviousness). The requirement that an invention not be obvious to the skilled person from what was already known; the ground on which most dosing-regimen patents fall.

L

Launch at risk. Launching a generic while a patent that might cover it is still in force or in dispute, accepting the exposure to damages.

Legal basis. The article of Directive 2001/83 (or the UK regulation) an application for a marketing authorisation is made under: full, generic, hybrid, biosimilar, well-established use, fixed combination or informed consent; it sets the data filed and the exclusivity clock the product ran against (legal bases).

List price. The published price of a medicine at a stated level (ex-factory, wholesale, pharmacy, reimbursement), as distinct from the net price after discounts and rebates (list v net).

Loss of exclusivity (LOE). The point at which the last of a product’s protections ends and competition can enter; a per-country date, and rarely the patent date (why the expiry date is not the launch date).

M

Marketing authorisation (MA). The licence to sell a medicine, national or EU-wide. In the UK a “PL” number; in the EU an “EU/1/yy/nnn” number for centrally authorised products.

Market protection. The two years after data exclusivity (plus one for a significant new indication) during which a generic may be authorised but not placed on the market: the “+2+1” of 8+2+1, becoming 8+1 plus earned extensions under the EU package (new rules).

Most-favoured-nation pricing (MFN). The US policy that its prices should be no higher than the lowest in comparable countries, pursued through company deals that commit to “rebalancing” international prices (EU–US tariffs and MFN).

N

NICE threshold. The cost per quality-adjusted life year above which NICE will not normally recommend a medicine for the NHS; raised to £25,000–35,000 in 2026.

Notification date. The date the marketing authorisation holder was told of the authorisation, which the Court of Justice held is the date the SPC term runs from, not the decision date (notification-date rule).

Novelty. The requirement that an invention was not already available to the public; a product on the market before the filing date is prior art even if nobody could analyse it (EPO G 1/23).

O

Objective necessity. The trade-mark test for repackaging a parallel import: the importer may alter the pack only as far as necessary to reach the market; the first of the BMS conditions (repackaging rules).

Orphan market exclusivity. The ten years during which no similar product may be authorised for the same rare-disease indication (orphan exclusivity).

P

Paediatric extension. Six months added to an SPC as the reward for completing an agreed paediatric investigation plan (paediatric extensions).

Parallel distribution notice. The EMA’s notice for an EU-sourced centrally authorised product distributed to another EU country; no longer valid in Northern Ireland.

Parallel import, parallel export. Buying a medicine in one country where it is cheaper and selling it in another, under the exhaustion rules; the importer relabels or reboxes within the trade-mark limits.

PL, PLPI, PLGB, PLNI. UK licence prefixes: a product licence, a parallel import licence, and the Great Britain-only and Northern Ireland-only prefixes used from 2021 to 2024 before UK-wide licensing returned.

Plausibility. The requirement that a patent application make it credible, at filing, that the invention does what it claims; the ground on which the apixaban and dapagliflozin compound patents fell in the UK (plausibility explained).

Polymorph patent. A patent on a particular crystalline form of a known compound.

Price concession. In England, a temporary higher reimbursement price granted when pharmacies cannot buy a generic at or below the Drug Tariff price.

Process patent. A patent on a way of making a compound; marginal for small molecules, central for biologics.

Product (for an SPC). The active ingredient or combination of active ingredients of a medicine; salts and esters of the same active are the same product.

R

Reference pricing (internal). Setting one reimbursement level for a group of interchangeable products, usually at or near the cheapest.

Relabelling, reboxing, rebranding. The three things a parallel importer may do to a pack, in increasing order of difficulty under the trade-mark rules: over-sticker the original box; put the medicine in a new box; sell a generic under the originator’s brand name (the last almost never allowed).

Revocation, nullity. A court’s or office’s decision that a patent is invalid; “revocation” in the UK and at the EPO and UPC, “nullity” in Germany.

S

Second medical use patent. A patent on a new therapeutic use of a known compound; see use patent. The UK grants no SPC on it (no second-use SPCs).

Serious shortage protocol (SSP). A UK instrument allowing pharmacists to supply an alternative strength, form or product when a listed medicine is short.

Skinny label. A generic’s label with the patented indication carved out (skinny labels).

SmPC. Summary of product characteristics: the authorised prescribing information for a product.

Specific Mechanism. The exception in the Acts of Accession from 2004 that let a patent or SPC holder stop parallel imports of its own product from a new member state where pharmaceutical patents were unavailable when its patent was filed, after a month’s notice from the importer; spent for all but Croatia (the Specific Mechanism).

SPC (supplementary protection certificate). The right that extends a medicine’s patent protection by up to five years to compensate for the time taken to obtain a marketing authorisation; national, granted on a basic patent, with a term calculated from the first EEA authorisation (SPC term).

SPC manufacturing waiver. Two exceptions to SPC infringement introduced in 2019, often lumped together: the export waiver, under which a generic or biosimilar may be made in the EU throughout the SPC term for export outside it, and the stockpiling waiver, under which it may be made and stored in the last six months for day-one EU sale; both need three months’ notice to the office and the holder. The UK has its own version. Not the Bolar exemption, which covers development work, not stock (the two waivers; in court).

Statutory scheme, VPAG. The UK’s two branded-medicines pricing schemes, under which companies repay a percentage of NHS sales (after the US deal).

Straw man. A patent attorney who files an EPO opposition without naming the client; the usual way a generic company attacks a patent anonymously.

Sufficiency. The requirement that a patent describe the invention well enough for the skilled person to carry it out; a near relative of plausibility.

Sunset clause. The rule, Article 24(4) to (6) of the medicines Directive and regulation 67 in the UK, that a marketing authorisation lapses if the product is not placed on the market within three years of grant or is absent for three consecutive years; one presentation on the market keeps it alive, exemptions need public-health grounds, and the agencies disagree on when the clock starts for a generic blocked by a patent (the sunset clause; Delfarma).

T

Tender. Procurement of a medicine for a hospital, a region or a health insurer by competitive bid; the route by which most biosimilars and hospital generics are sold.

U

UK Only. The words every pack placed on the UK market must carry since 2025, imports included.

Unified Patent Court (UPC). The court, open since 2023, that decides infringement and validity of European patents for the participating EU countries at once (the UPC for pharma).

Use patent. A patent on the use of a known compound for a purpose, or on a dosing regimen; protects the use only, so a generic may carve it out.

V

Validation. The step by which a granted European patent becomes a national patent in a designated state; without it the patent has no effect there.

Variation. A change to a marketing authorisation after grant; the EU’s variations framework was reorganised in 2026.

W

Windsor Framework. The 2023 UK–EU agreement under which, since 1 January 2025, medicines are licensed UK-wide and Northern Ireland has left the EU verification system (for parallel importers).

Wgp. The Dutch maximum-price law (Wet geneesmiddelenprijzen), which caps pharmacy purchase prices by reference to four countries.