The Cabinet yesterday approved a set of draft amendments to the Pharmaceutical Affairs Law (藥事法), allowing foreign pharmaceutical companies to enjoy data exclusivity for a period of five years.
The pharmaceutical data exclusivity refers to the legal protection of the results of efficacy and safety tests conducted by pharmaceutical firms before receiving government approval for the drugs.
Differing from other intellectual property rights such as patent protection and the non-disclosure of trade secrets, data exclusivity ensures that the data generated by pharmaceutical companies for purposes of registration may not be referred to or used by another person or company for a specific period of time.
Under the new amendments, drugs created and manufactured by foreign pharmaceutical companies will enjoy a five-year protection period for tests and studies, while protection for new improvements to existing products will be protected for three years.
The US government originally hoped to see the protection period for the testing of new drugs set at seven years, and those for old drugs with a new improvement set at six years.
It is estimated the domestic pharmaceutical industry will lose about NT$4 billion in its annual production value during the protection period and a NT$3.5 billion increase of medical expenses in the national health insurance program.
Under the draft, local pharmaceutical companies would be eligible to apply for the manufacturing of the licensed new drugs four years after a product hits the market and could begin manufacturing after five years.
Foreign pharmaceutical companies would only be entitled to protection when a new drug is registered with the Department of Health within three years after it has been made available on the market.
The US government has threatened to put Taiwan on its Special 301 Priority Watch List if it refused to regulate and protect medical information.