Over the past two months, Ravil Kassilgov and Mukhammadali Makhmudov successfully concluded two first-instance court cases on data exclusivity. We are pleased to share our recent experience with colleagues in the pharmaceutical industry and all interested parties:
Essence of the Disputes
A European biotechnology company (“the Client”) registered an original medicinal product in Kazakhstan in September 2015. In May and July 2021, two generic drugs (“Generics”) manufactured by different foreign producers, containing the same active substance, were registered in Kazakhstan.
An original medicinal product is developed using a newly discovered substance and undergoes a full course of preclinical and clinical studies. A generic is a reproduced copy of the original and is registered based on comparative studies. Development of an original product requires significant investment, affecting its market price, whereas generics are substantially cheaper.
Since Kazakhstan’s accession to the WTO, the country has implemented a six-year data exclusivity period for medicinal products. This rule prohibits generic manufacturers from relying on original drug research data and, in effect, bars the registration of generics for six years following the original product's registration. Responsibility for preventing such violations lies with the Drug Expertise Center and the Pharmaceutical Control Committee, which conduct the examination and registration of medicines.
Since the examination and registration of the Generics took place during the data exclusivity period of the original product without the Client’s consent, and following the mandatory pre-trial procedure under the Administrative Procedure Code (APPC), claims were filed in the Specialized Interdistrict Administrative Court (SIAC) of Nur-Sultan.
SIAC Rulings
The cases were reviewed by different SIAC judges under the APPC. Both claims were fully satisfied. The examination and registration of the Generics were declared unlawful, and the Committee was ordered to revoke the registration certificates of the Generics.
The decisions have not yet entered into legal force.
Why the Outcomes Are Noteworthy
The rulings continue the positive line of case law initiated by the Supreme Court and the Almaty City Specialized Economic Court in 2018–2019. However, given the differences in the fact patterns between the first precedent in our practice and the current cases — as well as the fact that these were examined under the APPC by newly formed courts — we highlight the following noteworthy aspects:
Related materials:
Analysis of the 2019 Precedent Case
Data Exclusivity – Webinar by the AIFC Academy of Law
Out-of-Court Settlement of a Data Exclusivity Dispute
The Legal Framework of Data Exclusivity in Kazakhstan
Essence of the Disputes
A European biotechnology company (“the Client”) registered an original medicinal product in Kazakhstan in September 2015. In May and July 2021, two generic drugs (“Generics”) manufactured by different foreign producers, containing the same active substance, were registered in Kazakhstan.
An original medicinal product is developed using a newly discovered substance and undergoes a full course of preclinical and clinical studies. A generic is a reproduced copy of the original and is registered based on comparative studies. Development of an original product requires significant investment, affecting its market price, whereas generics are substantially cheaper.
Since Kazakhstan’s accession to the WTO, the country has implemented a six-year data exclusivity period for medicinal products. This rule prohibits generic manufacturers from relying on original drug research data and, in effect, bars the registration of generics for six years following the original product's registration. Responsibility for preventing such violations lies with the Drug Expertise Center and the Pharmaceutical Control Committee, which conduct the examination and registration of medicines.
Since the examination and registration of the Generics took place during the data exclusivity period of the original product without the Client’s consent, and following the mandatory pre-trial procedure under the Administrative Procedure Code (APPC), claims were filed in the Specialized Interdistrict Administrative Court (SIAC) of Nur-Sultan.
SIAC Rulings
The cases were reviewed by different SIAC judges under the APPC. Both claims were fully satisfied. The examination and registration of the Generics were declared unlawful, and the Committee was ordered to revoke the registration certificates of the Generics.
The decisions have not yet entered into legal force.
Why the Outcomes Are Noteworthy
The rulings continue the positive line of case law initiated by the Supreme Court and the Almaty City Specialized Economic Court in 2018–2019. However, given the differences in the fact patterns between the first precedent in our practice and the current cases — as well as the fact that these were examined under the APPC by newly formed courts — we highlight the following noteworthy aspects:
- The Client’s original product was registered before Kazakhstan’s WTO accession and thus before the introduction of the data exclusivity rule. The new case law confirmed that data exclusivity protection applies in such cases, using the legal norms in effect at the time the generics were submitted for examination.
- The court issued a private ruling addressed to the Minister of Health of the Republic of Kazakhstan, instructing that the Minister be informed of the identified violations and the need to amend relevant subordinate regulations. As we understand, this was partly due to the defendants relying on subordinate rules while disregarding international treaty obligations.
- In its reasoning, the court noted that certain provisions of the Health Code do not fully align with Kazakhstan’s WTO commitments, and that international treaties in this area prevail and must be applied accordingly.
- We must also commend the exceptional professionalism demonstrated by the SIAC judges in Nur-Sultan in handling these complex disputes. We believe that further consolidation of such judicial practice will positively impact Kazakhstan’s investment climate and encourage local producers to invest in the development of original medicines.
Related materials:
Analysis of the 2019 Precedent Case
Data Exclusivity – Webinar by the AIFC Academy of Law
Out-of-Court Settlement of a Data Exclusivity Dispute
The Legal Framework of Data Exclusivity in Kazakhstan