On August 29, 2021, Israel’s Justice Ministry published a memorandum concerning a proposed bill to amend the Patent Law, 1967. The bill deals with certain limitations on patent protection during the term of patent term extension orders (“PTE”) in relation to pharmaceuticals and medical devices.

The stated purpose of the bill is to encourage competition in the Israeli market by bringing the Patent Law into alignment with the EU arrangement allowing certain actions to be taken during the term of a PTE, which would otherwise constitute patent infringement.

Two types of limitations are proposed: first, that it would not be an infringement of the extended patent to manufacture the pharmaceuticals or the devices for sale outside of Israel, or to develop an industrial process or take other necessary steps for this purpose. The second limitation would allow the manufacture of the patent-protected products in Israel during the six months preceding the expiration of the PTE in preparation for sales in Israel following such expiration, as well as storage and other necessary steps for this purpose.

On the whole the proposed arrangements appear to be a step in the right direction in terms of encouraging competition by, for instance, allowing the swift entry of generic drugs into the Israeli market, upon expiration of the patent protection. However, the bill lacks certain safeguards for the patent owners, whose impact on the innovation process cannot be discounted. By way of example, unlike the European regulation that this bill purports to emulate, there is no express provision against the re-importation of patent-protected products, exported under the aegis of the proposed exemption, back into Israel; nor is there any requirement that manufacturers availing themselves of these exemptions notify the patent office or the rights holder, also unlike in the EU.

The contemplated limitations will apply to any PTE requested from the date the amended law enters into effect (the “Effective Date”). From July 2, 2022 they will also apply to PTEs applied for, and to those already granted, before the Effective Date, provided they enter into force after the Effective Date.

Comments on the memorandum can be submitted to the Justice Ministry until September 19, 2021. We will continue to monitor developments.

The Intellectual Property Department
Herzog Fox & Neeman