Revised Patent Term Extension System in Korea: Implications for the Pharmaceutical Industry
Background
Unlike patent systems in other countries, under the previous Korean Patent Act, there was no time limit from the marketing approval date for patent term extensions for pharmaceutical patents, and there were no restrictions on the number of patents that could be extended for a single regulatory approval, thereby allowing extensions of multiple patents — such as compound, use, formulation, and dosage regimen patents — based on a single drug approval.
The domestic pharmaceutical industry has expressed concerns that Korea’s patent term extension system has led to prolonged monopolies by foreign drug developers in the Korean pharmaceutical market, which, in turn, delayed the introduction of cheaper generic drugs, and as a result, disproportionately favors those patent holders when compared to systems in other countries, including the United States and Europe. Critics argue that the delayed market entry of Korean local generics limits public access to affordable medications and could strain health insurance finances.
Amended Patent Act
On December 27, 2024, in response to these concerns, the National Assembly of Korea passed a revision to the Patent Act with the following key provisions: (i) the patent term cannot exceed 14 years from the date of marketing approval, and (ii) only one patent per approval is eligible for extension. The revised Patent Act is expected to be promulgated as early as January 2025 and will come into effect six months after its promulgation, likely in July 2025. This revision will apply to patent term extension applications filed after its effective date.
Lawmakers explained that the purpose of the revision was to address the lack of a cap on patent terms and the absence of limits on the number of patents eligible for extension, aiming to prevent delays in the release of generic drugs, and ensure early public access to medications, as well as to align Korea’s system with international standards, particularly those in the United States and Europe.
Under the revised Patent Act, there is no change to the provision allowing for a maximum five-year extension, but a new additional cap has been introduced, limiting the total extension to 14 years from the date of approval, in line with US practice.
Implications
While the full impact of the revised patent term extension system is still uncertain, initial analyses suggest that it may lead to shorter patent terms for original drugs. Only for the purpose of explanation, there may be extreme cases where the impact of the new cap could be significant. For instance, when marketing approval is granted within six years from the international filing date, and the patent term is extended for about three years in Korea, the revised 14-year cap could result in only about four months of extension, despite a prior three-year extension (please refer to the following diagram).
Furthermore, for monopoly drugs where the revenue during the extended patent term exceeds the revenue during the original term, the consequences could be considerable.
However, 2023 data on the status of effective patent terms for pharmaceuticals from 1999 to 2021 issued by the Korean Ministry of Food and Drug Safety (MFDS) shows that about 82% of pharmaceutical patents have an effective patent term of under 14 years, suggesting that extensions expire within 14 years from the approval date. As such, the new 14-year cap may have limited impact in many cases.
As a test, we applied the 14-year cap to 15 randomly-selected historic PTE cases handled by our office, and all resulted in extensions within the 14-year limit.
Perhaps the most significant change introduced by the revised Patent Act may be the limitation on the number of patents eligible for extension per product approval. Previously, multiple patents could be extended based on a single drug approval, for example, the above-mentioned data from MFDS also shows that the number of patent registrations exceeds the number of approvals by a factor of 1.7, which indicates that multiple patents may have been registered for a single product. Now, only one patent may be selected for extension. This is likely to have a notable impact on the strategies of original drug companies, as they may now need to focus on extending only one patent (substance patent or a secondary patent) to maximize their patent term. In contrast, generic companies will more easily be able to anticipate when the one extended patent of the original drug expires and this simplification may reduce the complexity of their market entry strategies.
Additionally, the revised Patent Act clarifies the starting point for patent term extensions, specifying that the extended period due to delayed registration (Patent Term Adjustment, PTA) will be clearly defined. This ensures greater transparency and consistency in calculating patent term extensions based on regulatory approvals.
The revised Patent Act also introduces provisions for rejecting applications for extension that exceed the 14-year cap, as well as allowing for invalidation petitions. If multiple patents are submitted for extension based on a single approval, none will be granted an extension.
Given these changes, patentees should be mindful of these new provisions when filing patent term extension applications after July 2025 in Korea.