The UK government is being challenged on many levels regarding its plans to negotiate a 'Brexit'. An important question for pharma and innovation is, will the UK government continue with its plans to formally ratify an international convention on patents called the Unified Patent Convention (UPC), that has taken about 40 years to negotiate.

Recently the opposition Labour party revealed that it raised questions in the House of Commons on this: specifically, it asked:

• Does the UK government plan to proceed to formally sign up to the UPC?
  
• If not, what steps is it taking to negotiate an alternative agreement?
  
• Will it clarify whether the UK will be able to host a pharma division of a new UPC Court in Aldgate Tower, if the UPC goes ahead?
  

The UK government should answer these questions before March 2017 but it has not confirmed when it will respond in detail.

The Unitary European Patent system aims to support innovation by cutting red tape and costs, and saving time by automatically validating a single patent in all EU and other countries that have signed the UPC treaty. EU countries that wish to sign the treaty must also agree to implement the relevant EU regulations on a 'European Unitary Patent'. This will provide key advantages for both inventors and life science investors by creating a more streamlined system for filing and registering patents, and for litigating against patents.

Under the current treaty for the UPC, the three countries with the highest number of European patents in force when the treaty was agreed (UK, France and Germany) would be the hosts for the three UPC courts of the new system. London would host the court that dealt with litigation on life science patents. Expert judges are being recruited from countries that have ratified the UPC treaty. Potential British and other judges have already been pre-selected.

If the UK does not sign the treaty, both the Netherlands and Italy are interested in hosting this new court. Italian authorities have started the procedure to formally ratify the UPC treaty. This will be completed by early 2017. Italy has registered more patents than the Netherlands and has also designated a court building that is available to accommodate the new UPC court in Milan.

A unified international UPC system is still essential, both within and outside the European Union

What is the issue for the UK government? 
Politically, the UK government feels that it cannot continue to accept the power of the European courts in Luxemburg and the supremacy of EU law over UK courts and English and UK laws. However, participation in the UPC system includes accepting that the judgments of the European courts will prevail over judgments of the UK courts, even if the Unified Patent Court is distinct and independent from other European institutions.

Until the UK government decides on a clear position on the treaty, the UK remains a 'contracting member state' of the UPC system and its representatives will continue to influence the initiative. If the UK refuses to ratify the UPC treaty, the current UPC treaty is likely to be renegotiated and the launch of the new life science UPC court will be delayed. The UPC treaty has not yet been ratified by Germany, but France and 10 other European Member States have signed the treaty.

Although renegotiation could lead to a long-term delay for the new system, it might provide a window of opportunity for those countries that are not members of the European Economic Area to consider joining the UPC system. This would extend the influence of the UPC system and EU law, and it would support the harmonisation of how to define and prove innovation in life science patents. As English would be the core language for life science litigation, and within the industry itself, there would be translation costs to consider if the court was not based in the UK.

Delays would be strongly discouraged by the global life science sector as it continues to rely on patent and other IP rights to support its investments in innovation and generate revenue for new research. Investors also seek the benefits the UPC system will provide.

A unified international UPC system that offers the possibility of resolving disputes more quickly and more efficiently is still essential, both within and outside the European Union.