China has implemented major changes to the Patent Law, which came into effect on January 20, 2024, including the introduction of the pharmaceutical patent term compensation system, which is a key change. This is following the adoption of the 2023 Detailed Rules for the implementation of the Patent Law and the Guidelines for Patent Examination in accordance with the new Chinese Patent Law.

The update, which affects stakeholders across the industry, introduces a nuanced approach to patent protection, focusing on new drug-related inventions. This move aims to protect the rights of innovative medicine manufacturers and encourage continued innovation in the pharmaceutical sector.

For the patentees of the new drug patents, a longer compensated patent term means higher profits obtained through market monopoly, which encourages innovation in the pharmaceutical industry.

The guidelines also clarify that "new drugs" means innovative drugs approved for marketing by the National Medical Products Administration (NMPA) and improved new drugs that meet the specified requirements.

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