The concept of Patent Term Extension, analyzed in the South Korean Supreme Court case 21Hu11070, originated in the US with the enactment of the Hatch-Waxman Act. Regarding the patent term extension system, several rulings are continuously being announced by the Korean Court. From the perspective of pharmaceutical companies, there is an incentive to actively extend the term. However, the requirements for getting an extension must be strictly interpreted. In this regard, this ruling is significant for interpreting new substances under the Pharmaceutical Affairs Act, particularly in cases involving PEGylation and patent term extension. The issue under debate is how to interpret Article 7 of the Enforcement Decree of the Patent Act. The Korean Supreme Court held that while improved activity of a derivative may establish novelty for patentability, it does not justify a patent term extension unless the active part producing the pharmacological effect differs from that of the first approved drug. As a result, under the Supreme Court’s view, patent extensions for a drug with improved pharmacodynamic properties will be limited unless the active part itself is distinct.

In interpreting “new substance”(defined as a substance with a new chemical structure in the active part showing the medicinal effect) for extension applications, the court distinguished between the “active part”and the “effective ingredient.”Even if efficacy or effect differs, the product is not a “new substance”if the active part’s chemical structure matches that of an already approved drug. This is judged to be an interpretation that is faithful to the wording of the Enforcement Decree of the Patent Act. When interpreting the Enforcement Decree of the Patent Act, both wording and policy considerations must be weighed. However, priority should be given to the text itself, with policy concerns addressed through legislation rather than judicial interpretation.