IP Disputes in Medicine

Brazil's latest compulsory licensing announcement

2007-04-26T04:16:00.000-07:00

Michel Lotrowska, a musician and health activist in Brazil, posted this informative note on Brazil's latest announcement that it was considering a compulsory license on patents for a medicine -- in this case, efavirenz, the BMS/Merck AIDS drug marketed by Merck in Brazil.

As noted by Michel and others, the Brazil government is using the threat of the compulsory license to negotiate a lower price from Merck. Most health activists and groups, including Knowledge Ecology International, say that Brazil should forget about the negotiations with Merck, and just issue the compulsory license, and then buy the drug from the lowest price suppliers (of acceptable quality). Why?

First, no one can really say today what the long term best price will be for this drug. Brazil thought they were getting a good price when they previously negotiated a $580 per year price. When Thailand actually did issue a compulsory license, they were able to buy the drug from a Generic supplier for $238 per year.

How low can prices go? With larger economies of scale, this product should be available for less than $400 per formulated kilo, or less than $90 per year, for the 600 mg per day dose. But his will only happen if several large countries buy from generic suppliers. Thailand and Brazil together would make a big difference.

Second, Brazil needs access to generic versions of new fixed dose combinations, like FTC + TDF + EFV, not to mention newer protease inhibitors that are co-formulated with ritonavir. Brazil, a member of UNITAID, needs to create a patent pool for all patents that are relevant for sustaining treatments for AIDS, and ensure that the pool has access to everything, through compulsory licenses if necessary.

Brazil then should negotiate on the remuneration for patent owners. They should not make the mistake of Thailand, and start the negotiation with a royalty rate that is very low, because the world will see this as evidence that the country will not pay a reasonable amount. One possibility would be use the 2005 WHO/UNDP remuneration guidelines, which I wrote. Another possibility would be to set aside a fraction of the budget for ARV purchases for a prize fund that would reward developers of new AIDS drugs, in proportion to the impact of the drug on improving health outcomes. This second approach would be the most innovative, and sustainable, in the longer run, in our opinion.

E.C. on: Ethical aspects of patenting inventions involving human stem cells

2007-04-09T15:57:00.000-07:00

This 2002 opinion by the E.C. Europe Group on Ethic's addressed larger issues of patents on stem cells, but it's statements on patents and access to health care have broader implications.

* 2.9. PATENTS AND ACCESS TO HEALTH CARE
The patent creates a control regarding commercial use. This raises questions as to the uses which are covered by the patent. To secure that patent holders do not misuse their rights for example by charging unreasonable fees for the use of their inventions, EGE finds that the recourse to compulsory licence should be encouraged when the access to diagnosis and treatment is blocked by misuse of patent rights. The EGE stresses the fact that it is the responsibility of the states to establish legal procedure for the delivery of compulsory licence and to examine if fair access to health care justifies such a procedure.

[Note the broad application of this statement, which is not limited to particular diseases or health problems. jl].

The Text of the Opinion No 16
ETHICAL ASPECTS OF PATENTING INVENTIONS INVOLVING HUMAN STEM CELLS

Delivered by the European Group on Ethics
In Science and New Technologies
To the European Commission
On 7 May 2002

Reference: Request by the European Commission on 18th October 2000
Rapporteurs: Linda Nielsen and Peter Whittaker
*****************************************************************************************************************************
The European Group on Ethics in Science and New Technologies (EGE),

2. OPINION
2.1. SCOPE OF THE OPINION

According to the 1998 EU Directive on the Legal Protection of Biotechnological Inventions article 7: « EGE evaluates all ethical aspects of biotechnology ».

The Group has, in its Opinion No. 15 of 14th November 2000 on the ethical implications of human stem cell research and its uses, made recommendations, namely:

- to set up a strict public control by centralised authorities, on human embryo research where it is allowed;

- to take measures to prevent commercialisation of human embryos or cadaveric foetal tissue;

- to ensure the respect of ethical principles through the control of public authorities, concerning import of human stem cells, where allowed.

This present opinion deals with the specific ethical questions related to patenting of inventions involving human stem cells. The Group is aware of the fact that patents also involve many difficult and different questions of an economic and political nature, which may influence the way of dealing with patents, but has seen its task as providing an ethical focus on the question. The rapid development of biotechnology, especially the promise of stem cell research, makes it appropriate to consider and clarify some questions which could not have been taken into account when the 1998 EU Directive was drafted, given the state of the art at that time.

One option would have been to forbid patenting of stem cells or stem cell lines. The consequence of such an option would be the major slowing of this research field (except in case of a very unlikely large public investment), and the EGE opinion is that it would be contrary to public (and especially patients’) interests. Moreover, the Group considers that it would be contrary to the EU choices as expressed by the 1998 EU Directive on patenting. The Group finds that it is crucial to define the conditions required to patent, the limits of the patenting of human stem cells in relation to ethical considerations and the relevant processes securing ethical evaluation.

2.2. THE BASIC ETHICAL DILEMMA
EGE recognises the importance of patents as an incentive to innovation and as a reward to the inventor for openness and publishing the results.

One ethical dilemma arises due to the fact that patents can encourage scientific progress which can be used to the benefit of better health care, and at the same time, patents can also impair access to the health care due to the need of a licence to use them and to the fees that will have to be paid to the patent holder.

It is then necessary to secure the right balance between the inventor’s interests and the society’s interest – in the sense that one task for the community is to secure ethical principles and values in the context of possible conflicting interests of stake-holders, namely: patients and patients’ associations, inventors and other researchers, donors, industry, investors, healthcare providers, and social insurance providers.

In order to be able to specify ethical limitations, a number of problems are to be considered, including:

- content of patents (process or product);
- various sources of stem cells;
- methods used to derive stem cells;
- protection of the donor;
- possible socio-economic consequences and philosophical implications of the patent system as applied to stem cells (further research, access to health care).

2.7. PATENTS AND FURTHER RESEARCH AND DEVELOPMENT
Although the appreciation of the patentability of an invention in biotechnology as in other fields is a matter of a case by case evaluation by a patent office and eventually by a court, the
Group again insists on the necessity to avoid the granting of too broad patents that would impair further research and development.

In the new area of stem cell research, the potential use is hoped to expand over time and stem cell lines may provide very important research tools. In addition to the academic exemption, it is essential to secure that patents on stem cell lines are not too broad, as this may have adverse effects on the aim to support further innovation to the benefit of health care.

It is therefore the opinion of EGE that patents shall only be granted, when the patent claim refers to a specific and a sufficiently accurately described stem cell line and its industrial application. That involves a consistent relationship between a patent claim and the description of the invention.

2.9. PATENTS AND ACCESS TO HEALTH CARE

The patent creates a control regarding commercial use. This raises questions as to the uses which are covered by the patent.

To secure that patent holders do not misuse their rights for example by charging unreasonable fees for the use of their inventions, EGE finds that the recourse to compulsory licence should be encouraged when the access to diagnosis and treatment is blocked by misuse of patent rights.

The EGE stresses the fact that it is the responsibility of the states to establish legal procedure for the delivery of compulsory licence and to examine if fair access to health care justifies such a procedure.

A New Low in the Pharma Drug Wars - Abbott Withdraws Seven Medicines in Thailand

2007-03-15T11:54:00.000-07:00

A New Low in the Pharma Drug Wars - Abbott Withdraws Seven Medicines in Thailand
Brook K. Baker, Health GAP
March 14, 2007

How low will drug companies go to protect their intellectual property empire? We knew they would sue South Africa, the epicenter of the global AIDS pandemic, to prevent comparison shopping for cheaper versions of brand name drugs (parallel-importation case 1998-2001). We knew that they would sue Indian the pharmacy of the poor, to try to ease legal standards to make getting pharmaceutical patents for minor variations of existing medicines even easier (Novartis v. India, 2006-2007). And now we know that they will go even lower and withdraw pending registration applications for essential life-saving medicines and boycott sales of all new medicines in Thailand because Thai leaders dared to issue a lawful compulsory license on a crucial, but over-priced AIDS medicine, Kaletra (Abbott, March 13, 2007).

Abbott's abrupt decision to withdraw seven pending registration applications, including one for a new heat-stable form of Kaletra, and its threat to make Thailand a no-drug zone for all new Abbott medicines is a truly appalling example of corporate hubris. (The six other drugs are the painkiller Brufen; an antibiotic, Abbotic; a blood clot drug, Clivarine; the arthritis drug Humira; the high-blood pressure drug Tarka; and the Kidney disease drug, Zemplar.) After touting itself to the be the engine of new life-saving discoveries, Abbott is now willing to withhold medicines altogether in order to extract even greater intellectual property concessions from developing countries.

Abbott falsely claims that Thailand has "broken patents and ignored the patent system" when it issued its compulsory license. To the contrary, Thailand has used a completely lawful flexibility under the WTO TRIPS Agreement to issue compulsory licenses permitting non-commercial use of essential medicines within its public health system. Abbott continues its unfettered, high mark-up sales to rich Thai consumers and to medical tourists who can afford higher price medicines in the private health care delivery system. Moreover, Abbott is scheduled to receive royalties on sales made to the private sector.

Article 31 of the TRIPS Agreement permits Thailand to issue a public, non-commercial use license without prior negotiations, but Thailand had in fact engaged in protracted but fruitless price negotiations with Abbott. Instead of negotiating, however, Abbott has unilaterally offered to sell Thailand Kaletra at its fixed middle-income tiered company price, $2200/patient/year, a price that is 440% higher than the cost price Abbott offers to African countries and more than five times as much as what will be charged by generic producers once there are sufficient economies of scale and competitive generic markets.

In order to provide alterative, life-saving anti-retroviral therapy to the steady stream of patients who develop drug-resistance or suffer undue adverse side effects from first-line therapies, Thailand determined that it would have to find a cheaper source of supply. Thus, it issued a compulsory license on Kaletra, as it had on another AIDS medicine, efavirenz, and on a cardiovascular medicine, Plavix.

Some industry pundits and Pharma allies in Congress wonder whether Thailand is planning a wholesale assault on the patent system by granting compulsory licenses for everything from erectile dysfunction drugs to patented facial creams. Addressing these concerns, Thailand has publicly announced strict criteria that will guide its compulsory licensing policy and has established a Subcommittee to implement the Government Use of Patents. The published criteria would limit compulsory licenses to drugs and medical supplies that are listed on the National Essential Drug List or that are necessary to solve important public health problems, to address emergencies or matters of extreme urgency, to prevent and control the outbreak of epidemics or pandemics, or to save lives. Accordingly to an additional criterion, Thailand will seek government use licenses only when the price of the particular medicine is too high to be affordable.

Applying these criteria, Thailand estimates that it will only consider licenses for fewer than 15% of medicines - hardly a wholesale assault on the patent system.

It would be bad enough if Abbott's product withdrawals affected its innovator products only, especially if there are not therapeutic equivalents available. But, there is the additional risk that by withdrawing the registration packets Abbott will succeed in preventing or delaying the registration of generic equivalents by making it harder for Thai drug regulators to confirm the safety and efficacy of the equivalent. Because drug regulatory agencies often rely upon or refer to originator data to grant marketing approval for follow-on products, this option is now moot. Hopefully, Thai regulator will be able to rely on the original Kaletra registration packet or on published data to support registration of new generic heat-stable versions of Kaletra, but this option is by no means certain.

This new tactic by Abbott in Pharma's war for profits exceeds all previous tactics. It directly violates the universal human right of access to essential medicines. It directly violates both the letter and the spirit of the Doha Declaration. It directly violates any conceivable norm of corporate responsibility. It is in fact the equivalent of a tactical nuclear device dropped into the middle of 580,000 people living with HIV/AIDS IN Thailand. How low is too low - Abbott has let us see the Pharma abyss.

Standing Up To Abbott's Decision to Withhold Registration and Marketing of Life-Saving Medicines - A New Variant of Pharmaceutical Apartheid

2007-03-15T11:48:00.000-07:00

Brook K. Baker, Health GAP
March 13, 2007

Abbott is now doing what drug companies have long threatened to do when developing countries use lawful flexibilities to access more affordable generic medicines - it is threatening to take its marbles and go home. Unfortunately, however, Abbott is not playing marbles, it is playing a deadly game of Pharmaceutical Apartheid, where drug companies withhold access to affordable life-saving medicines in a perverse effort to preserve intellectual property rights at all costs.

Abbott is upset because Thailand has lawfully issued a compulsory license on an important antiretroviral medicine, Kaletra. According to Abbott (and its think-tank apologists and Wall Street Journal defenders), Thailand issued this license without prior negotiations for a price discount or for a voluntary license. However, contrary to Abbott's claim, both international law (the WTO TRIPS Agreement, Article 31) and the Thailand Patent Act permit Thailand to issue compulsory licenses for governmental, noncommercial use without prior negotiation. Moreover, contrary to Abbott's claim, Thailand, like many other developing countries, had long engaged in fruitless negotiations with Big Pharma for deeper price discounts, but Abbott used its monopoly power to unilaterally determine the price points for its tiered-pricing "access" program.

Because Thailand has not caved into to threats and entreaties from Abbott, the USTR, certain members of Congress, and the international business press, Abbott has now raised the stakes further by withdrawing registration applications for the new heat stable form of Kaletra, an important AIDS medicine, and for six other medicines that it had submitted for marketing approval. (The meltrex, heat stable form of Kaletra is especially important in warm country climates like Thailand were maintaining a cold-supply chain and ensuring that poor patients have access to refrigerators to store their medicines is virtually impossible.)

This withdrawal is profoundly cynical and immoral. A company which has been subsidized through NIH and university research for most of its discoveries, which gets huge taxes breaks for its research and development expenditures, and which earns monopoly profits on all its sales in rich country markets that collectively comprise 90% of global pharmaceutical sales, now determines that it will withhold marketing of life-saving medicines when a country seeks to exercise its lawful, TRIPS-compliant rights to access more affordable generic medicines.

This withdrawal will make it much more difficult for Thailand to grant marketing approval for generic versions of Kaletra and other Abbott medicines because the Thai drug regulatory authority will not simply be able to compare the generic version against the innovator version to confirm that they are therapeutically equivalent. In the worst case scenario, generic companies will now have to repeat costly, time-consuming, and ultimately unethical clinical trials to prove something that is already crystal clear - equivalent generic medicines are safe and efficacious. Even if Thailand decides to forego reliance on new clinical trials, it may instead have to amend its law so that it can rely on WHO pre-qualification and/or the fact of registration by a stringent regulatory authority elsewhere. (Note: The U.S. is trying to block Thailand's future right to legislate such reliance in its free trade agreement negotiation where it seeks five-years of data exclusivity.)

However, even though Abbott will not necessarily by able to completely block registration of follow-on generics by its market withdrawals, its withdrawals will have devastating effects for those medicines for which there is no generic alternative at present.

Thus, to prove its point, and to maintain its market and intellectual property hegemony, Abbott is willing to make Thailand and its patients a "no drug zone." The predictable, inevitable consequence of this cynical power play will be the deaths of innocent patients.

Drug companies like Abbott have all kinds of lame excuses for their murderous policies. Novartis defends its patent law lawsuit in India because it wants to maintain its right to sell Glivec to middle-income patients, even though India represents only 1.3% of the global pharmaceutical market and even though 99% of Indians are not middle class. Pfizer wants to maintain its patent monopolies in the Philippines by filing frivolous lawsuits against government officials and generic companies which seek to permit lawful early registration of generic medicines. And now Abbott, pulls a new "troop-surge" weapon from its arsenal - wholesale market withdrawals.

Once again activists and thought leaders need to rally to the support of Thailand's lawful effort to access more affordable medicines and to condemn this latest variant of pharmaceutical apartheid. One hopes fervently that Thailand will stand firm, that it will find alternative ways to grant marketing approval/registration of generic versions of Pharma products, and that even more developing countries will stand up and fight for the human right of access to essential medicines.

Day 1 of WIPO PCDA 3, talking to the India Delegation

2007-02-20T09:34:00.000-08:00

On the first day of the 3rd session of the WIPO-PCDA negotiations in Geneva, I had the opportunity to interview officials from the Indian delegation and discuss the Indian government’s position on a variety of issues such as the development agenda and significant events potentially impacting India’s IP policy- the Novartis case, recent release of the controversial Mashelkar report and signing of a US-India Memorandum of Understanding (MOU).

India has been in the spotlight because of its initiative in hosting informal discussions in New Delhi about proposals contained in the “Manalo document” which was put out after the last WIPO General Assembly. A delegation official informed me that the various regional coordinators were invited to nominate three countries from their group to participate in the meeting that took place from February 5-7, 2007. Moreover, any country expressing a desire to participate was welcomed.

The objective of the meeting, attended by 22 countries representing all the regions, was to provide impetus to the PCDA process by consolidating the numerous proposals into a shorter list through general consensus and an informal, transparent process. Consequently, the 40 Annex A proposals were distilled down to a list of 22 proposals. The Indian delegate explained that at the end of the meeting some members still retained “qualifications and observations on these proposals but this provides a good way to examine them further. Let us see how member states proceed with it.”

The Indian delegation stressed the importance of moving forward with decision-making in a timely manner to avoid requests for further extensions on the period of negotiations.
Expressing frustration at the slow pace of negotiations since the adoption of a proposal for a development agenda, the Indian delegate stated, “it is imperative that the timeline is not eternal.”

It remains to be seen if this endeavor will bear any fruit and if any member will table the non-paper that is the outcome of the Delhi meeting, currently being circulated informally. In this regard, it is worth noting that on day one, a resolution was passed to format subsequent discussions on the basis of the Manalo working paper.

India has also received a lot of attention about Swiss pharmaceutical company, Novartis’ challenge of section 3(b) of the Indian Patent Act (2005) in the Chennai High Court. Novartis charges that this provision limits the scope of patentability in a way that is not TRIPS complaint and simultaneously violates Article 14 of the Indian constitution. The outcome of this case will determine the ability of Indian generic drug manufacturers to continue providing affordable medicines to patients in developing countries who are too poor to pay for patented drugs.

While a large international community is rallying against Novartis and demanding that the case be dropped, the Indian government has been charged with not taking strong enough measures to defend its patent act. Particularly conspicuous has been the absence of the Solicitor General of India during the presentation of arguments on February 15 and 16.

Speaking in a limited capacity as the Novartis case is sub judice, a representative of the Indian delegation responded that “there is no cause for concern and the Government of India is doing its job.” Further, he pointed out that the Additional Solicitor General, a local lawyer, was handling the case competently. Noting “that the Solicitor General is called upon only in cases when the constitution of India is challenged,” he stated the present position was that the Solicitor General’s constitutional expertise would be sought if the need arose in the future.

The current stance would be reassuring were it not for the fact that Novartis has hired a former Attorney General and a former law minister of India to appear on its behalf. Novartis certainly recognizes the implications this case has for access to medicines in India and the rest of the world, what will it take to shake India out of its complacence?

More bad news for generic drug companies recently came in the form of the Mashelkar report. In fact, Novartis has used this report’s recommendation in support of its case against the Indian patent law. Briefly, the government-appointed committee of IP experts headed by Mashelkar concluded that limiting the granting of patents for pharmaceuticals with new chemical entities (NCEs) or new molecular entities (NMEs) was a violation of the TRIPS agreement.

An Indian official confirmed that the Government of India has not taken any conclusive view on the report. “Given the sensitivity of the matter, it is fully within its rights to examine all the ramifications before accepting, partially accepting, or rejecting the report,” he said. The report was made immediately available on the government’s website and has since generated lots of public debate which in his opinion is facilitating and informing the government’s decision.

Hesitation on India’s part appears warranted considering the extent to which the report has been criticized by academics, industry and NGOs in India.

Yet, this is not the first time that India has been caught in an uncomfortable situation with Mashelkar.

Mashelkar chaired the Casablanca meeting in 2005. India issued statements distancing itself from the resolution that came out of that meeting, which undermined the position of many developing country delegates on the negotiations on a new WIPO substantive patent law treaty, a project that was put on hold at the recent WIPO General Assembly.

Finally, the Indian delegates commented on the US-India memorandum of understanding on bilateral cooperation for intellectual property and its effects on India’s position on IPR in a forum such as WIPO. I was informed “India has signed MOUs with the United Kingdom, France, European Patent Office and the US. India has taken a very very unambiguous position that no bilateral cooperation or agreement with any other government shall impinge on issues relating to policy, legislation or enforcement related issues which remain the prerogative of the Government of India.”

It was encouraging to learn that the areas of agreement are restricted the “soft issues” of capacity building, human resource development and public awareness programs in IP.

Debate on WIPO Development Agenda

2007-02-16T08:24:00.000-08:00

On February 9, 2007 KEI hosted a brownbag lunch discussion to talk about the WIPO Development Agenda (DA). The next round of negotiations will be held in Geneva the week of February 19-23. Invited to speak were several members of the US delegation, including Paul Salmon (USPTO), Bob Watts (US Department of State), Michael Shapiro (USPTO) and Marla Poor (Library of Congress); and DC WIPO representative, Suzanne Stoll. Thiru Balasubramaniam and Jamie Love from KEI also spoke, followed by a lively discussion between the audience and panel members.

KEI’s Geneva representative, Thiru Balasubramaniam presented some background on the DA, lending context to the discussions that followed. In 2004, the WIPO General Assembly agreed to consider the proposal to incorporate development into the core of WIPO’s activities in an effort to restore balance within existing IP policies. The original DA proposal supported by 14 countries called for the:

a. reappraisal of WIPO’s norm setting activities,
b. facilitation of technology transfer,
c. evaluation of intellectual property enforcement, and
d. promotion of development-oriented technical co-operation and assistance.

Subsequently, several more proposals were tabled by member countries culminating in a total of 111 submissions. No consensus was reached at the second inter-sessional intergovernmental meetings convened to examine the proposals. Further, at the General Assembly in September-October 2006, the Kyrgyz Republic introduced a proposal containing 40 recommendations (Doc PCDA/2/3) that were identical to the Chair’s conclusions that had been rejected at the second session. Following this, it was decided to devote the upcoming third session to the discussion of these 40 proposals grouped together under Annex A. These proposals are generally considered to be less controversial as they are relatively well accepted by members.

The remaining 71 proposals which include the core recommendations put forth by the Friends of Development constitute Annex B. Annex B is scheduled to be discussed at the fourth session in June.

Proposals in each Annex were grouped under six common clusters: 1) technical assistance and capacity building; 2) norm setting, flexibilities, public policy and public domain; 3) technology transfer, information and communication technology (ICT) and access to knowledge; 4) assessments, evaluation and impact studies; 5) institutional matters including mandate and governance and 6) other issues. According to Thiru, this division of proposals under vertical silos is viewed critically by some because of the separation of the proposals from their original contexts.

Speaking next as head of the US delegation, Paul Salmon confirmed that the US has indicated its position on all 111 proposals and has signaled its support on many of those included in Annex A.

Paul expressed optimism about the third session of the PCDA, saying that after two and a half years of discussions it presented a good opportunity to bring forward changes. Salmon suggested that the forum was important for achieving results with regards to proposals enjoying emerging consensus but at the same time cautioned about the slow pace such negotiations can take. The key is to be constructive about reaching consensus while also maintaining realistic expectations, he said.

Jamie Love of KEI commented that there had been progress on some issues, as reflected in some of the 40 proposals in Annex A that had received support from the US and the EC. He noted, however, that all but one of the Annex A proposals were those that had received support from either the US or EC, and that when the Annex was first proposed in 2006 at an earlier meeting, it was seen as an insulting and very minimal response to the Friends of Development proposals. Many of the more far reaching reform proposals were at first ignored, and now have been relegated to the Annex B, which will be discussed in June.

That said, the February meeting will be useful, as WIPO will agree that issues concerning the protection of the public domain will be part of WIPO's mission -- an issue that had been disputed in a 2003 debate over a WIPO meeting on open collaborative models for knowledge goods, and that WIPO will be doing more on the control of anticompetitive practices, Love said.

There was debate back and forth between Rob Weissman (Essential Action), Paul Salmon and Jamie Love about the degree to which WIPO has helped countries protect the poor on issues concerning flexibilities of the TRIPS. Paul Salmon was supportive of WIPO in this respect, while Rob and Jamie were more critical. There was also discussion of the need for more realism when it comes to enforcement. Developing countries would be more willing to enforce laws if the laws addressed obvious issues such as affordability of patented or copyrighted goods. Liberal limitations and exceptions to rights would in fact promote more respect for laws, in countries where incomes were low. Rob Weissman of Essential Action urged the US to play a stronger role in supporting improvements to WIPO’s technical assistance to countries on the use of flexibilities and competition policy.

There was a general discussion about the degree to which the US and European governments should pursue (a) very high levels of intellectual property protection, or (b) a more nuanced and balanced policy. According to Jamie, Germany was an example of a country that was pushing for very strong intellectual property norms at WIPO, at a time when many were questioning the wisdom of such an approach. The high rates of patenting in China and Korea suggest that 2017 might look a lot different from 2007, and some countries may be encouraged to embrace lower standards of patent quality (like the US), and use patents as protectionist measures. Neither the EC nor the United States, nor for that matter, any country, would benefit from such a race to the bottom, in the longer run.

Brad Biddle (Intel Corporation) also pointed out that as higher standards of IPR are implemented, corresponding limitations and exceptions will also have to be created. Giving the example of broadcasting, he explained that the economic value in creating these exceptions is well recognized by the industry. Matt Schruers of CCIA also advocated for finding a balance between creators’ rights and public access, noting that there was increasing consensus between creators and society on these issues.

Much of the wealth created in the United States in recent years has come from methods of sharing and using knowledge resources, rather than restrictive IPR regimes, Jamie said. Companies like Google, which are providing valuable services for the entire world and large profits for themselves, cannot operate as global services without some assurance that their core activities are legal. The EU experience with database protection has hurt the EU's domestic tech industry, not helped it, he said. Big corporations like Microsoft and Intel are now in favor of "patent reform" because they are the targets of patent litigation. The United States is now the largest purchaser of AIDS drugs in developing countries. There are indeed endless areas where US and European taxpayers are being asked to pay for drug purchases in developing countries. This is expensive and not sustainable unless you can deal with pricing abuses. The US was urged to abandon the strategy of framing issues in WIPO as "North South," and to use WIPO for serious debates about intellectual property norms and practices.

Paul Uhlir of the National Academy of Sciences also suggested several areas in which the US could take the lead in the international arena, including: promoting such features of its domestic IP policy as the low protection of federal government information that is placed in the public domain; the low statutory protection of databases; transparency in the national policy making and legislative processes; and the use of permissive licensing mechanisms such as the Creative Commons templates for providing voluntary, flexible private law alternatives to statutory IP law. [This paragraph edited Feb 19, 2007].

The US delegation provided answers to the many questions raised such as by Miriam Nisbet (American Library Association) about the PCDA process and Susan Sell (George Washington University) about the extent to which funding sources might constrain WIPO’s activities and policy. Following the open discussion among representatives of the government, academia, industry and consumer groups, many participants expressed interest in following the development agenda process. More updates from the next PCDA to come soon.

Dr. Margaret Chan to Dr. Mongkoi Na Songkhla regarding Thai CL

2007-02-12T16:43:00.000-08:00

The following is the text of a February 7, 2007 letter sent by Dr. Margaret Chan, the DG of the World Health Organization, to Dr. Mongkol Na Songkhla, the Thailand Minister of Public Health. The letter is an apology for comments at a briefing at the Thai National Health Security Office, which led to newpaper reports in Thailand suggesting the WHO was critical of the Ministry of Health's recent decisions to issue compulsory licenses on three drugs. An image on the letter is available here (page 1, page2). Jamie

World Health Organization

20, Avenue Appia CH-12
GENEVA 27
SWITZERLAND
TEL CENTRAL +41 22 791 2111
FAX CENTRAL +41 22 791 3111

Tel direct: +41 22 791 2797
Fax direct: +41 22 791 4846

In reply please refer to: DGO

Mr. Mongkol Na Songkhla
Minister of Public Health
Ministry of Public Health
Royal Thai Government
Tivanond Road
Nonthaburi 11000
Thailand

7 February 2007

Dear Minister,

It was a pleasure to meet you last week in Bangkok, and I must express my deep appreciation to you and your staff for the warm welcome, hospitality and great efficiency demonstrated throughout my brief visit to Thailand.

It was a great honour for me to have an audience with His Majesty the King, and with her Royal Highness Princess Maha Chakri Sirindhorn, in her capacity as Chair of the Board of Trustees and President of the of the Prince Mahidol Award Foundation.

I was particularly impressed with the field visit, which provided me with an opportnity to witness the work of dedicated health professionals and the community in Khon Kaen and Nam Phong. The pride and professionalism of the staff and the support of the community was obvious and most encouraging.

I also appreciated the opportunity to hear mote about the work of the National Health Security Office and the National Health Promotion Foundation. I was pleased to witness the commitment of the Royal Thai government to universal coverage with effective health care services, and to the health of the people of Thailand. I welcome the increasing budget for the universal coverage scheme, which I know understand amounts to close to 2,000 baht per person per year, and includes treatment for people with HIV/AIDS with antiretrovirals.

Minister of Public Health, Thailand Page 2

I deeply regret that my comments at the close of the briefing at the National Health Security Office were misrepresented in the media, and may have cause embarrassment to the government of Thailand. They should not be taken as a criticism of the decision of the Royal Thai government to issue compulsory licences, which is entirely the prerogative of the government, and fully in line with the TRIPS agreement.

Thailand is making good progress towards increase [sic] budget allocations for health, while simultaneously control [sic] rising health care costs with greater efficiency. Medicines are a substantial element of health care costs, and it is entirely appropriate and necessary for the government of Thailand to find means of reducing these costs to ensure sustainable financing of health care.

As I mentioned in the recent Executive Board, I firmly believe that the pharmaceutical industry-generic manufacturers and R&D companies are part of the solution. I am committed to dialogue with industry to find ways of ensuring that access to high quality essential medicines is not limited by cost considerations. I am equally committed to dialogue with people who suffer from HIV/AIDS and other conditions, and with civil society groups and NGOs.

WHO unequivocally supports the use by developing countries of the flexibilities within the TRIPS agreement that ensure access to affordable, high quality drugs. This includes the use of compulsory licensing, as described in paragraph 6 of the Doha Declaration of the TRIPS Agreement and Public Health. The decision whether to issue a compulsory license for a pharmaceutical product is a national one. There is no requirement for countries to negotiate with patent holders before issuing a compulsory licence. As a global community we need to ensure the right balance between the immediate and urgent pressing need to provide affordable medicines to the many that need them, and the need for provide continuous incentives for innovation. It is in this regard that I noted that prior negotiations with industry is a pragmatic approach that may ensure countries have access to high quality medicines at affordable prices.

Where there are urgent needs, the bottom line is that people need access to medicines.

I trust this clarifies the position of WHO concerning compulsory licensing of medicines, and I look forward to further opportunities to discuss these important issues with you in the future.

Yours faithfully,

Dr. Margaret Chan
Director-General

cc: The Minister of Foreign Affairs of Thailand, Bangkok
Permanent Mission Thailand to the United Nations Office at Geneva and the Specialized Agencies in Switzerland

A deconstruction of Novartis's defense of its challenge to the India patent regime

2007-02-07T07:59:00.000-08:00

A deconstruction of Novartis’s defense of its challenge to the India patent regime.

Brook K. Baker, Northeastern U. School of Law, Program on Human Rights and the Global Economy, Health GAP, February 7, 2007

Given the barrage of negative publicity that Novartis has received as a result of campaigns contesting its effort to overturn India’s strict new patent regime, Novartis has issued a three-page defense of its lawsuit. http://www.novartis.com/downloads/about-novartis/Novartis_position-Glivec_Gleevec_patent_case_india.pdf This defense contains some truths, numerous half truths, and several flat out lies:

Truth: Novartis seeks secure access to middle-income consumers via patent-based monopoly rights.

“In India, Novartis is faced with a globalization dilemma that characterizes many emerging economic powers today: two markets within one country. India has a booming middle class on one hand, and a vast number of extremely poor people on the other.

[W]e take affluent India seriously as a formidable power with all the rights and obligations that such status brings with it. As a consequence, we seek to establish effective protection for pharmaceutical innovation in India.”

Half-truths: Novartis does seek monopoly rights in the India market and it does compete with Indian companies, but it faces no realistic threat that patent-free Indian generics would be shipped to its patent-protected markets in North America, Europe and Japan.

“[I]t is clear that we seek business opportunities in India’s growing economy. We also compete with Indian companies globally in attractive markets, and the export of copies of our products into richer countries is a major concern to us.”

Rich countries have stringent border controls, drug registration procedures, and prescription practices that preclude import and sale of generic versions of patented medicines. If Novartis’s complaint were true, the U.S. would be flooded with cheaper generic versions of AIDS medicines (or even of Glivec which has been produced and sold at 1/10 the cost in India), but, of course, it is not.

Half-truth: For Novartis, patents are truly non-negotiable, but it is not true that the patent system is the best or only way of promoting research and development.

“Protecting innovation is the foundation for massive R&D investments made by the pharmaceuticals industry that are vital to medical progress. Companies can continue to bring improvements and innovations to patients and societies only with effective patent laws. For a research-based company such as Novartis, patents are not negotiable.”

The public sector, especially in the United States, contributes significant resources to the basic research that is the foundation of many pharmaceutical innovations. Moreover, under the patent regime, incentives for innovation are diverted from true social need towards block-buster drugs (sales over $1 billion a year) and me-too drugs (minor variations developed primarily to extent an existing patent monopoly or to gain market share from a competing block-buster drug). Similarly, patent-based monopoly rights divert pharmaceutical research away from preventative innovations, like vaccines, and towards every-day medicines for chronic diseases that primarily impact rich consumers in rich markets. As a consequence of this perverse set of patent-based incentives, there is very little research into the diseases that primarily affect poor people in the global south.

In addition, there are many viable alternatives to the existing patent-regime with respect to global public goods like medicines. Prize funds, research and development treaties, and more robust and targeted public investment in research are but a few of the proposals under discussion that could reduce or eliminate the bloated sales forces and supra-competitive profits that make drugs so expensive.

Half truth: Novartis now, belatedly supports one narrow set of TRIPS-compliant flexibilities for accessing cheaper medicines, but it is concurrently challenging another perfectly lawful flexibility, namely defining scope of patentability so as to prioritize public health and to increase access to medicines.

“Our case does not challenge provisions that provide for access under international trade agreements, specifically the TRIPS and the Doha Declaration. These flexibilities allow production for export under compulsory licenses that have been issued for public health reasons. They have been put in place to allow poor countries to safeguard access to medicines that do not have sufficient local production capacity. In fact, political agreement on the Doha flexibilities has been reached in order to mitigate impact of TRIPS implementation in India.

Novartis supports the TRIPS conditions that promote access for developing countries.”

Novartis confirms its new-found loyalty to one-narrowly defined TRIPS flexibility – compulsory licenses issued under the August 30, 2003, Paragraph 6 Implementation Decision. In this regard it is important to note that Novartis previously joined 38 other drug companies and trade associations in challenging South Africa’s completely lawful Medicines and Controlled Substance Act that would have permitted parallel importation. Maybe it now concedes the error of that 1998-2001 challenge to a lawful TRIPS flexibility, but even now it erroneously implies that compulsory licenses can only granted pursuant to the August 30 Decision.

But more importantly, Novartis’ lawsuit directly challenges another key TRIPS-compliant flexibility, namely the right to strictly define novelty, inventive step, and industrial applicability – the baseline standards of patentability – so as to exclude patents for minor variations of existing chemical entities, for new uses of know chemical entities, and for mere combinations of existing entities. Novartis and other drug companies want to impose the same loose standards of patentability for India and other developing countries that they have gained in the IP-crazed courts and legislature of the U.S. and Europe. There is in fact a great deal of variability of patent standards between countries, and India’s stricter definition is completely permissible under existing TRIPS standards.

Lie: The Mashelkar Committee report did not directly address, let alone hold, that certain provisions of the India Patent Act were non-compliant with TRIPS.

“Many of the points we have raised around India’s patent laws have been corroborated by the recent Mashelkar Committee report on patent issues in India. The Government-established Mashelkar Committee voiced its views in favor of incremental innovation and held that certain provisions of the Indian Patent Act are not compliant with international agreements, specifically WTO’s TRIPS agreement (Trade-related Aspects of Intellectual Property Rights).”

The Mashelkar Committee in India was tasked with determining “whether it would be TRIPS compatible to limit the grant of patent for pharmaceutical substances to new chemical entity or to new medical entity involving one or more inventive steps.” This definition would be even more restriction than the version of section 3(d) of the Act that Novartis is challenging. The only thing that the Mashelkar Committee actually said about the current India’s Patent Act is that “There is a perception that even the current provisions in the Patents Act could be held to be TRIPS non-compliant.” (¶5.11.) A “perception” is not a “holding.”

Lie: Research-based pharmaceutical companies like Novartis do not make their investment decisions based on monopoly marketing rights in developing country markets – which has been produced and sold at 1/10 the cost in India in rich country markets where their medicines enjoy even higher standards of intellectual property protection.

“Knowing we can rely on patents in India benefits government, industry and patients because research-based organizations will know if investing in the development of better medicines there is a viable long-term option.”

Many research-based drug companies are exploring and cementing strategic sub-licensing partnerships with Indian drug companies given their comparative cost advantages in manufacturing for global sales and given prospects for lower-cost clinical trials in India. However, drug companies make 90% of their global sales in the U.S., Canada, Europe, and Japan. India comprises only 1.3% of the global market. Does Novartis really want people to believe that its going to make fundamental investment decisions based on 1.3% of the global market instead of the 90%? It will set up shop in India in order to make even more profits in rich country markets not because of higher patent standards in India.

Donations are not an adequate defense: The best defense that Novartis mounts is that because poor people can’t afford its drug it gives much of it away in poor countries like India.

“In 2006, our access-to-medicines program reached 33.6 million patients. Novartis spent USD 755 million last year alone. ... The Glivec International Patient Assistance Program (GIPAP) is one of the most far-reaching patient assistance programs every implemented on a global scale. In India, 99% of patients who receive Glivec receive it free from Novartis [6,600 people].”

However, corporate donations are not a sustainable solution: (1) they are frequently hard to access, (2) they are revocable, (3) they are not offered across the broad spectrum of patented medicines that poor people need, and (4) they are designed primarily to forestall generic competition by removing market incentives.

Novartis’s efforts to sanitize its efforts to eviscerate the heart of India’s stringent patent regime are, in the end, indefensible. Its defense of its cancer-drug patent today will undermine access to medicines for HIV/AIDS, for heart disease, for diabetes, in fact for every new medicine needed by desperately poor people in developing countries. Charity does not hide avarice. By protecting its “fundamentals” – its non-negotiable patent-right aspirations – Novartis is revealing the cold and cruel logic of Big Pharma: profits over people; letting poor people die is less important than selling to middle-class Indians.

Pharma's Seven Deadly Lies about Thai Compulsory Licenses

2007-02-01T11:14:00.000-08:00

Brook K. Baker, Health GAP
Feb. 1, 2007

As Thailand issues more TRIPS- and Thai-compliant compulsory licenses for AIDS and heart treatment, the drug industry is unleashing an ever more strident disinformation campaign.

Lies Number One and Two - Abbott: "We do not view [the compulsory license on Kaletra] legal or in the best interest of patients" says Melissa Brotz, spokeswoman for Abbott.

Truth: Thailand's compulsory license on Kaletra is lawful in every respect: (1) it is a fully TRIPS-compliant Article 31(b) license issued on valid public health grounds and for government, non-commercial use, which requires no advance negotiation with the patent holder; (2) it is fully complaint with Thai law which directly authorizes government, non-commercial use licenses without prior negotiation; and (3) it sets a royalty at .5% of the sale price.

Likewise, Thailand's compulsory license is in the best interest of both patients and the Thai government. Abbott has systematically refused to lower its middle-income discount price below $2200/patient/year despite multiple protests by AIDS patients and their advocates. Not only will Thailand and its patients be able to access Kaletra at half the cost of Abbott's firmly-held, best-and-last-offer price, but the costs of such medicines will undoubtedly fall as greater and more secure demand creates economies of scale for Indian and eventually Thai generic producers.

Lie Number Three - Teera Chakajnarodom, Thai Pharmaceutical Research and Manufacturers Association: "After the company does 10 years of research, and then suddenly the Thai government would like to impose the compulsory license, taking away their property, their assets."

Truth: Patents are not "property" in the traditional sense - they are government granted rights that are intended to balance the interests of innovators and the public at large, and which are granted by governments with many express and implied conditions, including the right to issue compulsory licenses. Governments around the world, including the United States, have issued thousands of compulsory licenses since the late nineteen century, including on pharmaceutical products. Moreover, Thailand had its compulsory license law on the books when all three companies, Merck, Abbott, and Sanofi-Aventis, filed their patent claims in Thailand. How exactly was a patent granted by government, but only subject to its rights to issue a compulsory license, suddenly transformed into an absolute right that is violated when a license is actually issued?

Lie Number Four - Teera Chakajnarodom, Thai Pharmaceutical Research and Manufacturers Association: "Everything is negotiable."

Truth: For monopoly-based drug companies, everything isn't negotiable. Abbott has flatly refused for nearly six months to lower its $2200/year mid-tier price for Kaletra. (It did so in Brazil only because of Brazil's drawn-out threat to issue its own compulsory license.) Moreover, even when negotiating deeper discount prices, drug companies frequently extract promises that countries will refrain from seeking other cheaper sources of supply. In this context, drug companies are mainly interested in preventing generic competition. Paradoxically, in pursuing the generic-freeze-out option, drug companies will occasionally give concessions to bigger middle-income countries that "make the market" - like Thailand and Brazil - even though they would not do so for smaller and poorer countries like Guatemala.

Lies Number Five and Six - Harvey Bale, International Federal of Pharmaceutical Manufacturers and Association: "Compulsory licensing cannot be a route to commercial abuse and can put patients at risk." Merck, Abbott, and Sanofi-Aventis also warn that overriding patents risks jeopardizing quality.

Truth: Monopolies and excessive pricing are not commercial abuse, but competition and lower prices are - go figure. For the hugely rich, R&D drug industry (more than 90% of the global pharmaceutical market) to complain about commercial abuse by generic producer (less than 10% of the global pharmaceutical market) is deeply ironic.

In terms of product quality, Bale roll outs out another old chestnut - "generics are inferior." He neglects to mention that multiple generic versions of efavirenz have received pre-qualification at the WHO. (Note: generic versions of Kaletra are still awaiting pre-qualification). Similarly, the U.S. FDA has approved dozens of India anti-retroviral products, producing them in some of the 70 FDA/GMP-approved pharmaceutical plants in India.

Lie Number Seven - all of the above, compulsory licenses will reduce incentives for innovation.

Truth: All of Asia (except Japan) and all of Africa comprise only 5.1% of the global pharmaceutical market according to Information Management Group. Even though low- and middle-income markets are growing faster that developed country markets, drug companies continue to make that vast bulk of their profits off of sales in the U.S., Canada, Europe, and Japan, which collectively buy nearly 89% of drugs by dollar volume. Drug companies always argue that compulsory licenses interfere with their R&D incentives, but they never admit that developing C.L.s never affect their monopoly profits in rich country markets. How can South and Southeast Asia's infinitesimal share of the global market really affect R&D incentive?

Journalists covering the Thai compulsory license stories should begin to ask real questions to drug company representatives instead of acting as PhRMA press agents by simply reproducing their patently false assertions. For balance, journalists should also at least occasionally present the countervailing and easily accessible fact-based refutations of PhRMA's misrepresentations.

MASHELKAR REPORT MISSTATES INDIA’S RIGHT TO DEFINE SCOPE OF PATENTABILITY AND THREATENS ACCESS TO MEDICINES

2007-01-28T09:32:00.000-08:00

Professor Brook K. Baker
Northeastern U. School of Law, Program on Human Rights and the Global Economy;
Health GAP (January 26, 2007)

The Mashelkar Committee in India was tasked with determining “whether it would be TRIPS compatible to limit the grant of patent for pharmaceutical substances to new chemical entity or to new medical entity involving one or more inventive steps.” In its recently released report, “Report of the Technical Expert Group on Patent Law Issues (Dec. 2006)” [Mashelkar Report], not only did the Expert Committee misinterpret India’s flexibility under international law to limit patents of pharmaceutical products to new chemical entities, it exceeded its mandate to critique section 3(d) of the India Patents (Amendment) Bill, 2005. The errors in the Report include:

1. The Mashekar Report asserts without argumentation that “[g]ranting patents to only NCEs or NMEs and thereby excluding other categories of pharmaceutical inventions is likely to contravene the mandate under Article 27 to grant patents to all ‘inventions’.” (¶ 5.6.) In ¶5.7, it goes even further and concludes that such a limitation “is not consistent with the TRIPS Agreement.” In doing so, the Report erroneously concludes that the definition of invention (newness, inventive step, and industrial capacity) contained in Article 27.1 has any particular and definite meaning within the WTO TRIPS Agreement. In particular, the Report ignores (does not even address) the flexibility that countries like India have under Article 1.1 of the TRIPS Agreement, which states that “Members shall be free to determine the appropriate method of implementing the provisions of this Agreement within their own legal system and practice.” (Emphasis added.)

Although Members must “give effect to the provisions of [the TRIPS] Agreement,” Article 1.1, they have considerable flexibility in doing so, especially with regard to the Agreement’s under-determinate language, including that governing scope of patentability. In essence Article 1.1 of TRIPS devolves interpretive authority and discretion to sovereign nations to balance national interests within a minimally constraining international intellectual property system. Rather than seeking harmonization at any particular level of intellectual property protection, the GATT negotiators agreed to core of minimum standards only. Moreover, even in setting minimum standards, the negotiators left some implementation flexibility. Especially, where governments elected to adopt more general rules rather than very specific rules, as they did with respect to the definition of “invention,” there is necessarily broader discretion left to Members to determine the strictness of their definitions of newness, inventive step [1] and industrial applicability. Although these terms are not infinitely elastic, they are flexible enough to accommodate India’s current choice in Section 3(d) and arguably even a more stringent standard limiting pharmaceutical patents to new chemical entities involving an inventive step. The existence of this reservoir of flexibility is particularly apparent given the wide variability of patentability standards and exceptions among the many Member countries.[2]

2. The Mashelkar Report does not directly claim that limiting pharmaceutical patents to new chemical entities involving an inventive step would constitute prohibited discrimination against a field of technology and thus be prohibited by Article 27. However, over-eager reading between the lines of the Report might infer to such a claim. To the contrary, the TRIPS Agreement clearly permits differentiation between fields of technology, even though it does not permit out-and-out discriminatory exclusion of patents for a particular field of technology. Such differentiation is implicit in the many diverse forms of Article 30-related exceptions to patent rights such as: private and non-commercial use, experimental use, teaching, prior use, pharmacy preparations, foreign vessels, international civil aviation, regulatory review (Bolar), and exhaustion regimes.[3] Additional, express exceptions to patentability are set forth in Article 27.2 (protection of ordre public) and in Article 27.3 (diagnostic, therapeutic and surgical methods; and plants and animal). Moreover, courts and patent offices routinely come up with patent standards specific to particular fields of technology. India has simply chosen to clarify standards of patentability for pharmaceutical products in section 3(d) of it Patent (Amendment) Act of 2005, and in doing so has neither unfairly discriminated against a field of technology nor created an erroneous exception to patentability.

3. The Mashelkar Report asserts, without argument, that neither Articles 7 and 8 of the TRIPS Agreement nor the Doha Declaration on the TRIPS Agreement and Public Health can be used to derogate from the specific mandates of Article 27. (¶ 5.6.) To the contrary, the Doha Declaration in particular was adopted as a specific clarification that the TRIPS Agreement “can and should be interpreted and implemented in a manner supportive of WTO Members’ right to protect public health and, in particular, to promote access to medicines for all.” (¶ 4, emphasis added.) Furthermore, the Doha Declaration states that “each provision of the TRIPS Agreement shall be read in light of the object and purpose of the Agreement as expressed, in particular, in its objectives and principles.” (¶ 5(a).) Article 7 of the TRIPS Agreement is part of the basic principles of the Agreement, and it provides for “the mutual advantage of producers and users” and for “social and economic welfare” broadly construed. (Emphasis added.) Article 8 is also part of the basic principles of the Agreement, and it provides that “Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health ... provided such measures are consistent with the provisions of this Agreement.” The Doha Declaration and Articles 7 and 8 of the TRIPS Agreement tilt the balance in favor of defining scope of patentability to maximize access to medicines. This maximization would support both the existing provisions of section 3(d) of the Patents (Amendments) Bill, 2005, but also the adoption of the more stringent NCE-only standard.

4. The Mashelkar went far beyond its terms of reference to indirectly challenge the legality of Section 3(d) of the Patents (Amendments) Bill, 2005: “There is a perception that even the current provisions in the Patents Act could be held to be TRIPS non-compliant.” (¶5.11.) The Expert Committee was not asked to assess the legality of the Patents Bill nor has it provided any analysis whatsoever of alleged defects. This unwarranted and unprofessional excursion into areas beyond its mandate is particularly unfortunate given the pending lawsuit in India by Novartis challenging the TRIPS compliance of Section 3(d).

5. The Mashelkar Report makes no mention whatsoever of India’s obligations under binding human rights law. The Universal Declaration of Human Rights (UDHR),[4] the founding document of the international human rights regime, recognizes that every person has a right to a standard of living adequate for his or her health and medical care (Article 25), the right to share in scientific achievements (Article 27), and the right to a social and international order in which the Declaration’s rights can be fully realized (Article 28). The skeletal framework of a human right to health, articulated in the UDHR, has been further specified in the International Covenant on Economic, Social & Cultural Rights (ICESCR),[5] a legally binding treaty signed by India.

In Article 12, the ICESCR guarantees the right of everyone worldwide to "the highest attainable standard of physical and mental health" and requires State Parties to take steps necessary for “the prevention, treatment and control of epidemic, endemic, occupational and other diseases” and to provide “conditions which would assure to all medical services and medical attention in the case of sickness.” This skeletal right to health provision received further clarification when the Committee on Economic, Social and Cultural Rights (CESCR) issued General Comment No. 14 which concluded that there is a basic obligation to ensure a sufficient quantity of essential medicines (¶ 12(a)) and that these medicines must be affordable (¶¶ 12(b), 17). In sum, universal access to essential medicines is a core, non-derogable duty of all member States as is preventing, treating, and controlling epidemic and endemic diseases. (¶ 43(d) and ¶ 44(c)).

6. The Mashelkar Report creates a legally incoherent differentiation between what it calls “incremental innovation,” meaning “sequential developments,” and “ever-greening,” meaning trivial and inconsequential changes to an existing patented product. In doing so, it provides no litmus test by which such categorization might be made. How small a change must there be to be inconsequential instead of incremental? Where minor modifications to existing molecular structures in now routine in low-standard countries, like the U.S., or where obvious new doses or new combinations of existing products are likewise patentable, how would Indian patent examiners make the alleged distinctions?

7. In addition to misapplying governing legal standards, the Mashelkar Report incorrectly assesses and references the national interests of India, of its medicines consumers, and even of its pharmaceutical industry by:

• Ignoring public-health and access-to-medicines needs in their entirety;
• Confusing the practice of Indian producers in filing new use and new form patents in low-standard, high-income countries with the issue of setting proper TRIPS-compliant standards of patentability in India;
• Failing to acknowledge that Indian pharmaceutical companies can simultaneously earn high returns in U.S., European, and Japanese markets for off-patent medicines and for medicines patented under those countries’ lower patent standard, and still earn money and serve the needs of much poorer Indian and developing country consumers who rely on India for expanding and affordable access to newer life-saving and life-enhancing medicines that are not patentable under strict, but lawful, standards of patentability;
• Misunderstanding India’s role as an international leader and defender of developing-country interests and flexibilities on intellectual property-related issues to advance public health and to ensure access to medicines for all.

8. The Mashelkar Report fails to even acknowledge the input of civil society groups, including those from local and international intellectual property experts, that supported India’s flexibility to adopt a NCE standard of patentability for pharmaceutical products. In contrast, it included summaries of submissions by multiple industry stakeholders and of patent-attorney stakeholders.

9. The Mashelkar Report is a betrayal of the interests of people suffering from life-threatening diseases worldwide, especially people living with HIV/AIDS, and a capitulation to the interests of the multinational drug companies and a narrow spectrum of India manufacturers that subverted the process and stand to benefit from increased rights to charge unconscionable prices and to extract monopoly profits at the cost of denied access and millions of lives in India and abroad.

Endnotes:

1 Footnote 5 to the TRIPS Agreement gave Members flexibility to deem “inventive step” as synonymous with “non-obvious” and “capable of industrial application” to be synonymous with “useful.” However, the footnote does not restrict Members to that less strict standard, suggesting that they have flexibility to adopt much more rigorous tests.

2 Different standards concerning patentability of computer programs is but one example of this variability. Another testament to the degree of flexibility is efforts within WIPO to enact a new Substantive Patent Law Treaty.

3 See, Christopher Garrison, Exceptions to Patent Rights in Developing Countries (UNCTAD-ICTSD 2006).

4 U.N. Gen. Assembly Res. 217A, U.N. GAOR, 3d Sess., at 71, U.N. Doc. A/810 (1948).

5 International Covenant on Economic, Social and Cultural Rights, Dec. 16, 1966, 993 U.N.T.S. 3, 6 I.L.M. 360 (1966) (entered into force Jan. 3, 1976). The ICESCR has been ratified by 152 U.N. Member states, and another seven, including the U.S., have signed, signaling their intent to become legally bound.

PhRMA Lies and Distortions - Thai Compulsory Licenses

2007-01-28T09:24:00.000-08:00

PhRMA lies and Distortions - Thai Compulsory Licenses
Professor Brook K. Baker, Health GAP
January 26, 2007

Pursuant to Big Pharma's persistent strategy to distort key access flexibilities in the TRIPS Agreement, PhRMA's (US) junior partner trade association in Thailand has once again misrepresented the grounds upon which compulsory licenses can be granted under international law and the circumstances under which prior negotiations must be conducted. In response to Thailand's new announcement of compulsory licenses for a second HIV/AIDS medicine (Kaletra) and a first heart medicine, Teera Chakajnarodom, president of Thailand's Pharmaceutical Research and Manufacturers' Association (comprised of 43 national and multinational R&D drug companies), said the Thai government is using an overly broad definition of an emergency. "The law allows such actions with pharmaceutical products only in cases of extreme national emergencies, or during wartime, and only after negotiation with the companies concerned," Teera said, adding, "It is a provision in the law that has to be used judiciously and with extreme caution if one is not to undermine the confidence of the investment community." (AFP/Yahoo News, 25/1/07.)

Contrary to this absurd claim, Article 31 of the TRIPS Agreement allows issuance of compulsory licenses and government use orders without prior negotiation with patent holders for "emergencies or matters of extreme urgency" and/or for "government, non-commercial use." The Doha Declaration has previously clarified that AIDS can and should be considered an emergency, and recent publications from WHO document the growing crisis of chronic disease, especially cardiovascular disease and diabetes, in developing countries. Not only is Thailand free under WTO rules to determine what it considers to be a public health emergency or matter of extreme urgency, it is also permitted to issue a compulsory license (or government use order) for non-commercial government use. Thailand's announcement clearly states that the medicines are to be used in the context of its national treatment programs, erasing any doubt that the no-negotiation, non-commercial use provisions apply.

No longer content to argue that compulsory licenses are limited to emergencies, PhRMA now wants to argue that they are limited to "extreme" emergencies, like those arising in wartime. Similarly, contrary to absolutely clear language, PhRMA wants to argue that its ability to threaten, cajole, procrastinate, or bribe is being curtailed by Thailand's unfair refusal to engage in prior negotiations. We can expect that PhRMA's next claim will be that compulsory license can only be issued in contexts of intergalactic warfare and that compulsory license applicants and/or governments must spend 100 years in purgatory negotiating with PhRMA lawyers before a C.L. can be issued.

PhRMA's arguments are preposterous enough if they weren't continually reaffirmed by a misinformed press that simply refuses to report that compulsory licenses can be granted on any terms whatsoever. This collusion by the press is partially traceable to the U.S. also continuing to misrepresent the grounds upon which compulsory license might be granted.

Because the legal content of the US/PhRMA critique is so weak, they both fall back on veiled threats concerning direct foreign investment, as if drug companies make their manufacturing siting decisions and their product launch decisions primarily on the basis of IP rights and enforcement provisions in developing countries. PhRMA has consolidated its manufacturing in large plants and sets up local affiliates primarily for marketing and distribution purposes. It will sell its products wherever it finds market access profitable. Accordingly, the investment threats are also hollow.

Thailand should be praised, not mispresented, for its pro-health determination to actually use flexibilities which heretofore most developing countries have been unwilling to use because of US and PhRMA pressure. More countries should follow its example, especially with respect to access to lower-cost second-line medicines which will be crucial in the long-term campaign to use anti-retroviral therapy to extend the promise of life.

Sign-on letter to DOS and USTR for Thai compulsory licensing dispute

2006-12-16T09:09:00.000-08:00

This is a letter that will be sent to Honorable Condoleezza Rice, Secretary of State, and Ambassador Susan Schwab, United States Trade Representative, asking that the United State cease any opposition or interference with the Thai efforts to use WTO flexibilities to buy generic AIDS medicines. The letter will be sent on Wed, December 20, 2006.

You can find the letter, and instructions for signing on, here:
http://www.cptech.org/ip/health/c/thailand/2riceschwabthaicl.html

Letter asking USTR to not interfere with the Thai government decision to issue a government-use license on patents covering the AIDS drug Efavirenz

2006-12-12T07:31:00.000-08:00

The following is the link to the letter sent by Consumer Project on Technology to Ambassador Susan C. Schwab, requesting the United States Trade Representative not to interfere with the Thai government's decision to issue a government-use license on patents covering the AIDS drug Efavirenz.

First IGWG Meeting ends; new expert selection process for next meeting

2006-12-08T03:14:00.000-08:00

The involvement of NGOs and experts at future IGWG meetings was discussed on the fifth and final day of the first IGWG meeting. Greater future involvement of NGOs seems a distinct possibility, and the legal council of the Secretariate has said that experts for future meetings may be nominated by member states. This is a promising development. Experts for this meeting were selected by the Secretariat, and selection process has been widely criticized for lacking transparency and failing to include experts from developing countries. The meeting ended with plans for a new strategy and plan of action document to be issues by the Secretariat in February, with input from member state submissions, followed by a second meeting or series of meetings at a date/dates to be determined.

Netherlands Issues Non-paper

2006-12-07T05:48:00.000-08:00

Day four of the IGWG meeting is now underway. A revised version of the document "Elements of a Global Strategy and Plan of Action" was released at 7:30am Geneva time. The new version is divided into two separate papers: "Elements of the global strategy and plan of action: Elements of a Global Strategy" and "Elements of a global strategy and plan of action: Elements of a plan of action" (new version not available online, old version is here). Now in the afternoon session, The Netherlands has obtained approval from the EU to submit a non-paper on the "Elements" document(s) that is now being distributed by the Secretariat as the meeting adjourns. The non-paper addresses recommendations from the CIPIH report that are absent in the "Elements" documents. The text appears below:

Non Paper of The Netherlands

A/PHI/IGWG/1/Conf.Paper No 1

7 December 2006

Elements of a global strategy and plan of action

Elements of a plan of action

2) Prioritizing research and development needs

*Extract from text*	*Comment*
bullet 4: conduct research on affordable [to be defined]	definition should refer to the definition of ‘affordable’ in Essential medicines (affordable to people in their communities)
Elaboration of the above areas of action should consider recommendations …	include CIPIH recommendations 2.7, 2.8
Absence of reference to medicines as global public good	Include reference.
Absence of reference to gaps in translational research	Include reference

3) Promoting R&D

Elaboration of the above areas of action should consider recommendations …	include CIPIH recommendations 3.7 (open source), 4.5, 5.7 (International Conf on Harmonisation)
Elaboration of the above areas of action should consider recommendations should consider… and 3.6	Request specific action: WHO should actively undertake work on the issues in 3.6 (R&D treaty)

4) Building innovative capacity

preamble para: In further elaborating this element of the plan, activities proposed should take into consideration the work and mandates of other agencies such as WIPO and WTO	Request specific action: WHO should not shy away from making recommendations to these two agencies
bullet 5: Promote patent pools of upstream technologies	include reference to downstream patent pools

5) Transfer of technology to improve innovative capacity

bullet 4: Article 66.2 of TRIPS	include a reference to paragraph 7 of the Doha Declaration
In elaborating the plan for this area of work consideration should be given to taking advantage of work underway in universities, research institutions and PPPs	include a reference to the Philadelphia Consensus Statement, the recent call by prominent scientists and student groups which outlines how universities can improve access to medicines and transfer of knowledge to the developing world by changing their licensing policies and intellectual property rights. It may be useful for the IGWG to consider the development of best practices models for such licensing.
Absence of references	As with other sections include at end references to specific CIPIH recommendations, including 5.4, 5.8 (clinical trials)

6) Management of intellectual property

preamble para: The plan of action should address the development of capacities for the management of intellectual property and technologies in developing countries	Include the caveat expressed in CIPIH recommendation 5.3 “fully taking into account the needs of recipient countries and their public health policies”
bullet 1: enact legislation in developed and developing countries for application for the flexibilities provided for in TRIPS	Strengthen text with reference to CIPIH recommendation 4.13 including “the right of governments to use compulsory licensing”
bullet 2: establish or work within national and/or regional institutional frameworks to promote and manage intellectual property	Remove “to promote”
bullet 5: Strengthen education and training in management of IP	Include the caveat expressed in CIPIH recommendation 5.3 “fully taking into account the needs of recipient countries and their public health policies”
bullet 6: assure that bilateral trade agreements do not seek to incorporate “TRIPS +” protection	Strengthen text with reference to CIPIH recommendation 4.21 including “that ministries of health be properly represented in the negotiation”
Absence of references	As with other sections include at end references to specific CIPIH recommendations

7) Improving delivery and access

bullet 7: Devise ways to curb counterfeiting of medicines and technology	Remove. Not a CIPIH recommendation. Counterfeiting is most effectively combated by ensuring that high quality medicines are made affordable
bullet 11: continue to consider price of treatment for communicable diseases particularly of secondline drugs for HIV/AIDS	Refer to original wording of CIPIH recommendation 4.8 “Continuing consideration needs to be given…”
Elaboration of the above areas of action should consider recommendations …	Include references to CIPIH recommendations 4.1, 4.2, 4.3, 4.7, 4.8, 4.9, 4.15, 4.16, 4.19 (parallel importing), 4.20, 4.23 and 4.27

8) Ensuring sustainable financing mechanisms

bullet 4: establish a funding mechanism for research and development for neglected diseases, while avoiding duplication with existing programs	Remove “while avoiding duplication with existing programs”. This gives the misleading impression that there are extensive existing programmes.
Absence of references	As with other sections include at end references to specific CIPIH recommendations

APPENDIX

1. Text of CIPIH Recommendations Excluded from “Elements of a global strategy and plan of action” (A/PHI/IGWG/1/4)

3.5 Governments should continue to develop forms of advance

purchase schemes which may contribute to moving later stage vaccines,

medicines and diagnostics as quickly as possible through development

to delivery.

3.7 Practical initiatives that would motivate more scientists to

contribute to this field through “open source” methods should be

supported.

4.1 Governments need to invest appropriately in the health delivery

infrastructure, and in financing the purchase of medicines

and vaccines through insurance or other means, if existing and new

products are to be made available to those in need of them. Political

commitment is a prerequisite for bringing about a sustained improvement

in the delivery infrastructure and health outcomes. Health systems

research to inform policy-making and improve delivery is also

important. The integration of traditional medicine networks with

formal health services should be encouraged.

4.2 Developing countries should create incentives designed to

train and retain health-care workers in employment.

4.3 Developed countries should support developing countries’ efforts

to improve health delivery systems, inter alia, by increasing the

supply of their own trained health-care workers.

4.6 All companies should adopt transparent and consistent pricing

policies, and should work towards reducing prices on a more

consistent basis for low and lower middle income developing countries.

Products, whether originator’s or generic, should be priced

equitably, not just in sub-Saharan Africa and least developed countries,

but also in low and lower middle income countries where there

are a vast number of poor patients.

4.7 For noncommunicable diseases, governments and companies

should consider how treatments, which are widely available in developed

countries, can be made more accessible for patients in developing

countries.

4.8 Continuing consideration needs to be given to the prices of

treatments for communicable diseases, particularly of second-line

drugs for HIV/AIDS treatment.

4.9 Governments of low and middle income countries where

there are both rich and poor patients should formulate their funding

and price regulation with a view to providing access to poor people.

4.10 Governments need to prioritize health care in their national

agendas and, given the leverage to determine prices that patents confer,

should adopt measures to promote competition and ensure that

pricing of medicines is consistent with their public health policies.

Access to drugs cannot depend on the decisions of private companies

but is also a government responsibility.

4.11 Corporate donation programmes can be of great value in a

number of fields in collaboration with the actions of governments

and nongovernmental organizations. However, addressing health

needs in developing countries requires more structured and sustainable

actions by governments and other parties that stimulate accessibility

to products, while generating new treatments and products

adapted to the needs of developing countries.

4.12 Governments should remove any tariffs and taxes on healthcare

products, where appropriate, in the context of policies to enhance

access to medicines. They should also monitor carefully the

supply and distribution chain to minimize costs that could adversely

influence the prices of medicines.

4.14 Developed countries, and other countries, with manufacturing

and export capacity should take the necessary legislative steps to allow

compulsory licensing for export consistent with the TRIPS agreement.

4.15 The WTO decision agreed on 30 August 2003, for countries

with inadequate manufacturing capacity, has not yet been used by

any importing country. Its effectiveness needs to be kept under

review and appropriate changes considered to achieve a workable

solution, if necessary.

4.18 Developed countries and the WTO should take action to ensure

compliance with the provisions of Article 66.2 of the TRIPS

agreement, and to operationalize the transfer of technology for pharmaceutical

production in accordance with paragraph 7 of the Doha

Declaration on the TRIPS Agreement and Public Health.

4.19 The restriction of parallel imports by developed countries is

likely to be beneficial for affordability in developing countries. Developing

countries should retain the possibilities to benefit from differential

pricing, and the ability to seek and parallel import lower

priced medicines.

4.21 In bilateral trade negotiations, it is important that governments

ensure that ministries of health be properly represented in the

negotiation, and that the provisions in the texts respect the principles

of the Doha Declaration. Partners should consider carefully any

trade-offs they may make in negotiation.

4.22 Governments and concerned international organizations

should promote new purchasing mechanisms to stimulate the supply

of affordable new products and to enhance the number of suppliers

in order to provide a more competitive environment.

4.24 Countries should provide in national legislation for measures

to encourage generic entry on patent expiry, such as the “early working”

exception, and more generally policies that support greater

competition between generics, whether branded or not, as an effective

way to enhance access by improving affordability. Restrictions

should not be placed on the use of generic names.

4.25 Developing countries should adopt or effectively implement

competition policies in order to prevent or remedy anti-competitive

practices related to the use of medicinal patents, including the use of

pro-competitive measures available under intellectual property law.

4.26 Bilateral trade agreements should not seek to incorporate

TRIPS-plus protection in ways that may reduce access to medicines

in developing countries.

4.27 Governments should take action to avoid barriers to legitimate

competition by considering developing guidelines for patent

examiners on how properly to implement patentability criteria and,

if appropriate, consider changes to national patent legislation.

5.5 Developed countries should comply with their obligations

under article 66.2 of the TRIPS Agreement and paragraph 7 of the

Doha Declaration.

5.7 The process of the International Conference on Harmonisation

currently lacks immediate relevance to the needs of many developing

countries, but those countries should maintain their participation in

the process. In the meantime, developing country governments and

regulatory institutions should give support to regional initiatives,

tailored to the current capacities of their member countries, which

offer more scope for lifting standards over time, exploiting comparative

advantages, avoiding duplication, sharing information and facilities,

and promoting appropriate standardization without erecting

barriers to competition.

5.8 WHO has an important role to play, in collaboration with

interested parties, in helping to strengthen the clinical trials and

regulatory infrastructure in developing countries, in particular in

sub-Saharan Africa, including the improvement of ethical review

standards.

5.9 Apart from the European & Developing Countries Clinical

Trial Partnership, donors together with medical research councils,

foundations and nongovernmental organizations, need to offer more

help to developing countries in strengthening clinical trials and regulatory

infrastructure.

5.11 All countries should consider how best to fulfil the objectives

of the Convention on Biological Diversity. This could be, for instance,

through the establishment of appropriate national regimes for prospecting

for genetic resources and for their subsequent utilization

and commercialization; contractual agreements; the disclosure of

information in the patent application of the geographical source

of genetic resources from which the invention is derived and other

means.

2. Comparison of Incompletely Represented CIPIH Recommendations to the Indicated Corresponding Text in “Elements of a global strategy and plan of action” (A/PHI/IGWG/1/4)

CIPIH recommendation	Corresponding text in A/PHI/IGWG/1/4
3.6 Recognizing the need for an international mechanism to increase global coordination and funding of medical R&D, the sponsors of the medical R&D treaty proposal should undertake further work to develop these ideas so that governments and policy-makers may make an informed decision.	3. “Strengthen product regulatory capacity in developing countries, including improvement of ethical-review standards and clinical trials capacity.” And 5. “Establish a funding mechanism for research and development for neglected diseases.”
4.16 Companies should adopt patent and enforcement policies that facilitate greater access to medicines needed in developing countries. In low income developing countries, they should avoid filing patents, or enforcing them in ways that might inhibit access. Companies are also encouraged to grant voluntary licences in developing countries, where this will facilitate greater access to medicines, and to accompany this with technology transfer activities.	4. “Frame policies emphasizing affordable innovations adapted to realities of health-care delivery in developing countries.”
5.10 Digital libraries of traditional medical knowledge should be incorporated into the minimum search documentation lists of patent offices to ensure that the data contained within them will be considered during the processing of patent applications. Holders of the traditional knowledge should play a crucial role in deciding whether such knowledge is included in any databases and should also benefit from any commercial exploitation of the information.	2. “Promote discovery science in order to identify, validate and build up a sustainable portfolio of new products, whose development is facilitated through the screening of compound libraries for diseases relevant to the public health needs of developing countries.”
6.2 WHO should continue to monitor, from a public health perspective, the impact of intellectual property rights, and other factors, on the evelopment of new products as well as access to medicines and other health-care products in developing countries.	6. “Measure performance and progress towards objectives and targets of the global plan.”

"Open Ended" IGWG Drafting Groups

2006-12-06T07:55:00.000-08:00

The IGWG has just resolved that there will be "open ended" participation in the groups that will draft preliminary documents to come out at the end of this IGWG meeting, where open ended means "those who wish to participate may participate." No word yet on whether this includes NGO's or other non-member state delegations. The documents are expected to be "Elements of a Plan of Action" and "Elements of a Global Strategy."

Updated 11:30am EST:

South Africa asked if "those who wish to participate" includes everyone in the room. The Chair clarfied that his expectation had been that no NGO's would be included, that official experts could be included if requested by a member state, and that the European Commission would be included. However, he noted that there was little precedent on this issue, and that his suggestion was open to debate. South Africa, speaking on behalf of the AFRO region countries, responded by arguing that NGO's be able to participate in drafting groups upon the request of member states. Norway requested clarfication of the rules, and the Chair explained that WHO Constitution rule 86 gives the Chair the flexibility to include NGOs in drafting groups. The U.S. weighed in that NGO participation could be appropriate, assuming drafting groups would be responsible for distilling information and not negotiation. Kenya offered further support for the inclusion of NGOs, stating that NGOs' expertise is greatly needed by many of the member states. As the afternoon session ends, it appears that NGOs will be permitted to participate in the drafting groups.

Musical Chairs doesn't disrupt policy discussion at IGWG

2006-12-06T06:25:00.000-08:00

While the highlight of this morning's IGWG session was the statement of Iran on behalf of the Eastern Mediterranean Regional Organization (EMRO), the session began and ended with disputes over seating arrangements (statement link forthcoming). It had been suggested that seating be switched from a quasi-alphabetical setup to one with members of each regional group seated together. The U.S. delegation expressed approval for the proposal on the condition that new seating blocks include only member states, while Finland, on behalf of the EU, insisted that the European Commission delegation be permitted to sit with the EURO regional group. As the meeting reconvenes, seating has been rearranged, and the U.S. appears to have won out for now as the European Commission is still seated at the back.

There was concern that squabbles over seating would dominate the afternoon session, but Thailand and India have gotten discussion underway with strong policy based statements. Following a metaphor about a sparrow made by the Chair, Thailand declaired that in this case, "The small sparrow is not afraid of the eagle." India followed with a statement in support of a "treaty arrangement" and supported EMRO's call for further discussion of alternative incentives for R&D. Norway then reminded member states that IP flexibilities in the TRIPS Agreement go beyond just paragraph 6, which was followed by an elaboration by a WTO representative. This represents an expansion of discussion on TRIPS flexibilities beyond the narrow focus in several previous statements, particularly by the European Commission. A very strong start for the afternoon session.

Chair Selected at IGWG

2006-12-04T06:15:00.000-08:00

The WHO IGWG meeting got underway this morning with Assistant Director-General-Advisor to the Director General Denis Aitken presiding, with the intention that a chair and five vice chairs representing all six WHO regions be appointed after lunctime deliberations. The meeting has now reconvened,with the following appointments:

The chair is Peter Oldham, Counsellor of the Canadian Mission in Geneva. Vice chairs will be the Netherlands, Libya, Kenya, Singapore, and India. Kenya will serve as rapporteur.

Text of Thai compulsory license for Efavirenz

2006-12-01T11:22:00.000-08:00

The text of the 29 November 2006 Thai compulsory license for Efavirenz is here.

Letter asking WHO review of the Essential Drugs List (EDL) as it relates to patented products

2006-12-01T09:08:00.000-08:00

The following is the text of a letter to Dr. Margaret Chan, Director-General Elect, World Health Organization (WHO), asking for a review of the Essential Drugs List (EDL) as it relates to patented products. Jamie

Consumer Project on Technology
http://www.cptech.org

December 1, 2006

Dr. Margaret Chan
Director-General Elect
World Health Organization
20 Avenue Appia
1211 Geneva 27
Switzerland

Fax number: 41 22 791 4864
Email: chanm@who.int

Dr. Margaret Chan

We are writing to request a review of the manner in which the WHO Essential Medicines List is composed.

The intent of the Essential Medicines List (EDL) is to present “a list of minimum medicine needs for a basic health care system, listing the most efficacious, safe and cost-effective medicines for priority conditions,” where priority diseases themselves are identified in part on the basis of the potential for cost-effective treatment. Given that countries are free to use various means, such as compulsory licenses, to increase access to medical products that can improve the public health, it is appropriate to reassess the role that cost – especially as reflected under current patent medicine pricing regimes – plays in this evaluation.

Patents on drugs, which are tied to market costs, are clearly a factor in determining the EDL, as remarkably few patented medicines are listed. To examine this, we referenced every medicine that appears in the most recent WHO List, the 2005 14th edition, to the U.S. Food and Drug Administration Electronic Orange Book (http://www.fda.gov/cder/ob/) to check for patent status and the availability of generics.

The attached Table summarizes the patented drugs on both lists.[1] Only 14 (12 on the core list and 2 on the complimentary list) of the total 312 medicines on the EDL are under a U.S. patent that bars generic competition at the listed dose and route of administration.

While the Orange Book does not include all medicines, and while there may be some discrepancy between products under patent in the U.S. and those under patent internationally, this is likely an accurate representation of the WHO EDL that are under patent worldwide.

Of the 14 "essential" drugs that are patented, 11 are patented antiretroviral drugs used for the treatment of AIDS. There are only three patented drugs on the EDL (one on the core list, and two on the complementary list) for all other diseases -- evidence that patents have distorted prices considerably, and created enormous access barriers for the poor.

Drug industry representatives have used the WHO EDL to argue that rigid intellectual property protections are not a barrier to essential medicines, because “no” patented medicines are “essential” according to the WHO.[2] Of course this is a distortion; many patented medicines currently not on the EDL would be included were they available at generic prices – for instance the most recent list includes no patented anti-cancer drugs, and the core list includes no anti-cancer drugs whatsoever. The existence of a WHO “Essential Medicines List” which clearly does not contain many truly essential medicines may be confusing for public health officials and others and provide rhetorical fodder to those who oppose intellectual property flexibilities for health.

Simply put, the traditional intellectual property regime in place when the EDL was conceived in the 1970’s is no longer as firmly entrenched. The 1999 WHO Revised Drug Strategy, the 2001 WTO Doha Declaration on TRIPS and Public Health, the 2006 CIPIH report, the upcoming WHO Intergovernmental Working Group on Public Health, Innovation and Intellectual Property, and countless initiatives to address greater flexibility, including mechanisms other than rigid intellectual property rights for the promotion of medical innovation and the expanded use of compulsory licenses, are compelling testimonies to the importance and acceptance of the larger movement to overcome patent barriers when promoting "access to medicines for all."

Patented medicines currently available only at prohibitive prices may nonetheless offer the “potential for cost-effective treatment” as countries have the opportunity to legally produce or import generic versions. More critical to the evaluation of cost effectiveness under the emerging system is the true marginal cost of production, which bears little or no relationship to the market price in developed countries.

We believe that it is more appropriate that the Essential Medicines List reflect the opportunity that many countries have to obtain currently patented drugs at generic prices by assessing cost-effectiveness not only on the basis of current market prices, but also on the basis of potential generic prices if countries were to avail themselves of their right to exercise TRIPS flexibilities, including the granting of compulsory licenses. Developing countries in particular might stand to benefit from a model WHO Essential Medicines List that does not exclude essential patented medicines by ignoring the potential that those drugs could be obtained more cheaply. A welcome side-effect of this change would be an “Essential Medicines List" that more fully reflects the range of truly essential medicines, where essential reflects both the need for treatments and the costs of meeting those needs unburdened by patent rents.

We recognize that the current WHO Essential Medicines List (EDL) is designed to avoid high priced (less cost effective) patented medicines, that some national laws that reference the EDL create obligations for public outlays, and that these outlays may not be justified at the higher prices for patented medicines. The WHO could easily address this problem by creating a category within the EDL for medicines that are essential "if available at generic prices," an option that is clearly relevant for many developing countries.

We therefore propose a review of the policies and considerations that shape the WHO Essential Medicines List, to examine how the list should address medicines that are current under patent but could be manufactured or imported at generic prices.

Thank you for your consideration of this request.

Sincerely,

James Love
Director
CPTech
1621 Connecticut Avenue
Suite 500
Washington, DC 20009

CC: Bill Kean, Howard Zucker, Hans Hogerzeil, Malebona Matsoso

Attachment
ESSENTIAL DRUGS LIST PRODUCTS UNDER PATENT

CORE LIST
DRUG INDICATION
Abacavir Antiretroviral
Didanosine Antiretroviral
Lamivudine Antiretroviral
Stavudine Antiretroviral
Efavirenz Antiretroviral
Nevirapine Antiretroviral
Indinavir Antiretroviral
Ritonavir Antiretroviral
Lopinavir + ritonavir Antiretroviral
Nelfinavir Antiretroviral
Saquinavir Antiretroviral
Proguanil Malaria prophylaxis

COMPLIMENTARY LIST
DRUG INDICATION
Levofloxin Multi-drug resistant tuberculosis
Eflornithine Antiprotozoal for trypanosomiasis

FOOTNOTES

[1] Background information on the actual U.S. patents is available on request.

[2] The first comprehensive analysis of the patent status of the WHO essential drugs list was a August 2001 PhRMA survey on patents in Africa, presented by Tom Bombelles on September 30, 2001, at the American Society of Law, Medicine & Ethics (ASLME) conference on Law and Human Rights, in Philadelphia. This data was later updated, and presented in a 2004 article in Health Affairs, by Amir Attaran. "How Do Patents And Economic Policies Affect Access To Essential Medicines In Developing Countries?," Health Affairs, 23, no. 3 (2004): 155-166. Our letter to Health Affairs addressed logical fallacies in the Attaran article. James Love, "Drug Patents In Poor Countries," Health Affairs, 23, no. 5 (2004): 279. An example of the pharmaceutical industry use of the data on low patent coverage for the WHO essential drugs list is the May 4, 2004 IFPMA Press Release, "New Peer-Reviewed Study Shows That Patents on Essential Drugs Are Rare in Low-to Mid-Income Developing Countries," available on the web at http://www.ifpma.org/News/NewsReleaseDetail.aspx?nID=973, which reads in part: " 'By showing that the actual patenting of essential medicines in low- to mid-income developing countries is, in reality, quite rare, he gives policy-makers the opportunity to move away from a debate overly focusing on intellectual property rights and public health', notes Dr. Bale."

CPTech Hosts Post-Election FTA Strategy Session

2006-11-20T13:50:00.000-08:00

Last Thursday at CPTech a packed audience and 8 panelists discussed strategies for addressing the access to medicine implications of bilateral free trade agreements (FTAs) between the U.S. and other countries. Each panelist gave a short presentation:

Oxfam's strategy to influence FTA agreements includes the production of empirical research on the impact of past agreements. Rohit Malpani of Oxfam America (presentation) presented findings indicating that the U.S.-Jordan FTA, which is frequently touted as a success story, has had a negative impact on access to medicine in Jordan. Rohit also discussed FTA “side letters” that affirm the continued applicability of TRIPS flexibilities, but which only represent an “understanding” that may not be legally binding. Rohit expressed concern that side letters may be regarded by otherwise sympathetic legislators as an adequate substitute for including protections in the language of FTAs themselves.

Fabiana Jorge of MFJ International (presentation) proposed backing legislation to require that U.S. FTAs honor all intellectual property flexibilities in U.S. law that protect the interests of consumers. She stressed that this legislation would not only increase access to medicines for patients abroad but would also protect Americans from losing current legal protections.

Gaelle Krikorian of CRESP (presentation) illustrated the trend in FTA’s towards imposing more limitations on access to medicine and described conditions that stand in the way of reversing this trend. Gaelle expressed optimism over growing organized movements in opposition to FTA’s and suggested that those concerned about access to medicine do more to present data on the impact of FTA’s.

While maintaining that the best policy is to avoid TRIPS+ FTA’s in the first place, Brook Baker of Health GAP (presentation) discussed methods for improving the implementation of bilateral FTA’s already in effect. Brook reviewed considerations supporting more favorable interpretations of FTA texts including language in the Trade Promotion Authority Act (TPA), FTA side letters, and USTR letters to members of Congress. Brook suggested that U.S. FTA partners should waive data exclusivity and linkage requirements to test the authority of side letters and the sincerity of USTR’s reassurances about them.

Matthew Kavanagh of Global Justice described strategies for mobilizing FTA activism. Matthew suggested orienting a campaign around the likely expiration of TPA and stressed ways in which American interests are affected by access to medicine in other countries.

Asia Russell of Health GAP discussed global FTA activism and the need to raise awareness about FTA’s and access to medicine among public officials who often fail to realize that FTA’s raise concerns beyond labor and the environment. Asia proposed a “name and shame” list of legislators rated according to their voting record on access to medicines, and suggested pushing for greater transparency and inclusiveness in the FTA negotiating process.

Rob Weissman of Essential Action argued that ensuring that TPA is not renewed should be the number one priority of groups concerned about FTA’s and access to medicine. Rob agreed with CPTech that health activists should consider compromises on the issue of test data, and to ask USTR and Congress to consider remuneration for test data an alternative to exclusive rights.

Jamie Love of CPTech said that that intellectual property and pharmaceutical pricing norms are the USTR's primary interest in implementing FTAs, and that some TRIPS+ provisions are likely inevitable. Rather than demanding no TRIPS+ provisions in FTAs, a strategy that has failed in every FTA negotiation so far, Jamie argued that NGO’s should tolerate some comprises; For example, provisions requiring remuneration for test data in lieu of exclusive rights. Jamie argued that this stance would be more acceptable than “no TRIPS+” to a Congress concerned about other countries free riding on U.S. R&D. He suggested that NGOs attack exclusive rights to test data on the grounds that these provisions require the unethical repetition of human clinical trials. CPTech also suggested NGOs target the Korea FTA negotiations, on the grounds that USTR was seeking to outlaw mechanisms in Korea that were needed in the United States to deal with high drug prices (such as positive lists, variable reimbursements, etc). CPTech expressed frustration with the lack of NGO support for new trade paradigms based upon support for R&D rather than IPR and asked groups to be more forward looking and pro-active in thinking about global trade policy. Jamie also called attention to the new WHO Intergovernmental Working Group process, which begins December 4.

Important issues were also raised in the course of discussion following the presentations. Democratic staffers and other discussants said that Democratic control of both houses of Congress offered some opportunities, but would not necessarily result in a large shift in policy. The electoral defeat of two Republican representatives responsible for championing parallel trade legislation is further cause for NGO’s to curb their enthusiasm. "Don't expect much," said one staffer. Considerable discussion was also devoted to the impact of IP/Drug pricing chapters of FTAs on the American state governments. Some suggested that states might offer support for reining in provisions of FTAs that limit the ability of states to negotiate drug prices or choose a partial list of available drugs to subsidize. Other strategic issues were raised and discussed off the record.

Eight civil society views on Doha plus five

2006-11-14T11:04:00.000-08:00

Eight persons who follow negotiations over the TRIPS provided these brief views on Doha plus five. My favorite is the one by Sir John Sulston. jl

John Sulston FRS, 2002 Nobel Laureate in Physiology or Medicine

The WTO negotiations over TRIPS are worthy of Joseph Heller - just one damned catch after another.

Celine Charveriat, Oxfam International

The Doha Declaration said all the right things but to date has delivered virtually nothing to poor patients. We've gone backwards in five years. The US and the pharmaceutical industry are actively challenging any developing country that has tried to assert its rights and interpret global intellectual property laws in order to protect public health. The declaration will be worthless for poor patients in developing countries until rich countries match their rhetoric with action.

Mira Shiva, People’s Health Movement (PHM)

The Doha Declaration on Trips & Public health was brought about because of public health concerns expressed by developing countries & civil society . We have in the last 5 years witnessed the unwillingness to genuinely implement the flexibilities, we have witnessed the creation of new hurdles , the NON REVEIW of TRIPS , the seduction or arm-twisting of developing countries to sign TRIPS PLUS & many other biased trade measures through regional & bilateral FTA's in the name of greater trade & economic growth . We watch with pain the increasing inequities & worsening of the health & life of millions WHICH IS NOT ACCEPTABLE .

K Balasubramaniam, Health Action International Asia-Pacific (HAI-AP)

There is an urgent need for a clear sign of political will to give precedence to public health interests over commercial interests, This is nowhere to be seen. The clock is running out.

Dalindyebo Shabalala, Centre for International Environmental Law (CIEL)

The Doha Declaration was a major step forward as a statement of principle. Whether the implementation of the declaration, both in the 2005 amendment to TRIPS, and in the slowly growing application of national laws, will reflect that broad spirit is very much in doubt. The data are not yet in. However, we do have one guide -- the old maxim, "Garbage in, garbage out." A restrictive implementation will lead to restricted health outcomes. Only an approach that focuses on the delivery of better health outcomes rather than the protection of profit margins can accomplish what the spirit of the declaration intended.

Colleen Daniels, Health Action International Europe (HAI Europe)

In 2001, after the Doha Declaration was signed, Ambassador B.G. Chidyausiku, of Zimbabwe , asked the questions: "… how do we make it effective? How do we make it deliver the medicines to the people? How do we avoid this declaration ending up as a dead letter?" Today, the answer is that the Doha Declaration was not effective in implementation, it did not deliver medicines to the people and it seems as if it is indeed a 'dead letter.' Now we can only hope that the WHO Intergovernmental Working Group on R&D can finally make the necessary changes to a system that is broken.

Sangeeta Shashikant, Third World Network (TWN)

Five years since the Doha Declaration on TRIPS and Public Health, there is little to celebrate. The problem of access to affordable medicines continues. Although a few developing countries have used the flexibilities available since Doha, pressure from some developed countries and multinational pharmaceutical companies to not make use of these flexibilities or to adopt rules that go beyond the TRIPS Agreement is now more stronger and as a result undermining the Doha Declaration

James Love, Consumer Project on Technology (CPTech)

The 2001 negotiation was a good moment for the global trading system and for public health. The 2003 negotiations were a bad moment, giving us a cynical agreement that was designed to do as little as possible, in real life. But the 2001 agreement is still the more important -- it provide a basis and a mandate to protect access to medicine for all. For this to be achieved, we have to move to new paradigms for the management of intellectual property rights, and the support of R&D. Most important, we need to break the link between drug prices and R&D incentives. This is now possible, but we have to make it happen.

For CPTech's longer statement, see this.

To see what some of the same groups said 5 years ago when the Doha Declaration was promulgated please see this link:

http://www.cptech.org/ip/wto/doha/ngos11132001.html

CPTech statement on Doha plus five

2006-11-14T10:43:00.000-08:00

This is the statement presented today on behalf of CPTech by Thirukumaran Balasubramaniam, at a meeting in Geneva hosted by MSF to evaluate the first five years of hte Doha Declaration.

Doha + Five
The Doha Declaration on the TRIPS Agreement and Public Health, after five years

Consumer Project on Technology
November 14, 2006

I. The 2001 Doha negotiation

The World Trade Organization (WTO) adopted the Doha Declaration on the TRIPS Agreement and Public Health on November 14, 2001.

It most importantly stated, “the TRIPS Agreement …. can and should be interpreted and implemented in a manner supportive of WTO Members' right to protect public health and, in particular, to promote access to medicines for all.1

The Declaration was relatively short -- 553 words for the English version, split into seven paragraphs. It was both a political statement, supporting access to medicine for all, and a decision that addressed substantive issues in furtherance of that goal. The specifics were at the end of the Declaration.

Paragraph 5 set out "clarifications" regarding the flexibilities of the TRIPS in the areas of compulsory licensing and parallel trade, eliminating doubts about the freedom of countries to choose the grounds for compulsory licenses. The compulsory licensing fast-tract procedures for emergencies were plainly extended to include cases involving short or long term public health crisis. The WTO would only regulate parallel trade in the area of most favoured nation (MFN) status, or national treatment.

Paragraph 6, the weakest part of the Declaration, called upon the WTO's Council for TRIPS to find an expeditious "solution" to the problems facing countries with "insufficient or no manufacturing capacities in the pharmaceutical sector," when seeking to make effective use of compulsory licensing under TRIPS Agreement. This issue, which was often poorly understood and reported, would later become the subject of prolonged and sometimes treacherous negotiations, which in the end, provided a controversial and disappointing outcome.

Paragraph 7 of the Declaration gave least developing countries the right to eliminate pharmaceutical product patents or protections of pharmaceutical test data at least until 2016.

By singling out public health, and in particular pharmaceuticals, from other trade related issues, the Doha Declaration recognized that medicines are not just another commodity and may be differentiated from other inventions in order to protect public health, regardless of language in Article 27 of the TRIPS, regarding discrimination by field of technology.

II. Negotiations on paragraph 6 of the Doha Declaration

The negotiation over the implementation of paragraph 6 of the Doha Declaration was a major test for the WTO, that it largely failed. As noted by many experts, the WTO decision of 30 August 2003 was protectionist (it allows countries to participate as exporters, while blocking imports), complex, and poorly designed to exploit economies of scale and other efficiencies. It could have been worst. In 2002, the WTO considered limiting the decision to only a handful of diseases -- an irrational and morally repugnant result.

The 2005 WTO decision implementing the 2003 Decision and permanently amending the TRIPS Agreement was more than 2,300 words, including 1,616 words for a new article 31bis for the TRIPS. It is further marred by a restrictive 2003 Chairman's statement of 976 words.

A much shorter and simpler outcome was possible. For example, on October 23, 2002, the European Parliament adopted Amendment 196, in an effort to update the EU Directive 2001/83/EC relating to medicinal products for human use. This Amendment sought to address the paragraph 6 solution in only 51 words:2

"Manufacturing shall be allowed if the medicinal product is intended for export to a third country that has issued a compulsory license for that product, or where a patent is not in force and if there is a request to that effect of the competent public health authorities of that country."

The shorter solution was rejected by DG-Trade and USTR for the simple reason that it would have worked. While DG-Trade and USTR had endlessly advertised to an uncritical press that they were seeking to help the poor, this was clearly not the case.

Some of the flaws in the TRIPS amendment should be highlighted. The fact that it bars imports to nearly all high income countries is absurd, given the fact that these countries have already faced a potential crisis of inadequate capacity to manufacture medicines needed for public health emergencies twice since 2001 -- once for possible treatments for biochemical attacks, and again for treatments for a possible bird flu pandemic. The protectionist nature of the "solution" of paragraph 6 was designed to ensure that Indian generic suppliers could not export medicines to high-income countries under this mechanism -- a result that undermines economies of scale for developing country (but not high income country)’s producers, and ultimately makes consumers in both high and low income countries worst off.

That said, the WTO's amendment to the TRIPS Agreement did create some new space for permitting exports of medicines, when manufactured under a compulsory license.

III. National implementation of paragraph 6 of the Doha Declaration

The response by WTO members to implement this new flexibility has been quite uneven. Among the worst approaches to implementing the new mechanism are those found in Canada and the European Union. Often overlooked, but certainly the best implementation, is the mandatory compulsory licensing for export approach adopted by India, in February 2005.3

It is ultimately too early to judge the utility of the new Article 31bis of the TRIPS Agreement. The reason that there have been few efforts to use the provision is obvious. Few important medicines are now patented in India. As a consequence, importers have not had to rely upon the new paragraph 6 mechanisms -- yet. Over time, paragraph 6 may or may not become more important, depending upon the willingness of countries to issue import licenses, and the extend to which exporting countries rely upon other exporting mechanisms, such as Articles 6, 30, 31.k and 40 of the TRIPS Agreement, Paragraph 7 of the Doha Declaration, or the ability of countries without relevant patents (including non-WTO members) to ramp up export capacity.

As India’s implementation has show, those countries that use the new paragraph 6 mechanisms to promote exports can make it nearly automatic, if they want to. Poor implementation of Article 31bis is not entirely the fault of the WTO.

For non-LDC WTO members, the leading alternative to Article 31bis, are compulsory licenses that use TRIPS Articles 31.k and 40. The use of TRIPS provisions on remedies to anticompetitive practices, which can include simple refusals to license, are objectively much better mechanisms for authorizing exports -- a fact often overlooked by technical assistance experts.

IV. National implementation of paragraph 7 of the Doha Declaration

One of the largest disappointments has been the failure of LDCs or technical assistance agencies, like the WTO, WIPO or WHO, to promote implementation of paragraph 7 of the Doha Declaration. The major benefit of this provision so far has been the decisions by donors, such as the Global Fund, to effectively ignore patents in LDCs, or to accept compulsory licenses issued under questionable procedures. This solution is unsatisfactory in the long run, however.

V. National implementation of paragraph 4 of the Doha Declaration

Since 2001, a number of developing countries have issued compulsory licenses on patents for a handful of AIDS drugs. These include South Africa (2003, as remedy to anticompetitive practices), Zambia, Zimbabwe, Ghana, Malaysia, Indonesia, and Swaziland, to name only some examples. However, countries still struggle with compulsory licensing, for a variety of reasons, including lack of experience, uncertainly over procedures and remuneration, bad national laws, fears of backlashes from investors or trading partners, or corruption.

National laws still often fail to fully exploit the flexibilities of the TRIPS Agreement. None of the UN agencies dealing with technical assistance have provided optimal models for statutes on compulsory licensing in lower income countries. The WHO is woefully under-resourced for providing technical assistance, and in several cases has pressured its own staff when they have attempted to provide public health perspectives on intellectual property right issues, leading to speculation that large pharmaceutical companies exercise undue influence at the WHO.

VI. New paradigms for implementation of paragraph 4 of the Doha Declaration

National governments, UN agencies, development experts, donors, health activists and others need to consider new mechanisms for collective management of intellectual property rights, such as regional or global pools for patents on essential medicines. These patent pools can help countries address many of the problems associated with compulsory licensing. For example, patent pools can:

reduce transaction costs and develop the capacity to deal with legal, management and administrative issues associated with voluntary and non-voluntary licensing of patents,
provide for greater economies of scale for generic suppliers,
protect countries from political pressures, as the pool creates regional or global norms for licensing, and
insure that compulsory licensing will follow best practice models on issues such as remuneration, transparency, competition (open licensing), and drug quality (licensing only to qualified suppliers).

Additional attention should be given to the proposals for new paradigms to support medical R&D, including for example the medical innovation prize fund approach (such as United States proposed bill H.R 417 from the 109th Congress), or related systems to reward positive health care outcomes for development of products that treat Type II or III diseases, and global R&D treaties -- ideas that will be will be considered by the new WHO intergovernmental working group (IGWG), which first organizes on December 4-8, 2006.

Ultimately the most important paradigm shift will be to break the link between medical R&D and drug prices. Only then can the promise of the 2001 Doha Declaration reach its potential.

Footnotes:

1 WT/MIN(01)/DEC/2, Declaration on the TRIPS agreement and public health, 20 November 2001, Paragraph 4.

2 See 2002 Civil Society letter to Commissioner Lamy and Ambassador Zoellick on the European position: http://www.tacd.org/cgi-bin/db.cgi?config=admin/docs.cfg&id=178

3 Insertion of new section 92A to the Indian Patent Law - Compulsory licence for export of patented pharmaceutical products in certain exceptional circumstances. "After section 92 of the principal Act, the following section shall be inserted, namely:— 92A. (1) Compulsory licence shall be available for manufacture and export of patented pharmaceutical products to any country having insufficient or no manufacturing capacity in the pharmaceutical sector for the concerned product to address public health problems, provided compulsory licence has been granted by such country or such country has, by notification or otherwise, allowed importation of the patented pharmaceutical products from India. (2) The Controller shall, on receipt of an application in the prescribed manner, grant a compulsory licence solely for manufacture and export of the concerned pharmaceutical product to such country under such terms and conditions as may be specified and published by him. (3) The provisions of sub-sections (1) and (2) shall be without prejudice to the extent to which pharmaceutical products produced under a compulsory licence can be exported under any other provision of this Act. Explanation.—For the purposes of this section, "pharmaceutical products" means any patented product, or product manufactured through a patented process, of the pharmaceutical sector needed to address public health problems and shall be inclusive of ingredients necessary for their manufacture and diagnostic kits required for their use."

Noah on GATT Article 24, and goods in transit

2006-11-10T05:24:00.000-08:00

Ben Krohmal has posted a blog about a presentation by Noah Novogrodsky at a CPTech brown bag lunch event. Noah gave some background on the Canadian C9 problems, and on a CL effort in Ghana for HIV drugs. The novel part of Noah's presentation concerned his assertion that Article 24 of the 1947 Gatt could be somehow used to permit cross-border trade in medicines that one country had obtained or manufactured under a compulsory license. Noah seemed to be implying that the TRIPS rules would somehow not apply, but it was not clear why. Does anyone have any thoughts on this?

About two weeks ago Brook Baker from Health Gap gave a talk in Trinidad, where he mentioned in passing something about exceptions to patent rights for goods in transit. This is something that would be worth thinking about more. Goods in transit have a special status in the Paris convention, and also in the TRIPS, as indicated by the following footnote to Article 51 of the TRIPS:

SECTION 4: SPECIAL REQUIREMENTS RELATED TO BORDER MEASURES

Article 51: Suspension of Release by Customs Authorities

[this relates to of counterfeit trademark, pirated copyright goods, or "other infringements of intellectual property rights"]

Footnote 13: "It is understood that there shall be no obligation to apply such procedures to imports of goods put on the market in another country by or with the consent of the right holder, or to goods in transit."

Note that "goods in transit" are distinct from goods put on the market "by or with the consent of the right holder."

A CRITICAL ANALYSIS OF INDIA’S PROBABLE DATA EXCLUSIVITY/

2006-10-24T14:00:00.000-07:00

A CRITICAL ANALYSIS OF INDIA’S PROBABLE DATA EXCLUSIVITY/
DATA COMPENSATION PROVISIONS
Professor Brook K. Baker, Health GAP
October 20, 2006

I. INTRODUCTION

According to recent reports, on August 6, 2006, the Committee for the Protection of Undisclosed Information under Article 39.3 of the TRIPS Agreement, under the chairpersonship of Ms. Satwant Reddy, Secretary, Ministry of Chemicals and Fertilizers, finalized a proposal for a 5-year term of data exclusivity for India. Although the precise terms of the proposal have not yet been released to the public, an earlier version discussed at an Inter Ministerial meeting on May 22, 2006, is likely to have been adopted. Thus, it is important to analyze the severity of the wound India is about to inflict upon itself and its own population in terms of future access to affordable generic versions of new medicines. Likewise, it is important to analyze the knock-on affect that reduced access in India will have on poor consumers in other developing countries that have historically relied on low-price Indian generic medicines of assured quality, particularly in response to the global AIDS pandemic.

It would be logical to wonder why drug companies want data exclusivity rights in India since they have recently won product-patent rights that grant 20 years of patent protection, which ordinarily block generic competition. The answer is in fact fairly straight forward – smaller research entities and even major drug companies have not always filed patent application on drug innovations of uncertain value, especially in developing country markets.(1) Patent applications are expensive because of translation and filing fees and because annual patent maintenance fees. Since an innovator will ordinarily file its patent application long before safety and efficacy is established via clinical trials, the innovator may not want to waste patent fees on what may be a dead-end product. Whereas universities, small research companies, and even big pharma firms are willing to pay patent application and maintenance fees in large markets to hedge their bets and to preserve their monopoly interests, they are less willing to do so in smaller markets. Moreover, because India did not granted product patents until very recently, some drug companies responded by delaying introduction of a newer medicine on the market. In essence, traditional data exclusivity rules would have allowed drug companies to exclude competitors even where they had not sought or been permitted to patent their products.

Data exclusivity provisions, if added to the Indian Drugs and Cosmetic Act, will prevent India’s drug regulatory agency from referencing or otherwise relying on registration data previously filed by innovator drug companies in order to gain regulatory approval for therapeutically equivalent generic versions. Under data exclusivity rules, the Indian drug regulatory agency will have to pretend that the safety and efficacy of identical follow-on products cannot be established via proof found in the originator’s earlier submission. As a consequence, generic companies would be forced to repeat time-consuming, expensive, and unethical studies in order to receive regulatory approval during the five-year period of exclusivity. These added and unnecessary costs, delays, and ethical concerns virtually guarantee that no generic company will seek registration until the exclusivity period has expired.

Even with safeguard exceptions for data compensation (discussed further below), there might still be procedural delays and litigation bottlenecks that could impede access and/or increase the costs of essential generic products. India could avoid some of these consequences were it to adopt a simple, non-appealable formula for data percentage-based royalties. However, under more complex market-share compensation rules with required negotiations, market-share assessments, and opposition and appeal procedures, generic drugs could take years to come onto the market, and medicines would be more expensive in the interim. Either form of compensation adds to the eventual cost of medicines. On this ground and on the ground that India can and should be a leader in avoiding TRIPS-plus measures, India should avoid data-exclusivity even with a compensation option.

The WTO TRIPS Agreement does not require data exclusivity, and thus India is not obligated to adopt TRIPS-plus data exclusivity laws. The relevant portion of the TRIPS Agreement, Article 39.3,(2) only requires protection of expensive, undisclosed data submitted to drug regulatory agencies against “unfair commercial use” – basically theft or commercial espionage. Nowhere does TRIPS state that exclusive rights must be provided for a given period. In fact, TRIPS makes clear that countries may decide for themselves what constitutes “unfair commercial use” and that there are many possible approaches to satisfy this requirement. Permitting a drug regulatory authority to do its job – assuring the quality, safety, and efficacy of medicines – is not unfair commercial use; it is a mandated public service.(3)

The World Health Organization’s Commission on Intellectual Property Rights, Innovation, and Public Health recently reinforced the view that TRIPS does not require data exclusivity:

Article 39.3, unlike the case of patents, does not require the provision of specific forms of rights. It does not create property rights, nor a right to prevent others from relying on the data for marketing approval of the same product by a third party or from using the data except when unfair (dishonest) commercial practices are involved.

Prior to 1994, the U.S. tried to get its strict version of data exclusivity into the TRIPS Agreement and failed – developing country negotiators simply rejected its proposal. This “legislative history” of failure, by itself, should be enough to scuttle U.S.-inspired arguments that data exclusivity is required. Moreover, many countries have rejected data exclusivity as requirement of data protection and have instead adopted or continued more minimal forms of TRIPS-compliant data protection. These countries have never been challenged with a WTO complaint and for good reason – such a complaint would surely be considered unmeritorious. If more proof is required, the historic WTO Doha Declaration on the TRIPS Agreement and Public Health ensures the primacy of public health and further ensures that intellectual property rules do not interfere with promoting “access to medicines for all.” Even under U.S. law, the Trade Promotion Authority Act of 2002 § 2102(b)(4)(C), the U.S. is required to uphold the Doha Declaration.

The dangers of data-exclusivity on access to medicines is clear – poor consumers in India and throughout the developing world will have reduced access to the newest life-saving and life-enhancing medicines that is routinely available to their rich counterparts. Even though data exclusivity would not apply to all drugs, it would apply to the newest medicines (those involving “new chemical entities”), many of which represent therapeutic breakthroughs, such as Atazanavir, an important second-line AIDS medicine, and Tamiflu, a medicine believed to be effective against avian/human influenza. If implemented in the manner proposed, data exclusivity would apply to most of the important new medicines brought to market in India in the future. Moreover, the USTR and the R&D drug industry will continue to seek a shorter period of data exclusivity, usually three years, for new formulations and new uses of known medicines.(4) There’s no reason that Indians should not have access to affordable versions of the newest and most effective medicines even if those drugs are relatively few in number.

II. CRITIQUE OF INDIA’S FIVE-YEAR DATA EXCLUSIVITY PROPOSAL

According to available reports, India’s new data exclusivity proposal contains several safeguard provisions and exceptions:

(1) Application to “new chemical entities only”;
(2) exclusivity period running from the date of first approval anywhere in the world;
(3) requirement that a registration application be filed in India within one year of first approval elsewhere;
(4) an exception for emergencies and public health crises;
(5) an exception for drugs of mass consumption, including for HIV/AIDS, upon payment of a reasonable royalty;
(6) a compensation exception where repeat clinical trials would be unethical;
(7) an exception for reliance on data submitted elsewhere (rare);
(8) a Bolar provision allowing applications for marketing approval even during the period of data exclusivity;
(9) price control assurances;
(10) termination of exclusivity following a grant of a voluntary license by the data originator; and
(11) termination of exclusivity upon patent-term expiration.

This section will analyze and critique each of these so-called safeguard provisions.

1. Application to “new chemical entities only”

By its express provisions, Article 39.3 requires data protection only for “new chemical entities.” However, that term is not defined in TRIPS and it is subject to broader or narrower interpretations.

Under broader interpretations, “newness” would be considered only in the context of whether chemical entity has previously been approved in a pharmaceutical product in the Indian market. Under a stricter or narrower interpretation, “newness” would be considered in reference to any previous approval or commercialization anywhere in the world. Likewise, newness could be interpreted liberally or strictly with respect to variations in the form of the chemical entity. Overly liberal definitions of new chemical entities would encourage evergreening of data exclusivity by introduction of minor variations in the base chemical entity. Strict definitions would provide data exclusivity only once and only for truly unique chemical entities.

India’s current regulatory scheme with respect to registration is wholly inadequate.(5) Nonetheless, India remains free to adopt its own interpretation of “new chemical entity” and could wisely choose the narrowest possible definition,(6) such as the following:
A new chemical entity means a drug that contains no active moiety and which has not been known to exist previously in India or any other part of the world. For the purpose of this rule, active moiety means the molecule or ion, excluding those appended portions of the molecule that cause the drug to be an ester, salt (including a salt with hydrogen or coordination bonds), or other noncovalent derivative (such as a complex, chelate, or clathrate) of the molecule, responsible for the physiological or pharmacological action of the drug substance.
However, even this narrow definition could not prevent a likely period of marketing exclusivity for many new and important pharmaceutical products.

2. Exclusivity from the first date of approval anywhere in the world

The May 22 data-exclusivity proposal contained a provision that the period of data exclusivity would commence from the date of first approval of the new chemical entity for pharmaceutical use anywhere in the world. Drug companies at present routinely introduce their products first to rich-country markets in the United States, Europe, and Japan. This stop-the-clock provision would promote early introduction of the new product to the Indian market by penalizing drug companies for their own controllable delays in seeking product registration and marketing approval in India. Although this clause would not eliminate the total five-year period during which Indian consumers would not have access to the newest medicines, it would ensure that they did not suffer interminable delays – long delays in seeking approval followed by five long years of data exclusivity.

3. Requirement that a registration application be filed within one year of first approval anywhere in the world

A related provision requires that a drug company file its registration application within one year or thereby lose its right to claim that the chemical entity is new. In many respects, this provision would operate like the one-year rule in the Paris Treaty, which allows innovators a one-year grace period during which to file patent applications elsewhere in the world after their initial, first filing. The one-year patent grace period allows the patent applicant to claim novelty and to solve the inevitable bureaucratic difficulties of multiple filings.

Although it is a positive restriction to grant drug companies a one-year-only grace period rather than let them avoid a market for a long time and then still seek data exclusivity long after the drug has been in use elsewhere in the world, the one-year, use-it-or-lose-it grace period does not ultimately shorten the five-year period of exclusivity.

4. An exception for emergencies and public health crises

The proposal is likely to have an express exception for publicly declared emergencies and public health crises. Of course, there will be questions about who or which agencies will be permitted to declare such emergencies or crises and about their duration, but the larger question is why this exception should be limited to extreme circumstances. It would be much preferable if the data exclusivity provision, if any, would include an express exception for any circumstance in which a compulsory license or government use order has been issued in compliance with the India Patent Act as amended in 2005. That Act permits specials procedures for compulsory licenses granted to addressed emergencies and matters of extreme urgency, but it also allows compulsory licenses on many other grounds: government, non-commercial use, public health needs, competition, and export to countries lacking domestic manufacturing capacity. None of these flexibilities should be forestalled because of data exclusivity.

5. An exception for drugs of mass consumption, including for HIV/AIDS, upon payment of a reasonable royalty

A compensation exception limited to medicines of mass consumption simply does not make sense. The Gleevec case is a perfect example of a medicine critical to the survival of a small number of cancer patients and where monopoly pricing rendered treatment unaffordable except for the richest minority. In fact, drug prices are often set higher for drugs with small consumer bases. Patients suffering from relatively rare diseases have the same interests as patients of pandemics in accessing affordable medicines.

If a compensation system makes sense at all – a contested issue – it only makes sense if it is potentially available, and affordable, across a broad range of products through an easy to administer system.(7) The major justification for such a compensation system – even though it would be TRIPS-plus – would be to counteract drug companies’ claims that their investments are being “taken” without just compensation. The easiest to administer system would be one involving a modest percentage royalty fee based on Indian domestic sales without regard to the drug company’s R&D investment. A more complicated, and far less desirable, compensation scheme could require computation of relevant research and development expenditures and further calculations of market shares, and might even involve requirements for royalty negotiations, opposition procedures, and appeals. Such complex compensation schemes, even ones involving arbitration, can be laborious and slow.(8) They also raise a troubling degree of uncertainty about future costs that can greatly complicate economic forecasting and market entry by generic companies.

Any and all royalty or cost-sharing compensation schemes are problematic when compared to a baseline, TRIPS-compliant right to avoid data exclusivity altogether. As a preliminary matter, it is well established that major drug producers recoup their research and development expenditures in rich country markets in the U.S., Europe, and Japan.(9) Drug company profits continue to soar and continue to exceed R&D investments even though there has not been data exclusivity or compensation in most developing countries. Moreover, what drug companies call necessary and related research and development is a highly contested matter. Much drug research is focused on me-too drugs, on efforts to increase market share, and on efforts to make misleading claims for expanded use. Finally, research and development incentives from Indian market sales are insignificant on a global scale – the entire subcontinent comprises less than 1.3% of global pharmaceutical sales. Indeed, Africa and Asia combined total only 5.1% of global sales and all developing countries lumped together total roughly 11% of the global market.

In sum, the most desirable outcome would be no data exclusivity and no data compensation. India should be a global leader in resisting TRIPS-plus measures, particularly on a voluntary basis. If India stands up and resists U.S.-sponsored pressure for data exclusivity that will embolden other developing countries, including those involved in U.S. free trade negotiations.

6. A compensation exception where repeat clinical trials would be unethical

The truth of the matter is that clinical trials for generic equivalents of previously approved pharmaceutical products will always be unethical. Clinical trials are only justified where there is a legitimate scientific inquiry concerning the safety and efficacy of an investigational new product. However, once that safety and efficacy of the new product has been established the only scientifically valid studies of the follow-on equivalent are whether it is produced according to required quality standards and whether it is therapeutically equivalent to the original product, usually via bio-equivalence studies. The clinical-trial exception makes it sound like there is some subset of medicines where unnecessary and duplicative trials are ethical. To the contrary, exposing human subjects to placebo-based clinical trials when the drug being investigated is already known to be safe and effective is a gross violation of human rights and investigational ethics and enormous waste of medical and economic resources. It should not be tolerated let alone condoned.

7. A rare exception for reliance on data submitted elsewhere

India may well be advised to amend its drug regulatory scheme to permit more reliance on previous registration by stringent drug regulatory authorities or even on WHO pre-qualification. Vicarious reliance on the work of other highly capable drug regulatory authorities would reduce the burden on Indian regulators and also speed up the approval process. At present, India requires separate clinical trials on Indian patients, but this requirement seems unnecessary in the vast majority of cases. There is little need for India-specific studies to establish safety and efficacy for Indian people whose human biological diversity (and fundamental similarity) closely matches that in the rest of the world.

Reliance on foreign registration may certainly be beneficial in circumstances where a pharmaceutical product has not yet been brought to the Indian market and a generic producer stands ready to produce, import, or sell the product in India. (Note: the product’s patent status in India may adversely affect such an effort.) Alternatively, an importer could be seeking to use parallel importation rights to import a previously unregistered brand-name product. These producers or importers who are striving to bring new drugs to the Indian market should not be forestalled by the originator’s reluctance or delay in seeking approval in India. Thus, the idea that this should be a rare exception is probably misguided, though it is also true that data exclusivity would not be an issue if there were a more than one year delay in an Indian application for data exclusivity (see point 3 above).

8. A Bolar provision allowing applications for marketing approval even during the period of data exclusivity

The proposal is likely to contain a research exception and an exception to permit applications for marketing approval during the period of data exclusivity even though the actual grant will not occur until after the period expires. Clearly, it is desirable to allow follow-on producers to conduct research on product formulation, conduct stability experiments, and undertake bioequivalence studies. This advance work can permit the generic company to prepare a registration dossier for submission to the drug regulatory agency even during the period of exclusivity. Under the proposal the drug regulatory authority will be permitted to examine the application and rely on data previously filed by the data originator, but the drug regulatory authority will only be permitted to grant tentative approval. Final approval will be granted only after the period of exclusivity expires, but at the very least the new product might be brought onto the market very quickly rather than having to wait for an additional period of regulatory delay.

9. Vague price control assurances

Under the proposal, the Government says it will create a suitable mechanism to ensure that the prices of such new drugs continue to remain reasonable so that there is a wider coverage as far as the patients are concerned. The details of this mechanism are unspecified, and without specifications the threat of price controls offers little protection against the threat of rising drug prices, especially since the record of Indian price controls is not entirely reassuring. Moreover, since Indians continue to pay for the majority of drug costs out-of-pocket, higher prices will inevitably lead to lower usage, especially for poor Indian who live on less than $2/day.
10. Termination of exclusivity following a grant of a voluntary license by the data originator

Any authorization of a generic by the data exclusivity holder would automatically terminate data exclusivity for all producers. Whether the authorization applies only to voluntary licensees or whether it also covers the data holder’s launch of a generic version of its own product is uncertain. In the U.S., drug companies are beginning to launch official generic versions of their own drugs shortly before patent expiration in order to gain market share in the generic and in some instances to prevent a competing generic from gaining six months of exclusivity under U.S. law. There is no comparable, first-generic entrant rule in India, but the proposed provision is designed to prevent de facto market share control by the data holder and therefore to encourage entry by multiple generic competitors. This competition will have a favorable impact on prices.

11. Termination of the period of data exclusivity upon termination of the patent term.

India is proposing to ensure that the period of data exclusivity never extends beyond the term of patent protection. This clause could be significant for products that enter the market very late in their patent term – a condition that may apply in the short term to drugs in the Indian “mailbox” if there are additional long delays in granting patents (post-1995 innovations have been held in India’s mailbox until the new 2005 Patent Act Amendments.) This provision directly contradicts terms that the U.S. is seeking in its free trade agreement negotiations, so India might receive blow-back from U.S. authorities and PhRMA officials.(10)

III. CONCLUSION

India has attempted to soften the perverse effects of its unnecessary adoption of data exclusivity by engrafting multiple safeguard provisions and exceptions. Although it is true that these provisions ameliorate the harshest features of the proposal and grant some exceptions to data exclusivity, individually and collectively they do not mean that India is making a wise policy choice. The TRIPS Agreement does not require a grant of data exclusivity nor does the interest of India’s own pharmaceutical industry, which does not currently invest strongly in new chemical entity research and which can recoup its investments through data exclusivity granted in the U.S. and Europe. By granting data exclusivity, even with safeguards, India is allowing another form of monopoly market protection that will inevitably result in higher prices. Even worse, in some identified circumstances, it will prevent effective utilization of TRIPS-compliant flexibilities by preventing domestic registration of medicines for which compulsory licenses have been granted. Although the adverse policy consequences of this self-inflicted wound will fall primarily on poor Indian consumers, the adverse consequences could be felt in other developing countries as well. To the extent that Indian generic producers rely on marketing rights in India in order to produce medicines for exportation, domestic data exclusivity rules can deter generic entry into the production-for-export market. Likewise, since some countries require registration in the manufacturing country before granting marketing approval for an imported drug, data exclusivity in India may further delay life-saving access to generic medicines in other developing countries.

The best outcome would be for patients, public health and human rights practitioners, AIDS activists, and other progressive political forces in India to combine forces in opposing the adoption of data exclusivity. International activists should support Indian opponents in their campaign to resist U.S. and drug company pressure on India and to defeat data exclusivity during the legislative process. This is a matter of urgency as lives are at stake.
Endnotes:

(1) See, Shoibal Mukherjee, Here’s a penny for your pill (8 August 2006) available at http://www.hindustantimes.com/onlineCDA/PFVersion.jsp?article=http://10.81.141.122/news/181_1764059,00020008.htm#.

(2) Article 39.3 of the trips Agreement reads:

Member when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products with utilize new chemical entries, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, Members shall protect such data against disclosure, except where necessary to protect the public or unless steps are taken to ensure that the data are protected against unfair commercial use.

(3) Carlos Correa, Protection of Data Submitted for the Registration of Pharmaceuticals: Implementing the Standards of the TRIPS Agreement (2002); cf. Aaron X. Fellmeth, Secrecy, Monopoly, and Access to Pharmaceuticals in International Trade Law: Protection of Marketing Approval Data under the TRIPS Agreement, 45 Harv. Int’l L.J. 443 (2004); contra G. Lee Skillington & Eric M. Solovy, The Protection of Test and Other Data Required by Article 39.3 of the TRIPS Agreement, 24 Nw. J. Int’l L. & Bus. 1 (2003).

(4) Drug companies justify getting data exclusivity for new uses and new formulations of old chemical entities to incentivize clinical trials into expanded uses of previous medicines and into development of more patient-friendly formulations. In some countries, such new uses and new formulations will be patentable, but not under India’s 2005 Patent Act, unless they show significant therapeutic advantages. Accordingly, gaining three-year exclusivity will be a high priority goal for the pharmaceutical lobby and its USTR proxies – it will be the only way they can gain monopoly status and market exclusivity for some of their unpatentable products.

(5) Under Rule 122-E of the DCA Rules (1945), a “new drug” is defined as: (a) a bulk drug substance which has not been used in the country to any significant extent and has not been recognised as safe and effective by the licensing authority; (b) a drug that is already approved by the licensing authority which is now proposed to be marketed with modified or new claims, namely, indications, dosage, dosage form (including sustained release dosage form), route of administration; or (c) a fixed dose combination of two or more drugs, individually approved for certain claims, which are now proposed to be combined for the first time in a fixed ratio, or if the ratio of ingredients in an already marketed combination is proposed to be changed, with certain claims, namely, indications, dosage, dosage form (including sustained release dosage form), and route of administration. For the purpose of the Rules, all vaccines shall be new drugs unless otherwise certified and a new drug shall continue to be considered a new drug for a period of four years from the date of first approval or its inclusion in the Indian Pharmacopoeia, whichever is earlier.

(6) See, Initiative for Medicines, Access & Knowledge, The Impact of Article 39.3 in India: A Practical Perspective, 30 (2006); cf. http://www.fda.gov/cder/about/smallbiz/exclusivity.htm.

(7) Judit Rius Sanjuan, James Love & Robert Weissman, A cost sharing model to protect investments in pharmaceutical test data, CPTech Policy Brief No. 1 (Revised: 18 May 2006).

(8) I-MAK, supra note 6, has listed the following questions and concerns:
• How royalty standards are set. This would include identifying and explicitly setting out the costs that would be subject to compensation. For example, guidelines should be provided that clarify whether costs relating to failed trials form part of an assessment for compensation.
• What mechanisms would be utilised for government verification of originator claims, possibly including the creation of a specific authority set up under the Ministry of Health and/or Drug Controller General in India.
• How to catalyse access to undisclosed information relating to the cost of clinical trials and market-share data.
• What laws exist relating to the discovery of costs of clinical trials and market share data.
• How to devise mechanisms that will monitor effectively the amount of compensation the originator will receive, and whether the amount exceeds the original investment.
• What cap should be set on compensation and the percentage of original investment that can be recouped by originator, e.g. 80% as suggested by Fellmeth. Effectiveness and Procedural Aspects of Arbitration/Litigation
• How to ensure that production of medicines is permitted during arbitration and litigation so that extended administrative procedures do not become a bar to competition.
• Whether a specialist arbitration panel composed of public health experts is needed for such arbitration.
• How to prevent delay by expediting arbitration and litigation in compensation cases.
• How and whether appeals can be made from arbitration decisions.
• What the relative bargaining position of different market players is likely to be at the commencement of arbitration, and how this will affect competition.
• How to prevent “gaming” of a market share system—for example, where an originator refrains from selling a drug after obtaining marketing approval, the generic company pays 100% of the costs of the data for that drug.
• What the impact of artificial barriers will be to market entry on economic growth.
• Whether Indian industry is able to share in the costs of original investment, given that clinical trials will often have been conducted in the United States or Europe where costs are much greater, and whether the expense for Indian manufacturers would be prohibitive.
• How market share will be measured, and when will it be measured, because if assessments are not predictable, Indian manufacturers will not be able to assess risks or costs/benefits and make informed business decisions.
• Which Ministry will be responsible for monitoring implementation of the cost-sharing model, and other significant administrative aspects of this model, and how cumbersome these burdens will be to implement in practice.
To this list one could add questions about whether market share will be based on dollar volume of sales or pill volume of sales and how India would acknowledge or assess market share of later entrants?

(9) See Donald W. Light & Joel Lexchin, Foreign Free Riders and the High Prices of U.S. Patented Drugs, 331 British Med. J, 958-60 (2005).

(10) One of the primary rationales for data exclusivity from the U.S. perspective is that it allows a guaranteed period of market exclusivity and monopoly pricing even if a patent was never filed or if a granted patent has expired.