Workshop on Intellectual Property, Health Care and International Trade Agreements

Sponsored by:
 

• Consumer Project on Technology
• Health Action International
• Program in Infectious Disease and Social Change, Department of Social Medicine, Harvard University
• Medical Reform Group of Ontario
• Malaria Project, Center for Study of Responsive Law
• The Council for Responsible Genetics
• Consumers International, Regional Office for Asia and the Pacific

There will be a workshop on Intellectual Property and Health Care in Washington, DC, on May 7 and 8, 1998. The purpose of the workshop will be to discuss current and developing controversies regarding intellectual property in international trade agreements, as such they concern public health.

Persons who work in public health, consumer groups, government, or international organizations are encouraged to attend.

BACKGROUND

The topics are diverse. The following are only a few of the current controversies over intellectual property.

• Economics of Drug Development.  NIH spends an average of $7 million for FDA Phase I, II and III trials.  Pharmaceutical companies report to the IRS they spend about $3 million per drug on human use clinical trials for Orphan Drugs, but industry spokesman often assert that the cost of FDA approval is more than $300 million per drug.  What do policy makers or public health experts actually know about drug development costs?  What goes into a study of drug development costs?  How much does it actually cost to do clinical trials on a drug?  Once a compound has been invented and identified as a candidate for clinical trials, how much of the "cost" of drug development has already been done?  What are the differences between out-of-pocket, expected, and capitalized costs?  How are overhead costs calculated?  How much of industry R&D is directed at development of new drugs?  Why don't government bodies actually collect data on drug development costs.  Are industry trade association studies reliable?    How are cost "estimates" used and misused in policy debates?
• Scope of Patents in Health Care.  As Biotechnology evolves, what types of inventions will be patented?  What are the disputes over non-obviousness or utility of biotechnology patents.  How broad should biotech patents be? Why should consumers or public health groups care?  How much of the human body should be patented?
• Health Registration Data. United States trade officials and some pharmaceutical companies are seeking greater secrecy of data used to justify registration of new drugs, despite the fact that the U.S. FDA is a model for disclosure and openness.  Trade officials and pharmaceutical companies are also seeking greater levels of "unfair competition" protections for unpatented testing data, which will delay for years introduction of generic drugs.  Since claims for protection of unpatented testing data are based upon the need to protect investment, rather than the need to reward innovation (which is rewarded separately under patent law), there are some that argue that "unfair competition" protections for testing data should be reasonably related to costs of the testing, and that compulsory licensing should be used to protect consumers from abuses.  Bristol-Myers Squibb, one company seeking to expand the level of protection for health registration data, has used such provisions to protect its billion dollar per year monopoly on a governemnt invention (Taxol).

• Bolar Exemptions and Use of Patents in  Research.  In 1984, a provision in the U.S. Hatch-Waxman Act reversed a court ruling that prohibited Bolar Pharmaceutical from testing a Roche Products patented drug.  Bolar was using the patented drug in tests it needed to seek FDA approval for a generic that would be marketed when the Roche patent expired.  This provision in U.S. law speeds the introduction of patents after patents expire.  U.S. trade officials have objected to similiar provisions being included in national laws outside the U.S..  For example, U.S trade officials are lobbying very hard against a Bolar type exemption in Cyprus.  There are also broader questions of the ability of medical researchers to patents in medical research.

• Compulsory Licensing. Traditionally, governments have had the ability to issue or require compulsory licensing of patents or other intellectual property in areas of public interest. The U.S. has done this in the area of some patents on pharmaceuticals or biotechnology inventions, sometimes during reviews of mergers. The issuance of very broad patents in the biotechnology area, and the increasing use of patents on treatment regimes and other areas, has increased interest in the role of compulsory licensing in high technology medicine. Developing countries are also interested in compulsory licensing of medical inventions. Pharmaceutical companies are seeking to severely narrow if not eliminate compulsory licensing of medical inventions.

• Second Use Patents, Evergreen Patents, and related issues. Some countries permit so called "second use" or "swiss" patents, while others do not. For example, if there is a discovery that a drug currently in the public domain has a new use, inventor can patent the rights to use the public domain drug for the new use. This raises questions about status of the public domain drug. In the United States, companies patent the doses and/or methods of delivery used to treat an illness. These treatment regime patents were recently used by Bristol-Myers Squibb to block introduction of generic versions of Taxol in the U.S. Market. (The patents were licensed to BMS from the NIH).

• Parallel Imports. Some nations permit imports of pharmaceuticals legally purchased in international markets, while other countries prevent cross border trade. There are several aspects of the issue. The limitations of cross-border trade permit drug companies to engage in price discrimination, charging higher prices in countries with less internal competition. Pharmaceutical companies claim that cross board trade encourages imports of counterfeit drugs. Some public health groups say that counterfeiting is a serious problem, but is caused by high domestic prices and occurs in countries without parallel imports, and can be addressed separately from the parallel import issue. This is a very important issue for countries with small domestic markets, which want to get the best world price on the international market. U.S. trade officials are actively seeking to discourage this practice in South Africa and other countries.

• Trademarks and Public Health. Pharmaceutical companies claim that trademark rights shield industry from efforts by governments to promote generic drugs or permit parallel imports. Infant formula and Tobacco companies fight regulations on marketing practices under WTO rules regarding trademark rights.

• Pricing of Government Funded Medical Inventions. A bipartisan coalition of U.S. Congressman is seeking new pricing rules for pharmaceutical inventions developed with public funds.

• Alternatives to TRIPS. The WTO’s Agreement on Trade-Related Aspects of Intellectual Property is called TRIPS. It contains rules about intellectual property from a commercial perspective. Provisions in the TRIPS regarding patents, trademarks, health registration data and other items set the basic framework which virtually all countries will have to follow, or face trade sanctions. The provisions of the TRIPS are controversial in several areas, but particularly in the area of health care for developing countries. Prior to the TRIPS many developing countries did not have patent protection for pharmaceuticals – permitting easy entry by generic equivalents, and lower drug prices. Under TRIPS, these countries will see increases in drug prices, and new barriers for the poor’s access to medicines. Health Action International and the Consumer Project on Technology have proposed an alternative to the TRIPS approach which is based upon burden sharing for research and development. This approach would require countries to meet targets for R&D investments, but would give countries greater discretion on the mechanisms to fund R&D, and the ability to direct R&D spending on topics which strengthen domestic scientific institutions and address domestic public health problems.

The Plan for the Workshop

Organzing Strategies

Prior to the meeting, there will be an internet email forum on workshop topics. Participants will be encouraged to submit and discuss various topics in cyberspace prior to the Washington, DC meeting.

LOCATION The meeting will be held at the Hotel Washington, which is located at Pennsylvania & 15th Street, N.W.. The Hotel Washington is across the street from the White House, only 10 minutes from National Airport, and convenient to the Metrorail system. The URL for the Hotel is http://www.hotelwashington.com/ .  Reservations info by email is at: reservations@hotelwashington.com
 

REGISTRATION

Please send the following information to cgavin@cptech.org, or fax to Catherine Gavin at: 202.234.5176

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