Policy and Commercialisation Frameworks for Benefit Sharing, Trade and Use of Hoodia

1. Policy and Commercialisation Frameworks for Benefit Sharing, Trade and Use of Hoodia Rachel Wynberg Environmental Evaluation Unit, University of Cape Town

2. Overview • Appetite suppressant drug based on TK of indigenous peoples of southern Africa • Active constituents patented by CSIR • CSIR license agreement with Phytopharm • Patents and commercial development without knowledge or PIC of San • Agreement between CSIR-San Vetman Piet eating Hoodia in the Kalahari

4. The Negotiating Process

5. Historical South African Policy context • No focused policy or legislation on IKS and PIC at the time of CSIR-San agreement • No requirement for benefit-sharing agreements to be developed with knowledge holders • No requirement for PIC

6. The role of IPRs in promoting benefit-sharing • TK used directly by CSIR to guide their research and development • Patenting of Hoodia compounds ran counter to San belief systems but the principle was “too expensive” and the San opted for a weak compromise • Option: Adopt a “no patents on life” position and pursue alternative models of commercialisation. Could include a challenge of the CSIR patent. • Option: Co-ownership of the patent

7. The benefit-sharing agreement: • Parties are the South African San Council and the CSIR (CSIR would only negotiate with a legally constituted SA entity) • San are to receive 6% of all royalties received by CSIR and 8% of milestone income • Monies payable into Trust set up by CSIR and SA San Council but including regional representatives. No individual benefits. • Commitment to conserve biodiversity and undertake ‘best practice’ procedures • IPR remains exclusively with CSIR. San has no right to claim co-ownership. • San prohibited from entering agreement with any third party to commercialise Hoodia

8. The benefit-sharing agreement: was it fair and equitable? • San could receive millions of dollars but this amounts to less than 0.03% of net sales • Money comes from the CSIR’s share: Phytopharm and other’s share remains untouched • Criticism that relationship is disempowering and unequal • SA San Council are confined to the high-tech Big Pharma model and purportedly unable to pursue other models based on non-patented herbal medicines …. But the practice is different • Focus on monetary benefits only but loose commitment to ‘capacity building’

9. Figure 6.2. The distribution of Hoodia spp. and occurrence of the San in southern Africa. Hoodia distribution is compiled from data provided by PRECIS. San data is obtained from Suzman (2001); http://www.san.org.za; and R. Chennells, SASI, pers. comm. (2006).

10. San-Hoodia Benefit-Sharing Trust • Established to receive income from CSIR • To uplift standard of living and well being of San of southern Africa • To identify San beneficiaries • To ensure benefits are shared fairly, transparently and with ‘highest degree of diligence’ • Creates a Fund • Creates a Board of Trustees: CSIR, 3 reps appointed by SA San Council (=Khomani, !Xun, Khwe), three reps for the region appointed by WIMSA, WIMSA, professional appointed by SA San Council, DST • No remuneration to Trustees

11. San-Hoodia Benefit-Sharing Trust • All funds distribution based on detailed request • No distribution to individuals • R560,000 received to date – R200,000 to SA San Council, Namibia and Botswana still to receive their share but can only be done following establishment of their Councils

13. San-!Khoba Declaration September, 2006. 50 San reps from SA, Namibia and Botswana reached consensus that: • All San structures should include and respect San traditional values of fair sharing, consensus decision-making, and respect for culture. • A clear majority of funds received should reach and benefit San communities. • Administrative costs should be kept to a bare minimum (20:80 for R1 million). • Corruption in any form is totally unacceptable. • Priorities are and will be different in Botswana, Namibia and South Africa and consultation needed to establish priorities. • Priority to projects that are environmentally sustainable, economically viable, and that benefit many San.

16. Exclusive (Corporate-State) Model: Disempowering, unequal but potentially very lucrative. Good environmental controls. Strong R&D benefits. Genetic resource approach. National focus. • Free-rider (Corporate) Model: Free-riding, ecologically problematic, no benefits to San. • Interventionist (Corporate-State-NGO) Model: Greater outreach but less lucrative. Good environmental controls. NGO intervention and state regulation. Low R&D benefits. Commodity approach. Regional collaboration.

17. Corporate-State (Exclusive) Model

18. Free-Rider (Corporate) Model

19. Interventionist (Corporate-State-NGO) Model

20. Hoodia production cycle

21. South(ern?) African Hoodia Growers • MOU: San, SA Hoodia growers, Cape Nature, DETEC (Northern Cape) … others?? • Recognises San IP • Objective to share benefits with San, ensure traceability, quality and safety in Hoodia industy and effective conservation of the species • Pre-empting requirements of Biodiversity Act and ABS regs in SA • Ongoing negotiations, draft agreement intended to be finalised early next year • Critical that region collaborates … how …a single seal for all Hoodia products … link to CITES

22. Recent policy developments in South Africa • Biodiversity Act (2004) and development of ABS regulations (current) • IKS policy (2005) • Patent Amendment Act requiring disclosure of origin (2006) • Medicines Control Act; Traditional Medical Practitioners Act

23. ABS in the Biodiversity Act • (i) Conservation, (ii) sustainable use and (iii) fair and equitable sharing of benefits arising from bioprospecting using indigenous biological resources • Excludes human genetic material, exotic species, ITPGRFA species. Definition has very wide scope. • Distinguishes between procedures (i) to obtain indigenous biological resources and those (ii) to obtain knowledge

24. ABS in the Biodiversity Act • For resources a MTA is required as well as a BSA before a permit is issued • For knowledge holders a BSA is required • Negotiations must be on an ‘equal footing’ • All information must be disclosed before permit issued • Establishes Trust Fund • New ABS regulations due to be gazetted this year will give effect to these provisions

25. ABS Regulations • Regulate: • - bioprospecting of indigenous biological resources; and • - the export of indigenous biological resources for “bioprospecting or any other kind of research” • Recognise two phases to a bioprospecting project: • - the discovery phase (commercial application unknown or unclear); and • - the commercialisation phase. • Govern: • - the commercialisation phase • - the discovery phase of bioprospecting projects where the project makes use of an indigenous community’s traditional use or knowledge of the resource; • - export • Three types of permits: • - research permits, where TK is used (require BSA); • bioprospecting permits (require MTA and BSA) • export permits.

26. Priority steps … • Curbing illegal exploitation (overexploitation – trade without benefit sharing) – prohibit all wild harvesting??? • Ensuring industry collaboration on the Hoodia trade – local industry plus support from buying countries • State + industry + CBO partnerships critical ingredients for success • Building San institutions and capacity • Implementing ABS regulations