Intellectual property rights and procurement

1. Intellectual property rights and procurement = international developments & national experiences = Karin Timmermans - WHO Bi-regional Workshop on procurement and supply management of HIV, TB and malaria medicines using GFATM grants Bangkok 25-31 July 2005

2. Overview of presentation: • Patents, TRIPS & access to medicines • Recent developments • - Global • - India • Legal issues relevant for procurement

3. Patents are a public policy tool: • to promote and reward innovation • to disclose the invention, • and make it available to society

4. TRIPS has harmonized standards for patents. For most developing countries, the new standards are higher than their previous standards.

5. Introduction of TRIPS standards will delay the introduction of generic versions of new drugs TRIPS contains some safeguards, that can be used to mitigate its potential negative effects on access to medicines

6. The most important safeguards: • compulsory licensing • parallel importation These safeguards can only be used when incorporated in national laws.

7. Parallel importation One possible definition: importation without the consent of the patent holder, of a patented product marketed in another country either by the patent holder or his licensee

8. Compulsory license (CL): • license granted without permission of the patent holder • many countries’ laws have CL provisions • TRIPS allows CL in case of national emergency or extreme urgency, public non-commercial use, to remedy anti-competitive practices etc. • TRIPS does NOT limit the grounds for issuing a CL.

9. Compulsory license (CL): • TRIPS does specify conditions to be applied to CL, including: • case-by-case decision • first: try voluntary license • adequate remuneration patent holder • non-exclusive, non-assignable • predominantly for domestic market

10. The Doha Declaration on TRIPS and Public Health Confirms: TRIPS can and should be interpreted and implemented in a manner supportive of WTO members’ rights to protect public health, particularly access to medicines.

11. The Doha Declaration... Also says that: • Countries have the right to use compulsory licensing and parallel importation to ensure access to medicines; • Countries are free to determine the grounds for issuing a compulsory license; • LDCs don’t have to implement patents and data protection for pharmaceuticals until 2016.

12. Paragraph 6 of the Doha Declaration … … recognizes that it is not clear how countries with insufficient or no manufacturing capacity can make effective use of compulsory licensing, and instructs the WTO’s TRIPS Council to “find an expeditious solution” to this problem. A solution was agreed on 30 August 2003.

13. Question:

14. 30 August 2003:

15. Key elements of the solution (30 August Decision): • countries should first notify WTO (except least- • developed countries); • provide details of drugs to WTO; • possibly 2 compulsory licenses (importing and • exporting country); • special labeling, packaging and/or coloring/shaping; • notify WTO of the grant of compulsory license; • prevent re-exportation; • annual WTO review of the system; • some countries have opted out/only for emergency.

16. Recent developments at the global level

17. Decision = waiver, proposes amendment of TRIPS Risk of “TRIPS-plus” conditions in bilateral/regional trade agreements

18. TRIPS+ requirements (1): Data exclusivity for pharmaceuticals (5 years, or even more). During the exclusivity period, the Drug Regulatory Authority can not rely on the originator’s data to register generic versions.

19. During the exclusivity period: Generic manufacturers will have to submit their own data to prove safety and efficacy => They will have to repeat the clinical trials and other tests Alternatively, they can only enter the market after expiry of the data exclusivity period

20. TRIPS+ requirements (2): • ‘Linkage’: the Drug Regulatory Authority should refrain from registering generic versions of drugs under patent. • Role Drug Admin.: assess safety, efficacy and quality of medicines • Drug Admin. is not a ‘patent police’

21. TRIPS+ requirements (3): • Requirements to limit the grounds for issuing a compulsory license: • To remedy anti-competitive behavior • For public non-commercial use • In case of emergency • In case of insufficient supply

22. Thus, there is a need for both health and trade sector to remain vigilant and to work together, to safeguard access to medicines.

23. Recent developments in India

24. 3 categories of medicines: • patented elsewhere before 1995 • not affected • patented elsewhere between • Jan.’95 –Dec.’04 • ‘mailbox’ • patented from 2005 onwards • TRIPS rules apply

25. Mailbox: Applications from 1995-2004 (apparently nearly 9,000) Assessment to start January 2005 Patents will be granted for the remaining time ( < 20 years)

26. The questions: • which applications are in the mailbox ??? • which patents will be granted ? • amendment to the patent law • criteria • how will companies react ?

27. Positive point: the production and sale of generic drugs that are already on the market in India can continue; But: only if “significant investment”, and: royalties need to be paid. Most likely, production, sale and export of existing generic medicines will continue, but prices may rise.

28. Legal issues relevant for procurement

29. Medicines are subject to two sets of rules: Intellectual property rights Registration requirements The right to exclude Authorization to put a medicine on the market But not the right to market or to use

30. Basic requirements for drug procurement: but…

31. Possible exemptions for registration: • Compassionate use exemptions • Public sector procurement / tenders

32. Public health safeguards that can facilitate access to medicines: • Parallel importation • Compulsory licensing / 30 August Decision • Government use • Bolar provision

33. Government use: A special case of compulsory license – i.e. a compulsory license for the Government itself. Procedures for Government Use tend to be easier; But medicines produced under Government Use license cannot be sold commercially.

34. So if you want to procure generic medicines, what do you do? Where do you start?

35. Stepwise approach: • 1. Are there patents in the country? • If not, you can procure generics (provided they are registered) • Are there pharmaceutical patents? • If not, you can procure generics (provided …..

36. Stepwise approach: 3. Which ARVs are under patent in the country? And: how do we find out?

37. Stepwise approach: 4. Would a generic version of an ARV infringe any patent in the country? If not, generic procurement can proceed. If yes: - buy originator product, or - make use of safeguard mechanisms, if available under national law.

38. What are countries actually doing?

39. Cambodia: Patent law in place, but specifies that there will be no patents for pharmaceuticals until 2016. Note: - this is allowed for least-developed countries under the WTO’s Declaration on the TRIPS Agreement and Public Health (Doha, 2001); - this is something other least-developed countries should also consider.

40. Thailand: • Generic production of ARVs that are not • patented in Thailand • (incl. ddI powder); • Challenging the ddI patent in court

41. Brazil: • Generic production of ARVs that • are not patented in Brazil; • Negotiating price reductions of • ARVs that are patented, using the • ‘threat’ of compulsory licensing

42. Malaysia & Indonesia: Government Use - Malaysia for importation, - Indonesia (mainly) for local production.

43. Malaysia Indonesia

44. Thank you