Intellectual property rights and procurement

= international developments & national experiences =

Bi-regional Workshop on procurement and supply management of HIV, TB and malaria medicines using GFATM grants

Bangkok 25-31 July 2005

Karin Timmermans - WHO

Patents, TRIPS & access to medicines

Recent developments

- Global

- India

Legal issues relevant for procurement

Overview of presentation:

Patents are a public policy tool:

• to promote and reward innovation

• to disclose the invention,and make it available to society

TRIPS has harmonized standards for patents.

For most developing countries, the new standards are higher than their previous standards.

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

The most important safeguards:

• compulsory licensing

• parallel importation

These safeguards can only be used when incorporated in national laws.

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

• 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.

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

Compulsory license (CL):

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.

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.

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.

Parallel importation

Compulsory license

Country with production facilities

+ +Country without production facilities

+ ??

Question:

30 August 2003:

Parallel importation

Compulsory license

Country with production facilities

+ +Country without production facilities

+ v

• 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.

Key elements of the solution (30 August Decision):

Recent developments

at the global level

Decision = waiver, proposes amendment of TRIPS

Risk of “TRIPS-plus” conditions

in bilateral/regional trade agreements

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.

During the exclusivity period:

Generic manufacturers will have to submit their own data to prove safety and efficacy

Alternatively, they can only enter the market after expiry of the data exclusivity period

=> They will have to repeat the clinical trials and other tests

• Role Drug Admin.: assess safety, efficacy and quality of medicines

• Drug Admin. is not a ‘patent police’

TRIPS+ requirements (2):

‘Linkage’: the Drug Regulatory Authority should refrain from registering generic versions of drugs under patent.

• To remedy anti-competitive behavior

• For public non-commercial use

• In case of emergency

• In case of insufficient supply

TRIPS+ requirements (3):

Requirements to limit the grounds for issuing a compulsory license:

Thus, there is a need for both

health and trade sector to

remain vigilant and to work

together, to safeguard

access to medicines.

Recent developments

in India

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

Mailbox:

Applications from 1995-2004 (apparently nearly 9,000)

Assessment to start January 2005

Patents will be granted for the remaining time ( < 20 years)

The questions:

• which applications are in the mailbox ???

• which patents will be granted ?

• amendment to the patent law

• criteria

• how will companies react ?

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.

Legal issues

relevant for procurement

Medicines are subject to two sets of rules:

Intellectual property rights

Registration requirements

The right to exclude

But not the right to market or to use

Authorization to put a medicine on the market

Patented? Registered?

Originator drug - / + +

Generic version - +

Basic requirements for drug procurement:

but…

Possible exemptions for registration:

• Compassionate use exemptions

• Public sector procurement / tenders

Public health safeguards that can facilitate access to medicines:

• Parallel importation

• Compulsory licensing / 30 August Decision

• Government use

• Bolar provision

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.

So if you want to procure generic medicines, what do you do?

Where do you start?

Stepwise approach:

1. Are there patents in the country?

If not, you can procure generics (provided they are registered)

2. Are there pharmaceutical patents?

If not, you can procure generics (provided …..

Stepwise approach:

3. Which ARVs are under patent in the country?

And: how do we find out?

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.

What are countries actually doing?

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.

Thailand:

• Generic production of ARVs that are not patented in Thailand (incl. ddI powder);

• Challenging the ddI patent in court

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

Malaysia & Indonesia:

Government Use

- Malaysia for importation,

- Indonesia (mainly) for local production.

Didanosine

Zidovudine

Didanosine+Zidovudine

Lamivudine

Nevirapine

Valid for 2 years Valid for 7 - 8 years

Royalty to be determined Royalty 0.5 %

Authorization by Minister of Domestic Trade

Presidential Decree

Malaysia Indonesia

Thank you