TWN Info Service on Intellectual Property Issues (Dec14/01)
8 December 2014
Third World Network

Fraudulent medicines model law promotes pharma interest

New Delhi, 8 Dec (New Delhi) – A draft model law being developed by the United Nations Office on Drugs and Crime’s (UNODC) promotes the interest of pharmaceutical transnational corporations (TNCs).

The draft model law (latest draft dated 17 November 2014) conflate the quality of medicines with intellectual property (IP) enforcement, thereby promoting IP enforcement, with the potential to compromise access to affordable medicines. Further, it follows a criminal law approach instead of a public health approach to address the issue of medicines with compromised quality, safety and efficacy without looking at the complexities of medicines regulation.

Model laws are part of UNODC’s technical assistance program. According to the UNODC website “model laws were elaborated as tools of technical assistance, to assist governments translate their obligations under international treaties into national legislative provisions. The model laws aim to facilitate the review and amendment of existing legislation as well as the adoption of new legislation.”

UNODC is holding the second informal expert group meeting to review the provisions of the draft model law on fraudulent medicine in Vienna, Austria on 8-10 December 2014.  The objective of the consultation is to finalize the document.

[UNODC is one of the organisations that public health circles say is ‘captured’ by the pharmaceutical TNCs to further IP enforcement standards. Earlier similar organisational capture was seen at the World Customs Organisation (WCO), INTERPOL, Universal Postal Union (UPU) and World Health Organisation (WHO).  Member States’ objection at WHO led to a deactivation of WHO’s public private partnership known as International Medical Product Anti-Counterfeit Taskforce (IMPACT). The INTERPOL Secretariat went to the extent of accepting Euro 4.9 million from 29 pharmaceutical TNCs to further IP enforcement activities known as ‘pharma crime’.]

The agenda of the second expert consultation clearly shows a selective pick of like-minded experts who support the IP enforcement initiatives. According to the draft agenda obtained by Third World Network, the following persons are acting as Rapporteurs in various sessions.

General presentation of the draft by the principal drafter, Hugo Bonar  (Drug Regulatory Authority Ireland); General Provisions Rapporteur:  Sabine Walser and Vu Thi Hiep (Council of Europe in charge of the European Medicrime Convention); Messan Halimatou (Ministry of Health Cambodia), Mam Boravann (Ministry of Health Niger); Chapter II: Coordination and prevention Rapporteur: Bart Wijnberg (Council of Europe Medicrime Convention), Hashim Yusufu (former Nig้rian Drug Regulatory Authority) and Sivalingam Rasiah (DrugRegulatory AuthoritySingapore) ; Chapter III: Offences Rapporteur: Wilfrid Roge (International Institute against Counterfeit Medicine (IRACAM)  Ilisa Bernstein (US FDA); Chapter IV: Investigation Rapporteur: Lynda Scammell (UK Drug Regulatory Authority), Mickey Arieli (Drug Regulatory authority Israel) and Ashley How  (Pharmaceutical security Institute ); Chapter V: National and international cooperation and extradition Rapporteur: Bernard Leroy (Director IRACM)and Mercy Fomundam ( NEPAD Partnership);  Chapter VI: Prosecution of offences Rapporteur: Stephane De Spiegeleer (Ministry of Health Belgium) and Wael Armouti (Ministry of Health Jordan); Chapter VII: Protection of and assistance to victims and witnesses Rapporteur: Christian Tournie and David Benton (International Council of Nurses); Chapter VIII: Miscellaneous provisions Rapporteur: Maximiliano Derecho (Lawyer from Argentina)and Cynthia Genolet (International F้d้ration of  Pharmaceutical Manufactures and Associations (IFPMA)).

Interestingly all the Non-Governmental Organisations (NGOs) experts who are invited for the second expert consultation are known for their support of IP enforcement initiatives and promoting conflation of quality with IP. In addition to the International Council of Nurses the other three NGOs are invited to the consultation are closely linked to pharmaceutical TNCs. These are: Institute of Research Against Counterfeit Medicines (IRACM), Pharmaceutical Security Institute (PSI) and International Federation of Pharmaceutical Manufacturers and Associations (IFPMA). 

According to the IRACM website “The IRACM, an initiative of the Sanofi group, is a French association governed by the 1901 Act advocating in the fields of information, prevention and training. Its actions are complementary to other enforcement measures led by specialized national and transnational organizations such as Interpol and the World Customs Organization, who are also partners of the Institute.” IRACM partners include IFPMA and ‘Fight the Fakes’, an initiative by IFPMA for the strict enforcement of IP.  IRCAM is based in Paris and works closely with various French institutions.

PSI was established in 2002 in Washington DC by the Security Directors of 14 major pharmaceutical companies. The current membership includes 28 pharmaceutical companies.  PSI’s stated objectives include: protecting the public health, sharing information on the counterfeiting of pharmaceuticals; initiating enforcement actions through the appropriate authorities.  PSI is known for its inflated data on counterfeit and its effort to conflate quality issues with IP to make a case for IP enforcement.  PSI maintains a close relation with IFPMA and during the early days of PSI, the IFPMA Director-General served as the president of PSI. PSI is also part of INTERPOL’s IP crime unit and was co-chair of WHO’s defunct initiative IMPACT.

IFPMA, the lobby group for pharmaceutical TNCs, is always at the forefront of IP enforcement initiatives. It is directly or indirectly (through PSI) part of all the IP enforcement initiatives, which capture multilateral or regional organisations to push the TRIPS plus IP enforcement standards.

The International Council of Nurses is part of the IFPMA-led campaign known as ‘Fight the Fakes’.

Interestingly the agenda shows no participation from the generic pharmaceutical industry.

According to Stefano Bonino, Research Associate, School of Applied Social Science, Durham University (UK) the first expert consultation raised concerns of balance and fair representation. “More than 90% of the participants came from Europe, with only one participant from Nigeria representing African interests, and no North Americans, South Americans or Asians – major countries such as the US, India, Brazil, Russia and China were not party to the discussions,” noted Bonino (

He further states with regard to UNODC: “For an organisation that prides itself on representing 193 member states, one wonders if this situation represents a throwback to an age when a few of European countries ran the world.”

The proposed model law contains 42 articles divided into eight chapters with commentary: General provisions; Coordination and prevention of medical products; Offences (General offences; Offences of falsification of documents and equipment and implement; Offences related to participation in an organised criminal group; Offences related to obstruction of justice; Penalties and sentencing considerations); Investigations (Special investigation techniques); National and international cooperation and extradition; Prosecution of offences; Protection of and assistance to victim and witnesses;  Miscellaneous  provisions.

One of the main concerns related to the UNODC model law is the definition of fraudulent medicine, which gives ample room for the conflation of quality of medicine with IP.  According to the draft law ‘fraudulent medical product’ means any medical product with a false representation of:

(1) its identity, including its packaging and labelling, its name or its composition as regards any of the ingredients including excipients and the strength of those ingredients;

(2) its source, including its manufacturer, its country of manufacturing, its country of origin or its marketing authorisation holder; or

(3) its history, including the records and documents relating to the distribution channels used.

The false representation of identity including the packaging and label as per the definition can clearly bring trademark infringement within the scope of fraudulent medicine.  Similarly some experts are also worried that the false representation of identity and history can even include patent infringements.

In a similar situation at the WHO, the Secretariat resolution circulated during the 124th Executive Board Meeting of WHO in 2009 in its preamble paragraph clearly mentioned that “Recognizing that disputes about, or violations of, intellectual property rights are not to be confused with counterfeiting …” However, the next day the Secretariat circulated a corrigendum, which stated: “Please note that the sixth preambular paragraph of the draft resolution addressed to the Health Assembly should read as follows: Recognizing that disputes about, or violations of, patents are not to be confused with counterfeiting”.  Thus it is clear that the false representation of identity clearly includes trademark infringement.

The model law like any other criminal law recognises criminal intent as a requisite element to fall within the scope of criminal acts mentioned in the model law. However, experts point out that the element of intention in criminal law will be examined only during the prosecution stage at the time of a criminal trial. Therefore, generic companies can be subjected to harassment and prevented from competing with brand name companies.  The model law intends to dilute the criminal intent requirements by imposing an absolute criminal liability.

According to the commentary, “Common Law jurisdictions consider gross negligence, criminal negligence and culpable negligence and reckless disregard as to the consequences of the action as evidence of intent. This is a matter for the domestic legal system to consider how it defines intent by reference to its existing statute laws or legal precedent, as appropriate consideration should be taken to ensure that offences do not require that the intent in committing the offence is for the purpose of causing harm. Objectively, causing harm is most likely to be a consequence of the manufacturing and trafficking of a falsified medical product rather than its object. The offences in this model law are predicated upon fraudulent acts”.

Thus the criminal intent is of no consequences under the model to attract criminal liability. The commission of the act itself makes one liable under the model law. The criminal approach with stringent provisions can be used against small producers, especially generic companies.

The model law also contains provisions for the seizure of suspected medical products. According to draft article 32 “in the event of any offence under these model legislative provisions, the fraudulent medical product; documentation; and any ancillary equipment, as enumerated in article 13, vehicle, vessel, craft or premises used or intended to be used in the manufacture, trafficking or promotion of fraudulent medical products, shall be seized immediately upon discovery”.

There is no explicit exemption for medicines in transit. The European Union has earlier used seizure provisions in EU law to seize goods in transits, which does not violate IP in either the country of export or import. Recently the EU has blocked an exemption proposed by India and other developing countries to exclude medical products from the scope of action as activities and behaviors which result in Sub-standard, spurious, falsely labeled, falsified and counterfeit medical products. The EU directive currently allows the seizure of medical products in transit.  

The model law also proposes special investigation techniques such as infiltration,  assumed identities, controlled delivery and electronic surveillance to facilitate undercover operations.

Many provisions of the model law are copied and pasted from the Council of Europe Medicrime Convention.  According to Stefano Bonino, “UNODC copied some of its draft provisions from yet-to-be-ratified legislation from the Council of Europe – specifically the Medicrime Convention aimed at combating the illegal trade in medical products – in the development of this model law.”  He further observed that, “it seems UNODC is working closely with the Council of Europe to serve its interests in pushing forward the Medicrime Convention, which as many others have written in The Lancet and the British Medical Journal has serious problems, including unjustifiably criminalising some generic medicines”.

The introductory note in the model law states: “The model legislative provisions on falsified medicines build on previous legislative instruments and draft principles for model legislation by international and regional organizations and bodies including the following:

  • ท      Untied Nations Convention against Transnational Organized Crime (2004)
  • ท      The Council of Europe Convention on the counterfeiting of medical products and similar crimes involving threats to public health and similar crimes (Medicrime Convention) (2011)
  • ท      Directive 2011/62/EU of the Parliament and of the Council of 8 June 2008 amending Directive 2001/83/EC on the Community code relating to medicinal products for human use, regarding the prevention of the entry into the legal supply chain of falsified medicinal products (The Falsified Medicines Directive) (2011)
  • ท      The World Health Organization’s International Medical Products Anti-Counterfeiting Task Force (IMPACT) Draft Principles and Elements for National Legislation against Counterfeit Medical Products (2007)”.

However, it is fact that WHO suspended activities of IMPACT and instituted a Member-driven process to address the issues of quality, safety and efficacy of medicines.

The resolution 20/6 adopted at the 20th session of the Commission on Crime Prevention and Criminal Justice(CCPCJ) does not provide any mandate to address the issue of medicines within the UN Convention on Transnational Organised Crimes.  The resolution in its preamble stated: “… underscoring in that regard the potential utility of the United Nations Convention against Transnational Organized Crime”. However there was no decision to address it within the framework of this Convention.

There was an attempt to include the issue of fraudulent medicines within the framework of the UN Convention against Transnational Organized Crime at the 22nd Session of the CCPCJ. The resolution proposed by Argentina stated: “Encourages Member States to make use of the provisions of the United Nations Convention against Transnational Organized Crime to more effectively investigate and prosecute activities of organized criminal groups related to the production of and trafficking in fraudulent medicines, …”

However, the resolution was withdrawn due to the lack of confidence.

By choosing the model law route the Secretariat is aiming at bypassing the consensus of Member States. As mentioned earlier the Secretariat is relying on the mandate provided under resolution 6/20 for technical assistance to frame the model law.  It is very clear that the developing countries would not agree to a resolution which promotes IP enforcement; therefore the Secretariat did not want to consult the whole membership of States and instead chose a selective approach of consultation.

According to UN observers this is a classic case of vulnerability of UN organisations, which can be captured with financial resources. In this case France provided funds to UNODC’s Secretariat to implement its IP enforcement agenda through the work program on fraudulent medicines, especially the drafting of model law.

Stefano Bonino remarks: “The French government has also previously directly funded UNODC’s fight against fraudulent medicines. It is excellent that France cares to support UNODC’s work in this effort, but given that a good number of the experts involved in the consultation were French (working for UNODC, Council of Europe and INTERPOL) and/or representing French interests, including Sanofi, we need to be careful about how much influence this one player has and whether the entire world is willing to follow suit.”