TWN Info Service on Intellectual Property Issues (Jun17/01)
13 June 2017
Third World Network
South nations raise stakes on IP-Public Interest imbalance
Published in SUNS #8478 dated 9 June 2017
Geneva, 8 Jun (D. Ravi Kanth) - Major developing countries - India, South
Africa, China, Brazil, and Fiji - raised the stakes on the growing
"imbalance between intellectual property and the public interest" at
the World Trade Organization.
For the first time, the five countries called for an information-exchange
session on "compulsory licenses" and other flexibilities in the WTO's
Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement.
In an extraordinary proposal on "Intellectual Property and the Public
Interest" circulated on 6 June, the five countries urged members to share
their experience on the difficulties encountered by them for availing and
implementing compulsory licenses (CLs).
The use of CL by governments - which allow generic companies to produce
patented product or process without the consent of the patent owner for
addressing grave public health crises - is often met with fierce opposition by
major developed countries, particularly the United States.
Big pharmaceutical companies in the US and in Europe continue to treat CLs as
weapons of mass destruction and in many cases, resorted to extreme forms of
pressure tactics, including coercion, according to several reported cases in
various countries.
Despite clear provisions for the use of CLs which are allowed under Article 31
of the TRIPS agreement subject to certain conditions, the US and its partners
have left no stone unturned whenever any government of a developing country
sought to use CLs for meeting grave public health crises.
The Doha Declaration on the TRIPS Agreement and Public Health says "each
Member has the right to grant compulsory licenses and the freedom to determine
the grounds upon which such licenses are granted".
But due to onerous conditions in the Doha mechanism, only two countries had
sought the flexibility.
Against the backdrop of sustained attempts to foist "TRIPS plus"
standards in the free trade agreements as well as bringing controversial issues
such as "innovation" through the back door by developed countries,
the five developing countries sought to highlight the issues on which the TRIPS
agreement was negotiated and how the flexibilities must be used.
The TRIPS agreement, according to the five countries, "attempts to strike
an appropriate balance between the interests of right holders and users."
It is a minimum standards agreement that is designed for addressing "the
promotion of technological innovation" and "transfer and
dissemination of technology to the mutual advantage of users and producers of
technological knowledge in a manner conducive to social and economic
welfare."
Further, it seeks a "balance of rights and obligations" and has
enabled members to use various flexibilities accorded in the agreement.
"Key TRIPS flexibilities include transition periods for LDCs (extended by
the WTO until 01 January 2033), differing IP exhaustion regimes, refining the
criteria for grant of a patent (patentability criteria), pre-grant and
post-grant opposition procedures, as well as exceptions and limitations to
patent rights once granted, including the regulatory review exception
("Bolar" exception) to facilitate market entry of generics, compulsory
licences and government use," the five countries maintained.
However, many countries have been unable to use the flexibilities accorded in
the TRIPS agreement because of pressure and coercion by the US and other
developed countries.
The UN Secretary-General's High Level Panel Report on Access to Medicines last
year graphically catalogued instances where "capacity constraints or
political pressure from states and corporations" have prevented countries
from using TRIPS flexibilities.
"Political and economic pressure placed on governments to forego the use
of TRIPS flexibilities violates the integrity and legitimacy of the system of
legal duties and rights created by the TRIPS Agreement, as reaffirmed by the
Doha Declaration," the five countries argued.
The sponsors said, "in the Myriad Genetics (2013) case, the US Supreme
Court had ruled unanimously that naturally occurring genes cannot be patented,
even if they are isolated."
"In 2003, the US Federal Trade Commission had proposed tightening the
non-obviousness standard, in order to limit the grant of unwarranted
patents."
(Over ten days ago, "the US Supreme Court put sharp new limits on where
patent infringement lawsuits can be filed, undercutting patent owners' ability
to channel cases to favourable courts," according to a Bloomberg news
report.)
Further, "a slew of regional trade agreements containing "TRIPS
plus" standards of IP protection and enforcement have the potential to
significantly affect the policy space available for effective and full use of
the TRIPS flexibilities," the sponsors of the proposal maintained.
The proposal also listed the common "TRIPS plus" provisions in free
trade agreements (FTA) that affect the pharmaceutical sector: the definition of
patentability criteria; patent term extensions; test data protection; the
linkage of regulatory approval with patents and enforcement of IPRs, including
border measures.
"Such provisions can delay market entry of generics and increase prices of
medicines."
Worse still, even "investor-State disputes under regional or bilateral
investment protection agreements are also emerging as significant threats to
the use of TRIPS flexibilities in the public interest," the five countries
maintained.
Also, big pharmaceutical companies have resorted to "monopoly rights in
test data, without sufficient use of balancing exceptions and limitations to
protect the public interest."
These companies have exacerbated crises of access around the world, where many
patients were unable to afford medicines, and force governments with finite
health budgets to ration care.
The time has come for pursuing "a development-oriented approach towards
formulating IP laws and policies rather than pursue an iconoclastic approach of
IP for development," the five countries argued.
It is against this background, that the five countries said there is "a
need for discussion in the TRIPS Council on the relationship between IP and the
public interest and to broaden the understanding of how the IP system can be
more responsive to public interest considerations."
"While this issue is very pertinent for developing countries, it has also
been a topic of significant policy debate even in developed countries,"
the sponsors argued.
The five countries want a meeting during the upcoming TRIPS Council session on
13 June "to share their experiences on the use of compulsory licenses for
accessing health and other technologies."
The five countries want WTO members to share their national experiences and
examples of using compulsory licenses.
They posed four questions on CL so as to enhance the understanding on various
grounds available for issue of compulsory licenses and problems faced by
members while using them.
The four questions are:
* What grounds are available in their national laws to issue compulsory
licenses?
* What are the difficulties faced by WTO Members in using compulsory licenses,
including constraints, such as insufficient or no manufacturing capacities?
* How the measure of compulsory licence was used by governments to obtain price
reduction from patent holders?
* What was the result of using compulsory licenses in terms of price and access
to affordable products and technologies?
In short, the proposal paves the way for bringing CLs to the centre-stage at
the WTO which was never attempted in the past. By raising the issues concerning
CLs, the five countries will popularize the use of CLs in developing and
poorest countries
