E-DRUG: WTO on public health safeguards, poor countries
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[from pharm-policy with thanks; 2 messages in 1. NN]
This is the WTO's explanation of bolar, compulsory licensing and
parallel import provisions. Note that the WTO does not mention that
countries can eliminate injunctive remedies for patent owners in
compulsory licensing or government use, and that there is great
flexibility in terms of procedures for granting use, including the use
of non-judicial administrative procedures, or that countries can
specify, in national laws, fairly precise standards for issuing
licensing, setting compensation and achieving public health needs,
something that is rarely done and never recommended by the WTO or
WIPO.
Note also that there is no explanation that Article 30 of the TRIPS
could be used for other patent exceptions than the two they mention
(research and Bolar). Note also that in the discussion of parallel
imports, there is no mention of the great differences in national
policies, or mention that most national barriers to parallel imports
of
medicines are regulatory, and not matters of intellectual property
(because many countries have international exhaustion of patents and
trademarks).
Jamie Love
http://www.wto.org/english/tratop_e/trips_e/factsheet_pharm02_e.htm
FACT SHEET: TRIPS AND PHARMACEUTICAL PATENTS
Obligations and exceptions
Under TRIPS, what are member governments' obligations on
pharmaceutical
patents?
April 2001
Contents
Philosophy: striking a balance
Obligations and exceptions
What does "generic" mean?
Developing countries
This fact sheet has been prepared by the Information and Media
Relations
Division of the WTO Secretariat to help public understanding. It is
not
an official interpretation of the WTO agreements or members' positions
[snip]
RESEARCH EXCEPTION AND "BOLAR" PROVISION
Many countries use this provision to advance science and technology.
They allow researchers to use a patented invention for research, in
order to understand the invention more fully.
In addition, some countries allow manufacturers of generic drugs to
use
the patented invention to obtain marketing approval - for example from
public health authorities - without the patent owner's permission and
before the patent protection expires. The generic producers can then
market their versions as soon as the patent expires. This provision is
sometimes called the "regulatory exception" or "Bolar" provision.
Article 8
This has been upheld as conforming with the TRIPS Agreement in a WTO
dispute ruling. In its report adopted on 7 April 2000, a WTO dispute
settlement panel said Canadian law conforms with the TRIPS Agreement
in
allowing manufacturers to do this. (The case was titled "Canada -
Patent
Protection for Pharmaceutical Products")
ANTI-COMPETITIVE PRACTICE, ETC back to top
The TRIPS Agreement says governments can also act, again subject to
certain conditions, to prevent patent owners and other holders of
intellectual property rights from abusing intellectual property
rights,
"unreasonably" restraining trade, or hampering the international
transfer of technology. Articles 8 and 40
COMPULSORY LICENSING back to top
Compulsory licensing is when a government allows someone else to
produce
the patented product or process without the consent of the patent
owner.
In current public discussion, this is usually associated with
pharmaceuticals, but it could also apply to patents in any field - and
the TRIPS Agreement does prohibit discrimination between fields of
technology.
The agreement allows compulsory licensing as part of the agreement's
overall attempt to strike a balance between promoting access to
existing
drugs and promoting research and development into new drugs. But the
term "compulsory licensing" does not appear in the TRIPS Agreement.
Instead, the phrase "other use without authorization of the right
holder" appears in the title of Article 31. Compulsory licensing is
only
part of this since "other use" includes use by governments for their
own
purposes.
Compulsory licensing and government use of a patent without the
authorization of its owner can only be done under a number of
conditions
aimed at protecting the legitimate interests of the patent holder.
For example: Normally, the person or company applying for a licence
must
have first attempted, unsuccessfully, to obtain a voluntary licence
from
the right holder on reasonable commercial terms - Article 31b. If a
compulsory licence is issued, adequate remuneration must still be paid
to the patent holder - Article 31h.
However, for "national emergencies", "other circumstances of extreme
urgency" or "public non-commercial use" (or "government use") or
anti-competitive practices, there is no need to try for a voluntary
licence - Article 31b.
Compulsory licensing must meet certain additional requirements. In
particular, it cannot be given exclusively to a single licensee, and
usually it must be granted mainly to supply the domestic market.
Compulsory licensing cannot be arbitrary.
WHAT ARE THE GROUNDS FOR USING COMPULSORY LICENSING? back to top
The TRIPS Agreement does not specifically list the reasons that might
be
used to justify compulsory licensing. In Article 31, it does mention
national emergencies, other circumstances of extreme urgency and
anti-competitive practices - but only as grounds when some of the
normal
requirements for compulsory licensing do not apply, such as the need
to
try for a voluntary licence first.
PARALLEL IMPORTS, GREY IMPORTS AND 'EXHAUSTION' OF RIGHTS
Parallel or grey-market imports are not imports of counterfeit
products
or illegal copies. These are products made and marketed by the patent
owner (or trademark- or copyright-owner, etc) in one country and
imported into another country without the approval of the patent
owner.
For example, suppose company A has patented a drug, which it makes
under
patent in the Republic of Belladonna and the Kingdom of Calamine, but
sells at a lower price in Calamine. If a second company buys the drug
in
Calamine and imports it into Belladonna at a price that is lower than
company A's price, that would be a parallel or grey import.
The legal principle here is "exhaustion", the idea that once company A
has sold its product (in this case, in Calamine), its patent is
exhausted and it no longer has any rights over what happens to that
product.
The TRIPS Agreement simply says that none of its provisions, except
those dealing with non-discrimination ("national treatment" and
"most-favoured-nation treatment"), can be used to address the issue of
exhaustion of intellectual property rights in a WTO dispute. In other
words, even if a country allows parallel imports in a way that might
violate the TRIPS Agreement, this cannot be raised as a dispute in the
WTO unless fundamental principles of non-discrimination are involved.
Article 6