IP Provisions in Bilateral & Regional Trade Agreements and Public Health ICTSD/QUNO Dinner Discussion on IPRs in Bilateral & Regional Trade Agreements & Public Health 4 November 2009, Hotel Royal, Geneva Christoph Spennemann, Legal Expert, IP Team Division on Investment and Enterprise UNCTAD

Overview From TRIPS to Bilateral & Regional Trade Agreements (« FTAs ») Impact of FTAs in the area of public health: some examples Conclusions

From TRIPS to FTAs (1) TRIPS: introduction of minimum standards relevant to public health Patents available for all areas of technology Protection of pharmaceutical test data But many flexibilities Appropriate way of implementation (Art. 1 TRIPS) Lack of definitions (e.g. invention, patentability criteria, « unfair commercial use ») Exceptions (Art. 30 TRIPS)

From TRIPS to FTAs (2) Since 1995: more than 250 bilateral & regional trade agreements among WTO Members Not all of these have full IP chapters Trend: strengthening of exclusive rights; loss of TRIPS flexibilities

From TRIPS to FTAs (3) FTAs legitimate consequence of TRIPS Art 1 DCs are often demandeurs Market access to OECD But hesitant on IP (e.g. Chile) OECD countries push for stronger IP Response to domestic industry US Congress: public health safeguards in recent US FTAs (Colombia, Panama, Peru)

Example 1: term of patent protection TRIPS: 20 years from filing date US FTAs: obligation to adjust term for delays in Patent granting procedure Marketing approval procedure Now optional under US – Peru for pharmaceuticals, not other sectors TRIPS Art 27.1 non-discrimination does not prevent differentiation

Example 2: patentability criteria US FTAs introduce notion of « utility » Potentially broader than EPO’s « industrial application » Business models Research tools: safeguards in USPTO Guidelines & Federal Circuit case law, but no reference in FTAs Patents on new uses of known products US-Australia, Bahrain, Morocco, Oman Process patents in US law  unclear in FTAs

Example 3: test data exclusivity (DE) (1) TRIPS: strategically vague (« unfair commercial use ») FTAs (mainly US): exclusive rights in test data  no reliance by drug regulatory authority Impact on generic industry: No bioequivalence during term of protection  full clinical trials dossier Despite CLs & regulatory review exception: no regulatory approval prior to expiry of DE

Example 3: test data exclusivity (DE) (2) US – Peru: modifications E.g. subjects DE to Doha Declaration and TRIPS Art 31bis waivers (CL) EU: opposite development No DE in earlier FTAs; 10/11-year DE in recent proposals (Colombia, Ecuador, Peru) EFTA: some FTAs include DE Korea: compensatory liability option Colombia: compensatory liability for agrochemicals only

Example 4: linkage of drug regulation – patent status TRIPS: no provision  regulatory approval not concerned with patent status EU & EFTA: no linkage US FTAs: no regulatory approval prior to expiry of patent Shifts enforcement from IP owner to state Optional under new FTAs (Colombia, Peru, Panama) Effective remedies for patent infringement litigation Rewards for successful patent challenges

Conclusions FTAs are legitimate consequences of TRIPS FTA provisions on patents & regulated products shift balance in favor of IP holder FTAs do not refer to checks & balances used by OECD countries (e.g. patentability guidelines, case law) Recent adjustments in US FTAs respond to public health concerns Initiated by US Congress Role of developing countries?

Contact Christoph Spennemann Legal Expert Intellectual Property Team Division on Investment and Enterprise (DIAE) UNCTAD E-mail: Christoph.Spennemann@unctad.org Tel: ++41 (0) 22 917 59 99 Fax: ++41 (0) 22 917 01 94 http://www.unctad.org/tot-ip