1. © 2008 International Intellectual Property June 24, 2009 Class 8 Patents: Multilateral Agreements (WTO TRIPS); Global Problem of Patent Protection for Pharmaceuticals

2. Paris Convention Primary Provisions Right to National Treatment Right of Priority Independence of Patents Compulsory Working/ Compulsory Licensing © 2008

3. Paris Convention: what it does not address Subject Matter –Paris Convention broadly covers “industrial property” – it does not prescribe subject matter areas or fields of invention for which patent protection is required –Variation in scope of patent protection from country to country E.g., pharmaceuticals, food, chemicals Criteria for Patentability Term of Patent Protection © 2008

4. WTO TRIPS Agreement Primary Provisions (1/1/95) Subject Matter (Article 27) –“…patents shall be available…without discrimination as to the place of invention, the field of technology, and whether the products are imported or locally produced.” Requires patents to be granted in all fields of technology, whether product or process, including pharmaceuticals Criteria (Articles 27, 29) –Novel (new); inventive step (nonobvious); capable of industrial application (useful); sufficiently disclosed (enabled) Term (Article 33) –minimum of 20 years from application © 2008

5. WTO TRIPS Agreement Primary Provisions Compulsory Licensing (Article 31) –Expands on rights provided by Paris Convention Grounds for compulsory licenses not limited Prescribes substantive and procedural prerequisites –However, procedural prerequisites may be waived under certain circumstances General Exception (Article 30) –Allows members to adopt exceptions to patent rights that are Limited Do not unreasonably conflict with normal exploitation of patent Do not unreasonably prejudice the legitimate interest of patent holders (taking account of the legitimate interests of third parties) © 2008

6. TRIPS -- Transitional Provisions TRIPS includes transition period for members to adapt national legislation and practices to comply with TRIPS –Length of transition period varies type of obligation stage of development of the country Ex: Patent Law of China (pp. 246-49) –Revised law became effective 1993 –Fully compliant with TRIPS requirements –Between 1985-1996, number of patent applications filed in China have increased on average 18% © 2008

7. Transitional Provisions re: Pharmaceutical Products Different Provisions for Developing Countries (DC) and Least-developed Countries (LDC) –DC: Initially had until 1/1/00 to comply; extended to 1/1/05 –LDC: Initially had until 1/1/06 to comply; extended to 1/1/16 “Mailbox” System (effective as of 1/1/95) –Requires DC and LDC that did not already provide patent protection for pharmaceuticals to establish system for such patent applications to be filed Applications do not have to be examined until TRIPS becomes effective If patentable, patent granted for remainder of term counted from filing date If drug that is subject of mailbox application obtains marketing approval before patent granted, 5-year exclusive marketing right must be granted –This requirement does not apply to LDC until 1/1/16 (see infra) © 2008

8. Compulsory Licensing Under TRIPS – Primary Provisions Authorization by government to itself or third party to use patent without the patent holder’s permission Before obtaining compulsory license (Article 31(b)) –make reasonable efforts to obtain authorization from patent holder –on reasonable commercial terms –patent holder must be given reasonable time to comply However, these procedural requirements may be waived –National emergency »statement from national health authority sufficient –Extreme urgency –Public non-commercial use »E.g., distributing medicines to public clinics without profit © 2008

9. Compulsory Licensing Under TRIPS – Primary Provisions (cont’d) If compulsory license is granted –Patent holder shall be paid adequate remuneration (Article 31(h)) Economic value of authorization must be taken into account “adequate remuneration” not defined Amount does not need to be determined before license granted –Scope and duration of use must be limited to purpose for which license was authorized (Article 31(c)) –Use shall be authorized predominantly for the supply of the domestic market where the use was authorized (Article 31(f)) Subsequent amendment to TRIPS provided a waiver to this provision under certain circumstances as explained infra © 2008

10. Provisions of Doha Declaration on TRIPS Agreement and Public Health Paragraphs 1-3: preamble –Acknowledges gravity of the public health problems in DC and LDC, esp. HIV/AIDS, TB, and malaria TRIPS should be part of the solution to these problems –Patent protection is important for the development of new medicines, but it increases prices Paragraph 4 –“…the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health….” TRIPS provisions are sufficiently flexible for protection of public health © 2008

11. Provisions of Doha Declaration on TRIPS Agreement and Public Health Paragraphs 5-7 –TRIPS shall be in interpreted in light of objectives and principles –Compulsory licenses Each member has right to determine grounds Each member has right to determine what constitutes national emergency/extreme urgency –Specifically recognizes that public health crises relating to HIV/AIDS, TB, and malaria can fall into this category Members with insufficient or no manufacturing capacities may not be able to take advantage of compulsory licensing provisions –Instructs TRIPS Council to find solution (discussed infra) –Extends transition period for LDC to 1/1/2016 © 2008

12. Paragraph 7 of Doha Declaration Under paragraph 7, there was a question whether LDCs required to implement mailbox and exclusive marketing rights before the transition date (i.e., 1/1/2016) –WTO decided that LDCs do have to implement mailbox rights, but they do not have to grant exclusive marketing rights –What does this mean for LDCs? If a mailbox application is approved, then a pool of drugs that were generic before 1/1/2016 would be patented after 1/1/2016 –Generic manufacturing facilities in LDC would have to shut down –What if no mailbox system? Patent holders from outside of LDC would not be able to obtain patents after 1/1/2016 because inventions covered by patents would no longer be “novel” given extensive use of generics in the LDC –Generics would continue to be available © 2008

13. Amendment to TRIPS Agreement Paragraph 6 of the Doha Declaration –Recognized that members with insufficient or no manufacturing capacities may not be able to take advantage of TRIPS compulsory licensing provisions Why? –Article 31(f)’s requirement that the licensee uses the patented invention predominantly to supply the domestic market creates two problems Countries that do not have the capabilities to manufacture generic drugs under a compulsory license may import only a “non-predominant” portion of those drugs from another country Countries that do have the capabilities to manufacture generic drugs under a compulsory license (e.g., India) may export only a “non-predominant” portion of those drugs to other countries that need them © 2008

14. Amendment to TRIPS Agreement In 2005, WTO Members agreed to the first amendment to the TRIPS Agreement, referred to as Article 31 bis or “Medicines Export Amendment” Primary Provisions of Medicines Export Amendment –Authorizes issuance of compulsory licenses predominantly for the supply of pharmaceutical products to export markets (amends Article 31(f)) –Obligation to provide adequate remuneration is satisfied by payment in exporting country (amends Article 31(h)) –Procedural Requirements Country acting under Amendment must notify TRIPS Council There must be a determination by the importing country that it lacks manufacturing capacity Exporter must indicate that products are being exported pursuant to Medicines Export Amendment system © 2008