Overview of Public Health-Related TRIPS Flexibilities

1. Sisule F. Musungu, IQsensato (http://www.iqsensato.org) Overview of Public Health-Related TRIPS Flexibilities

2. Conceptual and Legal Basis for Flexibilities • The Preamble There are three important paragraphs in the Preamble of the TRIPS Agreement that are relevant to public health considerations. First, there is the recognition that IPRs are private rights. This paragraph is particularly relevant with respect to enforcement of IPRs. Second, is the paragraph recognizing the public policy objectives underlying the protection of IP, including developmental and technological objectives. Finally, is the recognition of the special needs of least-developed countries (LDCs) which necessitate maximum flexibility in the domestic implementation of laws and regulations in these countries with a view to enabling them establish a viable technological base.

3. Conceptual and Legal Basis for Flexibilities • The Objectives of IP Protection under TRIPS (art 7) The protection of IP contributing to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations

4. Conceptual and Legal Basis for Flexibilities • Principles for Guiding the formulation of implementing legislation (art 8) Members in formulating or amending their laws may adopt measures necessary for the protection of public health and nutrition and take measures to promote public interests in sectors of vital importance to their socio-economic and technological development; and, they may adopt appropriate measures to prevent the abuse of IPRs by right holders or the resort by them to practices that unreasonably restrain trade or adversely affect the international transfer of technology.

5. Freedom to determine Appropriate Method of Implementing TRIPS Obligations • Article 1: The relevant provisions here are the provisions of paragraph 1 which provides inter alia that WTO Members “may, but shall not be obliged to, implement in their law more extensive protection than is required…” and that they “shall be free to determine the appropriate method of implementing the provisions” of the Agreement. See India-Mailbox case Appellate Body (AB) interpretation

6. Freedom to Determine Exhaustion Regime (parallel imports) • Article 6: The TRIPS Agreement states that the issue of exhaustion is left to each Member to decide. In other words, TRIPS does not create minimum standards on this matter. The Doha Declaration on the TRIPAS Agreement and Public Health confirms this interpretation of article 6 in Para.... Which provides that “.........”

7. Patentable Subject & Patentability Criteria • Article 27: The general rule on patentable subject matter and the criteria for patentability under the TRIPS Agreement is contained in article 27(1) which provides inter alia that, subject to the exceptions set out in the Agreement, patents shall be available for all inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application. Article 27(2) provides discretion for Members to exclude from patentability subject matter where its is necessary to prevent the commercial exploitation of such inventions to protect ordre public or morality including to protect human health and the environment. Article 27(3) provides further discretion with respect to the patentability of diagnostics, therapeutic and surgical methods for the treatment of humans or animals and plants and animals and provides for a review.

8. Permissibility to Impose Certain Conditions on Patent Applicants • Article 29: Article 29 in addition to establishing one mandatory disclosure condition also establishes two optional condition that WTO Members may require patent applicants to fulfil before they are granted patent rights. The mandatory requirement is that “Members shall require that the applicant for a patent shall disclose the invention in a manner sufficiently clear and complete for the invention to be carried out by a person skilled in the art”. This is what in patent law is commonly referred to as enabling disclosure. The two optional disclosure conditions, that is conditions which WTO Members may choose to impose on applicants, are: (1) that Members may require the applicant to indicate the best mode for carrying out the invention as known to the inventor at the filing date, or where priority is claimed at the date of the priority claim; and (2) that they may require the applicant for a patent to provide information on corresponding foreign applications and grants.

9. Freedom to include Exceptions to Patent Rights, subject to three-Step-Test • Article 30: Article 30 of the TRIPS Agreement establishes the general parameters for exceptions to the exclusive rights envisaged in article 28 the Agreement. The rule is that exceptions to the patent rights are permissible provided that, taking into account the legitimate interests of third parties, the exceptions: (1) must be limited; (2) should not unreasonably conflict with the normal exploitation of the patent; and (3) should not unreasonably prejudice the legitimate interests of the patent owner. Note there is no closed list of exceptions but includes, among others, research and experimentation exception, the early working exception (bolar exception), preparation of medicines for personal use and prior use.

10. Freedom to Issue & Determine the Grounds for Issuing Compulsory Licenses • Article 31: In addition to the exceptions permitted under article 30, which can be used without any other formal requirement other than fulfilling the three-step-test, article 31 of TRIPS establishes an additional exception, referred to in the Agreement as use without the authorisation of the right holder, and special rules for the use of the exception. In common parlance, compulsory licensing. Compulsory licensing as a policy mechanism can be used to address a number of situations in the context of public health including, among others: high prices of medicines; anti-competitive practices by pharmaceutical companies; failure by pharmaceutical patent holders to sufficiently supply the market with needed medicines; emergency public health situations; and, the needs for establishing a pharmaceutical industrial base.

11. Freedom to Revocation Patents and Require Forfeiture subject to Judicial Review • Article 32: The TRIPS Agreement does not regulate the question of revocation or forfeiture. The Agreement only imposes a procedural requirement to be met in cases of revocation or forfeiture a patent. In particular, article 32 provides that “An opportunity for judicial review of any decision to revoke or forfeit a patent shall be available”. In certain circumstances, a patent can be revoked or forfeited. Various grounds for revocation and forfeiture exist in national laws. Under the European Patent Convention (CPC), for example, a patent can be revoked if it is determined that: the invention did not meet any of the patentability criteria; the patent was granted to a person not entitled to it; and failure to provide enabling disclosure.

12. No Requirement for Patent Term Extension • Article 33: The TRIPS Agreement, under article 33, establishes the patent term to be at least 20 years from the filing date. The length of this period is of critical importance. The longer the period, the longer the monopoly on the protected product or process.

13. Except for Process Patents no Reversal of Burden of Proof in Infringement Actions • Article 34: The general rule of evidence is that ‘he who alleges proves’. This general rule applies under TRIPS except with respect to process patents. In this regard, article 34 provides that, subject to the conditions set out under the article; where there is a patent for obtaining a product, the defendant can be ordered to prove that the process for obtaining an identical product is different from the patented process

14. Protection of Undisclosed Information: No Data Exclusivity Requirement • Article 39: In addition to patent protection for pharmaceuticals, the TRIPS Agreement also requires protection for test data that may be submitted by pharmaceutical and agro-chemical companies to regulatory authorities. The article provides that in ensuring the effective protection against unfair competition as provided for in article 10bis of the Paris Convention: “Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilize new chemical entities, the submission of undisclosed test data or other data, the origination of which involves a considerable effort, shall protect such data against disclosure”. Article 39 therefore only requires protection of test data from unfair competition when such data relates to new chemical entities and where the origination of the data involved considerable effort and provides for exceptions, such as where disclosure is necessary to protect the public

15. Freedom to Control of Anti-competitive in Contractual Licenses • Article 40: The article establishes a regime for the control of anti-competitive practices in contractual licenses which allows countries to prohibit the use of terms such as exclusive grant back clauses, clauses that preclude challenges to validity of the patent and coercive packaging.

16. Flexibilities in the TRIPS Enforcement Regime • Part III (21 articles): The minimum standards established here cover from general obligations on enforcement to specific rules on evidence, injunctions, damages, remedies, border measures as well as the application of criminal procedures. the provisions on enforcement have a direct impact of public health because they determine the practical effect of patent rights at the national level including the extent to which the individuals and groups can protect their access to medicines. For example, while article 44(2) permits members to exclude government use licenses from injunctions, if this is not done, pharmaceutical companies can easily frustrate governments effort to acquire essential medicines even in the cases of emergency by obtaining injunctions. Another example relates to the balance of rights between applicants and defendants contemplated in article 42. Ensuring that both the patent holder and defendants have practical means of exercising the rights contemplated is important to public health policy.

17. Transition Periods • Articles 65 & 66.1: 1996 for developed 2000 & 2005 for developing countries 2005, 2013 & 2016 for LDCs