Compulsory Licensing

Compulsory Licensing, Intellectual Property Rights and Pharmaceuticals

Internet Workshop

Compulsory Licensing: current hot spots

Tuesday 20 Feb, 7:30pm

To be held using Paltalk internet software: see the Paltalk website to download.

Program

The workshop will provide an opportunity to hear about and discuss:

· compulsory licensing and where it stands now (Sharon)

· report of WHO Commission on IPRs and Health (David)

· current disputes over IPRs in India (Upendra) and Thailand (Gillian).

Convenor: David Legge

The presentations will be brief and there will be adequate time for discussion. The workshop will not go on for more than one hour.

Technical

This workshop will be conducted via the internet in real time voice. The platform is PalTalk (download at [ttp://www.paltalk.com/en/start_chatting.shtml]).

You will need a headset with earphones plus boom microphone (less than $30 at any electronics computer stuff shop). You need a computer (PC) with Win 2000 or higher and 128 MB RAM and a sound card.

We ask those who are thinking of coming to let me as convenor know what their PT ID is so that they can be invited into the room.

For more information email david[at]phmoz.org

Resources

Facts about compulsory licensing

WTO documents give a good overview of compulsory licensing and the key dates and documents: Fact Sheet Sept 2006 [1] (note PDF file)

Technical Note on pharmaceutical patents and the TRIPS agreement [2]

MSF documents are quite illuminating in how this fits into practical usage: [3] (note PDF file), [4]

News articles

Thailand approves copycat drugs

From correspondents in Bangkok

January 30, 2007 06:06am Article from: Reuters

THAILAND'S army appointed government said today it had approved a cheap, copycat heart disease drug, the first time a developing country has ignored an international patent for such a treatment.

As well as the "compulsory licence" of Plavix, made by US and European pharmaceutical giants Bristol-Myers Squibb and Sanofi-Aventis, Bangkok approved a generic version of Abbott Laboratories' Kaletra to treat HIV/AIDS.

The move, which Thai health officials said would save the country as much as 800 million baht ($31 million) a year, drew flak from the drug industry but praise from AIDS activists.

"We have to do this because we don't have enough money to buy safe and necessary drugs for the people under the government's universal health scheme," Health Minister Mongkol na Songkhla told reporters today.

"The laws have been signed and became effective on Friday," said Mr Mongkol, who angered drugs companies in November by introducing Thailand's first such licence for Merck's Efavirenz anti-retroviral AIDS treatment.

Under World Trade Organisation (WTO) rules, a government is allowed to declare a "national emergency" and licence the production or sale of a patented drug without the permission of the foreign patent owner.

Teera Chakajnorodom, chairman of Bangkok-based pharmaceutical industry group PReMA, said he had not been told about the move in advance.

Although the drug companies had not had time to coordinate a response, Mr Teera said they might launch a legal challenge.

In Geneva, the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) urged the Thai government to discuss the issue with drugs companies.

Compulsory licences were open to abuse and could put the health of patients at risk, it said.

The widening of compulsory licensing is another blow to foreign investors already reeling from capital controls imposed last month to stem a rise in the baht and a proposed tightening of laws governing overseas firms in Thailand.

Foreign investors said it also appeared to be another case of the government, which assumed power after a September 19 coup against Prime Minister Thaksin Shinawatra, acting unilaterally and appearing indifferent to international reaction.

Thawat Suntrajarn, head of the health ministry's disease control department, said the copycat drugs would initially be imported from India and then be produced by Thailand's state-owned drug maker.

The price of Plavix would drop by more than 90 per cent to 6 baht (24 cents) per tablet, he said.

Plavix is Bristol-Myers Squibb's biggest-selling medicine, which had annual sales of $US6 billion ($7.8 billion) before a copycat Canadian-made version hit the market briefly in August.

Paul Cawthorne, local head of Doctors Without Borders, backed Mr Mongkol's stance, saying the government was spending 11,580 baht ($450) per patient per month for Kaletra and could cut that bill by two thirds if it switched to a generic make.

"That's a perfectly legal method for them to ensure access to essential drugs for Thai people," he said.

Thailand throws down gauntlet to drug giants

Follow link to Sydney Morning Herald article. [5]]

Thailand Invokes WTO Rule To Sell Generics For HIV And Heart Disease Drugs

Article Date: 30 Jan 2007 - 0:00 PST

Thailand has invoked a World Trade Organization (WTO) agreement on intellectual property rights to allow the manufacture, purchase and sale of generic versions of two drugs for heart disease and HIV/AIDS in the country.

The WTO agreement, which was negotiated as the Doha Declaration in 2001, allows governments to circumvent patent licences in the event of national health emergencies and to issue generic licences for the manufacture and sale of cheaper versions of essential drugs.

The two drugs in question are Plavix and Kaletra. Plavix (chemical name clopidogrel) is made by the US pharmaceutical company Bristol-Myers Squibb and the French pharmaceutical company Sanofi-Aventis, while Kaletra (chemical name lopinavir) is made by the US company Abbott Laboratories.

Plavix (clopidogrel) is an oral antiplatelet drug used to treat a range of heart and cardiovascular diseases. In 2006, Apotex, a Canadian generic drug manufacturer started selling clopidogrel but was stopped last month when a Canadian court rejected its right to do so. In 2005, Plavix was the world's second biggest selling pharmaceutical product with annual sales approaching 6 billion US dollars.

Kaletra (lopinavir) is a protease inhibitor antiretroviral drug and is given in combination with ritonavir as a multi-drug capsule to treat HIV/AIDS. Kaletra (lopinavir) was developed to enhance the HIV resistance of ritonavir, and when given alone it does not have enough bioavailability. The patent for the drug lapses in the US in 2016.

Other countries such as Brazil and India have already used the WTO national emergency exception rule to circumvent patent licences to make HIV drugs more accessible.

Thailand's Public Health Minister, Mongkol na Songkhla, said the decision is justified because the high cost of the patented versions of the drugs has made the health crisis worse in his country.

Human rights agencies and aid organizations such as Medecins Sans Frontieres are said to have applauded Thailand's actions.

This is the second move by Thailand to issue compulsory generic licences for patented drugs under the WTO regulation. Last November it issued generic licences for the anti-AIDS drug efavirenz.

The Thai government will first import some of the generic drugs from India while it sets up its own production. They estimate that by using generics treatment costs will reduce by up to 90 per cent, making it possible to treat the 500,000 people with HIV/AIDS and 200,000 people with heart disease in the country.

The pharmaceutical companies are said to be displeased with the move as they were not expecting it and are "concerned about continuing to invest in a country where the government cannot provide a basic guarantee for the safety of their assets," according to the Pharmaceutical Research and Manufacturers' Association.

The Thai Health Ministry said it would be willing to discuss imports at cheaper prices with the pharmaceutical companies, but felt this was the only way they would be able to deal with their public health crisis.

Journal articles

Thailand and the Compulsory Licensing of Efavirenz' Robert Steinbrook NEJM Volume 356:544-546

Of the many medicines for human immunodeficiency virus (HIV) infection, efavirenz, a nonnucleoside reverse-transcriptase inhibitor that became available in the late 1990s, is one of the most important. For the initial treatment of adults, the combination of efavirenz and two nucleoside reverse-transcriptase inhibitors "has become a standard-of-care comparator in clinical trials," according to Hammer et al.1 Moreover, efavirenz is available in a fixed-dose combination tablet with the nucleoside analogues emtricitabine and tenofovir; this tablet is taken only once a day. Efavirenz can cause birth defects when taken during the first trimester of pregnancy, so its use is restricted in . . . (you will need access to the journal to read the rest of the article).

Taking TRIPS to India — Novartis, Patent Law, and Access to Medicines Janice M. Mueller NEJM Volume 356:541-543

In August and September 2006, patients with cancer, lawyers for patient advocacy groups, and representatives of nongovernmental organizations (NGOs) converged on the offices of Novartis in Mumbai, India, to protest the company's efforts to obtain an Indian patent on Gleevec, the company's brand-name version of imatinib mesylate. Gleevec (spelled Glivec outside the United States) is used to treat chronic myeloid leukemia, and Novartis has patented the drug in 35 countries. The protesters also decried the drug's high price: Novartis sells it in India (where only 5% of people have private health insurance) for $26,000 per year; generic-drug manufacturers offer the drug at less than one tenth that price.1

Citing its right to recoup enormous research-and-development expenditures, Novartis refuses to drop the legal petitions it filed in the Chennai High Court in May 2006, challenging the Indian Patent Office's denial of a patent. According to Novartis, there is "no faster way to kill access to the latest life-saving drugs for people in India than to avoid offering patent protection."2 The company also emphasizes that 99% of Indian patients now receiving the drug get it free through the company's patient-assistance program.

The Gleevec challenge is the latest controversy facing India since its January 1, 2005, implementation of substantially enhanced patent protection for pharmaceuticals. India's membership in the World Trade Organization (WTO) means that for the first time in 35 years, drug products (the pharmaceutical compositions themselves, rather than merely the processes for making them) must be considered potentially patentable in India. The Indian government supports the expanded availability of patent protection as a catalyst that may enable India's enormous drug-manufacturing sector to evolve from reverse engineering to innovation.

It will take years, of course, to evaluate the effects of enhanced patent-based incentives on India's pharmaceutical industry. The immediate concern is patients' access to essential medicines that are manufactured in India and exported around the world. In the absence of notable patent-law restraints before 2005, India developed a world-class generic-drug–manufacturing sector, spawning major generics firms such as Ranbaxy, Cipla, and Dr. Reddy's, in addition to hundreds of smaller firms. India boasts more drug-manufacturing facilities that have been approved by the U.S. Food and Drug Administration than any country other than the United States. Indian generics companies, for instance, supply 84% of the AIDS drugs that Doctors without Borders uses to treat 60,000 patients in more than 30 countries.3

Will India's patenting of medicines put patients around the world at risk of losing a critical source of lifesaving generic drugs? The risk is currently minimal, thanks to public health safeguards developed by the Indian government. For example, the government has imposed price controls on essential medicines since 1970, and recent reports suggest that it may be expanding the list of drugs that are subject to such controls.4 More to the point, a number of safeguards have been built into the new patent law itself. These provisions resulted from years of intense public debate, government study, and legislative compromise.

First, patent coverage for pharmaceutical products will apply only prospectively to applications filed with the Indian Patent Office on or after January 1, 1995. Second, the law imposes powerful limitations on patents applied for between that date and December 31, 2004. Any Indian generics firm that began before 2005 to manufacture a drug that was subsequently covered by an Indian patent can continue to make and sell that drug, though it might have to pay royalties established by the government to the patent holder.

The law also includes the world's most extensive provisions on "compulsory licensing." Generics firms can legally copy patented drugs for export to the least-developed countries, which lack domestic manufacturing capability. Furthermore, generics firms and patient-advocacy groups are already making active use of robust "opposition" provisions in the law; indeed, it was opposition by a group of patients with cancer that led to the patent office's rejection of the Gleevec application. And clearly, the culture engendered by 35 years of prohibition of the patenting of pharmaceuticals will not be changed overnight. Two years into the new patents regime, the government has granted only one patent on a pharmaceutical product — to Hoffmann–La Roche, for its hepatitis C therapy, peginterferon alfa-2a (Pegasys).

Still other protections included in the law ensure that only truly innovative advances will be patented. The Novartis lawsuit is the first legal challenge to the most controversial safeguard, a provision against "evergreening" that targets attempts to patent minor improvements to old drugs. Section 3(d) of India's Patents Act forbids the patenting of derivative forms of known substances (e.g., salts, polymorphs, metabolites, and isomers) unless they are substantially more effective than the known substance. Neither the Indian patent statute nor its implementing rules define "efficacy." They give the patent office no guidelines for applying the new test. Novartis has asked the Chennai High Court to strike down this section as inconsistent with the WTO's Agreement on Trade-Related Aspects of Intellectual Property (TRIPS). TRIPS requires that patentable inventions be new and involve an "inventive step." Novartis contends that TRIPS gives WTO members the option of providing patent rights more generous than these basic criteria would mandate but does not allow members to go in the opposite direction by implementing stricter requirements for obtaining a patent.

The counterargument is that TRIPS does not define "inventive step." It permits (but does not require) WTO members to equate this criterion with the "nonobviousness" requirement of U.S. patent law — and thus gives member countries the flexibility to fine-tune their inventive-step criteria to reflect national socioeconomic conditions.

Moreover, Section 3(d) of India's patent law does not necessarily impose stricter requirements than are used elsewhere; it may be seen as simply creating a general presumption of nonpatentability for modifications of known chemical compositions — and shifting to patent applicants the burden of rebutting this presumption in each particular case. For example, the U.S. Patent and Trademark Office may reject a claimed drug as "prima facie obvious" on the basis of its structural similarity to existing chemical compositions. A classic way to overcome the rejection is to demonstrate the drug's unexpectedly good results. India's new efficacy test might well operate in a similar fashion.

The Chennai High Court considered these issues of sufficient importance to merit referral to a two-judge panel. By late January 2007, the panel had not issued a decision. NGOs were disappointed by the court's refusal to dismiss Novartis's challenge outright. But the Indian judiciary must analyze and rule on the viability and uncertain contours of the new patentability test. Until it does so, the patent office retains virtually complete discretion in its application of Section 3(d). The court must also determine whether the patent office followed correct administrative procedures in rejecting Novartis's application. The company contends that among other errors, patent examiners ignored data demonstrating that Gleevec has greater manufacturing stability than does the imatinib free-base form, as well as 30% greater bioavailability.5

India has an independent judiciary and an established rule-of-law tradition. Novartis's litigation needs to run its course, and the system must be allowed to do its job, since a number of important results could flow from this case. Indian courts probably cannot use the WTO's rules to strike down laws enacted by India's parliament, but the Chennai High Court will have to grapple with the meaning of Section 3(d) and other untested patent rules. Regardless of the outcome, the system will benefit from the judicial analysis. And even if Novartis ultimately obtains an Indian patent on Gleevec, the current safeguards give the government multiple options for ensuring public access to this and other lifesaving drugs.

Source Information: Ms. Mueller is a professor of law at the University of Pittsburgh School of Law, Pittsburgh.

An interview with Ms. Mueller is available at www.nejm.org.

References

1. Novartis challenges the Indian patent law. Zurich, Switzerland: Berne Declaration, October 9, 2006. (Accessed January 18, 2007, at http://www.evb.ch/en/p25011414.html.)

2. NGOs attack Novartis over drug access. Geneva, Switzerland: Swissinfo/Swiss Radio International (SRI), October 12, 2006. (Accessed January 18, 2007, at http://www.swissinfo.org/eng/In_depth/detail/NGOs_attack_Novartis_over_drug_access.html?siteSect=107&sid=7159190&cKey=1160714785000.)

3. As Novartis challenges India's patent law, MSF warns access to medicines is under threat. Press release of Médicins sans Frontières, September 26, 2006. (Accessed January 18, 2007, at http://www.doctorswithoutborders.org/pr/2006/09-26-2006_1.cfm.)

4. Bhargava A, Srinivasan S. Price regulation of essential medicines. The Hindu. October 17, 2006. (Accessed January 18, 2007, at http://www.thehindu.com/2006/10/17/stories/2006101702601000.htm.)

5. Novartis: writ petition against denial of Gleevec patient. Affidavit filed on behalf of the petitioner: Novartis AG v. Union of India et al., W.P. No. 24754 of 2006 (Mad. High Ct.) (May 19, 2006). (Accessed January 18, 2007, at http://www.lawyerscollective.org/.)