http://online.wsj.com/article/SB120406606358794697.html?mod=opinion_main_europe_asia
Bangkok's Drug War, Round Two
THE WALL STREET JOURNAL ASIA
February 27, 2008
Thailand's military government may be gone, but its war on drug patents is still very much alive. Just ask the new Health Minister, Chaiya Sasomsup, who is thinking about restoring intellectual property rights to their rightful owners -- the pharmaceutical companies.
Mr. Chaiya, who took office this month, is trying to clean up the mess bequeathed by his predecessor, Mongkol na Songkhla. Citing a World Trade Organization loophole, Dr. Mongkol seized patents on Merck's HIV/AIDS drug Efavirenz in 2006. In 2007, he took another HIV/AIDS patent -- Abbott Laboratory's Kaletra -- and Sanofi-Aventis's patent for a heart drug, Plavix. His last act before leaving office last month was to sign an order to seize four cancer drug patents: two from Novartis, one from Sanofi-Aventis, and one from Roche.
Mr. Chaiya is worried both about Thai patients' access to new drugs and trade sanctions against Thailand for seizing patents. Fair enough: The WTO provision Dr. Mongkol used specifies patent seizures are allowed only after "efforts to obtain authorization from the right holder on reasonable commercial terms and conditions," or in cases of "national emergency." It's unclear that Thailand's actions fit either circumstance.
But woe be to Mr. Chaiya to utter such heresy in Thailand, where nonprofit groups such as Oxfam 
and Doctor
s Without Borders have inculcated the public with scare stories about how Big Pharma has it in for Thai consumers. The NGO packhounds immediately flooded the Thai media with scare stories about Mr. Chaiya's proposal, forcing him to do a political backstep last week and say compulsory licensing policy has been "maintained." The matter is still under review.
What's missing here is the other side of the argument.
Many drug companies tier their pricing, charging developed countries more and developing countries such as Thailand, less. Thailand also faces a range of delivery problems that raise the ultimate cost of drugs to consumers, including high taxes on imports. Not least, seizing patents also puts patients at risk of importing nonbranded, lower-quality drugs.
Mr. Chaiya's job is to look after the health of the Thai people, not the political motivations of NGOs. It's clear what serves Thais best: drug companies that are incentivized, through the profit motive, to research and develop new drugs.
Saturday, March 8, 2008
A One-Side Argument Will NOT Ensure the Health of the Thai People
Friday, March 7, 2008
In the Thais' Eyes, Drug Patent Holders Must Fund Governments' Political Healthcare Promises
Head of Thailand's Food and Drug Administration resigns after one week
The Associated Press
Monday, March 3, 2008
BANGKOK, Thailand: The recently appointed head of Thailand's Food and Drug Administration resigned Monday amid controversy over the new government's plan to review a policy of overriding patents on several expensive cancer-fighting drugs.
Chatree said he decided to resign because he felt "uncomfortable with the politics," explaining that critics had brought up old, unproven allegations linking him to corruption in a computer procurement project in 2003. He called the allegations "politically motivated and groundless," without elaborating.
Chatree's predecessor, Siriwat Thiptharadon, was transferred to an inactive post last Tuesday by the new government of Prime Minister Samak Sundaravej. Siriwat called his transfer unfair, charging it was because he supported compulsory licensing of drug patents.
Compulsory licensing is intended to make some drugs more affordable by taking away the patent holder's ability to control the drug's price, a benefit of being a drug's exclusive supplier. International trade rules allow a government to issue a compulsory license to manufacture a generic version of a drug only in case of a national public health emergency.
[APPARENTLY UNDER THAI LAW, AS CALLED FOR BY HEALTH ACTIVISTS WHO LOBBIED TO REMOVE THE NEW FDA ADMINISTRATOR, DRUG INNOVATORS THAT DARE TO EXERCISE THEIR PATENT RIGHTS IN THAILAND ARE AUTOMATICALLY DEEMED ILLEGAL MONOPOLISTS. IN OTHER WORDS, A PATENT HOLDER'S EXERCISE OF THE EXCLUSIVE RIGHT TO SELL, DISTRIBUTE AND IMPORT A NEWLY PATENTED DRUG THAT HAS NO COMPETITOR IN THE MARKETPLACE, PROVIDES AMPLE BASIS FOR THE THAI GOVERNMENT TO DECLARE THAT A 'PUBLIC INTEREST' HAS BEEN VIOLATED. CONSEQUENTLY, THE THAI GOVERNMENT, PROMPTED BY ACTIVISTS BELIEVES IT IS PERMITTED TO 'TAKE' IT AWAY FROM THE PATENT OWNER VIA ISSUANCE OF A COMPULSORY LICENSE !!]
Siriwat was the architect of the government's policy leading to the issuing of compulsory licenses on Jan. 4 for four cancer-fighting drugs.
In the past two years, the Thai government has also issued compulsory licenses for several drugs used to treat AIDS and heart disease, drawing criticism from companies holding patents on the drugs.
The drug companies dispute whether the circumstances in Thailand qualify for such licenses.
Newly appointed Public Health Minister Chaiya Sasomsup said Monday the ministry will review the licensing policy on the cancer-fighting drugs, while ensuring patients have affordable access to the medicines.
[AT WHOSE COST, THAT OF THE DRUG COMPANIES?? ARE PATENT HOLDERS, AS A MATTER OF INTERNATIONAL POLICY, NOW RESPONSIBLE FOR FUNDING GOVERNMENTS' PUBLIC HEALTH CARE PROMISES??? WHY DOESN'T THE GOVERNMENT JUST TAKE OVER THE PHARMACEUTICAL BUSINESS & ELIMINATE FREE ENTERPRISE ALTOGETHER??]
He said that if negotiations fail to get drug companies to lower their prices, compulsory licensing would be maintained.
Chaiya earlier said the government planned to review the drug licensing policy because U.S. drug manufacturers might ask Washington to apply trade sanctions against Thailand.
The four drugs issued compulsory licenses on Jan. 4 are Novartis' Imatinib and Letrozole, Sanofi-Aventis' Docetaxel, and Roche's Erlotinib.
Novartis AG and Roche Holding AG are Swiss, and Sanofi-Aventis SA is French.
Wednesday, February 20, 2008
KEI Activists Try to Promote Anti-Patent Populism to Prod Politically-Motivated Patent Reforms Reminiscent of Prior Poor Policy Proposals
The following 1886 New York Times Op-Ed was disseminated by James Love of the George Soros-Funded Activist Organization, Knowledge Ecology International (KEI), in an Effort to Persuade US Policymakers & Congressional Representatives How the US Patent System is Broken and Needs to Be Replaced. Sadly, This Effort is Not Only Misguided But also Dangerous to Future U.S. Global Economic & Technological Competitiveness.
The article below is actually demonstrative of the historical ebbs and flows of U.S. patent policy during the late 19th and 20th centuries, as is reflected in additional information provided by the ITSSD following this article.
In the 19th Century, the New York Times on a number of occasions reported and editorialized on various proposals at radical reform of patent laws, including this automatic licensing [COMPULSORY LICENSING] proposal in 1886.
"PATENT LAW AMENDMENTS." The New York Times, February 11, 1886.
Representative Dunn, of Arkansas, introduced in the House on Monday a bill to prevent the establishment of monopolies under the patent laws of the United States. Section 4,884 of the Revised Statutes gives the inventor a complete monopoly of his invention. It provides that, in addition to a description of the invention, every patent shall contain "a grant to the patentee, his heirs or assigns, for the term of seventeen years, of the exclusive right to make, use and vend the invention or discovery throughout the United States and the Territories thereof." Mr. Dunn's bill amends this section by declaring that the grant to the inventor shall be, as now, for seventeen years, but instead of an exclusive and entire property in the invention, it shall cover "a royalty of 10 per centum of all gross sales of the right to make, use, and vend the same throughout the United States." Any person, it is further provided, shall have the right to make, use, and vend the patented article upon payment of the 10 per cent royalty to the patentee or his heirs or assigns.
The principle of Mr. Dunn's bill is sound and its purpose is commendable. It is obvious that some amendment of the bill would be necessary, for patented inventions vary so widely in respect to their cost of construction, the extent of the public demand for them, and the expense of putting them on the market, that a 10 per cent royalty would in many cases be a very insufficient return to the patentee for his expenditures of time, labor, money, and brains. The effect of such a law would be to discourage invention, and that would be a worse evil than the tendency to monopoly which the bill aims to check. The problem is too complicated to be solved in that simple way, but there is not the slightest doubt that a just and workable amendment to the patent laws can be drawn up which would prevent the use of the grants of the Patent Office as a foundation for greedy and oppressive monopolies.
It is high time that the interests of the people as against those of patentees received some consideration and protection. The spirit of the time is hostile to monopolies, and justly so. It is hard enough for the public to bear the exactions of corporate monopolies which have no other warrant than a charter granted under State laws and no protection save that accorded them by bribed legislators and lenient Judges. But that the great seal of the United States should be allowed to confer a license for unlimited extortion is a monstrous wrong. The doctrine that a corporation may demand "what the traffic will bear" is held to be outrageous and wicked. Yet letters patent of the United States at present grant to patentees an absolutely unrestricted right to apply this doctrine to the sale and use of their inventions. Surely there is somewhere a just limit to the profit which a patentee may be permitted to exact from the public under his grant from the Government, a limit which would yield him the due reward of his genius and insure him a full and generous return for his toil and outlay, and yet would protect the people to whom his devices were a necessity from that boundless avarice which experience has shown is often fostered in the favoring and secure shelter of a patent. Such a restriction would not discourage inventors, and it would have the salutary effect of making useful inventions more widely available.
There is one form of extortion under the patent laws, and it is the most common one which ought to be made impossible. The best example of this kind of legalized pillage is furnished by the Bell Telephone Company. That company, protected by a patent whose validity is strenuously disputed, exacts and annual rent of $14 from the local companies for telephone instruments which cost $3.42. That is the whole case in a nutshell of robbery by royalty. As a consequence of this 350 per cent profit and of its great revenues from the local companies, whose stock it holds to the face value of $22,000,000, the capital stock of the Bell Company, according to the statement of Boston newspapers, has been "watered" to seven times its original amount, and still the dividends are 17 per cent upon the enormously inflated capital. No such monopoly as that ought to exist by the sanction of the Government.
There should be most assuredly a well defined limit to extortion in the form of rent or royalty upon patented machines and devices. And the privilege of exacting royalties is one which should never be accorded save with reasonable safeguards. It ought not to be possible for a patentee to exact his own price with no alternative to the user. The latter should have the option of purchase outright in lieu of royalty or rent paid at stated periods; and the permissible royalty or rent would naturally become the basis of the purchase price. A patentee ought to be content to sell his machine or device at a fair price, and the user ought to have the right of absolute ownership in it if he chooses to remunerate the patentee in that way.
James Love, Knowledge Ecology International (KEI)
**********************************************************************************
It is no surprise that U.S. government treatment of patents, copyrights & trade secrets has long been influenced by concerns and fears about economic downturns.
“A Brief History of the Patent Law of the United States”
According to at least legal commentator,
“[D]ifferent attitudes...have prevailed at [] different times and...have had...effects on...the...development of [] patent law...In the last two decades of the nineteenth century there was a period of economic depression and increasing concern about the power of "big business" leading to the passage of the Sherman Antitrust Act in 1890. This climate was reflected in the patent field by an increasing tendency of the courts to hold patents invalid. By the late 1890's the depression had run its course and patents came back into favor with the reviving economy. In general the twentieth century has seen a dynamic interrelationship between the patent system and the application of antitrust laws. Although the first antitrust law, the Sherman Act, was enacted in 1890, the courts did not start to give it teeth until Theodore Roosevelt’s administration (1901-1909). It was not until the 1930's that the patent system started to come under attack, being viewed as assisting in the maintenance of monopolies that were seen as being at least a contributing factor to the economic misery of the thirties. This skepticism about the patent system survived World War II and blossomed again in the depressed economic conditions of the 1970's, a period of strong anti-trust enforcement...In the early 1980's, the thinking of the Chicago School of economists came to the fore and with the election of President Reagan enthusiasm for antitrust enforcement went out of fashion.” (Ladas & Perry, LLP – 2003)
Source: Rediscovering the Value of Intellectual Property Rights, Presented at The 20th Liberty Forum Of Instituto de Estudos Empresariais - iee “Property Rights and Development”, ‘IP in the 21st Century: Challenges & Concerns’, in Porto Alegre, Brazil
April 17, 2007, accessible at: http://www.itssd.org/ppt/IPinthe21stCentury.ppt .
Thursday, February 7, 2008
Activist NGOs Call For Developing Country IP & Economic Welfare (More 'Balance' Needed In IP and Trade); Not For R&D and Business Skills Training
http://www.ip-watch.org/weblog/index.php?p=898
Intellectual Property Watch
29 January 2008
NGO Panel: More Balance Needed In IP And Trade; Disclosure May Not Be Enough
By Catherine Saez
A more balanced international regime for intellectual property rights and trade is needed to rectify the current system, which too strongly favours developed countries, developing country panellists said at a recent event.
But some say that a proposed requirement to disclose the origin of genetic material and associated traditional knowledge in patent applications would not be sufficient to improve this balance.
The current patent system has been seen as the primary enabling mechanism for biopiracy, the misappropriation of genetic resources, said panellist Xuan Li, coordinator of the innovation and access to knowledge programme at the intergovernmental South Centre. The World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) also has allowed the misappropriation of genetic resources, she said.
[THIS IS PATENTLY UNTRUE AND SMACKS OF SOCIALIST PUBLIC GOODS IDEOLOGY TO DISGUISE PATENT PIRACY PREDILECTIONS]
Li made the remarks at a 24 January event organised by the South Centre and the Center for International Environmental Law (CIEL), held alongside a weeklong meeting of the UN Convention on Biological Diversity (CBD) working group on access and benefit sharing (ABS).
A Chinese official on the panel also raised these concerns and said that TRIPS is sometimes unbalanced and privileges the holder of IP.
[THE CHINESE ARE DISINGENUOUS, CONSIDERING THEY WISH TO DEVELOP THEIR OWN TEMPORARY INTELLECTUAL PROPERTY MONOPOLIES]**
A more balanced system should be devised in the future that would be more favourable to developing countries, the official said, adding that an amendment to TRIPS Article 29 on a mandatory disclosure requirement (see South Centre paper [pdf]) is proposed by developing countries including China, in order to bring the agreement more in line with CBD principles, like benefit sharing.
[CHINA TENDS TO PLAY BOTH SIDES OF THE FENCE]**
The protection of biodiversity and the rights of indigenous peoples are being analysed at several international fora. Approaches to the disclosure of origin issue have been raised at the WTO, the World Intellectual Property Organization (WIPO), and the CBD.
As the CBD is a prior treaty to TRIPS, under the Vienna Convention, TRIPS needs to be compatible with the CBD mandate, said panellist Dalindyebo Shabalala, director of the IP and sustainable development project at CIEL.
[THIS ALSO IS UNTRUE - THE LATEST TREATY IN TIME ON THE SAME OR SIMILAR SUBJECT MATTER USUALLY SPEAKS TO THE MORE MODERN INTERPRETATION OF TERMS AND REFLECTS THE MORE MODERN THINKING OF TREATY PARTIES - ESPECIALLY IF THE MORE RECENT TREATY TERMS IN QUESTION ARE MORE SPECIFIC THAN THOSE OF THE EARLIER TREATY ON THE SAME OR SIMILAR SUBJECT - THUS, THE TRIPS RULES ARGUABLY SUPERCEDE THE MORE GENERAL CBD RULES]
The ABS working group was established by the CBD Conference of the Parties at its fifth meeting in May 2000, with a mandate to develop guidelines and other approaches to assist parties and stakeholders with the implementation of the access and benefit-sharing provisions of the convention.
Another mandate was given to the working group in 2004 to elaborate and negotiate an international regime on access to genetic resources and benefit sharing with the aim of adopting an instrument to effectively implement provisions in Articles 8 and 15 and the three objectives of the convention. These include conservation of biological diversity, sustainable use of its components, and fair and equitable sharing of the benefits arising out of the utilisation of genetic resources.
In the second mandate of the ABS working group, WIPO was asked to play a significant role in CBD deliberations. Some industrialised countries have sought to have WIPO play the role of the major provider of technical expertise on IP-related issues such as the protection of traditional knowledge and disclosure of origin, according to Shabalala.
However, the processes at WIPO do not fully reflect the human rights dimension of the protection of indigenous/traditional knowledge associated with genetic resources, as the delegates and the secretariat have a lack of experience on human rights and environmental issues, he said. According to Shabalala, other United Nations agencies also have competence in understanding IP issues, such as the World Health Organization or the United Nations Conference on Trade and Development.
Concerning a certificate of origin for resources, Pierluigi Bozzi of the Economics Department at the University of Rome put into perspective the importance of knowing the precise origin of genetic resources in the context of the CBD. “The unlawful removal of a resource becomes visible only after the event and in times and places far from the original context,” he said.
[THIS IS TYPICAL EUROPEAN POSITION FAVORING 'GEOGRAPHIC INDICATORS' AND RULE OF ORIGIN AS A MEANS OF DISGUISED TRADE PROTECTIONISM]**
The real asset of the ascertainment of the place of the origin of genetic resources would be to bring management and control of a biological element back to its own ecosystem, allowing the country to bear the responsibility for the knowledge and the management of that specific biological component. This would also allow the benefits and incentives to be spread across the entire value chain, not only to the end of it, according to Bozzi. The fair and equitable sharing of the benefits is a “prerequisite” to realise the two first objectives of the CBD (conservation and sustainable use of biodiversity), he said.
[THIS IS A PRESCRIPTION FOR STATE-CENTRALIZED OWNERSHIP OF THE COMMONS - RES COMMUNIS - AND THUS A MANDATE FOR WELFARE STATE SOCIALISM]
The indigenous perspective on disclosure seems somewhat different, according to Le’a Malia Kanehe, legal analyst at the Indigenous Peoples Council on Biocolonialism. She said that several problems had been identified with disclosure, such as trans-boundary people or biopiracy having taken place prior to the CBD. The latter case would mean that genetic resources would be ex-situ, outside of indigenous control. But the main concern of the indigenous peoples, according to Kanehe, is to find out if disclosure really addresses the rights and interests of indigenous peoples, particularly in the case where national law does not recognise indigenous peoples’ rights.
[NOW, THIS IS A LEGITIMATE CONCERN]
An ongoing international project to develop prior art databases of traditional knowledge for patent examiners also is potential dangerous as they might become a “shopping list” of traditional knowledge over which indigenous people could lose both ownership and control (IPW, Biodiversity/Genetic Resources/Biotechnology, 19 December 2007; IPW, Subscribers, 17 December 2007). An international patent system might not be consistent with local customary laws, she said. Indigenous people should have the choice whether or not to commercialise their knowledge. “We don’t want to be third-party beneficiaries,” she said.
[THIS ARTICLE'S PORTRAYAL OF THE CURRENT PRIVATE PROPERTY-BASED GLOBAL IP STANDARDS AS UNFAIR TO DEVELOPING COUNTRIES IS NOT ONLY WRONG, BUT ALSO REFLECTS AN IDEOLOGY PREDISPOSED AGAINST PRIVATE PROPERTY IN FAVOR OF 'PUBLIC GOODS'.
THIS IS ESPECIALLY TRUE CONSIDERING THAT ALL WHICH IS NECESSARY TO PROECT THE RIGHTS OF INDIGENOUS AND OTHER DEVELOPING COUNTRY CITIZENS WHO ARE 'INVENTORS' AND PROPERTY HOLDERS IS A NATIONAL 'RULE OF LAW' FRAMEWORK THAT RECOGNIZES AND PROTECTS EXCLUSIVE PRIVATE PROPERTY RIGHTS IN PATENTED DISCOVERIES AND DERIVATIVE INNOVATIONS.
WHAT IS CRUCIAL AND IMPORTANT IS THAT THE DISCOVERIES CAN BE REDUCED TO THE UNIVERSAL STANDARD FOR PATENTABILITY: NOVEL, USEFUL & UNOBVIOUS. TO SUGGEST THAT ANY EFFORT TO REDUCE TRADITIONAL KNOWLEDGE TO SUCH A STANDARD WOULD, IPSO FACTO, SHORTCHANGE INDIGENOUS PEOPLES IS CLEARLY INACCURATE AND FALSE.
THE COMMONS IS OWNED BY NO ONE, NOT EVEN THE STATE, THOUGH THE STATE CAN ACT AS 'TRUSTEE' FOR ITS CITIZENS IN PRESERVING AND PROTECTING THE PUBLIC GOOD DERIVED FROM THE USE OR NONUSE OF THE COMMONS. WHILE THE STATE MAY FAIRLY CHARGE AN ACCESS FEE TO 'TAKE' FROM THE COMMONS, IT SHOULD NOT BE ENTITLED TO ANYTHING MORE THAN AN ADMINISTRATIVE FEE. IT SHOULD NOT BE ENTITLED TO DERIVE A ROYALTY STREAM FROM THE HUMANLY MANIPULATED PRODUCTS DERIVED FROM NATURE, UNLESS THE STATE HAS BEEN INVOLVED, SCIENTIFICALLY AND/OR ECONOMICALLY IN SOME OF THE HUMAN MANIPULATION OF THE NATURE THAT RESULTS IN MARKET-RELEVANT INNOVATIONS .
ONLY TO THE EXTENT THAT FLORA EXTRACTED FROM THE 'COMMONS' (NATURE), PRESUMABLY WITH STATE OR INDIGENOUS PEOPLE CONSENT, CAN BE PROVEN TO HAVE BEEN SUFFICIENTLY MANIPULATED BY HUMANS IN SUCH AS WAY AS TO MAKE IT NOVEL, USEFUL AND UNOBVIOUS, CAN THE RESULTING DISCOVERY/INNOVATION BE PATENTED AND LATER COMMERCIALIZED FOR PROFIT AS PRIVATE PROPERTY.
CONSIDERING ITS MANY INACCURATE STATEMENTS, THE ADVICE GIVEN IN THIS ARTICLE BY THE AUTHOR, IF FOLLOWED, WILL ACTUALLY DEPRIVE DEVELOPING COUNTRY CITIZENS OF THE OPPORTUNITY TO INNOVATE THEMSELVES. BY FOCUSING ON ALLEGED 'BIOPIRACY' RATHER THAN HELPING DEVELOPING COUNTRY INVENTORS TO BECOME SKILLED IN RESEARCH & DEVELOPMENT AND ENTREPRENEURSHIP ACTUALLY FOSTERS GREATER STATE WELFARE AT THE EXPENSE OF INDIVIDUAL WELFARE WHICH IS NOT ENHANCED AS A RESULT.
LASTLY, THIS ARTICLE SEEMS TO PROMOTE A 'NEGATIVE PARADIGM' OF SUSTAINABLE DEVELOPMENT INSOFAR AS IT ADVOCATES IN FAVOR OF STATE-CENTRED OR EVEN SUPRANATIONAL UN-CENTERED GOVERNANCE THAT DIMINISHES INDIVIDUAL GROWTH AND OPPORTUNITY FOR THE SAKE OF THE 'PUBLIC GOOD'. HENCE, UNDER THE PROPOSED SYSTEM INDIVIDUALS WILL NEVER BE ABLE TO REALIZE THEIR HUMAN POTENTIALS.]
Wednesday, January 16, 2008
European Commission Hands 110th Congressional Majority & Presidential Contenders a New Political Issue - Bashing Private Intellectual Property Rights
The following article demonstrates indirectly how the ‘failure to work’ doctrine in international intellectual property (patent) law has been squeezed down from 4 years under the Paris Convention for the Protection of Industrial Property (Patents) to practically zero years, and then used as a justification by governments to declare a compulsory license if there is found to be a ‘lack of adequate competition’.
Pursuant to Article 5 of the Paris Convention, the ‘failure to work’ doctrine essentially affords each member country “the right to take legislative measures providing for the grant of compulsory licenses to prevent the abuses which might result from the exercise of the exclusive rights conferred by the patent”.
However, within the European Union, it appears that a company’s indigenously (internally) developed know-how (as opposed to know-how and technologies acquired by means of merger & acquisition), especially in the healthcare or information technology sectors, is deemed to be a ‘public’ good – or in the international context, a ‘global public good’ (GPG).
Consequently, if the medical or healthcare-related knowledge or technology is unique in the marketplace without peer, and the holders of the patents to such know-how or technologies impose conditions for licensing or refuse to license the patent altogether, the EU Commission’s Antitrust Directorate is empowered to deem (i.e., to invoke a legal presumption of 'monopoly' against) the holders of the patents to such know-how or technology as operating an illegal ‘monopoly’. This makes it easier for governments to recommend the use of antitrust remedies to ‘break’ the monopoly via the issuance of compulsory licenses even though there is NO predatory behavior by the company and NO unreasonable contractual or market behavior by U.S. legal standards.
Emerging country governments, such as the Government of Brazil, are now basing their policies of ‘universal access to healthcare’ and ‘universal access to knowledge’ (A2K) on this approach to patents law. Such approach has also been embraced by many Majority members of the 110th United States Congress.
EU Probes Pharmaceutical Industry
On Dwindling New Patents, Drugs
http://online.wsj.com/article/SB120048256196094295.html?mod=hpp_us_whats_news
The Wall Street Journal Europe
By CHARLES FORELLE
January 16, 2008 9:17 a.m.
BRUSSELS -- European Union investigators raided drug companies in several countries as the bloc's antitrust watchdog launched a wide investigation of potentially anticompetitive practices in the industry.
Neelie Kroes, the EU antitrust chief, said the industry-wide inquiry would examine whether large companies are abusing their market power to prevent competitors from bringing new drugs to market, or whether companies were colluding to restrain competition. [THIS AMOUNTS TO A 'WITCH HUNT' – CORPORATE CITIZENS IN CONTINENTAL EUROPE ARE DEEMED ‘GUILTY’ UNTIL PROVEN ‘INNOCENT’ – PRECISELY THE OPPOSITE SITUATION IN AMERICA DUE TO THE U.S. CONSTITUTION]
AstraZeneca PLC, GlaxoSmithKline PLC, Sanofi-Aventis SA, and Pfizer Inc. said they were among the companies contacted, although the commission did not name the companies searched Tuesday and early Wednesday, nor where they were located.
The EU's so-called sector inquiries are broad-brush examinations; they don't necessarily lead regulators to bring antitrust cases, but can result in substantial fines. Recent sector inquiries have focused on energy markets and payment-card systems. Both eventually resulted in antitrust action -- most recently in the EU's declaring unlawful a type of interbank fee set by MasterCard.
Mrs. Kroes cited figures indicating that the number of new drugs launched annually has declined from an average of 40 in the late 1990s to 28 between 2000 and 2004. "The pharmaceutical markets are not working as well as they might," she said. [THIS IS ANOTHER ‘MARKET FAILURE’ WHICH THE EU REGULATORS WISH TO ‘CORRECT’ THROUGH GOVERNMENT INTERVENTION/REGULATION ANATHEMA TO EXCLUSIVE PRIVATE PROPERTY RIGHTS]
The pharmaceutical sector inquiry seems likely to reanimate a debate about the intersection of competition policy and patent law. EU officials say one concern is that companies are "misusing" patent laws to block new drugs made by rivals. Such misuse might entail overbroad patent filings or specious lawsuits. The officials say that if the companies in question are "dominant," then any abusive behavior falls under their jurisdiction as a violation of EU monopoly rules.[THERE DOES NOT NEED TO BE REALLY AN ‘ILLICIT’ ACTIVITY – JUST THE MERE PRESENCE OF INNOVATION LEADERSHIP AND NO DESIRE TO LICENSE THE TECHNOLOGY...]
Another potential violation is more straightforward -- collusion between companies, for instance, agreeing not to enter each other's markets, or taking payment not to launch a competing drug. [THIS IS A LEGITIMATE ‘CONCERN’ IN THOSE INSTANCES WHERE IT CAN BE DEMONSTRATED BY CLEAR & CONVINCING EVIDENCE]
The EU has taken on alleged patent abuses before. In 2005, the Commission fined AstraZeneca €60 million ($89 million) for trying to block generic-drug makers from coming out with versions of its blockbuster ulcer drug Losec. The Commission said AstraZeneca gave "misleading" information to national patent offices that led them to wrongly extend the company's patents on Losec. AstraZeneca has appealed the case.
Under EU regulations, commission officials can raid the premises of businesses operating in Europe, whether or not they are European companies.
The EU began the sector inquiry with unannounced inspections -- triggering the first ones within hours of the commission's decision Wednesday to authorize the inquiry. In earlier sector inquiries, EU officials had begun more politely, with requests for information.
--Dow Jones Newswires contributed to this article.
Saturday, January 12, 2008
Former ITSSD Intern Reveals How American & European Activists and Politicians Attack U.S. Intellectual Property Rights
The New War on Drugs:
Activists and Politicians Attack Intellectual Property Rights
Capital Research Center - Organizational Trends
January 2008
http://www.capitalresearch.org/pubs/pdf/v1199294989.pdf
America’s pharmaceutical industry is the envy of the world and the savior of millions of sick people. But activist groups, many of them founded by Ralph Nader and funded by liberal foundations, are campaigning to limit the industry’s incentives to produce new life-saving drugs. Their strategy focuses on undermining the intellectual property rights that protect pharmaceutical innovation.
By Karl Crow
Karl Crow is a 3rd Year student at Temple University's Beasley School of Law. In 2007 he was an intern at the Institute for Trade, Standards, and Sustainable Development (ITSSD) in
Princeton, New Jersey.
Wednesday, December 26, 2007
Open Source for Cost Effective Drug Discovery
Dr. Samir K 
Brahmachari,
the new Director-General of the CSIR is all set to unleash the open source revolution in drug discovery and biotechnology. The Economic Times Reports: “For the first time ever, India plans to launch an innovate drug discovery programme roping in global IT firms, researchers, companies, and young minds at scientific laboratories to invent drugs at a fraction of the cost of an MNC-developed drug. Drug discovery has hitherto been the forte of MNC pharma giants.The government has begun discussions with Sun Microsystems to set up web-management tools for an ‘open source’ drug discovery project, which works similar to a popular online encyclopaedia formed by articles contributed and edited by the brightest minds worldwide.
The first project would be to develop medicines for tuberculosis and later extend to other diseases like malaria and AIDS.Under the proposed project, researchers attached to institutions like the Royal Society of UK, Imperial College of London, Medicine Sans Frontiers and various Indian universities will have an opportunity to work on a drug discovery process even at an individual level. What’s more, the contribution would also fetch reward and recognition. Corporates like the Kinetic Group, entities like the Welcome Trust and various corporate groups would sponsor these rewards.
The project is likely to be implemented either by the Council of Scientific and Industrial Research (CSIR) itself or the Institute of Genomics and Integrative Biology.‘We have already built a database of the requirements for developing drugs for infectious diseases. This would be hosted online, where individual experts could contribute in solving specific aspects of the drug discovery. Specific contracts will then be assigned to individual contract manufacturers and clinical research organisations,’ the project’s architect and CSIR’s new director general Samir K Brahmachari told ET.
‘The chemical entities thus developed will instantly become generics as the knowledge will be in public domain. This is diametrically opposite to the concept of intellectual property protection, which involves legal expenses to bar others from applying their minds on the invention,’ Mr Brahmachari said. Mr Brahmachari also heads the department of industrial research. ‘When a thousand young students contribute in solving a complex puzzle, we are empowering them to be the knowledge leaders of tomorrow.
For researchers at state-owned laboratories, it offers an exiting challenge of social importance,’ he added. It is likely that generics makers, like Ranbaxy and Cipla, could be more interested, than MNCs, as it would be volume-based. MNCs are more keen on low-volume high-value brands.If successful, the project would also challenge MNC drug makers claims that they invest billions of dollars in risky experiments hoping to develop one useful drug.
The project will get one-third funding from the government, one-third from international sources and the rest from philanthropic entities.” Sounds like a fantastic idea! Dr. Brahmachari’s open source strategy appears not only to challenge the notion that patents are necessary for innovation, but also the notion that investment for mass production needs monopoly incentives through patents. Look out for Spicy IP’s interview with Dr. Brahmachari in the coming week!
Most Indian drug majors too in line for patent protection
14 Dec, 2007, 0046 hrs IST,Khomba Singh, TNN
NEW DELHI:
It’s not just global drug discovery majors that are seeking patent protection. Out of the 8,000 drug patent applications in India filed between 1995 and 2004, about 40% are from Indian pharma companies.
Domestic majors such as Ranbaxy Laboratories, Dr Reddy’s Laboratories and Cipla have filed over 100 patent applications each. Between 1995 and 2004, the Indian patent office received over 8,000 patent applications related to medicine.
Ranbaxy Laboratories, India’s largest drug maker, has claimed protection for 112 drugs during the period, including few which are at various stages of clinical development. In addition, Ranbaxy has also filed 30 patents in 2006, including seven for new drug delivery systems (NDDS), which are in advanced stages of development.
Similarly, other pharma majors such as Cipla and Dr Reddy’s Laboratories have each sought protection for over 100 drugs, says Dr Amit Sengupta who reviewed the mailbox applications in India in collaboration with the health ministry. However, many of these applications, both from global MNCs and Indian companies, are frivolous which may not qualify as a candidate for a patent.
According to Professor Carlos M Correa, a former member of the World Health Organisation (WHO) Commission on Intellectual Property, Innovation and Public Health (CIPIH), many of the patent applications worldwide are merely ‘new laboratory techniques’ and therefore would not qualify for patents. “The pipeline of discovery drugs are drying up. While there are around a million applications in the US, only 20 new chemical entity (NCE) got US Food and Drug Administration’s approval in 2005 compared to 51 in 1997,“ he said.
[THIS IS NOT BRAIN SCIENCE - WHEN FACED WITH IDEOLOGUES LIKE DR. CORREA WHO DISPISE PRIVATE PROPERTY RIGHTS, ESPECIALLY IPRs, PROMOTE CONVERSION OF PRIVATE PROPERTY INTO PUBLIC COMMUNAL PROPERTY AND SEEK TO JUSTIFY DEVELOPING COUNTRY GOVERNMENT EXPROPRIATION OF PATENTS WITHOUT PAYMENT OF FAIR & ADEQUATE COMPENSATION, PROFIT-SEEKING LIFE SCIENCES COMPANIES IN THE PHARMACEUTICAL & BIOTECHNOLOGY SECTORS WILL SLOW DOWN THEIR DEVELOPMENT OF PATENTABLE MEDICINES.]**
Companies are now merely tinkering with the existing drug and seeking patent applications for the same. Only 2-3 application from each of the Indian companies are serious contenders for a patent, Dr Sengupta added. However, some innovator companies feel that there are many innovations which deserve patent protection. “Innovations are either patentable or non-patentable. Patent offices are getting mature to weed out those inventions which do not merit a patent and one should look at the actual data of patents rejected before a claim like this is made, “ Novartis India vice-chairman and MD Ranjit Shahani said.
Since India became trade-related aspects of intellectual property rights (TRIPS)-compliant in 2005, both global and Indian companies have rushed to claimed protection for new drugs or innovations. If drugs get patented, the innovator company will get exclusive marketing right for 20 years. Few global companies have already got patent for drugs in cancer, anti-Aids and other therapeutic areas.
Wednesday, December 19, 2007
Foolish Academics Prescribe Wrong Antidote for Developing Country Diseases: Fewer Patents & More Compulsory Licenses Will Cause More Harm Than Good
Fewer Patents, More Compulsory Licenses: The Knock-Off Effects of India's Strict Patent Act and Thailand's Compulsory Licenses
By Professor Brook K. Baker
Health GAP
December 11, 2007
Activists have long claimed that access to medicines campaigns set precedents that have a snowball effect. What we are now seeing, given India's victory against Novartis in the drug company's challenge to section 3d of the India Patent Act and given Thailand's highly publicized campaign to issue compulsory licenses on both AIDS and heart disease medicines, is a new wave of patent withdrawals and a growing wave of compulsory licenses.
[CORRECTION, PROF. BAKER: WHAT WE ARE NOW SEEING IS A LYNCH-MOB APPROACH TO PUBLIC ADVOCACY BASED ON FEARS AND MISREPRESENTATIONS RATHER THAN FACTS. ACTIVISTS WILL CAUSE MUCH GREATER HARM THAN GOOD TO DEVELOPING COUNTRY EFFORTS TO IMPROVE PUBLIC HEALTHCARE]***
This reciprocal wave action creates a wider opening for continuing access to newer and lower costs medicines. But the promise of this opening will only be realized if more countries amend their patent acts to take advantage of the TRIPS-compliant, definitional flexibilities that India has enacted and if more countries use the TRIPS-compliant flexibilities for issuing compulsory licenses for generic medicines that Thailand has used.
[ACTUALLY, MORE AND MORE PHARMACEUTICAL AND BIOTECH COMPANIES WILL WITHDRAW PATENT APPLICATIONS IN SUCH DEVELOPING/EMERGING COUNTRIES BECAUSE OF THEIR CONCERN THAT THEIR MEDICAL INNOVATIONS WILL BE EXPROPRIATED BY GOVERNMENTS WITHOUT PAYMENT OF FAIR & ADEQUATE COMPENSATION - HENCE, THEY WILL NO LONGER MAKE AVAILABLE THE MUCH NEEDED MEDICINES DEVELOPED AND COMMERCIALIZED OUTSIDE SUCH COUNTRIES BASED ON RECOGNIZED AND LEGALLY PROTECTED PATENTS. IDEOLOGUES LIKE PROF. BAKER, NEVERTHELESS CONTINUE TO INSIST THAT PRIVATE IP SHOULD BE CONVERTED INTO PUBLIC PROPERTY.] ****
Patent victories
In the summer of 2006, following massive August 7 protests in Bangalore and Bangkok, GlaxoSmithKline withdrew its patent application for lamivudine/zidovudine (Combivir or Combid), an important first-line combination antiretroviral, both in India and, perhaps even more significantly, in Thailand. The withdrawal in India was clearly obligatory under India's new Patent Act 2005, which has strict standards preventing patenting of mere combinations of existing medicines, and was relatively straightforward, even under Thailand's easier, more "Westernized" patenting standards. Combivir was a simple fixed-dose combination of two earlier discovered drugs and involved neither newness nor an inventive step. The principal new "ingredient" in the combination was silicone - a trivial addition graphically represented by Indian demonstrators when they dumped sand in front of the Glaxo office. The anti-Combid victory in Thailand was reminiscent of an earlier activist victory in 2004 where a robust civil society movement forced Bristol Myers Squibb to abandon its patent on ddi. Although Glaxo saw the writing on the wall, Novartis did not and tried to mount a TRIPS and constitutional challenge to section 3d of the Indian Act.
Once again protestors mounted an international campaign, and good lawyering by the Lawyers Collective and others resulted in a resounding defeat for Novartis in the Chennai High Court, in August, when all of Novartis's efforts to undermine India's strict standards for patentability were defeated.
At the time, activists claimed that the Novartis case had critical implications for access to medicines, certainly for AIDS drugs, but for other medicines as well. There were thousands of patent applications waiting in the India 1995-2005 patent "mailbox," the vast majority of which involved minor tweaks on pre-1995 medicines. If Novartis had won, many of those patent applications would have been pursued and many might have succeeded. However, with Novartis's defeat, the pharmaceutical industry began to strategically review its mailbox filings, and its new filings as well, to weed out the clearly unmeritorious applications.
The most recent example is further withdrawals by GlaxoSmithKline of two ARV patent applications, on Abacavir and Trizivir (GSK drops claims on two AIDS medicines, The Economic Times, 7 Dec 2007). Sources report that Glaxo's decision to withdraw those applications was in response to Novartis's loss and was undertaken to avoid a patent-defeat precedent that might have undermined its attempts to pursue patent claims in countries with weaker patent standards.
The growing evidence of India's success in stopping the flow of patent applications on trivial variations of existing products should lend courage to activists and patent reformers in other countries. India has clearly set a new and defensible standard for patenting only truly innovative pharmaceutical products. The Philippines parliament is already considering a statutory amendment in line with section 3d of the Indian Act, but the momentum should not stop there. Other countries can lighten the load on their under-resourced patent offices and ensure high standards of patentability for medicines by taking the route forged by India.
The Indian success has also been reinforced by the availability of pre-grant opposition procedures, which allow consumer groups, generic companies, and IP specialists to intervene and challenge weak patent applications. There are already fifteen pre-grant oppositions in India concerning AIDS medicines and the number is likely to grow as public interest groups begin to appreciate the importance of stopping 90-95% of the patent applications on pharmaceutical patents that can be rejected under the Indian standard even though they sail through the U.S. patent office.
[UTOPIAN ACADEMICS SUCH AS PROF. BAKER CONVENIENTLY OMITS THE INTENTION OF ACTIVISTS, NAMELY, TO ESTABLISH MEDICINES AND MEDICAL TECHNOLOGIES AS 'PUBLIC GOODS' THAT MAY BE EXPROPRIATED BY GOVERNMENTS]***
Compulsory licensing victories
Activists in Thailand have waged a near decade-long campaign to convince the Thai government to issue compulsory licenses on AIDS medicines.
Although the first effort in 1999 concerning ddi was unsuccessful because of fears of U.S. trade retaliation, activists persisted and new leadership in the Thai Health Department issued compulsory licenses on efavirenz, lopinavir/ritonavir, and clopidrogel in late 2006 and early 2007. Of course, Thailand was not the first developing country to issue compulsory licenses on AIDS medicines. Malaysia and Indonesia had done so earlier for first-line regimens, and over half a dozen countries had done so in Africa as well. However, in terms of middle-income countries with large populations living with HIV/AIDS, Thailand was the first to issue licenses on higher-cost, second-line medicines. Brazil had threatened such licenses, but in the end had improvidently settled for price concessions instead.
The impact of Thailand's leadership is immediately apparent. Shortly after Thailand's bold move, Brazil issued a compulsory license on efavirenz on May 4. Indonesia did so even earlier, in March of 2007, though, unlike Brazil, its license drew little attention from Big Pharma, the USTR, or the army of right-wing think tanks that have mounted a global disinformation campaign about the legality and propriety of compulsory licenses.
Emboldened by Thailand, Indonesia is considering additional licenses on tenofovir, videx, and lopinavir/ritonavir. The proactive Ministry of Health in Thailand is also continuing to weigh additional government use C.L.s on four cancer medicines and up to 20 additional products for treating hypertension, diabetes, and hyperlipideamia. Lawyers in South Africa have petitioned the Competition Commission to obtain additional licenses on efavirenz, both to promote competition but also to allow co-formulation of fixed-dose combinations.
Most of the licenses thus far have been issued for government use. This form of licensing has certain advantages because it is widely practiced in rich countries, including the U.S., because it obviates the need for prior negotiations with the drug company, and because it reserves the private sector to the patent holder's monopoly control, undermining claims that all profits are foregone and that research and development will be undermined.
However, there are also some drawbacks to government use licenses, especially when one considers how much pressure has been brought to bear on Thailand even though it carved out a private-sector monopoly reserve for Big Pharma. The first drawback, not so apparent in Thailand as perhaps in other countries, is that many poor people cannot access medicines in public sector pharmacies, which often experience stock-outs or otherwise fail to carry essential medicines. These patients must therefore rely on private sector pharmacies where monopoly pricing prevails. Thus, in countries where high disease burdens persist and where major portions of the population are de facto dependent on private-sector pharmacies, government use licenses may be an imperfect solution to access on the ground. The second drawback is that having two pricing regimes in the same country, high private-sector prices and low public-sector prices, encourages "arbitrage," or more accurately theft and resale of public sector medicines to private sector consumers. Third, avoiding negotiations may be overrated since governments can set short time limits for such negotiations and insist on strict pro-access terms whether by regulation or negotiation demands.
The impact of Thailand's compulsory licensing victories will be lessened if other developing countries do not follow suit. In fact, a better scenario will arise when developing countries cooperate more vigorously in the selection and timing of compulsory licenses. Generic producers are most likely to invest the $1-$1.5 million dollars needed to formulate a generic equivalent if they can see a sizeable market in developing countries that aggregate their collective demand. In addition, with larger, more secure, and more predictable markets, more producers will enter the market and more producers will manufacture at efficient economies of scale. The combination of competition and efficiency will result in lower prices and more secure and redundant sources of supply.
The strongest way for countries to cooperate may well be through creation of patent pools that allow the collective management of both compulsory and voluntary licenses (negotiations on both in- and out-licenses).
Alternatively, developing countries could form regional "buying groups" and/or work intensively with the Clinton Foundation (at least for ARVs).
However, in order to be able to take advantage of their South-South strength, countries will need to be more proactive both in amending their patent legislation to allow maximum use of TRIPS-compliant flexibilities and in utilizing those flexibilities to actually issue compulsory licenses.
The current, countervailing strategy of Big Pharma, besides USTR intimidation and even product withdrawals, seems to be the use of strategic price discounts and restrictive licensing. Although these concessions look tempting in the short-run - since they reduce the treat of trade sanction and product embargoes - they are futile in the long run since they are Pharma controlled and because they deter generic entry. An even greater danger is presented by so-called free trade agreements where the United States attempts to impose TRIPS-plus intellectual property protections that hamper countries ability to ensure access to medicines for all.
Conclusion
The space that has been created by activist-backed defense of India's strict patent standards and by activist-prompted issuance of multiple compulsory licenses in Thailand is one of the most promising outcomes of AIDS advocacy in 2007. Hard fought precedents have been won, but enemies in Big Pharma and in the U.S. government are hard at work plotting a reversal of fortune. It is only by building on these recent victories - by rejecting more patents, by issuing more compulsory licenses, and by opposing TRIPS-plus IPR provisions - that activists and pro-access forces in developing countries can create a momentum that cannot be stopped.
Standing still is not an option.
Professor Brook K. Baker, Health GAP
Northeastern U. School of Law
Program on Human Rights and the Global Economy
