lovely ones - - - just thought i’d attach this simple guide to all things “Trips”, it’s stolen from the Pharmaware website and is really useful for describing Patents, WTO and compulsory licensing…obviously we are all experts now but maybe good to have on stalls…??? x x x

Patenting, TRIPS, Compulsory Licensing – What is it all about??

So we hear lots of people complaining about ‘patents’, talking about ‘TRIPS’ and phrases like ‘compulsory licensing’ flying around, but what does it all mean? PharmAware felt that it was about time all of this was explained so you can decide for yourselves what you think and whether the World Trade Organisation (WTO) has got it right or wrong…

What is TRIPS?

TRIPS stands for ‘Trade Related aspects of Intellectual Property Rights’. It was instigated by the WTO as a means of ‘striking a balance between providing incentives for future inventions and creations in the long term, whilst allowing people to use existing inventions and creations in the short term’.[1] In brief it aims to protect the rights of those who invent products and ensure that they are getting the support financially to fund the development of their products, whilst still allowing for the use of the products to support future developments by other individuals or groups.

So does it just include pharmaceutical medicines?

No, although it’s the pharmaceutical industry that gets the most publicity with regards to TRIPS, the agreement actually covers a wide range of subjects, from copyright and trademarks, to integrated circuit designs and trade secrets.

What is Patenting and what part does it play in TRIPS?

Patents provide the patent owner with the legal means to prevent others from making, using, or selling the new invention for a limited period of time, subject to a number of

exceptions.1 WTO members have to provide patent protection for any invention, whether a product (such as a medicine) or a process (such as a method of producing the chemical ingredients for a medicine). Patent protection has to last at least

20 years.1 There are some exceptions to this though…

• Inventions whose commercial exploitation needs to be prevented to protect human, animal or plant life or health.
• Diagnostic, therapeutic, and surgical methods for treating humans or animals.
• Certain plant and animal inventions.

So for example, if a country as signed up to the TRIPS agreement and GlaxoSmithKline invent a new drug for TB they can apply to that government for patent protection. When granted this would prevent any generic production by other companies of this drug, preventing pricing competition and ensuring that Glaxo got their money back for the research and development of the drug.

That all sounds great for the big pharmaceutical companies but won’t this mean that they can charge what they like as no other companies will be able to compete with them?

Well to some degree yes, they can choose the price and ensure that they are making enough to cover their research, development and production costs and make money from the fact that they invented the drug. However there are restrictions. The WTO state that as part of TRIPS governments can act to prevent patent owners and other holders of intellectual property rights from abusing those rights, ‘unreasonably restraining trade’, or hampering international transfer of technology.1 How this works in practice though is difficult to see. It is often the large pharmaceutical companies from the powerful developed countries who are the patent holders. The developing countries, who in many cases rely on the debt relief and aid from these developed countries, are then placed in a very difficult situation. Keeping the donors happy whilst ensuring that their people have access to the drugs they need at an affordable price.

What does compulsory licensing mean? Doesn’t this also stop situations like this?

Compulsory licensing is when a government allows someone else to produce the patented product or process without the consent of the patent owner. It’s also known as ‘use without authorisation of the rights holder’.1 Compulsory licensing or government use of a product without the authorisation of the owner can be obtained only under certain conditions. These include:1

• Having first sought voluntary licensing from the patent holder and been unsuccessful. Unless…
• There is a ‘national emergency’, ‘other circumstances of extreme urgency’ or ‘public non-commercial use’.

This is where the Doha Declaration (2001) comes into play. This was an additional declaration that was made to ensure the protection of particularly developing countries, to ensure public health is supported through the TRIPS agreement. It states that members of the WTO have the right to decide when and under what circumstances compulsory licenses are granted and what determines a ‘national emergency’.1

As well as compulsory licensing there are also ‘parallel imports’ or ‘grey imports’. This is where a country can legally import a patented drug from another country without the permission of the patent owner.1 So if say a company makes a drug under patent in country A and exports it to country B, if the drug is sold cheaper in country B, country A can import the drug from country B at the lower price. This is because the drug company has exhausted its patent rights on the batch that was originally exported to country B.

This all sounds good, the drug companies get their costs covered and are stopped from charging too much, governments can over-rule patent rights with compulsory licensing if they need it and they can even import the patented drugs from other countries if they’re cheaper. So what is all the fuss about?

Well in theory it is great and ensures the best deal for everyone. But…Pharmaceutical companies can be very corrupt in the way in which they deal with countries and will often do all they can to influence countries into not issuing compulsory licenses. Preventing them from charging too much is also difficult to implement and patenting is preventing the cheaper generic production of much needed drugs. As mentioned earlier, the big pharmaceutical companies are from the more powerful, developed countries such as the United States and the UK. It is these countries who are providing much needed debt relief and aid, therefore a huge power struggle exists and developing countries can be left in situations whereby they are not exercising their rights to issue compulsory licenses or not grant patent rights through fear that they may jeopardise their relationship with the countries that they are dependant upon.    

For more information on TRIPS and Patenting see: Reference 1

For more information on the negative impact of TRIPS see: http://www.oxfam.org.uk/what_we_do/issues/health/wto_patentrules.htm

This entry was posted on Wednesday, February 25th, 2009 at 6:04 pm and is filed under Campaign News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.