WTO: 2011 NEWS ITEMS

TRIPS

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NOTE:
THIS NEWS ITEM IS DESIGNED TO HELP THE PUBLIC UNDERSTAND THE DISCUSSION IN THIS EVENT. WHILE EVERY EFFORT HAS BEEN MADE TO ENSURE THE CONTENTS ARE ACCURATE, IT DOES NOT PREJUDICE THE POSITIONS OF THE VARIOUS ORGANIZATIONS OR THEIR MEMBER GOVERNMENTS. IT IS NOT AN OFFICIAL RECORD.

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Knowing whether a product is patented has implications for what procurement agencies, research institutions, industry and other stakeholders can do. Once they have determined how and where they are free to act (their “freedom to operate”), they can devise strategies for research and development of new medicines, and for improving access to these medicines in poorer countries, participants said.

And meanwhile, the financial crisis has increased pressure on public health, World Health Organization Director-General Margaret Chan said.

“Public health now finds itself caught in a cross-current of rising expectations and ambitions, set against rising demands and costs, at a time when funds are stagnant or shrinking. In such a situation, introducing greater efficiency is a far better option than cutting budgets and services,” she said.

“Today, health officials seeking to use their budgets efficiently, by procuring lower-cost generic products, must do so with a good understanding of patent status. This situation has created a critical need for capacity to manage and apply intellectual property in the developing world.”

World Intellectual Property Organization (WIPO) Director-General Francis Gurry and WTO Director-General Pascal Lamy said digital databases are making information on patents easier to obtain. WIPO’s searchable database PATENTSCOPE now has seven million documents, set to rise to 20m within 2011, Mr Gurry added.

The technical symposium on “access to medicines, patent information and freedom to operat” was the second organized by the three organizations. The first was in July 2010.

 

The directors-general

In the opening session, the three directors-general paid tribute to the co-operation that has developed over the years and helped them to understand each other’s perspectives.

WHO Director-General Margaret Chan (full text available here) said the WTO intellectual property (TRIPS) agreement changed the picture. Before that, “countries were free to choose not to grant patents on medicines. Health officials could purchase lower-priced generic medicines without having to consider the patent status. Those days are over,” she said.

Financial constraints and the need to procure lower-cost generic products means there is a critical need for capacity to manage and apply intellectual property in the developing world, she went on.

“The issues being explored today address the need for more transparent and accessible data on patents to support decisions about freedom to operate,” she said.

WIPO Director-General Francis Gurry (full text available here) stressed that one of the justifications for patent protection is the disclosure of technology. While this had not functioned effectively in the age of paper copies, modern technology has made the information easily accessible.

Among WIPO’s core functions in this area therefore is to make patent information available. Better cross-lingual tools being developed to overcome language barriers, he said.

WTO Director-General Pascal Lamy (full text available here) envisaged “an information platform that is accessible for all, usable by even those who lack technical or legal expertise, and which gives real-time information about the patent coverage of essential medicines.” Citing his own experience working with these issues he described this as “an aspiration well worth working towards”. While acknowledging the practical difficulties that still have to be confronted, he recognised the significant progress that has been made, including by WIPO, to make patent information a useful tool for policymakers.

He also spoke of the challenge of making the work of the three organizations blend together better, welcoming the progress that has been made as the special expertise and information resources of each Secretariat are made available to support the work of other organisations, in line with their distinct mandates.

 

Presentations and discussion

> The presentations are here

WHO speakers said access to medicines, vaccines and diagnostic equipment is determined by the selection of technology, affordable prices, sustainable finance and reliable supply systems. Intellectual property has an impact on at least some of these. While access to off-patent medicines remains the biggest health issue, access to patented medicines has also become more important since the TRIPS Agreement came into being and the conclusion of bilateral or regional free trade agreements with more extensive levels of protection.

Subsequent presentations included research reports on how much can be found out about the situation on patents for various medicines around the world, and the present gaps in the information obtained. One participant observed that it is difficult to establish that a product is not patented in a country because the absence of information on a patent could simply mean that it has not been included in the databases that were searched.

They also covered different situations such as vaccines, whose technology is more complex than medicines, and where the opportunities for producing cheaper generic versions are different. Speakers emphasized, however, that for most vaccines, intellectual property does not constitute a significant barrier to development and access in developing countries until now; this was largely influenced by other factors, such as lack of knowhow and regulatory issues.

Organizations’ “freedom to operate” in order to develop and supply the medicines or technology differ according to whether the technology is patented or not, which is why information on patent protection for various products in various countries is important.

The information has to be “accessible, trusted, neutral and relevant,” one said.

Participants’ comments spanned a range of views on how patents can affect access to medicines and their affordability, and the strategies that can be devised to make use of innovations.

Some pointed out that organizations have many options for being able to operate where patents exist.  These provide a practical way of bridging the gap between the constraints of patents and need to make medicines accessible.

Options for working with patented technologies include voluntary licensing, litigation to challenge a patent, non-assertion covenants (when patent owners declare they will not apply patent rights), compulsory licensing, inventing “around” the patent (inventing in an area not covered by the patent), and patent pooling, participants said.

According to this view, collaboration over patents offers useful opportunities — including for transferring clinical data and other knowhow — that would not exist otherwise.

Others noted that these strategies incur costs. They require experience in managing intellectual property rights, such as negotiating licences with the patent owner, and capacity in research and development in order to invent “around” the patent. Obtaining information on where freedom to operate exists can therefore be costly and requires meaningful databases and comprehensive patent information, they said.

> See also: background paper (pdf)

 

________________

Opening remarks, Dr Margaret Chan
Director-General, World Health Organization

Mr Pascal Lamy, Dr Francis Gurry, distinguished experts, ladies and gentlemen,

I am pleased to host this meeting at WHO and extend my warmest welcome to all of you.

By again focusing these technical discussions on access to medicines, we are standing on a common ground in the mandates and expertise of our three agencies that empowers us to address one of the most pressing issues in public health today.

Public health needs innovation, and it needs access to good quality medical products. These are long-standing needs. But recent trends have forced governments everywhere to look at the efficiency and fairness of their health services. This includes a close look at pharmaceutical expenditures, and this close look inevitably turns to questions of affordability, including access to generic medical products.

The financial crisis hit the world like a sudden jolt. Money is tight, and public health, within individual countries and internationally, is feeling the pinch. In this new era of economic austerity, global health initiatives and agencies, like the Global Fund, the GAVI Alliance, and WHO itself, now face serious financial shortfalls.

Since the start of this century, public health has been on a winning streak. The past decade brought remarkable gains for health, largely through the scaled-up delivery of commodities, including medicines and vaccines. As just one example, the number of young child deaths worldwide dropped last year to its lowest level in nearly six decades.

No one wants the current momentum to stall. The big question now is this: can these gains be sustained in an era of austerity?

Health care costs are rising. Public expectations for health care are rising. Ambitions of health officials are rising as more and more governments move towards universal coverage, seeking to extend financial protection to the sick and poor.

Demands are rising as chronic noncommunicable diseases shift their burden from wealthy populations to the poor and disadvantaged. Diseases like cardiovascular disease, hypertension, diabetes, and cancer now impose 80% of their burden on low- and middle-income countries. Many of these patients will require long-term, if not life-long, access to medicines.

Who will foot the bill? How will this trend affect the current laudable drive towards universal coverage?

Given the concentration of these diseases among the poor, some way must be found to make chronic treatments more affordable. For health systems in the developing world, these are the diseases that will truly break the bank.

Public health now finds itself caught in a cross-current of rising expectations and ambitions, set against rising demands and costs, at a time when funds are stagnant or shrinking. In such a situation, introducing greater efficiency is a far better option than cutting budgets and services.

Last year’s World Health Report set out policies and practical actions for financing health services, with a strong emphasis on moving towards universal coverage. Nearly all countries want to move in this direction but are worried about the costs.

The report wisely emphasizes ways to improve efficiency in the delivery of health care. Let me give you a relevant example.

The report estimates that countries could save about 60% of their pharmaceutical expenditures by shifting from originator medicines to generic products. But this is done in only a few wealthy and middle-income countries. A long-standing problem is the lack of essential procurement and regulatory capacities in many developing countries. More recently, both the procurement and the production of lower-priced generic products have been made more difficult by yet another trend: the globalization of patent protection.

Prior to the TRIPS agreement, countries were free to choose not to grant patents on medicines. Health officials could purchase lower-priced generic medicines without having to consider the patent status. Those days are over.

Today, health officials seeking to use their budgets efficiently, by procuring lower-cost generic products, must do so with a good understanding of patent status. This situation has created a critical need for capacity to manage and apply intellectual property in the developing world.

Ladies and gentlemen,

The issues being explored today address the need for more transparent and accessible data on patents to support decisions about freedom to operate.

The Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property specifically calls for access to user-friendly global databases which contain public information on the administrative status of health-related patents.

Last year, the South-East Asia and Western Pacific Regions of WHO jointly issued a step-by-step guide explaining how to conduct patent searchers for medicines. You will be hearing from the author of this guide, Tahir Amin, later today.

The guide aims to help health officials navigate more easily through a landscape of patent information that is complex, sometimes murky, and often riddled with tricky pitfalls.

You will also hear a report on the patent status of medicines included in the WHO model list of essential medicines. Let me thank WIPO staff for facilitating WHO collaboration with the Franklin Pierce Law Center at the University of New Hampshire.

These model lists, which date back to 1977, help focus priorities for the pharmaceutical sector as a whole. They promote a higher quality of care, better management of medicines, and the cost-effective use of health resources.

In selecting medicines for the list, price has been an important consideration, but patent status has not. The few studies of patent status for medicines on the list, conducted in 1991 and 2004, indicate that around 5% to 6% are patent protected in some way.

The study you will hear about today reviews the patent status of all 58 medicines added to the list, since 2003, in a large number of countries. The results will be an important guide for countries seeking to procure essential medicines at the most affordable prices.

Ladies and gentlemen,

I have a final comment.

In recent weeks, all eyes have been watching scenes of civil unrest in the Middle East. Many leaders at the World Economic Forum in Davos linked this unrest and instability to the failure of governments to improve people’s lives.

They pointed to entrenched poverty, to large numbers of unemployed youth, to rising food prices, and above all, to vast inequalities within and between countries. In the view of top leaders, reducing global imbalances has become the new political and economic imperative.

I believe these observations extend to the health sector.

I make this point because I believe it underscores the extremely important nature of the work that our three agencies are jointly undertaking. Improving access to medicines is a fundamental, feasible way to improve equity and distribute the benefits of progress more evenly.

A world that is greatly out of balance in matters of health is neither stable nor secure.

Thank you.

Opening remarks (prepared text), Pascal Lamy
Director-General, World Trade Organization

Good morning, ladies and gentlemen

I would like to thank my colleague Director General Margaret Chan for hosting today’s event, and thank her for her warm welcome to this, the second in the series of technical symposia jointly convened by the WHO, WIPO and the WTO Secretariats on issues relating to public health and intellectual property. I pay tribute to her and to Director General Francis Gurry for the cooperative and collegial spirit that they both bring to our partnership.

We were honoured to host the first in this series, last July, when the three Secretariats, with the support of partners from industry, civil society and health initiatives, joined forces to take stock of the state of play concerning access to medicines, and the full array of sources of data that are available for policymakers. The idea was not to engage in policy discussions or legal debate, but rather, it was a chance for us to look at how we could collaborate more closely and more effectively to provide a stronger, more coherent and more accessible information base for policy debate.

Let me try to set the scene for our work today by drawing several conclusions from the discussions last July.

First, each Secretariat can meet its specific mandate much more effectively if this is done in careful, systematic coordination with counterparts in the other Secretariats. For instance, for us in the WTO, health innovation and access to medicines has been at or near the top of the IP policy agenda for the last decade. It is difficult to say or do anything useful in this domain, however, solely by referring back to the TRIPS Agreement and other areas of trade law. We can only make a sustained and useful contribution if our work is informed and guided by the state of play of access to medicines on which we gladly turn to the WHO for expert advice and empirical data. Equally, the impact of IP on access to medicines can ultimately only be understood through an objective appraisal of what patents cover needed medicines, where they are in force — or not in force — and who holds the patents in question, information of which WIPO is the custodian.

The second observation that emerged from last July’s inaugural symposium was that there is indeed great potential, still mostly untapped, for the use of empirical data to inform policy debate on health innovation and access to medicines. The symposium, I hope, left no participant in doubt that all of us who care deeply about health innovation and access to medicines, would benefit from improved accessibility of these raw data, but also from the careful putting together of all of the pieces of the empirical puzzle.

It follows that I warmly welcome the theme for today’s symposium. Understanding what is actually going on out there — who is patenting what, where, to what effect — is central to the kind of policy discussions that take place in the WTO and elsewhere regarding TRIPS and initiatives for access to medicines.

Today’s symposium is a chance for a detailed, systematic dialogue between the custodians, the managers, and the skilled users of these information systems, on the one hand, and the policy community and health access initiatives, on the other hand.

We should perhaps aspire to an information platform that is accessible for all, usable by even those who lack technical or legal expertise, and which gives real-time information about the patent coverage of essential medicines. As one who has worked with many others on the critical issues surrounding the patent system and health innovation and access to medicines, I can certainly say it is an aspiration well worth working towards.

I turn again to Margaret, our host today, and to Francis, to express once more my deep appreciation for the collegiality, seriousness of purpose, and dedication to practical cooperation that they have both shown in our work together. Your deliberations today, and the feedback that you pass to us, will be invaluable for future planning, both for the WTO Secretariat as such, and for the cooperative program of the three Secretariats. I trust, therefore, that this will be a true symposium — an exchange of practical experience and ideas for future cooperation — leaving us with a richer, more enabling base of information to support us all in our future endeavours.

Thank you for joining us today, and all the very best for a fruitful day of discussions, and for continuing practical dialogue in the future.

MORE
> Announcement and background
Programme and presentations
Summary

JULY 2010 SYMPOSIUM:
> Announcement
> News story
> Programme and presentations
Summary

  

What is a ‘freedom to operate’ analysis?

Freedom to operate is — first and foremost — a strategic management tool. It is the synthesis of scientific, legal, and business expertise coupled with strategic planning.

Strictly speaking, however, freedom to operate is a legal concept. It is a legal opinion by a patent counsel on whether the making, using, selling, or importing of a specified product, in a given geographic market, at a given time, is free from the potential infringement of third-party intellectual property or tangible property rights. As such, it is one type of input among many that managers use to make strategic risk-management decisions in relation to research and development and product launch.”

> From background paper (pdf)

 

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