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FACT SHEET: TRIPS AND PHARMACEUTICAL PATENTS
Philosophy: TRIPS attempts to strike a balance

The WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) attempts to strike a balance between the long term social objective of providing incentives for future inventions and creation, and the short term objective of allowing people to use existing inventions and creations.

The agreement covers a wide range of subjects, from copyright and trademarks, to integrated circuit designs and trade secrets. Patents for pharmaceuticals and other products are only part of the agreement.

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September 2006

Contents
> Philosophy: striking a balance
Obligations and exceptions
What does “generic” mean?
Developing countries

This fact sheet has been prepared by the Information and Media Relations Division of the WTO Secretariat to help public understanding. It is not an official interpretation of the WTO agreements or members’ positions

The balance works in three ways:
  • Invention and creativity in themselves should provide social and technological benefits. Intellectual property protection encourages inventors and creators because they can expect to earn some future benefits from their creativity. This encourages new inventions, such as new drugs, whose development costs can sometimes be extremely high, so private rights also bring social benefits.
  • The way intellectual property is protected can also serve social goals. For example, patented inventions have to be disclosed, allowing others to study the invention even while its patent is being protected. This helps technological progress and technology dissemination and transfer. After a period, the protection expires, which means that the invention becomes available for others to use. All of this avoids “re-inventing the wheel”.
  • The TRIPS Agreement provides flexibility for governments to fine tune the protection granted in order to meet social goals. For patents, it allows governments to make exceptions to patent holders’ rights such as in national emergencies, anti-competitive practices, or if the right-holder does not supply the invention, provided certain conditions are fulfilled. For pharmaceutical patents, the flexibility has been clarified and enhanced by the 2001 Doha Declaration on TRIPS and Public Health. The enhancement was put into practice in 2003 with a decision enabling countries that cannot make medicines themselves, to import pharmaceuticals made under compulsory licence. In 2005, members agreed to make this decision a permanent amendment to the TRIPS Agreement, which will take effect when two thirds of members accept it.

 
What is the basic patent right? back to top

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.

 
A patent is not a permit to put a product on the market back to top

A patent only gives an inventor the right to prevent others from using the patented invention. It says nothing about whether the product is safe for consumers and whether it can be supplied. Patented pharmaceuticals still have to go through rigorous testing and approval before they can be put on the market.

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The TRIPS Agreement

Article 7
Objectives

The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

Article 8
Principles

1.   Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement.

2.   Appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.