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Chapter 4: Medical technologies: the access dimension


C. IP-related determinants of access

Key points                 

  • The mere existence of intellectual property rights (IPRs) on a product is not a barrier to, nor its absence a guarantee of, access to that product. The impact of IPRs on access to medical technologies depends on how they are regulated nationally, and how they are managed by the right holder.
  • WTO members have the flexibility to design their national intellectual property (IP) systems within the minimum standards set by the TRIPS Agreement, in cognizance of a country's economic, developmental and other objectives, including public health.
  • Defining patentability criteria and their application in practice may have a considerable impact on access to medical technologies.
  • Substantive examination and opposition procedures can help to address the problem of erroneously granted patents. This has implications for market entry by generic producers.
  • The regulatory review exception allows potential competitors to complete the marketing approval process during the patent term, in order to enable early market entry of generic medicines upon expiry of the patent.
  • WTO members are free to determine the grounds for granting compulsory licences. Such grounds can include public interest in general and are not limited to public health emergencies.
  • Compulsory licences and government-use authorizations have been used to import cheaper generic medicines or to produce them locally.
  • In 2003, WTO members agreed to introduce a new flexibility into the TRIPS Agreement. The flexibility, known as the Paragraph 6 System, is designed to enhance access to medicines by removing a potential barrier for countries that need to import medicines.
  • While the reasons for the limited use of the Paragraph 6 System are still under consideration, it could be more widely used in the future, for example, following the introduction of the product patent regime in key potential exporting countries, or in the case of a pandemic or some other health security event where effective treatments may be patented in all major supplier countries.
  • Under the TRIPS Agreement, WTO members are free to determine their exhaustion regime. An international exhaustion regime allows the parallel importation of patented medical products.
  • Some countries allow the patent term to be extended, upon request of the patent holder to compensate for regulatory and other delays. Different views have been expressed about the impact of such extensions on public health.
  • Companies increasingly use voluntary licences as part of their corporate social responsibility programmes, especially in the area of HIV/AIDS. This trend has been reinforced by the creation of the Medicines Patent Pool.
  • The most common provisions in free trade agreements (FTA) that affect the pharmaceutical sector are definition of patentability criteria, patent term extensions, test data protection, linkage of regulatory approval with patents and enforcement of IPRs, including border measures. Such provisions can delay market entry of generics and increase prices of medicines.

This section focuses on the IP-related determinants for improving access. It builds on the overview of the IP system and policy discussed in Chapter II, Section B.1, and focuses on its impact on access to medical technologies. In contrast, Chapter III, section D, considers the IP system from the perspective of innovation.

IP law and its practical implementation interact with access to technologies in a complex manner. For example, a finished medical product typically combines numerous inputs and innovations, some of which may be protected by IPRs, potentially held by different parties. The mere existence of an IPR cannot create a barrier to a protected product or technology, but neither does its absence serve as a guarantee of access to the protected product or technology. Much depends on: how the acquisition, maintenance and enforcement of IPRs are regulated under the applicable national law; how such law is applied in practice; where IPRs are applied for; for how long the IPRs are exercised; who holds the IPR; and how the IPR holders choose to exercise – or not to exercise – their rights.

The current international IP regime – as defined by the TRIPS Agreement, the respective WIPO treaties and a number of regional agreements – sets minimum standards of IP protection. However, it gives countries responsibility for designing their national IP systems within the confines of these international laws while also taking into account different considerations such as the stage of their social, economic and cultural development, as well as specific interests and needs, including in the area of public health. The public policy options and other options afforded to members under the TRIPS Agreement are commonly referred to as "flexibilities". This chapter categorizes and sets out these flexibilities and other IP-related determinants of access in pre-grant and post-grant stages.

1. Determinants of access prior to patent grant

Pre-grant patent issues essentially relate to questions such as what is considered patentable subject matter, what subject matter is specifically excluded, and how specific criteria for patentability are defined and applied by patent offices. Both the rules regarding patentability, and how they are applied in practice, ultimately determine the boundaries of a right to exclude others from using protected inventions and thus can have considerable (but not always decisive) impact on access to that technology. Erroneously granted patents potentially impede access and possibly impede further research, and are not in the public interest. Detailed explanations on patentability criteria (patentable subject matter, novelty, inventive step/obviousness, industrial applicability/usefulness and disclosure) are provided in Chapter II, Section B.1(b)(iii). The following, while not exhaustive, describes a number of particular issues which are relevant for access to medical technologies. Issues relating to the patenting of first and second medical indications of known products are discussed in Chapter III, Section D.3(b).

(a) Diagnostic, surgical or therapeutic methods for the treatment of humans or animals

Diagnostic, surgical or therapeutic methods for the treatment of humans or animals are often excluded from patentability (consistent with the optional exclusion provided for in Article 27.3(a) of the TRIPS Agreement). Where such exclusion occurs, it typically derives from concerns that a doctor should be free to apply the method of treatment that best suits a patient, without having to secure approval from a patent holder. A judgment in the United Kingdom explains the reason for the exclusion as "merely to keep patent law from interfering directly with what the doctor actually does to the patient".1 Some laws expressly clarify that this exclusion does not apply to any apparatus or product (such as medical devices) that may be used for the purpose of diagnosis, surgery or therapy. In some countries, inventions concerning diagnostic, surgical or therapeutic methods for the treatment of humans or animals are not patentable because they are not regarded as inventions that meet the requirement of industrial applicability.2 In some other countries, patents on such methods of medical treatment are not enforceable.

(b) Patent examination and patent registration

From the perspective of access to medical technologies, it is important to be aware of the changes that are typically made during the patent examination and grant procedure and, therefore, clearly differentiate patent claims made in the published patent application from claims contained in the patent as granted. There is no guarantee that an application will mature into a patent, and any claims in an issued patent may be much narrower than what was originally sought. Only the claims as granted determine the legal scope of the right (for guidelines for the examination of pharmaceutical patents see Box 4.12).

Box 4.12. Guidelines for the examination of pharmaceutical patents: developing a public health perspective 

In order to support the examiners' work, and also ensure that all patentability criteria are met, many patent authorities have established search and examination guidelines which describe in detail the application of patent law to particular circumstances. WIPO has published a collection of links to the guidelines produced by a range of patent offices.3 In addition, the International Bureau of WIPO, following consultations with the International Searching and Preliminary Examining Authorities under the Patent Cooperation Treaty (PCT), published the PCT International Search and Preliminary Examination Guidelines.4

The International Centre for Trade and Sustainable Development (ICTSD), the WHO and the United Nations Conference on Trade and Development (UNCTAD) have published draft guidelines for the examination of pharmaceutical patents. The guidelines are intended to be a contribution towards the improvement of transparency and efficiency of patentability examination for pharmaceutical inventions, particularly in developing countries (ICTSD/UNCTAD/ WHO, 2007). 

To obtain information about the grant, the validity of the patent, as well as the eventual scope of patent protection, it is necessary to review the patent itself and its legal status, including whether a patent has been amended or corrected, or whether a patent has lapsed due to non-payment of maintenance fees. This needs to be done for every jurisdiction, since considerable variation may exist. Further, some claims may have been rejected by one patent office, but may have been granted by another. Such variations in the scope of patents within a patent family are especially likely to occur between jurisdictions that provide for substantive examination and jurisdictions that only provide for registration – thus deferring to later judicial proceedings, if any, the question of patent scope or validity.

(c) Patent quality

Errors can occur in patent grant and administration. Such errors can be burdensome for rights holders, third parties and the patent administration. To ensure that patent procedures meet the required standards and deliver high-quality results, many patent offices around the world have introduced quality management measures. Such systems measure outputs aimed at promoting higher quality standards and continued patent system improvements.

Quality management measures comprise certain general principles: a patent office should be clear about its functions and provide the necessary resources (staff, premises, equipment and training) to deliver its functions effectively; procedures should be properly documented and feedback mechanisms (internal and external customer communication) should be provided to identify problems and opportunities so that procedures could be improved to avoid recurrence of problems; staff responsibilities should be clear and, to the extent possible, objectives should be measurable; regular and comprehensive quality reviews should be carried out.5 For example, at the international level, the PCT Common Quality Framework for International Search and Preliminary Examination, which is set out in Chapter 21 of the PCT International Search and Preliminary Guidelines, requires International Authorities under the PCT to establish quality management systems containing certain features which are important for ensuring effective search and examination according to the requirements of the PCT. The quality reports are published on a dedicated website.6 In the WIPO Standing Committee on the Law of Patents, member states are currently discussing the issue of quality of patents.7

2. Pre-grant and post-grant review procedures

Depending on national rules, third parties often have the option of filing oppositions against a patent either before or after the grant, or of filing observations during the patent examination process. India, for example, provides both a pre-grant and a post-grant opposition system. The character of both examination and opposition procedures have an impact on what types of inventions are ultimately patented, and thus can be decisive in relation to short-term market entry by generic producers.

Opposition proceedings are designed to ensure that patents are not granted on claimed inventions that do not satisfy the patentability requirements. For example, an opponent might submit prior art documents showing that the key features of the claimed invention had already been publicly disclosed.8 Opposition procedures are thus a tool that can contribute to higher quality of patents and legal certainty. However, few patents are opposed, and oppositions tend to involve commercially more significant patents. For example, in 2009 the European Patent Office (EPO) reported a rate of opposition proceedings of 5.2 per cent.9

Some countries provide a re-examination mechanism which allows a patent application or a patent to be re-examined in the light of new prior art. In countries where a patent application is published before a patent grant, third parties can analyse the claimed invention before the patent office makes a decision. In some of these countries, third parties may submit prior art relevant to the patentability of the claimed invention without participating in the subsequent procedure.

Similarly, many patent laws allow decisions of a patent office to grant a patent to be challenged by a third party, within a certain period of time, before an administrative review body, such as an appeal board in a patent office.

Erroneously granted patents can lead to delayed entry of generic versions, thus negatively impacting access to medicines. They can also become problematic with regard to patent linkage, for instance, when the grant of marketing approval for medicines is linked with patent status. The regulatory agency may refuse to register generic products based on the existence of patents that should not have been granted in the first place.

The European Commission Pharmaceutical Sector Inquiry report highlighted the importance of opposition procedures in the pharmaceutical area. Before the EPO, the opposition rate was much higher for the pharmaceutical sector than for organic chemistry. While generic companies almost exclusively opposed secondary patents (i.e. patents on improvements or on related aspects of a drug as opposed to the basic molecule itself), they prevailed in approximately 60 per cent of final decisions rendered by the EPO, including the Boards of Appeal, between 2000 and 2007. In an additional 15 per cent of cases, the scope of the patent opposed was restricted. On average, these procedures took more than two years. The report stated that litigation could be seen as an efficient means of creating obstacles for generic companies.10 Any revocation or restriction of secondary patents may considerably affect the legal certainty regarding the validity of the patents.

The majority of interested parties in an opposition proceeding are rival companies, but they may also include patient organizations, public health groups and individuals, among others. As an instance of a challenge by a commercial rival in 2009, the Indian Patent Office upheld a pre-grant opposition filed by a generic drug manufacturer concerning a patent application for crystalline adefovirdipivovil, a treatment for hepatitis B. It was decided that the claimed invention lacked an inventive step and the patent application was rejected.11

3. Post-grant determinants of access

A number of important determinants of access to medical technologies relate to the management of patent rights post grant. They include the regulatory review exception, compulsory licensing and government use, parallel imports, and IPR enforcement. In relation to the issue of management of patent rights by rights holders, this section also analyses recent licence agreements in the area of HIV/AIDS.

(a) Exceptions and limitations to patent rights

This section describes certain exceptions and limitations to patent rights that provide safeguards for access to medical technologies. While exceptions for regulatory review purposes, compulsory licences and government use have a direct bearing on access to medical products and are discussed below, research exceptions relate to innovation and are therefore discussed in Chapter III, Section D.4(b).

(i) Regulatory review ("Bolar") exception

During the process of obtaining marketing authorization, the applicant has to produce a first batch of the product, which may be considered an infringement of a related patent. Because regulatory approval may take several years, the inability to use the patented invention during the approval process, prior to patent expiration, would delay market entry of generic versions.

The regulatory review exception mitigates this situation by, in general, entitling anyone to use a patented invention during the patent term without the consent of the patent holder for the purposes of developing information to obtain marketing approval.12 This exception thus favours market entry by competitors immediately after the end of the patent term, and is, therefore, an instrument that is specifically designed to ensure early access to generic medicines.

The panel in the WTO case of Canada – Pharmaceutical patents of 2000 found that Canada's regulatory review exception was permitted by Article 30 of the TRIPS Agreement, which allows limited exceptions to patent rights, subject to certain conditions.13 A 2010 WIPO report identified that 48 countries provide for such an exception.14 The report maps the different approaches taken by countries in the national implementation of this important policy tool within patent laws. Developed and developing countries alike have tended to follow the Canadian form of an exception that was confirmed as being permitted under WTO rules. This exception extends to activities seeking product approvals under foreign as well as domestic regulatory procedures. Other countries consider that their general research exception is broad enough to cover use of a patent for the purposes of regulatory review, and some laws expressly state this.

The scope of the regulatory review exception varies among countries. In some countries, it applies to any patented product that requires regulatory review; in others, it applies only to pharmaceuticals or medicinal products. In some countries, it applies to all applications for marketing approval; in others, it applies only to certain types of applications, such as those based on bioequivalence data. In some countries, it applies only to regulatory review in the country where the competitor will use the patented invention to prepare its submission; in others, it applies to regulatory review in any country. The range of covered activities can vary, for example, with respect to experimental use other than for purposes of regulatory review.

(ii) Compulsory licensing and government use

Compulsory licensing allows the exploitation of a patent during the patent term without the consent of the patent holder, but with the authorization of competent national authorities. This authorization may be given to a third party, or, in the case of government use, to a government agency or to a third party authorized to act on the government's behalf. The term "compulsory licensing" is often used to refer to both forms of authorization, although they can have important operational distinctions.

Compulsory licences

Some possible grounds for compulsory licensing are suggested in Article 5A of the Paris Convention (e.g. abuse of patent rights, including failure of the patent holder to work the invention) and in Article 31 of the TRIPS Agreement (e.g. national emergency and public non-commercial use). However, this list is not exhaustive. The Doha Declaration on the TRIPS Agreement and Public Health (discussed below) confirmed what was already implicit in the TRIPS Agreement – that WTO members have the freedom to determine the grounds upon which compulsory licences are granted. They are thus not limited to emergencies or other urgent situations, as is sometimes mistakenly believed. A range of grounds have been set out in national laws. Most of these grounds can be grouped as follows:

  • Non-working or insufficient working: Many countries provide that where a patentee fails to work a patent in its jurisdiction, or where such working by the patentee is insufficient, a compulsory licence may be granted, provided that all other requirements are met. Some national laws simply state that if a patentee is not working the invention, or is not sufficiently working the invention without any legitimate justification, a third party may request a compulsory licence. In some countries, the laws provide detailed provisions clarifying the circumstances that may be applicable. Such clarifications include the types of activities by the patentee that are considered as "working", in particular, whether importation of the patented invention is considered as "working" in the country or not,15 and the situations under which working by the patentee is not considered "sufficient".
  • Anti-competitive practices: Some countries provide specific provisions under the patent law that allow the granting of a compulsory licence, in order to remedy an anti-competitive practice engaged in by the patentee. In certain countries, such as the United States, the use of licences to address competition concerns is not regulated by patent or other IP laws but such licences may be granted as a result of proceedings under general competition (antitrust) laws.
  • Public interest: Many countries allow the granting of compulsory licences on grounds of public interest, without further defining the term. Others mention specific grounds, in particular, national emergencies and circumstances of extreme urgency, national security and public health in general. However, a national emergency or extreme urgency is not a pre­requisite requirement for a compulsory licence under the TRIPS Agreement. Public interest could also include the non-availability of the patented product, such that reasonable needs of the public are not being met. In some cases, the laws refer to more specific health-related situations, such as a compulsory licence on a patent relating to diagnostics, or on a patent concerning a biotechnological research tool. Health-specific grounds can, for example, be found in France and Morocco. Under provisions on the licence d'office dans l'intérêt de la santé publique, the health minister can seek the grant of a compulsory licence if the product or method is made available by the right holder in insufficient quantity or unsatisfactory quality, or if the prices charged are abnormally high.16
  • Dependent and blocking patents: Many countries provide for the possibility of requesting a compulsory licence where a patent (second or "dependent" patent) cannot be exploited without infringing another patent (first or "blocking" patent). Article 31(l) of the TRIPS Agreement provides that such compulsory licences can only be granted if the second invention is an important technical advance of considerable economic significance and that, where a compulsory licence is granted to the holder of a second (dependent) patent to use a first (blocking) patent, the holder of the first patent shall also have a right to a cross-licence to use the second patent.

Government use

A number of national laws explicitly entitles the government, or a third party authorized by the government, to use a patented invention without authorization of the patent holder. The grounds may vary but typically relate to public policy objectives such as national security or health. A specific authorization may be needed to use a patented technology, or the legal system may limit the scope of remedies that are available when a patent is infringed in the performance of a task authorized by the government.17

TRIPS requirements for compulsory licences and government use

The requirement that prior efforts be made to negotiate a voluntary licence for a reasonable period of time has been interpreted in different ways in national laws. The requirement to negotiate may be waived in situations of national emergency, in other circumstances of extreme urgency, or in cases of public non-commercial use (Article 31(b)). In cases where the use of the patent is authorized without the consent of the patent holder to remedy adjudicated cases of anti-competitive practices, WTO members are not obliged to apply these conditions. In such cases, the licence need not be predominantly for the supply of the domestic market (thus allowing exports of unlimited quantities) and the amount of remuneration can be different (i.e. it would generally be a lesser amount or even none at all).

The limitation of compulsory licences and government use to predominantly supply the domestic market, found in Article 31(f) of the TRIPS Agreement, was revised following the Doha Declaration to allow production under a compulsory licence exclusively for export under certain terms and conditions. In effect, Article 31(f) limits the quantity that could normally be exported under a standard compulsory licence, which was identified as a potential problem for countries that had insufficient manufacturing capacity or no domestic manufacturing capacity, and therefore wished to import such products. The response to this problem is discussed in Section 3(a)(iii) below on the Paragraph 6 System.

Country experiences and practices

Compulsory licences have not been limited in practice to address infectious diseases or public health emergencies. In early 2012, based on a request under Section 84 of the Indian Patents Act, an Indian generic company obtained a compulsory licence for sorafenib, a treatment for liver and kidney cancer because the Indian Controller of Patents considered, among others, that it was not available at an affordable price.18 Between 2006 and 2008, Thailand declared government use for a number of pharmaceutical products, including for clopidogrel (a drug used to treat heart disease), letrozole (a breast cancer drug), docetaxel (a breast and lung cancer drug) and erlotinib (a drug used for treating lung, pancreatic and ovarian cancer).

In 2007, after protracted negotiations with the patent owning companies, the Brazilian government issued a compulsory licence for efavirenz, an important ARV drug used by a third of Brazilians receiving treatment through a national programme. Less than two months after the compulsory licence was issued, the first shipment of generic efavirenz was received from India, where there was no patent on this product. Brazil reported to the TRIPS Council that it had taken two years to locally produce the medicine, partly because the patent law does not require applicants to disclose all information necessary for the commercialization of an end product.19 After the licence was issued, the price dropped from US$ 1.59 per dose for the originator product to US$ 0.43 per dose for the imported generic version of the drug.20 It is estimated that the Brazilian government's policies, including the use of TRIPS flexibilities, saved approximately US$ 1.2 billion on ARV drug purchasing costs between 2001 and 2005 (Nunn et al., 2007).

Several other developing countries have granted government-use authorisations to make available patented ARVs where the originator's price was considered too high or where only limited amounts of the drug were accessible to the population – for example, Malaysia in 2002 and Thailand in 2006-2008 (see Box 4.13). Since 2010, Ecuador has issued two compulsory licences for public non-commercial use with respect to medicines used to treat HIV/AIDS (Box 4.14).

After earlier compulsory licences granted in 2004 and 2007 by the government of Indonesia, the

presidential decree of 3 September 2012 subjected seven HIV/ AIDS and hepatitis B medicines on the Indonesian market to a government use order until expiry of the relevant patents. Under this order, the pharmaceutical industry has been appointed as the patent exploiter for and on behalf of the government. The decision is based on the urgent need to control HIV/AIDS and hepatitis B in Indonesia.21

Box 4.13. Government use of patents: the Thai example 

Thailand has authorized government use of patents on several pharmaceutical products used to treat HIV/AIDS, heart attacks, strokes and cancer. The first case concerned efavirenz. In 2005, more than half a million Thai citizens were HIV positive. Although the Thai government had made a commitment in 2003 to provide free ARV treatment to all who needed it, the cost of doing so rose significantly when newer, better and more expensive treatments became available. In November 2006, the Thai Ministry of Public Health issued a decree that it would use the patent rights relating to efavirenz and it authorized the state-owned Government Pharmaceutical Organization (GPO) to import or produce efavirenz under which the patent holder was entitled to receive a royalty of US$ 0.5 per cent of GPO's total sales value.

Following the declaration of government use for the ARV treatment lopinavir/ritonavir in 2008, the number of patients in Thailand using lopinavir/ritonavir has reportedly increased from 39 to 6,246.22 In February 2007, the patent holder announced a global price reduction on efavirenz, benefiting HIV/AIDS patients around the world. 

Box 4.14. Public non-commercial use: the example of Ecuador 

Ecuador's IP authority granted a compulsory licence to a pharmaceutical distributor with operations in Ecuador. The compulsory licence, granted in April 2010, covers a patent relating to the active ingredient ritonavir, which is a retroviral protease inhibiting compound used for the treatment of HIV/AIDS. The licence covered all the patent rights, including importation, and was limited to use in Ecuador. The licence was reportedly intended for public non-commercial use (Article 31b of the TRIPS Agreement). The Ecuadorian authorities informed the patent owner before they granted the compulsory licence. The licence is valid until the date on which the patent expires in 2014. The licensee is required to pay the patent owner adequate remuneration calculated according to the Tiered Royalty Method, which was based on a royalty of five per cent of the price of the patent owner's product in the United States, adjusted for the difference in gross domestic product per capita between the United States and Ecuador, yielding a royalty rate of 0.42 per cent of the United States price. The procedure for the grant of the compulsory licence took six months to complete.23 In November 2012, Ecuador's Institute of Intellectual Property granted a second compulsory licence for public non-commercial use on another HIV/AIDS medicine (abacavir/lamivudine) to a local manufacturer, expecting thus to achieve a price reduction of 75 per cent.24 

Government use declarations are also often used in the context of international procurement by UNICEF or other international bodies to enable the import of generic medicines, especially ARV medicines.25

Practical experiences show that the bargaining power created by just the legal possibility of a compulsory licence can benefit developing countries even where a compulsory licence is not actually granted (Cornish, 2003). For example, the Brazilian government has demonstrated that legislation which provides for the effective and expeditious use of compulsory licences can be a useful asset in negotiating lower prices for ARV drugs (Abbott and Reichman, 2007). Using the threat of compulsory licensing, the Brazilian government negotiated significant price reductions on efavirenz and nelfinavir in 2001, lopinavir in 2003, the combination of lopinavir and ritonavir in 2005, and tenofovir in 2006.

That said, the use of licences to address competition law concerns in the field of medical technical technologies is not limited to developing countries. In developed countries, licences have been granted, among other reasons, as a result of action taken by competition authorities in order to address practices having an impact on access and innovation in the field of medical technology. In 2002, for example, the US Federal Trade Commission (FTC) requested the cross-licensing of a patent on tumour necrosis factor to a Swiss company in the course of merger review proceedings. The licence permitted the Swiss company to compete with a US patent owner. In 2005 and 2007, the Italian Competition Authority investigated abuses of dominant position by two large pharmaceutical companies which refused to license rights to their pharmaceutical products. The result was that royalty-free compulsory licences were issued, with the expectation that the resulting generics would be exported to other European countries where the patents concerned had already expired.26 On the other hand, in September 2012, the Italian Administrative Court granted the appeal against a January 2012 decision by the Competition Authority which had fined a pharmaceutical company for exclusionary abuse of dominant position. The Court highlighted that the simple enforcement of exclusive IPRs was not sufficient to support Competition Authority's finding of an abuse of a dominant position.27

(iii) The Paragraph 6 System: an additional flexibility aimed at enhancing access to medicines

A new pathway for access to medicines …

Paragraph 6 of the Doha Declaration mandated the TRIPS Council to find a solution to the difficulties faced by countries with insufficient or no manufacturing capacities in the pharmaceutical sector in making effective use of compulsory licensing. This resulted in the 2003 WTO General Council decision to establish the framework for special compulsory licences, which is an additional flexibility aimed at enabling exports of medicines to these countries. The System – informally dubbed the "Paragraph 6 System" – initially took the form of a waiver of certain conditions regarding compulsory licences. In 2005 WTO members adopted it by consensus as the Protocol Amending the TRIPS Agreement. This outcome, providing an additional legal pathway for access to medicines, has special significance as the sole amendment proposed to any of the WTO multilateral trade agreements since their adoption in 1994. The System has already been available for use since the 2003 waiver decision and will become a permanent feature of the TRIPS Agreement once two thirds of WTO members formally notify their acceptance. A wide cross-section of the WTO membership has already taken this step, with many notices of acceptance received from developing countries, including several LDCs, and virtually all developed countries.28 Accepting the Protocol is distinct from incorporating the System into national law or choosing to make use of the System. It expresses legal consent that all WTO members should be permitted to use this additional flexibility if they so choose.

Intended by WTO members to contribute to global efforts to strengthen the legal framework for access to medicines, the new System has been endorsed in a number of multilateral forums:

  • The 2008 WHO Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property (GSPA-PHI) identified the use of the System as a specific action.
  • The Ministerial Declaration – 2009 High-Level Segment of the Economic and Social Council of the United Nations reaffirmed the right to use the Paragraph 6 System, encouraging the provision of assistance to developing countries in this regard. It expressly called for a broad and timely acceptance of the TRIPS amendment.
  • Similarly, the 2011 UN Political Declaration on HIV/ AIDS: Intensifying our Efforts to Eliminate HIV/AIDS called for early acceptance of the TRIPS amendment.
  • The 2012 Declaration "The future we want", an outcome document from the United Nations Conference on Sustainable Development ("Rio+20"), reaffirmed the right to use the System along with other TRIPS provisions.

… that addresses a particular procurement scenario.

The System applies in a particular access scenario where an importing country needs medicines to deal with a public health problem, but a potential exporting country faces a legal impediment because Article 31(f) of the TRIPS Agreement limits supply under a compulsory licence predominantly to the domestic market. The special export licence under the System is free of this constraint, enabling and indeed requiring the full production under a compulsory licence to be exported. Accordingly, the situation addressed by the System would arise only when a country wishes to obtain a particular pharmaceutical product, and:

  • The product cannot be produced domestically at all, or in sufficient quantities, due to lack of capacity.
  • The preferred producer of the particular product (normally, the cheapest supply that best meets regulatory and quality requirements) is located in a country where a patent is in force on that product and needs a compulsory licence in that country to produce for export.

The System does not apply to most procurement scenarios: for example, when affordable supplies are already available from countries where no patent is in force (this has been the experience with older ARV treatments for HIV/AIDS, the bulk of which have been imported at highly competitive prices by countries from generic producers in India (see Chapter IV, Section A.2(a), on HIV/AIDS); and when prices for the originator product can be reduced through negotiation to an affordable level without recourse to a compulsory licence, or when the originator company agrees to grant a voluntary licence to a generic producer.

How has it been used in practice …

By 2012, one special export licence under the System has been exercised. In that instance, the licence was used by a Canadian company to ship medicines to Rwanda (see Box 4.15). Ghana reportedly considered using the System in 2005 when it declared an emergency situation with regard to HIV/AIDS and granted a government use authorization order to import generic HIV/AIDS medicines (although a declaration of emergency is not a requirement for using the System).29 Imports were initially intended to be sourced from Canada, where the products were patented, but Ghana later chose to import the products from generic manufacturers in India, where no patent applied. Another potential use30 concerned an Indian company's applications, filed in September 2007 with the Indian patent office, to manufacture and export to Nepal several anti-cancer pharmaceuticals patented in India, including erlotinib. Reportedly, the applicant later withdrew the applications. As an LDC, Nepal was automatically entitled to use the System, but it had not notified the WTO that it wished to import these medicines which is a prerequisite for the use of the System.

Box 4.15. case study on supply of ARVs to Rwanda 

In 2004, Médecins Sans Frontières (MSF) approached a Canadian company to produce a triple-combination ARV (zidovudine, lamivudine and nevirapine). MSF initiated this move in the absence of any specific request from an importing country. The company obtained marketing approval in Canada in 2006, less than six months after the date of its application. Canada's Access to Medicines Regime (CAMR), which implements the Paragraph 6 System, had to be amended to cover the product because Canada limits the scope of its law to a specified list of products. The three medicines combined in the product were each covered by a separate patent owned by a separate company. In July 2007, the company sought, without success, voluntary licences from the three patent holders.

In July 2007, Rwanda sent the WTO a brief notification of its intention to import 260,000 packs of the triple-combination ARV, reserving the right to modify the estimated quantity. It said it would not allow patent holders to enforce any patents on the product that may have been granted in its territory. As an LDC, Rwanda was not obliged to state anything else, nor did it need to notify its intention to use the System.31 In September 2007, the company applied for a compulsory licence in Canada which, under the System, would allow it to export 15,600,000 tablets (the equivalent of 260,000 packs) over a two-year period. The compulsory licence was granted two weeks later. The Canadian government notified the WTO in October that it was using the System as an exporting country.32

Canada reported that in October 2007 the Rwandan government issued a public tender for this triple-combination ARV.33 The Canadian company had originally offered its ARV at the no-profit price of US$ 0.39 per tablet. There were indications that at least four Indian generic manufacturers could supply the product at a lower price. Canada reported that if Rwanda had procured the ARVs from these manufacturers, it would not have needed to use the System at all, since the products were not patented in India. However, during the tender process, the Canadian company halved its price to US$ 0.195 per tablet. In May 2008, the company announced that it had won the tender.

In line with the terms of the CAMR and the System itself, the tablets shipped to Rwanda were distinguished from the version manufactured for the domestic market by the mark "XCL" and white colouring, instead of the standard blue. The packaging bore an export tracking number issued by the Canadian government. Details of the product and its distinguishing characteristics, as well as details of the shipment, were posted on the web.34 A royalty was payable by the Canadian company for the right to use the patent, but the patent holders waived payment. A total of 6,785,000 tablets were shipped to Rwanda in September 2008, and an additional 7,628,000 tablets were shipped in September 2009, i.e. within the two-year validity period of the compulsory licence.35 

… and is it really working as expected?

The TRIPS Council reviews the System each year and reports to the WTO General Council on how the System has been implemented and used, its operational context, and the status of the TRIPS amendment. The discussions have become more detailed since 2010, after Canada and Rwanda used the System, and they now also cover a wider range of issues such as the operational requirements of the System and alternatives to ensure access to medicines. While no firm conclusions have been reached as a result of these discussions, various WTO members have voiced a range of views (WTO, 2010; WTO, 2011), including the following diverse observations on whether the System is fulfilling its intended function:

  • By 2012, the System was only used once, and it took three years before the shipments in question proceeded. The System is too complex and administratively unwieldy for further use, and a multi-stakeholder workshop is needed in order to discuss the operation of the System. It is essential to clarify whether constraints on its use were built into the System, thus necessitating its reform, or whether such constraints were a consequence of how individual countries chose to implement it.
  • Potential users of the System may be deterred by concerns about political or trade ramifications associated with the use of compulsory licensing.
  • The CAMR was successfully utilized, and only a very small portion of the three-year time period was taken up with procedures associated with the System. Much of the time that elapsed between the regulatory review of the medicine in question and the actual shipments was attributable to other factors.
  • The limited use of the System is not an appropriate measure of its success, as no delegation demonstrated evidence of obstacles to its use when such use was required. A single case demonstrated that the System could work when necessary, and that it could play a supportive role in the wider effort to improve access to essential medicines, given that alternative ways of procuring the needed medicines are often available.
  • The System is not a panacea to solve all public health-related problems. Rather, it is part of a broader picture which includes other important aspects that have an impact on innovation and access, such as infrastructure, tariffs, innovative financing mechanisms, partnerships and cooperation (including at the regional level), and regulatory frameworks.
  • Implementation of full patent protection for pharmaceutical products in India, coupled with the approaching expiry of transition periods in LDCs, could make it more difficult in the future to procure generic versions of new medicines. Under such circumstances, the Paragraph 6 System might assume a greater significance.

… while its full operational context is still being mapped …

While the System provides an avenue to respond to demand for medicines in a specific procurement scenario, there has been negligible notification of demand from potential beneficiaries who are faced with this particular scenario. This is against a backdrop of widespread expressions of concern about affordable access to medicines. No developing country has notified the WTO that it has a general intention to use the System, although LDCs need not take this step and other countries could also do so at the same time they notify details of the needed product. Countries are entitled to notify their expected needs for medicines at an early stage in the procurement planning process, without having to give a commitment to adhere to the quantities notified or commit to proceed with imports under the System should preferable alternatives arise even at a late stage in the procurement process. In cases where the product needed is patented in the preferred supplying country(ies) – for example, where generic companies have the ability to copy the product, and where importing countries' combined effective demand is sufficient – such early notification may increase the practical likelihood of potential exporters responding to the opportunity to use the System.

One key question is whether, and, if so, in what circumstances, the particular "Paragraph 6" scenario has so far arisen in practice. A further question concerns the extent to which affordable medicines are already available without the need for compulsory licences for export. Reported procurement experiences suggest that many medicines were already available as generic exports from countries where no patent was in force. For example, Brazil, Ecuador and Thailand reportedly issued compulsory licences for the importation of products outside the System from countries where the products were not patented and were already in production as generics. Rwanda's use of the System also took place against a background of lower generic prices being available from other sources. Where generic medicines are available from non-patented sources, the System does not need to be used. This situation may change in future as the progressive impact of changes to pharmaceutical patentability in key export countries such as India makes it less likely that newer generations of medicines will be so readily available in generic versions for export (see Chapter IV, Section A.2(a)). In the future – for example, in response to a pandemic or some other health security event – effective treatments are more likely to be patented in established major supplier countries. In such a scenario, the System could well assume greater importance and be used more extensively. The availability of the System provides a more credible basis for effective use of compulsory licensing for countries with either no production capacity or limited capacity, thus strengthening their hand in negotiations on price. Past experience with procurement processes (such as Brazil's threat to use compulsory licensing for the ARV drug nelfinavir in 2001) shows how effective use of compulsory licensing can succeed in inducing lower prices without the actual final grant of a licence. The limited role of the System thus far may also partly be due to the fact that many countries procure needed medicines through international procurement programmes which may have other means of leveraging lower prices. Examples of such programmes include those run by PEPFAR, the CHAI, the Global Fund, UNICEF and UNITAID.

One area of current debate centres on the necessity to establish an adequate commercial basis for potential suppliers under the System, in order to respond to needs that have been signalled in notifications to the WTO. The System expressly recognizes the need for economies of scale in the context of its provisions on regional trade agreements, also referring to the possibility for parties to such agreements to make joint notifications.

The special export licence is one legal pathway that can be followed when it represents the optimal route to effective procurement, but, as for any compulsory licence, it does not in itself make the production of a medicine economically viable. Sufficient scale and predictability of demand are prerequisites for making it practically and commercially viable for companies to undertake the regulatory, industrial and commercial steps required to produce and export a medicine under such a licence. Regional approaches to procurement and joint notifications by countries with similar needs for accessible medicines may offer pathways to aggregating demand under the System, thus enabling an effective response to the needs identified.

The System includes measures to ensure that products reach their intended beneficiaries and are not diverted elsewhere. Such measures may include specific labelling or marking, special packaging and/or special colouring/ shaping of the products, but these ways of distinguishing products should be feasible and should not have a significant impact on price. Recent industry experience with other forms of labelling and packaging for specific markets, for example in cases of tiered pricing, donation and philanthropic procurement schemes,36 may provide practical examples for how to distinguish products without incurring significant costs. Annex II provides more detailed information on the operation and use of the System.

(b) Voluntary and socially responsible licences

An owner of a patent can share IP voluntarily with third parties through licensing agreements. A licence is a contract in which the patent holder allows another party to use the IP, either in return for a payment of royalties (or some other consideration) or free of charge, for a certain field of use, in a certain territory (which may be for the life of the patent). In the framework of their corporate responsibility programmes, research-based pharmaceutical companies have in the years since the adoption of the Doha Declaration increasingly used licence agreements to allow generic producers to manufacture and distribute generic versions of their products within a defined geographical area.

(i) Voluntary license agreements in the area of HIV/AIDS

Today, most companies that own IPRs covering products for the treatment of HIV/AIDS have signed licence or immunity-from-suit agreements with various generic producers, or have issued non-assert declarations on their HIV/AIDS products. Often, these agreements are referred to as "voluntary" licence agreements, as opposed to compulsory licences (for an overview of current agreements, see the list by Beyer, 2012).

Companies began to use this type of voluntary licence agreements to a greater extent after the adoption of the Doha Declaration. Initially, the scope and territory were rather limited, and some of the agreements were triggered by interventions from third parties.

The trend to license HIV/AIDS products to generic companies has further increased with the creation of the Medicines Patent Pool in 2010. The Pool has so far entered into two licence agreements. The first is with the National Institutes of Health in the United States and covers a patent on darunavir. The second is with Gilead, a US-based biopharmaceutical company and covers patents on another ARV, tenofovir, the co-formulation with emtricitabine, as well as on elvitegravir, cobicistat and their combination with tenofovir and emtricitabine. By 2012, the Pool had signed sub-licence agreements with four Indian generic companies for the manufacturing of all or some of these products. Some of these companies did not sign the agreement for tenofovir, given that in 2009 a patent application for tenofovir was rejected in India.37

Companies have further extended licensing programmes to include newer products and pipeline products. While initial agreements had a very limited scope and were predominantly focused on sub-Saharan Africa and LDCs, countries in which patents are often not granted or, if granted, not enforced, some companies have now expanded the geographical coverage to include more middle-income countries, and covering up to 112 countries (Beyer, 2012).38

Licensing practices have also come under scrutiny. One of the issues highlighted is that the geographical scope is limited and excludes most middle-income countries. The licence agreement signed by the Medicines Patent Pool with Gilead has led to a vigorous debate among public health groups about the added value of this agreement and role and mandate of the Medicines Patent Pool in that regard.39

Overall, it is very difficult to assess these licensing agreements, given that the terms and conditions are not disclosed, with the notable exception of agreements signed by the Medicines Patent Pool. Basically, with these licence agreements, the licensors allow others to serve the high-volume, low-profit markets in poor countries with a high disease burden of HIV/AIDS (LDCs, sub-Saharan Africa and low-income countries).

Licence agreements could potentially become a more important factor in HIV/AIDS medicines production in the near future. Agreements, if they are signed with multiple companies, can contribute to improved access to medicines through increased competition, which, in turn, leads to lower prices and increased availability of ARV treatments in developing countries. License agreements are also one of the main indicators in used by the Access to Medicines Foundation in their ranking of pharmaceutical companies, see Box 4.16. In discussions about supporting the use of voluntary licences in the future, it has been suggested that guidance should be made available to developing countries. Such guidance would set out what needs to be covered in voluntary licensing agreements and it could also possible include model contracts.40

(ii) Socially responsible licensing

Research institutions in the United States have been allowed to patent and license these patents that arise from research funded by federal grants since the passing of the Bayh– Doyle Act in 1980. This legislation has spurred discussions about how licensing policies of universities should recognize public health goals. For example, a debate arose concerning patents held by Yale University over stavudine, a substance that had been synthesized in 1966 and discovered to have reverse transcriptase inhibitor properties by researchers at Yale in the early 1990s. This research was supported by federal grants. The university had exclusively licensed production, marketing and distribution to a company which sponsored Phase III clinical trials of the drug.41 Although the university had not applied for patents in most developing countries, stavudine was patented in South Africa (Patent ZA8707171).42 When Médecins Sans Frontières (MSF) began providing antiretroviral treatment in South Africa, the drug was being sold at prices that were 34 times higher than generic versions available in other countries.43 In December 2000, MSF approached the South African division of the licensee company for permission to import generic stavudine, but were advised to approach the patent holder, Yale University. Under pressure from civil society, the student body, research communities and the inventor of stavudine in March 2001, the license agreement was revised and the company reached an immunity-from-suit agreement with a generic drugs company in South Africa allowing the marketing of stavudine in South Africa and other African countries ('t Hoen, 2009; Beyer, 2012).

Against the background of this debate, a new model of so-called "socially responsible licensing" has arisen, by which new IP-protected technologies can be used and accessed at affordable prices in underserved communities. For instance, in 2002, Eva Harris of the University of California, Berkeley, sought a licensing agreement for a portable diagnostic tool for dengue fever. She proposed a licensing agreement to the university, whereby it would license production and distribution rights to a non-profit organization, which in turn would provide the tool free or at cost, while preserving the university's right to earn royalties from "derivative technologies distributed in developed countries" (Mohiuddin and Imtiazuddin, 2007). Socially responsible licensing is thus another tool that can contribute to enhancing access to medical technologies in developing countries.

Box 4.16. Access to Medicine Index

The Access to Medicine Foundation (AMF) is an international non-profit organization dedicated to improving access to medicine. The AMF publishes the Access to Medicine Index, which ranks pharmaceutical companies according to their strategic and technical efforts to enhance global access to medicine. The aim is to develop a transparent means by which pharmaceutical companies can assess, monitor and improve their own performance and their public and investment profiles while building a platform on which all stakeholders can share best practices in the area of global access to medicine.

The Index ranks 20 pharmaceutical companies on their efforts to provide access to medicines, vaccines and diagnostic tests to people living in 103 countries. The Index for 2012 covered 33 priority diseases, including neglected tropical diseases, the ten most important communicable diseases and the ten most important non-communicable diseases in terms of their health burden on the countries included in the Index as well as maternal health and neonatal infections. Rankings are based on a large number of indicators that measure activities across areas, such as R&D, patent policy, pricing and philanthropy. It provides reports on each company's leading practices and the changes the company has made since publication of the previous Index report. The reports also suggest areas for improvement.44


(c) Exhaustion of rights and parallel imports

Parallel imports refer to genuine products first put on the market in another country and imported through a channel parallel to the one authorized by the right holder. Parallel imports are not counterfeit, and the right holder has had the opportunity to receive payment for the first sale. They are sometimes referred to as "grey market goods" – in other words, they are not black market goods, but neither have they been imported through a channel authorized by the right holder.

"Exhaustion" is a legal doctrine according to which the IP right holder cannot prevent the further distribution or resale of goods after consenting to the first sale. In such a situation, the right holder is considered to have "exhausted" its rights over these goods (the exhaustion doctrine is also known as the "first sale doctrine"). The exhaustion doctrine plays a role in enabling access to medicines, as the decision by a country to adopt international, regional or national exhaustion is an important factor in determining whether medical products can be imported (or re-imported) from other countries where prices are lower. Other important factors impacting parallel importation are the rules regarding the regulatory approval regime and private law governing the contract between the manufacturer and its distributors. In case of abuse of IPRs, competition law can also serve as a useful corrective tool.

Countries have employed several options in regulating the exhaustion regime so as best to serve their domestic policy objectives.

(i) International exhaustion

Some countries apply a regime of "international exhaustion", meaning that IPRs over goods are exhausted after the first sale by or with the consent of a right holder located anywhere in the world. As of 2010, 20 countries have adopted a regime of international exhaustion of patent rights in their domestic laws: these include Argentina, China, Costa Rica, Egypt, India, Kenya and South Africa, as well as the parties to the Cartagena Agreement (the Plurinational State of Bolivia, Colombia, Ecuador and Peru).45 In 2002, the UK Commission on Intellectual Property Rights report recommended the adoption of an international exhaustion regime in order to facilitate access to medicines for developing countries and LDCs. The report also noted, however, that establishing a differential pricing system with low prices in developing countries and higher prices in developed countries required that markets with different price levels had to be segmented so that low-priced medicines could not enter higher priced markets.46

Later, in 2006, a report by the WHO Commission on Public Health, Innovation and Intellectual Property Rights (CIPIH) also called for a differentiation between developed countries and developing countries, recommending that developing countries should maintain their ability to parallel import from other developing countries (WHO, 2006b).

Many countries do not specify rules on exhaustion in their IP laws, rather, they leave it to the courts and administrative practice. In many cases, different exhaustion regimes apply to patents, trademarks and copyright.

(ii) National exhaustion

Other countries apply the exhaustion doctrine with respect to IPRs, but only to the extent that the first sale takes place within their own territory. This is called "national exhaustion". Under this regime, the rights of the IP owner are exhausted, but only with respect to goods that have been put on the market in the country with the right holder's consent, thus enabling the right holder to prevent parallel importation. A total of 40 countries have opted for this type of exhaustion for patents. Such countries include Brazil, Ghana, Madagascar, Malaysia, Mexico, Morocco, Mozambique, Namibia, Thailand, Tunisia, Turkey and Uganda.47

(iii) Regional exhaustion

A third option is "regional exhaustion". The first sale of goods in the region by the right holder (or a sale made with his consent) exhausts any IPRs over those products – not only domestically, but within the entire region – and therefore parallel imports within the region cannot be opposed, based on IPRs.48 This is the case, for example, in EU member states and those of the EEA, in African Intellectual Property Organization member states and in Eurasian Patent Organization member states.49 At the same time, the right holder can still use his IPRs in order to prevent goods from being imported from outside the region in question.

(iv) Policy options for exhaustion regimes

Article 6 of the TRIPS Agreement provides that "nothing in this Agreement shall be used to address the issue of exhaustion of intellectual property rights" for the purposes of WTO dispute settlement, as long as the doctrine is applied in a way that does not discriminate according to the nationality of the right holder. The Doha Declaration clarified that the effect of this provision is to leave each WTO member free to establish its own regime for exhaustion without challenge, subject to the non-discrimination provisions aforementioned. This clarification is reflected in the different choices that members throughout the world have made with respect to exhaustion.

Some countries have adopted specific exhaustion regimes. For example, Rwanda adopted the Law on the Protection of Intellectual Property in 2009 (Law No. 31/2009) which provides for a system of national exhaustion of patent rights with the possibility of international exhaustion for specific products. Article 40 empowers the Minister to declare patent rights exhausted on the advice of a government agency or upon request of an interested party. The law lists several grounds on which such an authorization can be given and provides that the authorization can be revoked if the parallel importer fails to fulfil the purpose of the Minister's declaration, or if the conditions that gave rise to the declaration cease to exist.

Box 4.17. Patent term extension: the example of Atorvastatin calcium 

Atorvastatin calcium is a medication for the treatment of high cholesterol. The product was approved by the US Food and Drug Administration in December 1996 and was first marketed in 1997. It became one of the best-selling drugs in history. One of the United States patents on this medicine (No. 4,681,893), granted in 1987, had originally been set to expire in May 2006 but was extended by more than three years to September 2009 under a patent term extension provision (35 U.S.C. § 156). The exclusivity period of the basic patent was extended for an additional six months, to March 2010, under a paediatric exclusivity provision. 

The choice of the exhaustion regime is, of course, only one of the factors determining whether parallel imports can take place. Another important aspect is the contract concluded between the right holder and the distributor. For example, if such a contract prohibits the distributor from re-exporting the goods concerned, the right holder could argue that engaging in parallel importing constitutes an act violating the distributor's contractual obligations, independently of whether his IPRs are exhausted or not. Some FTAs explicitly preserve for the patent owner the right to contractually limit parallel imports. In such situations, competition law can play an important role as a potential correcting factor. For example, Switzerland applies international exhaustion in the field of trademarks. In a recent competition law case in that country, a Swiss company was shown to have continuously applied a contractual clause until 2006 as part of a licence to an Austrian-based firm. This clause prohibited the licensee from exporting to Switzerland the products it had manufactured in Austria under licence. In 2009, the Swiss Competition Commission imposed a fine on the company, as it considered that such a clause constituted a vertical agreement which would significantly affect competition on the Swiss market and, therefore, struck down the clause, thus permitting parallel imports.50

Another important factor that determines whether parallel imports can take place is the set of health regulations for market approval of medicines. Any country may prohibit parallel imports of different versions of the same pharmaceutical product if those versions lack marketing approval in the country of importation – even if the country embraces an international exhaustion regime.

(d) Patent term extension

National laws set out the period of time during which the patent can remain in force (the "patent term"). The term of protection available must not end before the expiration of a period of 20 years, counted from the filing date of the patent application. This rule is set out in Article 33 of the TRIPS Agreement and was applied in the WTO case of Canada – Term of Patent Protection in 2000.51 A patent will lose effect before the end of the available term, for example, if it is invalidated, or if the patent holder ceases payment of required maintenance fees. However, patents relating to commercially successful pharmaceutical products are likely to be maintained for the full available term.

A number of WTO members, such as Australia, the European Union, Israel, Japan, the Republic of Korea and the United States, make available an extension of the patent term beyond the minimum of 20 years required by the TRIPS Agreement, generally to compensate for regulatory delays. This is because, unlike products in most other fields of technology, pharmaceutical products must undergo regulatory review in order to ensure safety and efficacy. The regulatory review process can considerably curtail the market exclusivity period that holders of pharmaceutical patents would otherwise enjoy.

For example, the United States provides for patent term extensions of up to five years, subject to a 14-year ceiling on the total market exclusivity period (the period after the market authorization until patent expiry) (see Box 4.17). Based on Regulation (EC) No 469/2009,52 EU member states make available supplementary protection certificates (SPCs) for up to five years, subject to a 15-year limit on the total market exclusivity period after the marketing approval of the product. Since 2007, the European Union has also allowed for six-month extensions of SPCs in return for the completion of clinical studies of a product's effectiveness and safety in children.

In addition to serving as compensation for lengthy marketing approval procedures, patent term extensions are also made available by certain countries in order to compensate the right holder for any unreasonable curtailment of the patent term as a result of processing delays in the patent office. Patent term extension is also a standard feature in bilateral FTAs.

Many different views have been expressed about the impact of patent term extensions on public health. Some argue that such extensions hinder access to medicines because they delay the market entry of generic medicines. Others are of the view that extensions are favourable from a public health perspective because they support medical innovation and thus improve access to health in the long run.

(e) Enforcement of IP

An overview of IP enforcement standards is set out in Chapter II, Section B.1(f). This section looks at issues of enforcement that are specifically linked to access to medicines (see Box 4.17).

In the area of cross-border trade in medical products, public health and free trade interests intersect. The common objective is to ensure that free trade in legitimate medical products, including generic medicines, is not subject to unnecessary legal barriers to prevent movements of medicines between countries. This common objective is also reflected as a general principle in the enforcement section of the TRIPS Agreement (Article 41.1).

In 2009, Brazil and India, supported by a number of other developing countries, focused the international community's attention on the subject and expressed strong concerns at WHO and WTO meetings53 about the detention of in-transit generic medicines by customs authorities at different EU ports on the basis of Council Regulation (EC) No 1383/200354. The regulation allows customs authorities to detain goods suspected of infringing IPRs in the European Union. Since 2003, this has also included goods in transit which are suspected of infringing patents. In 2008, customs authorities in the Netherlands detained 17 consignments of generic medicines, reportedly on the grounds of alleged infringement of one or more patents which were valid and enforceable in the Netherlands. Of these 17 consignments, 16 originated in India and one in China. The majority of the consignments were in transit, destined for developing countries in Latin America and Africa. Included in one of these consignments was a hypertension drug, destined for Brazil. In 2009, German customs authorities detained a generic antibiotic shipped from India to Vanuatu through Frankfurt Airport for alleged trademark violation. In the reported cases, there was no suggestion that the medicines were infringing any IPRs in the countries of origin or countries of destination. The in-transit generics were therefore legitimate in the countries of origin and in the countries of destination. The consignments concerned were subsequently released.

In May 2010, Brazil and India initiated WTO dispute settlement proceedings by requesting consultations with the European Union on its customs measures. Among other things, Brazil and India claimed violation of the General Agreement on Tariffs and Trade (GATT) obligation to allow freedom of transit, as well as various provisions of the TRIPS Agreement on patent rights and enforcement.55 In earlier TRIPS Council discussions, the European Union had concurred with the claimants that customs action should not affect legitimate trade in generic medicines. On the other hand, it defended its regulation as being fully TRIPS-compliant, arguing that it was important for customs authorities to be allowed to control in-transit medicines, as this could help save patients' lives in developing countries. So far, further action in the WTO case has not been pursued and there has been no request for a WTO dispute settlement panel to be established.

In July 2011, the Indian government announced that India and the European Union had reached an informal settlement of the dispute ("Understanding") to guide border enforcement of IP in the European Union based on the principles agreed in the Understanding which are due to be reflected in the draft regulation to replace Regulation No. 1383/2003.56

In the interim, the European Commission has issued "Guidelines concerning the enforcement by EU Customs authorities of IPRs with regards to goods, in particular medicines, in transit through the EU".57 These guidelines clarify the application of Council Regulation No 1383/2003 and take account of the findings in a European Court of Justice judgment of 1 December 2011.58 In particular, the guidelines lay down the understanding that the mere fact that medicines are transiting through the EU territory and are subject to a patent rights in the European Union "does not in itself constitute enough grounds for customs authorities to suspect that those medicines are infringing patent rights". However, a substantial likelihood of diversion of such medicines onto the EU market "may constitute enough grounds for customs authorities to suspect that the medicines at stake infringe patent rights".

Taking into account the discussion about the detention of in-transit generic medicines, Switzerland also clarified that, under the Swiss Federal Act on Patents for Inventions, customs authorities may only prohibit the transit of patent-infringing goods if the right holder presents direct evidence concerning infringement of a patent in both Switzerland and in the country of destination.59 These issues also came up in ACTA negotiations (see Box 4.18).

It is therefore important to ensure that enforcement provisions in trade agreements and trade rules do not create unnecessary barriers to legitimate trade in generic medicines. For this purpose, there is clearly a need to distinguish between counterfeit and generic medicines, in order to avoid definitional issues becoming a de facto barrier to access to generic medicines (definitional issues are also discussed in Chapter IV, Section B.7(e)(ii). As the review of Kenya's 2008 Anti-Counterfeit Act has demonstrated (see Box 4.19), separating counterfeit from generic medicines has been an issue in the process of drafting national legislation (see Box 4.18). There has also been a trend in recent FTAs to include provisions on IPR enforcement (see Section 5 below).

Box 4.18. The Anti-counterfeiting Trade Agreement 

The Anti-Counterfeiting Trade Agreement (ACTA) constitutes another example of a proposed international instrument which has been the subject of substantive discussions on the potential impact of IP enforcement measures on access to medicines. Following two separate initiatives by Japan and the United States, a group of like-minded countries negotiated the ACTA, from 2007 to 2010. The ACTA aims to build on existing international rules in the area of IP, in particular on the TRIPS Agreement, and is intended to address a number of enforcement issues where participants identified perceived gaps in international legal framework.

According to the participants in the negotiations, the ACTA aims to:

  • establish a state-of-the-art legal framework of enforcement measures to effectively respond to the growing phenomena of counterfeiting and piracy in international trade
  • promote sound enforcement practices to foster the creation of additional mechanisms to combat the proliferation of illicit products
  • ensure cooperation among the parties to address the challenges of cross-border trade in counterfeit and pirated goods.60

While WTO members are free to agree on higher standards, as long as those standards respect the provisions of the TRIPS Agreement (Article 1.1), the impact of higher enforcement standards under ACTA on trade in legitimate pharmaceutical products was extensively discussed at a number of TRIPS Council meetings. Concerns were voiced about ACTA's potential to negate decisions taken multilaterally, such as the Doha Declaration on the TRIPS Agreement and Public Health, as well as to deny the benefits of access to medicines under the Paragraph 6 System.61 Participants in the ACTA negotiations emphasized that these concerns had been addressed in the final version of the agreement which, among others, recognized the principles set out in the Doha Declaration. The ACTA does not provide for border measures to apply to products infringing patents and preserved the optional application of border measures to goods in transit. The ACTA text was circulated as a TRIPS Council document in October 2011.62

The Agreement has triggered an intense debate in many countries about, among others, its impact on access to medicines. As of December 2012, the number of countries which have ratified the agreement was not sufficient for it to enter into force. 

Box 4.19. drawing a line between counterfeit and generic products: Kenya's High court ruling 

In April 2012, the High Court of Kenya considered that the definition of "anti-counterfeit" in the country's 2008 Anti-Counterfeit Act was too ambiguous, as it failed to clearly distinguish between counterfeit and generic medicines, thus carrying the risk of adversely affecting access to generic medicines. The Court therefore ruled that the relevant passages of the Act could infringe the fundamental right to health guaranteed under Kenya's constitution and requested the State to reconsider the provisions concerned.63 Similar issues have been raised, among others, with respect to Uganda's draft Anti-Counterfeit Bill, Tanzania's 2008 Merchandise Marks Regulations, and the East African Community Anti-Counterfeiting Policy and Bill which was proposed in 2010. 

4. Patent information and its relationship with public health policy

Access to patent information is an area of increasing importance for the procurement of medical products.64 When making procurement decisions relating to the purchasing of the best-priced quality products, procurement agencies may also need to consider the patent status of the products and the legal status of these patents in specific markets.

The joint technical symposium entitled "Access to Medicines, Patent Information and Freedom to Operate", held in February 2011, reviewed the linkages between the patent information system and a range of policy questions associated with access and innovation in the field of public health.65

The symposium discussion on the need to make better use of patent information to support public health initiatives resulted in the following observations:

  • Reliable domestic patent information is difficult to obtain in many countries.
  • Health authorities and other stakeholders face difficulties in assessing the status of patents.
  • Collaborative efforts are needed to build capacity and improve availability of data, particularly in developing countries.
  • Patent information should be digitized, up to date and correct, and patent registers should be searchable online and easy to use.
  • Where available, the international nonproprietary name (INN) should be submitted in patent applications, so as to aid patent searches.66
  • Providing comprehensive patent information and enhancing access to national registers is the responsibility of national governments.
  • Procurement agencies would benefit from tools to aid patent searches relating to health technologies, as well as a consultation service on how to find and interpret patent information.

Having access to complete patent information is also relevant, in order to build on the results of previous R&D – either by exploiting public domain technologies, inventing around protected technologies, or developing new technologies on the basis of public or protected technologies. Improving access to patent information related to health is also a concern of the GSPA-PHI, which addresses the need for access to user-friendly global databases containing public information on the administrative status of health-related patents. The WIPO Development Agenda, the work of the WIPO Committee on Development and Intellectual Property, the development and maintenance of WIPO Standards, the International Patent Classification,67 as well as the establishment of Technology and Innovation Support Centers68 also aim to make patent information easier to obtain and to use.

5. Review of IP provisions in recent FTAs

Since the entry into force of the TRIPS Agreement, the number of FTAs containing provisions on IP protection and enforcement has increased. Some merely reaffirm the principles of the TRIPS Agreement, requiring adequate and effective protection of IP in accordance with the minimum standards set down in that agreement. There has been a recent trend for certain FTAs, in particular those involving developed countries, to require the parties to implement more extensive protection and enforcement of IPRs than provided for under the TRIPS Agreement. These higher and additional IP standards are often referred to as "TRIPS-plus" (see Chapter II, Section B.1(a)). While Article 1.1 of the TRIPS Agreement expressly allows WTO members to implement in their law more extensive protection than is required by the TRIPS Agreement, such protection must not contravene the provisions of that agreement, including its non-discrimination provisions. Such provisions generally require the parties to an FTA to extend the application of any higher standards to nationals of all other WTO members (as explained in Chapter II, Section B.5(b)).

This section provides an overview of the standards set down in certain FTAs that are of particular relevance to the pharmaceutical sector. For a broader overview, see Valdés and Tavengwa (2012). It also provides an overview of studies that have attempted to estimate the potential economic impact of these standards. It summarizes the approach adopted in a number of FTAs, and the role played by international organizations. Finally, it considers the potential implications for access to medical technologies. However, the focus on FTAs does not mean that no other types of agreements contain provisions which have a potential impact on the pharmaceutical sector. Such provisions may also be encompassed in bilateral investment treaties or specialized IPR agreements, for example, the ACTA, which represents a recent example of a plurilateral agreement dealing only with IPR enforcement (see Chapter IV, Section C.3(e)).

(a) Provisions affecting the pharmaceutical sector

The most common features found in virtually all FTAs are obligations to accede to a range of WIPO conventions and treaties, for example, the PCT, the Patent Law Treaty or the Trademark Law Treaty. FTAs also oblige signatories to respect TRIPS Agreement standards, in particular its principles of non-discrimination (national treatment and most-favoured-nation treatment). In addition, certain standards found in FTAs which relate to patent and test data protection, as well as IPR enforcement more generally, are particularly relevant to pharmaceutical products and other medical technologies. While there is no unique approach to IP standards in FTAs, certain commonalities in terms of clarifying and increasing TRIPS Agreement standards can nevertheless be observed. Provisions in FTAs that typically affecting the pharmaceutical sector cover (but are not necessarily limited to) one or more of the following subjects.

(i) Patentability

FTA provisions often cover various aspects of patentability. First, certain FTA standards do not provide for certain possible exclusions from patentability permitted under TRIPS, for example, by expressly preserving the patentability of plants and animals. Second, with regard to patentability criteria, a number of FTAs specify how some or all of the criteria (novelty, inventive step, industrial applicability), as well as the requirement of sufficient disclosure, are to be applied. Some FTAs expressly provide that patents must be available for a known product if a new use can be determined and the general patentability criteria are met in this respect.

(ii) Patent term extension

Certain FTAs require that an extension of the 20-year term of patent protection established by the TRIPS Agreement be available for pharmaceutical products to compensate the patent owner for any unreasonable curtailment of the patent term as a result of the marketing approval process, or as a result of processing delays in the patent office.

(iii) Grounds for granting compulsory licences

While the TRIPS Agreement does not establish an exhaustive list of grounds for granting compulsory licences, certain FTAs limit such grounds to remedies under competition law, situations of extreme urgency and public non-commercial use.

(iv) Exhaustion

Under the TRIPS Agreement, as confirmed by the Doha Declaration, WTO members are free to choose the exhaustion regime that best meets to their domestic policy objectives (see Chapter IV, Section C.3(b)). However, the standards set by some FTAs specifically provide for the right of a patent owner to limit parallel imports through contracts.

(v) Test data protection

While Article 39.3 of the TRIPS Agreement requires countries to protect undisclosed test data against unfair commercial use, it does not specify the manner or duration of such protection (see Chapter II, Section B.1(c)). In contrast, some of the more recent FTAs specify that a period of exclusivity is required for the protection of such data; this is usually set at five years, but sometimes extends to eight years. During the exclusivity period, the regulatory authorities are not allowed to permit generic competitors to market the same or similar product on the basis of the approval granted to the originator company, unless the latter authorizes such reliance. In certain FTAs, data exclusivity also covers cases in which an FTA party permits the granting of a marketing approval of regulated products on the basis of an earlier marketing approval of the same or similar product in a third country. This has the effect of preventing generic companies from relying on the test data supplied by the originator company to another country's government, even if no test data have been supplied to the government of the country in which the generic company seeks to market its product. The TRIPS Agreement only requires test data protection when submission of data is mandatory.

(vi) Patent linkage

Although government authorities both may grant patents on pharmaceutical inventions and provide approval for patented pharmaceutical products for market entry, the two functions are not necessarily related. Most countries have separate agencies that grant patents (patent offices) and approve drug products and do not link these functions.

Nevertheless, it is possible to link regulatory approval, ordinarily based on safety and efficacy, to the patent status of the drug product. This so-called "patent linkage" can take several forms. In its simplest form, linkage may involve a requirement that a patent owner simply be informed of the identity of any manufacturer seeking regulatory approval for a generic version of the originator's drug product. A stronger version of patent linkage could prohibit the granting of marketing approval for a drug product by a third party prior to the expiration (or invalidation) of a patent covering that product. An even stronger form of linkage could prohibit not only the granting of marketing approval, but also the consideration of a generic drug application during the patent period.

A number of FTAs include patent linkage provisions, such as the Colombia–Mexico FTA, the Japan–Thailand FTA, the Dominican Republic–Central America–United States FTA (CAFTA-DR), and several other FTAs to which the United States is a party.

Some stakeholders argue that patent linkage places regulatory agencies in the role of "patent enforcers", that some patent linkage provisions make no exception for generic medicines produced under compulsory licence, and that patent linkage provisions can unjustifiably extend exclusivity if the regulatory agency is unable to begin a review of the generic drug application during the patent period. On the other hand, proponents of patent linkage argue that it prevents unnecessary infringement, and increases transparency and predictability through the identification of patents relevant to each pharmaceutical product as part of the marketing approval process.

(vii) Enforcement

While enforcement standards set by FTAs are generally of broad application and are not sector-specific, a number of these standards have the potential to directly affect the pharmaceutical sector. Relevant enforcement provisions include, for example, the application of border measures to IPRs other than trademarks and copyright (for which they are already mandatory provisions under the TRIPS Agreement), as well as their application to goods in transit. In short, "border measures" allow right holders to work with customs authorities to prevent the importation of goods covered by IPRs.

(viii) Reaffirmation of TRIPS flexibilities and Doha Declaration principles

Some FTAs explicitly confirm the parties' agreement that the IPR standards set by the FTA neither affect the right of the parties to the FTA to take measures to protect public health nor their right to use the additional flexibility made available to WTO members through the Paragraph 6 System (see Chapter IV, Section C.3(iii)). For certain FTAs, this has been addressed by so-called "side letters" on public health. Other FTAs contain such provisions in the body of the agreement. Such confirmation is aimed at addressing concerns that FTA standards could limit the flexibilities available under the TRIPS Agreement and later instruments.

(b) Major players

As illustrated by Table 4.1, which lists provisions affecting the pharmaceutical sector, the FTAs which clarify or adopt higher standards of IPR protection and enforcement are clustered in and around three main geographical areas, namely the United States, the European Free Trade Association (EFTA) and the European Union:

  • Since 2001, the United States has concluded 12 such FTAs with 17 countries. These agreements generally cover IPRs in a comprehensive manner, including most of the issues listed in Table 4.1.
  • Since the early 1990s, the EFTA, which comprises Iceland, Lichtenstein, Norway and Switzerland, has concluded an extensive network of 24 agreements covering 33 countries and territories. As Table 4.1 shows, the majority of these agreements focus on higher standards with respect to patent term extension, test data exclusivity and enforcement measures at borders. Some other agreements are not listed in the table, because they do not contain an IPR chapter (Canada), are limited to reaffirming the TRIPS Agreement (Croatia and Mexico), or because they reiterate the commitments under international agreements, including the TRIPS Agreement, with a built-in review clause (Southern African Customs Union and Gulf Cooperation Council).
  • Since the mid-1990s, the European Union has concluded a series of association, partnership and trade agreements (see titles "European Community", or "EC" in Table 4.1). The Stabilisation and Association Agreements (i.e. the agreements that countries enter into with a view to facilitating eventual accession to the European Union) with several central European countries aim to calibrate the level of protection to that in the Community acquis (i.e. the rights and obligations that EU member states share, including EU treaties and laws, declarations and resolutions, international agreements on EU affairs and the judgments given by the Court of Justice). This includes, among others, obligations to provide for patent term extension, test data exclusivity and higher enforcement standards. Most association agreements concluded with countries in the Mediterranean region, as well as the agreements with Chile, Mexico and South Africa, provide for protection in line with the "highest international standards", without defining the precise meaning of such standards – in particular, whether the reference point is multilateral agreements (such as the TRIPS Agreement), or any standards set, for example those set down in other bilateral or regional agreements. The more recent agreements concluded with the Caribbean Forum of African, Caribbean and Pacific States (CARIFORUM) and the Republic of Korea illustrate the European Union's new approach to the negotiation of a detailed IPR chapter, thus replacing the previously used references to "highest international standards".





Table 4.1 Key provisions affecting the pharmaceutical sector in selected FTAs


Provision on













Patent term extension

Compulsory licensing


Test data exclusivity

Patent linkage


Side letters/reaffirmation of Doha Declaration

EC–Turkey (1995)

Level of protection similar to common body of EU legislation and jurisprudence (acquis)

EC Stabilisation and Association Agreements with the former Yugoslav Republic of Macedonia (2004), Croatia (2005), Albania (2009), Montenegro (2010)

Level of protection similar to EU acquis

EC Association Agreements with Algeria (2005), Israel (2000), Jordan (2002), Morocco (2000), Tunisia (1998) and Interim Agreement with Lebanon (2003)

Protection in accordance with highest international standards

EC Association Agreement with Egypt (2004)

Protection in accordance with prevailing international standards

EC–Chile (2003), Mexico (2000), South Africa (2000)

Protection in accordance with highest international standards

EC–CARIFORUM (pending as of August 2012)







EC–Korea (provisional application as of July 2011)




Five years


EFTA–Albania (2010)




Eight years



EFTA–Chile (2004)




Five years




EFTA–Colombia (2011)


√ (optional)



Reasonable period (normally five years)



EFTA–Egypt (2007)





five years




EFTA–Hong Kong, China (pending as of August 2012)





Eight years




EFTA–Israel (1993)

Protection of patents on a level similar to that prevailing in EFTA

EFTA–Jordan (2002)

Protection of patents on a level similar to that prevailing in the European Patent Convention (EPC)

EFTA–Korea (2006)




Adequate number of years or financial compensa-tion




EFTA–Lebanon (2007)





Six years or compensa-tion




EFTA–Montenegro (pending)




Eight years



EFTA–Morocco (1999)

Protection of patents on a level similar to that prevailing in the EPC

EFTA–Peru (2011)


√ (optional)



Reasonable period (normally five years)



EFTA–Serbia (2010-2011)




Eight years



EFTA–Singapore (2003)








EFTA–Tunisia (2005)





Five years




EFTA–Turkey (1992)

Protection of patents on a level similar to that prevailing in the EPC

EFTA–Ukraine (pending)




Five+one years







Six years



NAFTA (1994)





Reasonable period (normally five years)




United States–Australia (2005)

Five years


United States–Bahrain (2006)



Five years

CAFTA-DR (2006-2009)



Five years

United States–Chile (2004)



Five years


United States–Colombia (pending)

√ (optional)



Reasonable period (normally five years)

United States–Jordan (2001)






United States–Korea (2012)



Five years

United States–Morocco (2006)


Five years

United States–Oman (2009)



Five years

United States–Panama (2011)




Reasonable period (normally five years)

United States–Peru (2009)




Reasonable period (normally five years)

United States–Singapore (2004)



Five years


Source: WTO Secretariat.

Note: This only reflects provisions in FTAs that set higher standards, and does not reflect those that merely reaffirm the TRIPS Agreement).

That provisions affecting the pharmaceutical sector form an integral part of most of the FTAs concluded by the United States, the European Union and EFTA reflect the fact that the United States, the European Union and Switzerland are the world's largest producers and exporters of pharmaceutical products.69 Provisions on patents or test data protection are comparatively rare in, or absent from, FTAs concluded without the involvement of the United States, the European Union and EFTA, and especially in cases where such agreements are concluded among developing countries only, or where they involve LDCs. In some of these FTAs, detailed provisions on patents and/or test data protection are set out, but these usually restate TRIPS Agreement standards. A notable exception is the agreement between Colombia and Mexico, which provides for data exclusivity for a period "normally" of five years.

(c) Economic impact analysis

Some studies have looked at the economic impact of the FTA IPR provisions on the pharmaceutical sector. For example, a 2009 study commissioned by the ICTSD concluded that the CAFTA-DR would lead to an annual price increase for active ingredients in Costa Rica of between 18 per cent and 40 per cent by 2030, requiring increased public spending in the range of US$ 2 million to US$ 3.357 million. The strongest repercussions were expected from standards on patentability criteria and standards on test data exclusivity.70 A similar 2009 study for the Dominican Republic predicted a modest price increase of 9 per cent to 15 per cent for active ingredients by 2027. It found that the strongest impact by far was to be expected from provisions on data exclusivity. Interestingly, the authors also reported that information asymmetries and government policy imperfections would have a higher impact on prices than regulatory changes in the IP regime.71 A 2012 study, prepared by two civil society organizations in Colombia, found that the introduction of data exclusivity in exchange for trade preferences in 2002, and later confirmed in the FTA negotiations, has led to an additional expenditure of US$ 412 million.72 Finally, a 2007 Oxfam Briefing Paper estimated that prices for medicines in Jordan had increased by 20 per cent since the conclusion of the agreement with the United States. Here again, data exclusivity was singled out for delaying the market entry of almost 80 per cent of the generic versions of newly launched medicines between 2002 and 2006, with additional expenditures for medicines estimated at between US$ 6.3 million and US$ 22.04 million.73

Assessing the economic impact of specific chapters in FTAs in an isolated fashion may, however, not do justice to the overall architecture of FTAs and their resulting effects in terms of wealth creation, improved living standards, and transparent and non-discriminatory procedures leading to delivering better value for money, among other things. Impact assessments that have been prepared by parties to a particular FTA, and that cover the effects of the FTA as a whole are more common.74

Each of the higher standards adopted in FTAs – either on its own or in conjunction with other standards – has the potential to affect both the creation of, and subsequent access to, medical technologies. Typically, it can achieve this not only by incentivizing the invention of medical technologies in the first instance, but also by delaying the arrival of generics on the market for a period of time following the initial invention. Among the factors that can delay market entry of generics are narrower interpretations of or limitations to TRIPS flexibilities than otherwise available to WTO members. The trend towards the inclusion of detailed IPR provisions continues, including in the more recent FTAs negotiated by the European Union. At the same time, the readiness to include public health safeguards in these agreements – either in an IP chapter or in side letters – has also significantly increased over the past decade.

For its part, the WTO can contribute to monitoring and awareness-raising, among other things, through the examination of notified FTAs in the Committee on Regional Trade Agreements and through the regular review of national trade policies under the Trade Policy Review Mechanism. Based on Article 63.3 of the TRIPS Agreement, WTO members can also seek access to, or information on, bilateral agreements from other WTO members.

With regard to the WHO, a number of resolutions have also been adopted which explicitly call on WHO member states to take into account the flexibilities in the TRIPS Agreement and later instruments (e.g. the Doha Declaration and the Paragraph 6 System) in trade agreements (e.g. see Element 5.2(c) of the GSPA-PHI adopted by World Health Assembly Resolution WHA 61.21, which recommends that countries take into account the impact on public health when considering adopting or implementing more extensive IP protection than is required by TRIPS).75

1. [1999] RPC 253 (Pat. Ct.) [51], aff’d in part [2001] RPC 1 (CA) (United Kingdom). back to text

2. See WIPO document SCP/12/3 Rev.2, Annex II, for information on national laws regarding exclusion from patentable subject matter. back to text

3. This information may be accessed at on­law/en/guidelines.htmlback to text

4. See to text

5. WIPO document WIPO/SCP/12/3 Rev.2. back to text

6. See to text

7. See to text

8. For more information on prior art, see Chapter II, Endnote 67. back to text

9. Source: WIPO Statistics Database back to text

10. See pharmaceuticals/inquiry/communication_en.pdfback to text

11. In the Matter of Patent Application No. 712/del/2002, Order of 18 March, 2009. back to text

12. This exception is sometimes called the “Bolar” exception after the 1984 U.S. court decision Roche Products v. Bolar Pharmaceuticals that had considered this type of use to be patent infringement, leading to US legislation that defined this type of use as a permissible exception to the patent right (Roche Products v Bolar Pharmaceuticals, 733 F.2d. 858 (Fed. Cir. 1984). back to text

13. WTO document WT/DS114. back to text

14. WIPO document CDIP/5/4, Annex II. back to text

15. This issue was raised in consultations requested by the United States with Brazil under the WTO dispute settlement mechanism. The mutually agreed solution can be found in WTO document WT/DS199/4. back to text

16. See Article L613-16 of the French Code de la propriété intellectuelle and Article 67 of Morocco’s Loi relative à la propriété industrielleback to text

17. WIPO document CDIP/5/4, p. 16. back to text

18. Available at License_12032012.pdf. At the time of writing (December 2012), the appeal of the patentee was pending.  back to text

19. WTO document IP/C/57, para. 19. See Chapter II. back to text

20. WTO document IP/C/M/65, para. 151. back to text

21. See to text

22. WTO document WT/TPR/S/255, para. 173. back to text

23. For more details, see WTO documents IP/C/M/63, paras. 359-70, WT/TPR/S/254/Rev.1, para. 140 and IP/C/57, para. 113. back to text

24. See­pid-184.htmlback to text

25. See ‘t Hoen (2009). back to text

26. See: WTO document IP/C/61, paras. 50-55; and Khor (2007, p. 18). back to text

27. See italy_court_quashes_decision_1012.Aspxback to text

28. See to text

29. See noah-novogrodsky-on-compulsory.htmlback to text

30. WTO document IP/C/64, para. 104. back to text

31. WTO document IP/N/9/RWA/1. back to text

32. WTO document IP/N/10/CAN/1. back to text

33. WTO document IP/C/M/64, para. 116. back to text

34. See to text

35. Source: WTO document IP/C/M/64. back to text

36. See Annex to the Chairman Statement in WTO document WT/GC/M/82. back to text

37. See to text

38. See johnson-johnson-rebuffs-medicines-patent-pool/back to text

39. See:; www.i-mak. org/publications/; and msf-review-july-2011-gilead-licences-medicines-patent-poolback to text

40. See to text

41. to text

42. See to text

43 See:; and to text

44. Source: to text

45. See WIPO document CDIP/5/4 REV., Annex II. back to text

46. See to text

47. See WIPO document CDIP/5/4 REV., Annex II. back to text

48. See to text

49. See WIPO document CDIP/5/4 REV., Annex II. back to text

50. See,lnp6I0NTU042l2Z6ln1ad1IZn4Z2qZpnO2Yuq2Z6gpJCDdH94fWym162epYbg2c_ JjKbNoKSn6A—&lang=enback to text

51. WTO document WT/DS170. back to text

52. Official Journal of the EU L152/1 of 16 June 2009. back to text

53. The issue was first raised at the 124th Executive Board meeting of the WHO in January 2009. Brazil and India raised it again under “Other Business” at the WTO’s General Council meeting on 3 February 2009, as well as at the TRIPS Council meetings on 3 March 2009 (WTO document IP/C/M/59, paras. 122-91) and on 8 June 2009. back to text

54. Official Journal of the EU 2003 L196/7. back to text

55. WT documents WT/DS408/1 and WT/DS409/1. back to text

56. See to text

57. See customs_controls/counterfeit_piracy/legislation/guidelines_on_transit_en.pdfback to text

58. Joined cases C-446/09 (Philips v LuchengMeijing) and C-495/09 (Nokia v Her Majesty’s Commissioners of Revenue and Customs). back to text

59. See to text

60. See the statements of the participants in the ACTA negotiations at the TRIPS Council meeting in October 2011, WTO document IP/C/M/67, paras. 457-508. back to text

61. WTO documents IP/C/M/69, paras. 230-310; IP/C/M/67, paras. 456-543; and IP/C/M/63, paras. 248-336. See also Chapter III and Annex II). back to text

62. WTO document IP/C/W/563. back to text

63. See Judgment-Petition-No-409-of-2009-Anti-counterfeit-case.pdfback to text

64. The content and the sources of patent information are explained in Chapter II, Section B.1(b)(viii). back to text

65. See: html; med_ge_11/; and trip_18feb11_e.htmback to text

66. In early development stages, the INN of a product would have not yet been assigned. A potentially useful way of recording compounds would be using text-based structure representations (e.g. the International Union of Pure and Applied Chemistry (IUPAC) International Chemical Identifier (InChI), InChI presently does not support, for example, Markush structures, but ongoing projects exist to extend the scheme and allow it to describe numerous types of chemical structures. back to text

67. The IPC, established by the Strasbourg Agreement Concerning the International Patent Classification, provides for a hierarchical system of language independent symbols for the classification of patents and utility models according to the different areas of technology to which they pertain. The standardized application of IPC symbols to patent documents by experts enables language independent patent searches and makes the IPC an indispensable search tool. For further information, see classifications/ipc/enback to text

68. See to text

69. See IFPMA (2011, p. 46). back to text

70. See to text

71. See to text

72. A Spanish version of the report is available at www.ifarma.orgback to text

73. See to text

74. See, for example, the Office of the United States Trade Representative website for the agreements concluded with its trading partners, available at free-trade-agreementsback to text

75. In 2010, the East Mediterranean Regional Office of the WHO produced a policy guide on “Public health related TRIPS-plus provisions in bilateral trade agreements” for negotiators and implementers in the region (El Said, 2010). See phi/publications/category_ip_trade/en/index.htmlback to text