15 th Annual IGPA Conference Kyoto, Japan, 5 December 2012 The Interface Between Public Health, Trade & TRIPS: Current Work at the WTO and How it Relates to the Generic Industry Roger Kampf, WTO Secretariat The views expressed are personal and cannot be attributed to the WTO, its Secretariat, or any of its Member governments. 1
I. Introduction: The Interface Between IPRs and Public Health
Where Do We Come From: the Interface between IPRs and Public Health • Since last decade: – Impact of IPRs on innovation of and access to medicines moved to centre of cross-cutting debate between separate policies • TRIPS-related issues (as confirmed by Doha Declaration): – IPR as an important factor for development of new medicines, but: concerns expressed about effect on prices → How best to reconcile the need for incentives to invest in R&D and access to medicines? – Importance of flexibilities recognized, but: need to preserve balance of rights and obligations → How is optimal balance between IPRs and public health best achieved? – TRIPS as part of wider national and international action to address health problems, but: cannot solve issues on its own → How to ensure capacity to deal with innovation-access cycle in a holistic manner?
From Boundaries to Synergies: Bringing Together Distinct Policies IP Law, International Innovation & Management Trade & public and Domestic research Administration Economic policies Settings Quality, Safety, Human Rights Public Health Efficacy Framework Regulation Access to Medical Technologies
An Issue Addressed at Various Levels & By Different Actors Multilateral Framework : Free Trade • WHO Agreements • WIPO • WTO Key actors: • IGOs • Regional Organizations • Governments • Private Sector • Civil Society Regional Domestically: • IP policy & Framework: • ARIPO strategy • • Legislation OAPI • • Courts others
Key Provisions Affecting Pharmaceutical Sector in Selected FTAs Notified to WTO Patent term extension Compulsory licensing /reaffirmation of Doha Test data exclusivity Provision on Patent linkage Side letter or Enforcement Patentability Exhaustion Declaration FTA EFTA - Albania, Chile, Colombia, Mandatory (7) 5 to 8 years (7) 4 2 Egypt, Korea, Peru, Serbia, Optional (2) Reasonable period Singapore, Tunisia, Ukraine (10 in (normally five years) total) (2) Adequate number of years or financial compensation (1) EFTA - Jordan, Morocco Protection of patents on a level similar to that prevailing in the European Patent Convention – EC Turkey, Stabilisation and Level of protection similar to common body of EU legislation and jurisprudence Association Agreements with FYROM, Albania, Croatia, Montenegro EC – Chile, Mexico, South Africa and Protection in accordance with highest international standards Association Agreements with Algeria, Israel, Jordan, Morocco, Tunisia, Lebanon (Interim Agreement) EC – Cariforum (pending as of √ √ 8/2012) EC – Korea (provisional application) √ √ √ 5 years US - Australia, Bahrain, CAFTA/DR, 8 Mandatory (11) 3 2 Five years (8) 12 8 11 Chile, Colombia, Jordan, Korea, Optional (1) Reasonable period Morocco, Oman, Panama, Peru, (normally 5 years) (3) Singapore (12 in total) 6
The Generic Industry: An Active User of the IP System • As IP rightholder - for example: – Trademarks for branded generic products – Enforcement of trademarks and other IPRs • As voluntary licensee – Increased number of voluntary licensing programmes (new / pipeline products, broader range of countries) – Different types of partnerships: • Extended partnership, including acquisition of shares, right to distribute partner products, acquisition of manufacturing facility by generic partner (ex: GSK/Aspen) • One licence agreement to manufacture a single product • Reliance on generic companies as distributors (ex: Gilead) – Medicines Patent Pool and WIPO Re:Search • As compulsory licensee • As user of litigation procedures • As stakeholder in policy-making process → Interest in balanced and well -functioning IP system
II. WTO’s Mandate and Role in the Pharmaceutical Sector
General Overview • Trade (rules) intersect with public health objectives in many ways: – Positive link: trade - higher living standards – improved public health conditions – Defensive link: right to take trade-restricting measures to protect public health recognized in all WTO agreements • The WTO’s role is to: – Offer a forum for discussion of the interface between trade rules and public health – Settle disputes: • Few cases challenged appropriateness of measure chosen to achieve public health objectives, not the right to protect public health – Raise awareness and build capacity • The WTO’s mandate is NOT to interpret TRIPS provisions or to assess use of TRIPS flexibilities 9
WTO Is Not “Just” About TRIPS ! (1): Tariffs • Growing importance of international trade for supply of public health goods: – +12%/year, from 92 bn. USD (1995) to 500 bn. USD (2010) – Amounts to 4.2% of global merchandise trade • Applied tariffs on health-related products: – Affect both access and domestic production – Pharmaceutical Sector Initiative (1994) – selected WTO Members liberalize markets for >6500 products and ingredients (= estimated 79% of global trade) – Sectoral initiative for open access to enhanced health care (2006) • For detailed study see WTO Staff Working Paper: More Trade for Better Health ? International Trade and Tariffs on Health Products (October 2012) 10
Imports of Health-Related Products: in bn. USD for 2010 Average Annual Growth 1995-2010 202,703 A1 - Dosified medicines +16.0% 97,545 C2 - Medical equipment +11.3% 86,933 C1 - Hospital inputs +11.9% 72,052 B - General inputs +7.9% 26,910 A3 - Specific inputs +6.4% 9,775 A2 - Bulk medicines +9.6% 11
Bound vs. Applied Tariffs on Health-Related Products 12
WTO Is Not “Just” About TRIPS ! (2): Public Procurement • Procurement policies and practices: – Maximize competition in procurement process – Helps to achieve “best value for money” • The WTO’s plurilateral GPA (42 Members): – Ensures non-discrimination and transparency – Magnitude of health-related procurement: • US statistical report (2008): 40 bn. USD for hospitals, 50 bn. USD for health sector in general, 30 bn. USD for goods/services procured by Department of Health • EU statistical report (2007): 11 bn. EUR for medical technologies covered by GPA • Japan statistical report (2010): 1.8 bn. USD for contracts awarded by MoH – Revised agreement signed in 2012 13
Health Sector Coverage by Selected GPA Parties Coverage of Coverage of health-related health-related Coverage of Party entities at the entities at the sub- Coverage of goods health-related central central services government level government level Canada √ √ √ X European Union √ √ √ X Hong Kong, China √ N/A √ X Israel √ X √ X Japan √ X √ X Korea √ X √ X Norway √ √ X Singapore √ N/A √ X Switzerland √ √ √ X X Chinese Taipei √ √ √ √ United States √ √ √ 14
WTO Is Not “Just” About TRIPS ! (3): SPS and TBT Agreements • Avoid unnecessary barriers to international trade – Human health or safety recognized as legitimate objective • Use internationally-established health and safety standards • Almost half of the issues raised in TBT Committee relate to human health and safety • Directly affects the pharmaceutical sector: – Health products, including herbal medicines (regulation and inspection) – Medical devices 15
Examples from TBT Committee Brazil (2009) European Union (2009) Measure: GMP certificate Measure: imported products, required when applying for including APIs, required to be registration of certain health produced according to GMP products at ANVISA equivalent to those of the EU, confirmed by written declaration of competent authority in exporting country Objective: Protection of human Objective: Prevention of entry health and prevention of into supply chain of falsified deceptive practices medical products Concerns (selection): Concerns (selection): • Acceptance of ISO certification as • Unjustifiable burden for competent evidence of compliance? body in exporting country • Availability of sufficient inspection • Acceptance of WHO API GMP resources at ANVISA? certificate? 16
WTO Is Not “Just” About TRIPS ! (4): Competition Law and Policy • No multilateral framework at WTO, but: – Art. 40, 31, 8 TRIPS (anti-competitive practices/ IPR abuse) – Article 10bis Paris Convention (unfair competition) • Relevant for: – innovation and access – generic companies (e.g. patent settlement agreements, agreements between generic companies, mergers) • Objective: – inform regulatory and other policy choices – Corrective tool where needed to ensure competition from innovation to delivery • Country experiences: – South Africa: cases at Competition Authority – EU: Commission pharmaceutical sector inquiry 17
WTO Is Not “Just” About TRIPS ! (5): Conclusion • Many of the other WTO disciplines directly affect the generic pharmaceutical industry, in particular: – Bound and applied tariffs – Government procurement – TBT and SPS – etc. • Need for generic industry to take a holistic, multi- dimensional approach, and not to focus exclusively on TRIPS matters 18
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