Transcript Document

TRIPS-Plus Provisions in EU FTAs
Impact on Public Health and
Access to Medicines
Mohammed El Said (UCLAN)
IP and Access to Medicines
UNDP, Kiev 22-23 June 2010
Overview
 EU
and IP protection
 EU and bilateral trade agreements
 Some TRIPS-Plus provisions under EU
bilateral trade agreements
EU and IP

Major producer + comparative advantage
 Main player during the Uruguay Round
 Industry influence
Pharmaceutical companies spent US $759
million to influence 1,400 congressional bills
between 1998 and 2004; the pharmaceutical
industry ranks top in terms of lobbying
money and the number of lobbyists
employed (3,000).
Stiglitz 2006
 Internal and external policies
EU and Bilateral Agreements
 Creator
of TRIPS-Plus = The Barcelona
Process in mid 1990s
 Understanding TRIPS-Plus.
 TRIPS-Plus emerge under 3 types of EU
bilateral agreements:
• EU-Association Agreements (AAs)
• EFTA Agreements
• EU-Free Trade Agreements (FTAs)
Some TRIPS-Plus provisions related to
public health and access to medicines
1- Transition periods
2- Extending patent term
3- Data exclusivity
4- Parallel Importation
5- Compulsory Licensing and government use
6- Patentability of new use
7- Patentability criteria
8- Accession to TRIPS-Plus agreements
9- Exceptions and exemptions
10- Terminology issues
1- Transition Periods
- TRIPS awards transitional periods
- FTAs may restrict this by applying these
standards in advance. e.g EU-Jordan AA
- Implications
1- Prevents countries from preparing
2- Facilitates entry of patented drugs earlier
3- High royalties
2- Extension of patent protection
term

TRIPS awards 20 years patent protection from
the date of filing. (Art 33)
 FTAs require a country to make available an
extension of the patent term to compensate the
patent owner for unreasonable curtailment of the
patent term. e.g FTAs with Columbia and Peru
 Implications
1- Extending patent the term monopoly
2- Impact on prices and generics
3- Pressure on patent offices
Patent term extension- Impact


A Korean study concluded that the extension of patent
term is likely to cost the Korean National Health
Insurance Corporation what amounts to US $529m for
extending drug patents for 3 yrs and US $757m if it has
to agree to a 4 yr extension as proposed under the FTA
negotiations with the United States. Hankyore (2006)
If provisions in US-AUS FTA delayed by 24 months entry
of generics of only top 5 PBS drugs (Aus
Reimbursement Scheme), expenditure will increase by
1.5$ billion between 2006-09.
Aus Institute
3- Data Exclusivity Requirements

Separate form of protection from patents
 TRIPS awards countries considerable policy
space
 TRIPS-Plus introduces this protection form. e.g
EFTA-Lebanon provides data protection for least
6 years for pharmaceutical products
 Implications
1- Prolonging patent protection term
2- Delaying generic drugs entry into markets
3- Higher prices of medicines
Data Exclusivity- Empirical
evidence
The average price of generic drugs can fall by as much as 30% of the
innovator drug price when the number of generic versions of the
drug on the market increases
(WHO)
- In Jordan, Data exclusivity, independently prevented generic
competition for 79% of medicines launched by 21 multinational
pharmaceuticals since 2001.
- Additional expenditures for medicines with no generic competitor, as
a result of enforcement of data exclusivity, were between $6.3m and
$22.04m
Oxfam (2007)
- 8 years of data exclusivity in Canada would have added 600$m to
drug costs alone in the last 5 years. TWN (2008)
- CAFTA’s Data Exclusivity rules are limiting access to some generic
drugs in Guatemala.
(Shaffer and Brenner, 2009)
4- Parallel Importation

Under TRIPS, Countries have discretion to
choose the regime (Art 6).
 Reiterated under Doha Declaration: leave each
Member free to establish its own regime for such
exhaustion
 FTAs are imposing restrictions.
 Implications
1- preventing countries from benefiting from the
variation in pharmaceutical prices
2- strengthens monopolistic position of companies
3- higher prices of medicines
Restricting parallel importationImpact

Parallel importation reduced the price of first-line
anti-retroviral medicines to one-third of the price
of the patented version in Kenya.
Oxfam (2006)
 Glivec, an anti–blood-cancer drug, and Norvasc,
a hypertension drug –which patent was expired
in 2007-. While both drugs were cheaply
available in their generic form in India, the drugs
were being sold in their patented form in the
Philippines with a 90% increase in the price on
the Indian market.
Oxfam (2006) 
5- Restricting Compulsory
Licensing and Government Use
 TRIPS
(Art 31) and the Doha Declaration
reiterates members rights
 FTAs may impose restrictions.
- Implications
1- Market monopoly
2- Negative impact on competition
3- Diminish flexibilities and options
Compulsory Licensing- impact
studies



Malaysia became the first country in Asia to issue a
“government use” licence for the importation of generic
ARVs in 2003. This reducing the average cost of the
Malaysian’s MoH treatment per patient per month from
US $315 to US $58, an 81% reduction.
Khor
If the US-Thailand signed the proposed FTA, compulsory
licensing that could have reduced the cost of second-line
ARVs by 90% in Thailand would be severely restricted.
The WB concludes that issuing compulsory licences for
second-line ARVs would represent a saving of US $3.2
billion for the Thai national health budget over 20 years.
WB
Ecuador latest country to issue one for ARVS in 2010.
The License immediately reduced cost of drug by 27%
6- Patentability of New Use

TRIPS sets the guidelines for granting patents, it
contains no obligation to award protection to
new use.
 Increasingly, FTAs are awarding protection to
new use, e.g Art 15.9 of US-Oman FTA states:
 Each party confirms that it shall make patents
available for any new uses for, or new methods
of using, a known product, including new uses
and new methods for the treatment of particular
medical conditions.
New Use - Implications
 According
to a 2005 survey in France, it
found that 68% of the 3096 new products
approved in France between 1981 and
2004 brought “nothing new” in
comparison to previous preparations.
Prescrire (2005)
 Implications
1- prolong monopoly and patent term
2- impacting innovation
7- Defining Patentability Criteria

Art 27.1 TRIPS protects inventions as long as
they are new, involve an inventive step and are
capable of industrial application.
 Some FTAs define these. e.g US-Morocco
states:
 Each Party shall provide that a claimed
invention is industrially applicable if it has a
specific, substantial, and credible utility.
 Implications:
1- Restricting policy space
2- Imposing standards which may not be suitable
8- Accession to TRIPS-Plus
Agreements

TRIPS reference to IP agreements
 No requirements to join any other agreement
outside TRIPS
 EU-FTAs, e.g EFTA-Morocco, Annex V:
•
•
•
•
•

PCT
Nice
Budapest
UPOV
Rome
Other agreements such as the WIPO Treaties
 Assessment of the impact first is necessary
9- Exceptions and Exemptions

Early working exemption
 Exceptions from patentability, e.g Art 27.3 of
TRIPS gives countries the option to exclude:
• Diagnostic, therapeutic and surgical methods for the
treatment of humans or animals;
• plants and animals other than micro-organisms, and
essentially biological processes for the production of plants
or animals other than non-biological and microbiological
processes.

FTAs may forfeit this
10- Phraseology/terminology
 Aim
for clarity, avoid use of vague
terminologies under FTAs, such as
Provision of intellectual property protection
in accordance with the “highest
international standards” in a “fair and
equitable” and ''effective'‘ manner.
Assessment too soon?
 According
to WHO predictions, the full
impact of medicine price rises will not be
felt until about 15 years after the FTA
begins…
WHO
Conclusions/recommendations
 Assessment
of impact
 Collaborative effort
 Negotiation teams
 Strengths and weaknesses
 Checks and balances
Thank you
Mohammed El Said
[email protected]