Workshop on Intellectual Property,Health Care and International Trade Agreements

[James Love <love@cptech.org>]

Workshop on Intellectual Property, Health Care and International Trade
Agreements

May 7-8, 1998 
Hotel Washington 
Washington, DC 
http://www.cptech.org/may7-8 

Version 1.03 

Sponsored by: 

     Consumer Project on Technology
     Health Action International
     Program in Infectious Disease and Social Change, 
       Department of Social Medicine, Harvard University
     Medical Reform Group of Ontario
     Malaria Project, Center for Study of Responsive Law
     The Council for Responsible Genetics


There will be a workshop on Intellectual Property and Health Care in
Washington, DC, on May 7 and 8, 1998. The purpose of the workshop will
be to discuss current and developing controversies regarding
intellectual property in international trade agreements, as such they
concern public health. 

Persons who work in public health, consumer groups, government, or
international organizations are encouraged to attend. 
 

BACKGROUND

Over the past decade, international trade agreements have increasingly
focused on non-tariff topics, including intellectual property. Today the
World Trade Organization (WTO), the North American Free Trade Agreement
(NAFTA) and proposed treaties, such as the Multinational Agreement on
Investments (MAI) and the Free Trade Area for the Americas (FTAA) have
controversial intellectual property provisions which have significant
impact on public health policy. In addition, the United States is
engaged in a plethora of bilateral and multilateral trade negotiations
on health care and intellectual property topics. Pharmaceutical and
biotechnology interests are very active in shaping the international
debate in these matters, while consumer and public health groups are
generally inactive. 

The topics are diverse. The following are only a few of the current
controversies over intellectual property. 

**    Economics of Drug Development.  NIH spends an average of $7
million for FDA Phase I, II and III trials. Pharmaceutical companies
report to the IRS they spend about $3 million per drug human use
clinical trials for Orphan Drugs, but industry spokesman often assert
that the cost of FDA approval is more than $300 million per drug.  What
do policy makers or public health experts actually know about drug
development costs? What goes into a study of drug development costs? 
How much does it actually cost to do clinical trials on a drug?  Once a
compound has been invented and identified as a candidate for clinical
trials, how much of the "cost" of drug development has already been
done?  What are the differences between out-of-pocket, expected, and
capitalized costs?  How are overhead costs calculated?  How much of
industry R&D is directed at development of new drugs?  Why don't
government bodies actually collect data on drug development costs.  Are
industry trade association studies reliable?    How are cost "estimates"
used and misused in policy debates?

**   Scope of Patents in Health Care.  As Biotechnology evolves, what
types of inventions will be patented?  What are the disputes over
non-obviousness or utility of biotechnology patents.  How broad should
biotech patents be? Why should consumers or public health groups care? 
How much of the human body should be patented?

**    Health Registration Data. United States trade officials and some
pharmaceutical companies are seeking greater secrecy of data used to
justify registration of new drugs, despite the fact that the U.S. FDA is
a model for disclosure and openness.  Trade officials and pharmaceutical
companies are also seeking greater levels of "unfair competition"
protections for unpatented testing data, which will delay for years
introduction of generic drugs.  Since claims for protection of
unpatented testing data are based upon the need to protect investment,
rather than the need to reward innovation (which is rewarded separately
under patent law), there are some that argue that "unfair competition"
protections for testing data should be reasonably related to costs of
the testing, and that compulsory licensing should be used to protect
consumers from abuses.  Bristol-Myers Squibb, one company seeking to
expand the level of protection for health registration data, has used
such provisions to protect its billion dollar per year monopoly on a
governemnt invention (Taxol).

**    Bolar Exemptions and Use of Patents in  Research.  In 1984, a
provision in the U.S. Hatch-Waxman Act reversed a court ruling that
prohibited Bolar Pharmaceutical from testing a Roche Products patented
drug.  Bolar was using the patented drug in tests it needed to seek FDA
approval for a generic that would be marketed when the Roche patent
expired.  This provision in U.S. law speeds the introduction of patents
after patents expire.  U.S. trade officials have objected to similiar
provisions being included in national laws outside the U.S..  For
example, U.S trade officials are lobbying very hard against a Bolar type
exemption in Cyprus.  There are also broader questions of the ability of
medical researchers to patents in medical research.

**   Compulsory Licensing. Traditionally, governments have had the
ability to issue or require compulsory licensing of patents or other
intellectual property in areas of public interest. The U.S. has done
this in the area of some patents on pharmaceuticals or biotechnology
inventions, sometimes during reviews of mergers. The issuance of very
broad patents in the biotechnology area, and the increasing use of
patents on treatment regimes and other areas, has increased interest in
the role of compulsory licensing in high technology medicine. Developing
countries are also interested in compulsory licensing of medical
inventions. Pharmaceutical companies are seeking to severely narrow if
not eliminate compulsory licensing of medical inventions.

**    Second Use Patents, Evergreen Patents, and related issues. Some
countries permit so called "second use" or "swiss" patents, while others
do not. For example, if there is a discovery that a drug currently in
the public domain has a new use, inventor can patent the rights to use
the public domain drug for the new use. This raises questions about
status of the public domain drug. In the United States, companies patent
the doses and/or methods of delivery used to treat an illness. These
treatment regime patents were recently used by Bristol-Myers Squibb to
block introduction of generic versions of Taxol in the U.S. Market. (The
patents were licensed to BMS from the NIH).

**    Parallel Imports. Some nations permit imports of pharmaceuticals
legally purchased in international markets, while other countries
prevent cross border trade. There are several aspects of the issue. The
limitations of cross-border trade permit drug companies to engage in
price discrimination, charging higher prices in countries with less
internal competition. Pharmaceutical companies claim that cross board
trade encourages imports of counterfeit drugs. Some public health groups
say that counterfeiting is a serious problem, but is caused by high
domestic prices and occurs in countries without parallel imports, and
can be addressed separately from the parallel import issue. This is a
very important issue for countries with small domestic markets, which
want to get the best world price on the international market. U.S.
trade      officials are actively seeking to discourage this practice in
South Africa and other countries.

**   Trademarks and Public Health. Pharmaceutical companies claim that
trademark rights shield industry from efforts by governments to promote
generic drugs or permit parallel imports. Infant formula and Tobacco
companies fight regulations on marketing practices under WTO rules
regarding trademark rights.

**   Pricing of Government Funded Medical Inventions. A bipartisan
coalition of U.S. Congressman is seeking new pricing rules for
pharmaceutical inventions developed with public funds.

**   Alternatives to TRIPS. The WTO’s Agreement on Trade-Related Aspects
of Intellectual Property is called TRIPS. It contains rules about
intellectual property from a commercial perspective. Provisions in the
TRIPS regarding patents, trademarks, health registration data and other
items set the basic framework which virtually all countries will have to
follow, or face trade sanctions. The provisions of the TRIPS are
controversial in several areas, but particularly in the area of health
care for developing countries. Prior to the TRIPS many developing
countries did not have patent protection for pharmaceuticals –
permitting easy entry by generic equivalents, and lower drug prices.
Under TRIPS, these countries will see increases in drug prices, and new
barriers for the poor’s access to medicines. Health Action International
and the Consumer Project on Technology have proposed an alternative to
the TRIPS approach which is based upon burden sharing for research and
development. This approach would require countries to meet targets for
R&D investments, but would give countries greater discretion on the
mechanisms to fund R&D, and the ability to direct R&D spending on 
topics which strengthen domestic scientific institutions and address
domestic public health problems.

  

The Plan for the Workshop

Representatives from industry groups, government organizations and
academia have been invited make presentations and answer questions on a
variety of topics. However, the main focus of the meetings will be the
dialogue between participants over IP specific issues. This will be a
"working group" workshop. People will be encouraged to ask questions and
make contributions during discussions. We will begin with a review of
the institutional framework for policy making in international trade
venues, followed by brief presentations and discussions of specific IP
issues. It is expected that participants will outline specific positions
on topics, such as the appropriate international norm for disclosure of
health registration data, or the scope of 
Trademark rights in the context of generic drug substitution, or other
topics, and that these positions will be discussed by participants. This
is expected to take up the first day and half. 
 

     Organzing Strategies

The second half of the second day will focus on organizing strategies
for public health and consumer groups. 
This is include an identification of  areas for coordinated actions to
increase consumers' inputs and 
perspectives on health and IP debates and policy making, and the
development of statements that can help build that coordination and be
the basis for taking positions in national and international fora. 
 

Prior to the meeting, there will be an internet email forum on workshop
topics. Participants will be encouraged to submit and discuss various
topics in cyberspace prior to the Washington, DC meeting. 

LOCATION The meeting will be held at the Hotel Washington, which is
located at Pennsylvania & 15th Street, N.W.. The Hotel Washington is
across the street from the White House, only 10 minutes from National
Airport, and convenient to the Metrorail system. The URL for the Hotel
is http://www.hotelwashington.com/ Reservations info by email is at:
reservations@hotelwashington.com 
 

REGISTRATION

Persons interested in participating in the workshop should contact
Catherine Gavin <cgavin@cptech.org> or James Love  <love@cptech.org> at
the Consumer Project on Technology, voice 202.387.8030, fax
202.234.5176. There is no fee, but people should provide advance
registration. 

Updated information about the workshop will be on the Web at: 

http://www.cptech.org/may7-8