[Ip-health] Recent examples of the use of compulsory licenses on patents
James Packard Love
james.love@keionline.org
Sun Mar 11 06:07:03 2007
This is the 28 March 2007 version of "Recent examples of the use of
compulsory licenses on patents." Jamie
http://www.keionline.org/index.php?option=3Dcom_content&task=3Dview&id=3D30
Recent examples of the use of compulsory licenses on patents[1]
KEI Research Note 2
James Packard Love
Knowledge Ecology International
8 March 2007
I. Introduction.............................. 2
II. North America............................ 2
A. United States............................. 2
1. Mandatory compulsory license for patents whose term was
extended by GATT implementation
...........................................2
2. Government use under 28 USC 1498.......... 3
3. Bayh-Dole Act............................. 3
4. Merger reviews............................ 4
5. Non-merger remedies to anticompetitive practices
....................................... 5
6. New U.S. Supreme Court standard for granting injunctions on
patents
.......... 5
B. Canada.................................... 5
III. EUROPE.................................. 7
A. Belgium................................... 8
B. France.................................... 8
1. RU 486.................................... 8
2. BRAC1 and BRAC2 patents on breast cancer tests
........................................ 8
C. Germany................................... 9
D. Italy..................................... 9
E. United Kingdom............................ 9
IV. ASIA..................................... 10
A. China..................................... 10
B. India..................................... 10
C. Indonesia................................. 10
D. Malaysia.................................. 10
E. Korea..................................... 11
F. Taiwan.................................... 11
G. Thailand.................................. 11
V. LATIN AMERICA............................. 12
A. Argentina................................. 12
B. Brazil.................................... 12
C. Chile..................................... 13
D. Dominican Republic........................ 13
E. Ecuador................................... 13
VI. AFRICA................................... 13
A. Cameroon.................................. 14
B. Ghana..................................... 14
C. Guinea.................................... 14
D. Eritrea................................... 14
E. Mozambique................................ 14
F. South Africa.............................. 14
G. Swaziland................................. 15
H. Zambia.................................... 15
I. Zimbabwe.................................. 16
VII. MIDDLE EAST............................. 16
A. Israel.................................... 16
I. Introduction
The term "compulsory license" is used to describe a number of
mechanisms for non-voluntary authorizations to use patents. The most
important global norm for the use of compulsory licenses is Article
31 of the WTO TRIPS Agreement, which addresses uses "of a patent
without the authorization of the right-holder, including use by the
government or third parties authorized by the government." Other
TRIPS provisions that are important are Articles 1, 6, 7, 8, 31 bis,
40 and 44, as well as the provisions of the 2001 Doha Declaration on
TRIPS and Public Health.
Contrary to many popular news reports and statements by misinformed
government officials and industry lobbyists, the WTO rules are quite
liberal in terms of the grounds for granting compulsory licenses.
There are no limitations on the scope of disease. Indeed, there is
no requirement that compulsory licenses be limited to cases involving
health care problems at all.
This paper reports on a number of recent examples of the use of
compulsory licenses, in both developed and developing economies.
The examples cover a wide variety of technologies, legal mechanisms,
and grounds for non-voluntary authorizations to use patents.
II. North America
A. United States
1. Mandatory compulsory license for patents whose term was
extended by GATT implementation
In 1995, as mandated by the Uruguay Round Agreements Act, patent
terms in the United States were changed from 17 years from the date
the patent was granted to 20 years from the date the patent
application was filed. This extended patent terms for many products,
including pharmaceuticals. In 1996, Congress enacted a statutory
mandatory compulsory license for products brought to market prior to
patent expiration, provided that a generic manufacturer had
previously made a "substantial investment" toward bringing a product
to market in anticipation of the pre-1995 patent expiration.[2] The
mandatory compulsory license applied to over 100 brand name
pharmaceutical products. However, the benefits of these compulsory
licenses were undermined because drug registration issues were not
addressed in the GATT implementation legislation.
2. Government use under 28 USC 1498
In 2001, DHHS Secretary Tommy Thompson threatened to use 28 USC 1498
in order to authorize imports of generic ciprofloxacin for stockpiles
against a possible anthrax attack.[3]
In 2005, the U.S. Department of Justice cited its right to use
patents in 28 USC 1498 when it opposed injunctive relief for
infringement of patents relating to the Blackberry email services
supplied to both the government and private firms that used the
Blackberry device to communicate with the government.[4]
In a November 2005 Congressional hearing, DHHS Secretary Michael
Levitt testified before the House of Representatives that he had
effectively required the patent owners for Tamiflu (Roche/Giliead) to
invest in U.S. manufacturing facilities for the product, so that the
United States government would have access to Tamiflu if confronted
with an avian flu pandemic.[5]
In 2007, the U.S. Supreme Court was petitioned to hear an appeal of
Zoltek Corp. v. U.S.[6] Zoltek has a U.S. patent on a process for
making material used in F-22 fighter jets, but the U.S. imports the
product from an unlicensed foreign manufacturer without paying
royalties to Zoltek. The United States argues that it may, in effect,
have a royalty-free compulsory license for government use of the
product because the patented process is carried out in a foreign
country, meaning that the patent holder is not entitled to
"reasonable and entire compensation" under 28 USC 1498.
3. Bayh-Dole Act
In 1997, a march-in rights petition by Cell-pro was denied, and
ultimately their infringing device was pulled from the market despite
its clinical advantages and lack of a licensed alternative.
In 2001, DHHS used its authority to exercise march-in rights for
patents on stem cell lines resulting from publicly funded research
and held by the Wisconsin Alumni Foundation (WARF) as leverage to
secure an open license on those patents.[7]
In 2004, DHHS and NIH refused to grant march-in rights in a case
brought by Essential Inventions involving patents on the AIDS drug
ritonavir (Norvir).[8] Abbott Laboratories had increased their U.S.
price of the drug by 400% in one day to promote sales of their new
combination therapy and undermine sales of competitors=92 drugs. A
similar request by Essential Inventions for march-in rights to
patents involving the glaucoma drug latanoprost (Xalatan) was also
denied.[9]
In 2006, the Centers for Disease Control threatened to use march-in
rights to issue compulsory licenses on patents on reverse genetics,
which are needed to manufacture vaccines for avian flu.
In 2007, Essential Inventions requested Robert Portman, Director of
the Office of Management and Budget, to take steps to develop and
accept alternative competitive sources of supply for federal
procurement of two HIV-AIDS medicines: stavudine/d4T and ritonavir
[10]. Due to public funding for the development of both drugs, the
U.S. government has a royalty-free, nonexclusive, worldwide statutory
license to the patents for each product.[11] On March 1, 2007,
Essential Inventions met with OMB officials, and extended the
proposal to include the AIDS drug emtricitabine (Emtriva).
4. Merger reviews
In 2002, the U.S. Federal Trade Commission (FTC) ordered[12] a
compulsory cross-license of the Immunex tumor necrosis factor ("TNF")
patent, to Serono, including the "freedom to practice in the
research, development, manufacture, use, import, export, distribution
and sale of TNFbp-I Products and certain glycosylated and
nonglycosylated fragments, derivatives and analogs thereof in the
United States." Note the permission to export, which is anticipated
by Article 31.k of the TRIPS. In this case, the compulsory cross-
license allows a Swiss firm to compete with the U.S. patent owner.
In 2005, the FTC ordered a compulsory license of Guidant=92s
intellectual property surrounding the RX delivery system for Drug-
Eluting Stents (DES) as a condition of Guidant=92s acquisition by
either Johnson & Johnson or Boston Scientific.[13] Boston Scientific,
which eventually won the bidding to acquire Guidant, was required to
license DES patents to a potential entrant, Abbott.
5. Non-merger remedies to anticompetitive practices
In 2002, the U.S. Department of Justice required Microsoft to license
on reasonable and non-discriminatory terms intellectual property
rights in a number of different protocols needed to create products
that were interoperable with Microsoft Windows.[14]
In February 2007, in a case involving a failure to disclose patents
on the standard, an FTC antitrust remedial order compelled memory
chipmaker Rambus to license its patented technology on certain
specified terms and limited the maximum royalty rates that Rambus can
collect for use of its patents to 0.25 percent for SDRAM products;
0.5 percent for DDR SDRAM products, as well as SDRAM memory
controllers or other non-memory chip components; and 1 percent for
DDR SDRAM memory controllers, or other non-memory chip components.
After three years, the royalty rate will be zero percent[15].
6. New U.S. Supreme Court standard for granting injunctions on
patents[16]
In June 2006, a court granted Microsoft a compulsory license to use
two patents owned by z4 Technologies that relate to Digital Rights
Management systems used by Microsoft for its Windows and MS Office
software programs.
In July 2006, a court granted DirectTV a compulsory license to use
the Finisar patent on integrated receiver decoders (satellite set top
boxes), for a royalty of $1.60 per device[17].
In August 2006, a court granted Toyota a compulsory license on three
Paice patents for hybrid transmissions, for a royalty of $25 per
automobile.
In September 2006, a court granted Johnson and Johnson a compulsory
license to use three of Dr. Jan Voda=92s patents on guiding-catheters,
medical devices for performing angioplasty[18].
B. Canada
In a September 2001 speech on the Myriad Gene Patent, the Ontario
Health Minister called for compulsory licensing of patents on genes
relevant to tests for breast cancer. In January 2002, the Ontario
Advisory Committee on New Predictive Genetic Technologies published
"the Ontario Report to Premiers: Genetics, Testing & Gene Patenting:
Charting New Territory in Healthcare." This report noted that the
Doha Declaration calls upon nations to take measures "to protect
public health and, in particular, to promote access to medicines for
all," and concluded:
-------indent---
In order to prevent the statement from providing a hollow right, the
concept of promoting access to medicines for all must include
providing access to the diagnostic procedures necessary to determine
when and which medicines to provide. The federal government should,
therefore, amend the Patent Act to specifically allow the potential
for compulsory licensing of patents relating to the provision of
genetic diagnostic and screening tests should this power be necessary.
-------end indent---
On October 18, 2001, Health Canada overrode the Bayer patents on
ciprofloxacin, and authorized generic manufacture for purposes of
building a stockpile as protection against an attack of certain
strains of anthrax. In announcing the action, Paige Raymond Kovach,
a spokeswoman for Health Canada, said: "These are extraordinary and
unusual times . . . Canadians expect and demand that their government
will take all steps necessary to protect their health and safety.''
On May 14, 2004, Canada passed BILL C-9: An Act to Amend the Patent
Act and the Food and Drugs Act. The law came into force on May 14,
2005 creating Canada's Access to Medicines Regime (CAMR). The
purpose of the legislation is to allow Canadian manufacturers to
export medicines to countries lacking manufacturing capacity.
Proposed royalties paid to the patent holder vary according to the
importing country's Human Development Index. The benefits of the
Act are limited to products listed on "Schedule 1," the list of
patented pharmaceutical products that are eligible to be exported
under the compulsory license. Civil society groups supported the
passage of the legislation, yet they also pointed out a number of
flaws in the bill.
There have been three requests for compulsory licenses under the
CAMR. The first was a December 14, 2004 request from Essential
Inventions, for the manufacture and export of imatinib mesylate to
Chile. The Canadian government was not responsive. The second was a
request from Apotex and MSF for the manufacture and export of a fixed-
dose combination for the treatment of AIDS. The third was a February
13, 2006 request from Biolyse Pharma Corporation, for patents on
oseltamivir phosphate and sold by Roche under the brand name Tamiflu.
On August 31, 2005, Schedule 1 of the Patent Act was amended to add
lamivudine (150 mg) + nevaripine (200 mg) + zidovudine (300 mg)
tablets =96 the fixed dose combination in the Apotext/MSF application.
On July 1, 2006, the Canadian government published a proposed
amendment to Schedule 1 of the Patent Act to add oseltamivir
phosphate (75 mg capsules and 12 mg/mL powder for oral suspension),
which is used in the treatment and prophylaxis of Type A and Type B
influenza[19]. In September 2006, the product was included in
Schedule 1.
Apotex claims as defense to an infringement claim that its sales of
generic copies of AstraZeneca=92s Zestril and Merck=92s Prinivil tables
are permitted under terms of a compulsory license. A trial started
in January 2006.[20]
On May 7, 2004, Torpham successfully appealed a rejection of a
compulsory license application involving Merck patents for the
manufacture and sale of Lisinopril.[21] Torphan had sought a license
to the use the patents for purposes of manufacturing and exporting to
the United States. The court held that the request for the
compulsory license had sufficient merit to proceed to the next stage,
and that serving export markets abroad constitutes Canadian demand
for the patented product.
On September 16, 1998, Brantford asked a Canadian federal court for
an order compelling Merck to license patents needed to manufacture
SESIC. On April 30, 1999, Brantford filed another application for a
compulsory license. The case involved a number of procedural
disputes and appeals, such as a February 2, 2005 court decision
rejecting Merck=92s efforts to dismiss the compulsory licensing
application on certain procedural grounds.[22] A hearing on the
compulsory license was held in April 2005 before the Patent Appeal
Board. On September 1, 2005, the Patent Appeal Board upheld an
earlier rejection of the compulsory license. Brantford appealed to
the court. On November 7, 2006, a court in British Columbia upheld
the rejection of the compulsory license, holding that the
Commissioner of patents had not erred in determining that patent
abuse had not been established, since it was reasonable for the
Commissioner to find on the evidence that there was no genuine market
demand for the product, and that it was reasonable to find that not
enough time had been afforded Merck to respond to Brantford=92s request
for a license, and Merck=92s silence could not be construed as a
refusal to license.[23]
III. EUROPE
On April 29, 2004, the European Court of Justice issued a preliminary
ruling on compulsory licensing of intellectual property rights under
European competition law, in the IMS Health v. NBC case. The ECJ
held that under certain circumstances an obligation to license an
intellectual property right exists. The four conditions were:
1. The intellectual property right should constitute, upstream, an
indispensable factor in the downstream supply of a (secondary) product.
2. The potential licensee should intend to produce new goods or
services not offered by the owner of the right, and for which there
is a potential consumer demand.
3. The refusal should not be justified by objective reasons.
4. The refusal should be of such a nature that it reserves for the
owner of the right the market for the provision of the product by
eliminating all competition on that market.
A. Belgium
Belgium modified its patent law in 2005, creating a new compulsory
cross-license for biotechnology inventions, and also a new compulsory
license for public health purposes.[24]
B. France
1. RU 486
France considered the use of compulsory licenses in the case of the
abortion pill RU 486, which was developed by the French
pharmaceutical manufacturer ROUSSEL UCLAF. In response to threats of
boycotts by pro-life organizations, the company withdrew the product
from the market. In the subsequent efforts by the French government
to reverse the decision, a court ruled the government could obtain
access to the medicine by using the ex-officio license system.
Earlier, however, the product was already back on the market, so the
ex-officio license was not needed
2. BRAC1 and BRAC2 patents on breast cancer tests.
France was among several European countries outraged by the high
prices of breast cancer diagnostic tests, because of a monopoly from
the Myriad Genetics patents on diagnostic testing.
On September 7, 2001, the French government published "Considering
an ex officio licence" - Communiqu=E9 issued by M. Roger-G=E9rard
Schwartzenberg, Minister for Research . This Communiqu=E9 said:
-------indent---
". . . the bill transposing the 1998 European directive on the legal
protection of biotechnological innovations will very soon be
submitted to the Council of Ministers. This bill amends Article L
613-16 of the Intellectual Property Code, broadening the system for
ex officio licences issued by the State to include patents on
diagnostic processes, whilst at the moment it applies only to medicines.
From now on, where the interests of public health demand, in the
event of a diagnostic test being made available to the public in
insufficient quantity, of inadequate quality or at an abnormally high
price, the State will be able to make this test subject to an ex
officio licence.
This way, use of this test will not be restricted by an unfair
monopoly of the patent-holder. Genetic screening must be available to
help everyone, without access to a diagnostic test being
unjustifiably hindered by unfair claims to a monopoly and excessive
costs.
------end indent-------
In 2004, France did amend its patent law to allow the broader use of
ex-officio licenses, and in particular, to authorize the government
to issue ex-officio licenses to patents on certain dialogistic
technologies. The new act provides that:
------indent----
Where the interests of public health demand, and in the absence of a
voluntary agreement with the patent holder, the minister responsible
for industrial property may, by order of the minister responsible for
public health, request ex-officio licenses in accordance with Article
L. 613-17 for any patent granted for:
a) a medicine, a medical device, a medical device for in vitro
diagnosis, [or] a related therapeutic product;
b) processes for obtaining them, [or] for products necessary in
obtaining such medicines or for processes for manufacturing such
products
c) a diagnostic method ex vivo.
-------end indent---
C. Germany
In 2000, Roche asked the German government to grant a compulsory
license on a patent protecting the Blood Screening HIV Probe owned by
Chiron. On May 22, 2001, a licensing agreement was reached between
Roche and Chiron. In return for its license, Roche agreed to end its
attempts to obtain a compulsory license.[25]
D. Italy
On June 1, 1994, Sorin Biomedica S.p.A. filed a lawsuit with the
Court of Milan, Italy against Chiron Corporation and Ortho Diagnostic
Systems S.p.A. for a declaration of nullity and noninfringement of
the Italian counterpart to Chiron's European Patent 0 318 216 (the
"=92216 patent"). Sorin additionally filed a request with the Italian
Ministry of Industry, Commerce and Artisanship (ICA) for compulsory
license to the '216 patent. Chiron filed a counterclaim and sought a
finding that the patent is valid and infringed by Sorin. The ICA
suspended Sorin's request for a compulsory license pending the
outcome of the litigation.
E. United Kingdom
Following the passage of Directive 98/44/EC of the European
Parliament and of the Council of 6 July 1998 on the Legal Protection
of Biotechnological Inventions, the United Kingdom amended its patent
law to provide for mandatory compulsory cross-licenses of certain
biotechnology inventions used for agriculture. The license is
available to plant breeders who demonstrate a technical advance.
The December 6, 2006 UK Gowers Review noted the British Society of
Plant Breeders complained that the provision is "ineffective in the
U.K. at least", because to prove an advance, the product must
actually be created, thereby infringing on the patent, in calling for
an expanded research exception to permit broader use of the
compulsory license.
IV. ASIA
A. China
In 2005, China used the threat of a compulsory license to obtain
voluntary licenses to manufacture generic Tamiflu.
B. India
In February 2005, India amended its patent law to provide for patent
protection for pharmaceutical inventions. The legislation created a
mandatory compulsory license for products that were already
manufactured and marketed in India. The new provision was added under
Section 11 A of the Indian Patent Act and read as follows:
------indent-------
"(7) On and from the date of publication of the application for
patent and until the date of grant of a patent in respect of such
application, the applicant shall have the like privileges and rights
as if a patent for the invention had been granted on the date of
publication of the application:
Provided that the applicant shall not be entitled to institute any
proceedings for infringement until the patent has been granted:
Provided further that the rights of a patentee in respect of
applications made under sub-section (2) of section 5 before the 1st
day of January, 2005 shall accrue from the date of grant of the patent:
Provided also that after a patent is granted in respect of
applications made under sub-section (2) of section 5, the patent-
holder shall only be entitled to receive reasonable royalty from such
enterprises which have made significant investment and were producing
and marketing the concerned product prior to the 1st day of January,
2005 and which continue to manufacture the product covered by the
patent on the date of grant of the patent and no infringement
proceedings shall be instituted against such enterprises
[26]." [Emphasis added]
------end indent---
C. Indonesia
On October 5, 2004, Indonesia issued a government use compulsory
license to manufacture generic versions of two HIV/AIDS drugs,
lamivudine and nevirapine, until the end of the patent term in 2011
and 2012, respectively. The license includes a royalty rate of 0.5%
of the net selling value[27]. Production of the ARVs has started by
PT Kimia Farma.
D. Malaysia
On September 29, 2004, the Malaysian Minister of Domestic Trade and
Consumer Affairs issued a two-year government use compulsory license
to import from India didanosine (ddI), zidovudine (AZT) and lamivudine
+zidovidine (Combivir) [28]. The Ministry of Health proposed a
royalty rate of 4% of the value of the generic product.
E. Korea
On January 30, 2002, the People's Health Coalition for Equitable
Society, the Association of Physicians for Humanism, and the Korean
Pharmacists for Democratic Society jointly filed for a compulsory
license for Glivec, a drug to treat chronic myelogenous leukemia
(CML), and gastrointestinal stromal tumor (GIST). The request was
rejected[29].
In October 2005, the Korea Food and Drug Administration (KFDA)
announced it was considering a compulsory license for the manufacture
of generic versions of Tamiflu.[30]
F. Taiwan
On July 26, 2004, the Taiwan Intellectual Property Office (TIPO)
issued a compulsory license to Gigastorage for 5 patents related to
CD-R of Phillips. The term of the license is through the expiration
of the patent terms.
In November 2005, Taiwan issued a compulsory license for patents
needed to manufacture and sell generic versions of Tamiflu.[31]
According to this report by Deutsche Presse-Agentur dpa:
----indent-------
The Intellectual Property Office (IPO) granted compulsory licensing
to Taiwanese pharmaceutical companies after talks with Roche and
Gilead Science - the U.S. developer of Tamiflu - broke down. 'Roche
and Gilead insisted they can supply enough Tamiflu if bird flu erupts
in Taiwan. Our argument was: When there is a bird flu pandemic,
millions of people will be hospitalized or dead, and some countries
might confiscate Tamiflu or ban its export. We cannot gamble our
people's lives on their unreliable promise,' Lai Chin-hsiang,
Secretary-General of the Department of Health (DOH), told Deutsche
Presse-Agentur dpa. "Under the compulsory license, valid until
December 31, 2007, Taiwan drug firms can make Tamiflu for domestic
use and should use it only when there is a shortage of supply from
Roche."[32]
----end indent-------
G. Thailand
On November 29, 2006, the Thailand Ministry of Health announced a
government use compulsory license to import (from India) and locally
produce efavirenz until 2011. [33] The proposed royalty was 0.5
percent of the price of the generic product, a figure that is subject
to additional negotiations with the patent owner.
On January 25, 2007 the Thai government announced two additional
government use compulsory licenses on patents for the AIDS drug
Kaletra (LPV+RTV)[34] and the heart disease drug Plavix (clopidogrel
bisulfate),[35] also with a proposed royalty of 0.5 percent.
V. LATIN AMERICA
A. Argentina
On October 18, 2005, Health Minister Gines Gonzalez Garcia announced
that the government would issue compulsory licenses on the patents
for Tamiflu. However, it was later determined that patents on Tamiflu
had not been granted in Argentina.
B. Brazil
On January 8, 2001, 12 days before President Clinton left office, the
USTR filed a complaint over the Brazil compulsory licensing law in
the WTO Dispute Settlement Body. USTR officials called this the
"Merck" case. At issue was Article 68 of Brazil's patent law, which
allows compulsory licenses to be issued in situations where the
patent holder does not locally manufacture the patented product
(known as a "local working" provision). The U.S. received a large
amount of negative publicity, and on June 25, 2001, the Bush
administration withdrew the complaint. However, under the agreement
between the two countries, Brazil agreed to provide the U.S. with
advance notice if a license is issued under Article 68 of the Brazil
Patent Act, and disputes would be discussed through a bilateral
"Consultative Mechanism." The agreement was not made public.
In early 2001, Brazil announced it was considering compulsory
licenses for patents on nelfinavir and efavirenz.
In March 2001, the Brazilian government reached a settlement with
Merck for price discounts on efavirenz in return for not issuing a
compulsory license.
On August 22, 2001, Brazilian Health Minister Jose Serra announced
the Brazilian government would issue a compulsory license for the
manufacture of the antiretroviral drug nelfinavir (sold under the
brand name Viracept by Roche) to the Brazilian pharmaceutical
producer Far Manguinhos. On August 28, the two parties resumed
talks, and on August 31 they reached an agreement; Roche will sell
the drug in Brazil at an additional 40% discount, and Brazil will not
issue the compulsory license.
On September 5, 2003, the Brazilian government issued a decree that
would allow it to produce or import generic anti-AIDS drugs without
the consent of companies holding the patent on those medications. The
health minister made it clear that the decree was meant to apply to
antiretroviral drugs - specifically lopinavir, efavirenz and
nelfinavir. The ministry said in a statement it had negotiated with
the name-brand companies in August seeking a reduction of more than
40%, but was offered a maximum discount of 6.7%. Brazil and Merck
reached an agreement in November.
In 2005, Health Minister Humberto Costa signed a decree declaring the
patent of Kaletra in the public interest and appropriate for
compulsory licensing. A subsequent settlement with Abbott reduced
the price by 46 percent.
In 2005, the government of Brazil declared that they were considering
issuing compulsory licenses to permit the manufacture of Viread. "As
a result of discussions with the Brazilian government, Gilead reached
agreement with the Brazilian Health Ministry in May 2006 to reduce
the price of Viread in Brazil by approximately 50%."[36]
Brazil also used the threat of compulsory licenses on the patents for
Gleevic to obtain a price discount of more than 65 percent.
C. Chile
In December 2004, Essential Inventions requested a compulsory license
to supply Glivec to Chile[37].
D. Dominican Republic
There have been requests for compulsory licenses on the patents for
Plavix, a heart disease drug. On May 14, 2002, the French embassy in
Dominican Republic wrote to Sr. Hugo Guiliani Cury, Secretary of
State of the Dominican Republic, expressing opposition to the
compulsory license[38].
E. Ecuador
In 2003, Acromax, a local manufacturer, petitioned the patent office
to grant a compulsory license for the fixed-dose combination of
Lamivudine (3TC) and Stavudine (d4T) (sold under the trade-name
Combivir by Glaxo). The request was rejected and Glaxo granted
Ecuador preferential prices on all their HIV-AIDS medicines. Acromax
appealed and the request was rejected again.[39]
VI. AFRICA
Compulsory licensing in Africa is now fairly common, but often not
widely publicized. A typical compulsory license may be based upon
model authorizations prepared by organizations who are engaged in
providing treatment for AIDS in order to satisfy donor requirements
that purchases of generic medicines are consistent with trade rules.
A. Cameroon
On January 2005, the nonprofit corporation Essential Inventions
requested the Minister of Public Health to grant ex-officio licenses
for the patents relevant for importation, manufacture or sale of
generic versions of the following medicines used in the treatment of
HIV/AIDS: Nevirapine/Viramune=AE, Lamivudine/3TC=AE, and fixed-dose
combinations of Lamivudine and Zidovudine/Combivir=AE. The request is
still pending[40].
B. Ghana
In October 2005, the Minister of Health issued a government use
compulsory license for importation into Ghana of Indian generic HIV/
AIDS medicines[41].
C. Guinea
On April 18, 2005, the Ministry of Health issued compulsory licenses
for importation on patents on drugs to treat HIV/AIDS.
D. Eritrea
On June 5, 2005, the Minister of Health issued compulsory licenses
for importation into Eritrea of generic HIV/AIDS medicines[42].
E. Mozambique
On April 5, 2004, Mozambique's Deputy Minister of Industry and
Commerce issued Compulsory License no. 01/MIC/04 for patent rights to
lamivudine, stavudine and nevirapine. The license was granted to
Pharco Mo=E7ambique Lda, a local producer that plans on manufacturing
the antiretrovirals as a fixed-dose combination. Royalties are not to
exceed 2% of sales[43].
F. South Africa
On March 7, 2001, Indian pharmaceutical manufacturer CIPLA formally
requested the South African Department of Trade and Industry issue
compulsory licenses to patents on the following HIV drugs:
nevirapine, lamivudine, zidovudine, stavudine, didanosine, efavirenz,
indinavir and abacavir.
On September 19, 2002, Hazel Tau, working with the Treatment Action
Campaign (TAC), filed a complaint with South Africa's Competition
Commission against GlaxoSmithKline (GSK) and Boehringer Ingelheim
(GI). Twelve parties would join the complaint, which charged GSK
and BI with excessive pricing of ritonavir, lamivudine, ritonavir
+lamivudine and nevirapine.
On October 16, 2003, after an extended investigation, the South
Africa Competition Commission issued a statement saying:
-----indent-------
Pharmaceutical firms GlaxoSmithKline South Africa (Pty) Ltd (GSK) and
Boehringer Ingelheim (BI) have contravened the Competition Act of
1998. The firms have been found to have abused their dominant
positions in their respective anti-retroviral (ARV) markets.
In particular the Commission has found the firms have engaged in the
following restrictive practices:
1. Denied a competitor access to an essential facility
2. Excessive pricing
3. Engaged in an exclusionary act
----end indent-------
On December 10, the Competition Commission announced that it had
reached a settlement with GSK. The settlement required GSK to:
-----indent------
1) extend a voluntary license granted to Aspen Pharmacare in
October 2001 in respect of the public sector to include the private
sector;
2) grant up to three more voluntary licenses on terms no less
favourable than those granted to Aspen Pharmacare;
3) permit the licensees to export the ARVs to sub-Saharan African
countries;
4) permit the importation of the drugs for distribution in South
Africa if the licensee does not have manufacturing capability in
South Africa;
5) permit licensees to combine the relevant ARV with other
antiretroviral medicines; and
6) charge royalties of no more than 5% of the net sales of the
relevant ARVs.
-------end indent--------
Shortly thereafter, a similar settlement was reached with BI.
G. Swaziland
On April 20, 2004, the Ministry of Health and Social Welfare in
Swaziland noted the existence of an emergency relating to AIDS, and
authorized procurement of medicines for HIV/AIDS "in the best cost/
effective way possible on the international market irrespective of
the existence of any patent or other Intellectual Property protection
applicable in Swaziland until such time as it will no longer be
considered essential to address the current Public Health crisis
related to HIV/AIDS."
H. Zambia
On September 21, 2004 the Zambian Minister of Domestic Trade and
Consumer Affairs issued a compulsory license for lamivudine,
stavudine and nevirapine. The license was granted to Pharco Ltd., a
local producer, which will produce a triple fixed-dose combination. A
maximum royalty rate of 2.5% applies[44].
I. Zimbabwe
In May 2002, Zimbabwe's Minister of Justice, Legal and Parliamentary
Affairs declared a Period of Emergency in order to override
antiretroviral drug patents for a period of 6 months[45]. The
declaration included a government use compulsory license to make, use
or import generic HIV/AIDS medicines. In 2003, the period of
emergency was extended by five years (until 31 December 2008). With
assistance from India, Zimbabwe has begun local production of
antiretrovirals though the generic company Varichem Pharmaceuticals
(Private) Limited.
VII. MIDDLE EAST
A. Israel
"In January 1992, BTG-Israel filed an application in the Israeli
Patent Office for a compulsory license to manufacture BTG's Bio-Hep-B
under Biogen's Israeli patent which, upon approval, would enable BTG
to produce the vaccine in Israel and likely to export the vaccine to
countries in which neither Biogen nor others have been granted a
blocking patent. In September 1995, the Registrar ruled in an
interlocutory decision that BTG-Israel is entitled to a compulsory
license to the Biogen patent. Biogen's appeal of the interlocutory
decision was rejected."[46]
"Biogen appealed the Registrar's decision to the District Court of
Tel Aviv, Israel, and moved for a stay of the license, which was
granted ex parte pending hearings with both parties. Following
hearings which took place in December 1996, the motion was denied in
January 1997; however, the ex parte stay was left in force pending
Biogen's appeal to the Supreme Court and maintained by the Supreme
Court pending the decision by the District Court on the merits of
Biogen's appeal. The District Court heard the appeal in early March
1997, and in June 1997 the District Court denied Biogen's appeal and
subsequent motion for a stay, pending Biogen's appeal of the District
Court decision to the Supreme Court on the merits of Biogen=92s appeal.
In March 1998, the Supreme Court granted Biogen the right to appeal
the District Court's decision. A date has not yet been set for the
hearing. In the absence of any action by the Supreme Court, the
compulsory license is now effective and allows BTG-Israel to produce
the vaccine in Israel upon receipt of regulatory approval and to
export the vaccine to countries in which neither Biogen nor others
have been granted a blocking patent."[47]
The Biogen Israeli patent expired in December 1999, before the
Supreme Court ruled on the compulsory license.
FOOTNOTES
[1] This is an update from a 25 December 2006 version of the same
paper. Several persons have provided helpful substantive and
editorial contributions to this survey, which we will update from
time to time. This work is licensed under the Creative Commons
Attribution-Noncommercial 3.0 License.
[2] 104TH Congress, Report, Senate, 2d Session, 104-394,
Pharmaceutical Industry Special Equity Act Of 1996, Report Together
With Minority Views [To accompany S. 1277]. For more information:
http://thomas.loc.gov/cgi-bin/cpquery/?
&item=3D&&sid=3Dcp104pqlQi&&refer=3D&r_n=3Dsr394.104&&dbname=3Dcp104&&sid=
=3Dcp104pql
Qi&&sel=3DTOC_0&
[3] For more information: http://www.cptech.org/ip/health/cl/cipro/
[4] The United States=92 Statement Of Interest, November 2005., Ntp,
Inc., Plaintiffs, V. Research In Motion, Ltd., Defendant., Civil
Action No. 3:01CV767.
[5] See video excerpts from November 8, 2005 Hearings of the
Subcommittee on Health of the House Committee on Energy and Commerce,
http://www.cptech.org/ip/health/tamiflu/hearingexcerpts11082005.html
[6] Petition available at: http://www.scotusblog.com/movabletype/
archives/Zoltek.pdf
[7] September 5, 2001, "National Institutes of Health and WiCell
Research Institute, Inc., Sign Stem Cell Research Agreement," http://
www.nih.gov/news/pr/sep2001/od-05.htm. Memorandum of Understanding
between WiCell Research Institute, Inc. and Public Health Service:
http://stemcells.nih.gov/staticresources/research/registry/MTAs/
Wicell_MOU.pdf
[8] For more information: http://www.essentialinventions.org/drug/
ritonavir.html
[9] For more information: http://www.essentialinventions.org/drug/
latanoprost.html
[10] For more information: http://www.essentialinventions.org/
eii2omb-5jan07.pdf
[11] See U.S. Code tit. 35. =A7=A7 202(c)(4) and 209(d)(I).
[12] For more information: http://www.ftc.gov/opa/2002/07/amgen.htm
[13] For more information: http://www.ftc.gov/opa/2006/04/
bostonscigui.htm
[14] United States Of America, Plaintiff v. Microsoft Corporation,
Defendant. Civil Action No. 98-1232 (Ckk), Final Judgment, (November
12, 2002), available at: http://www.usdoj.gov/atr/cases/
f200400/200457.htm. For a detailed account of work to implement the
order, see: Interim Joint Status Report On Microsoft's Compliance
With The Final Judgments, available at: http://www.usdoj.gov/atr/
cases/f201300/201386.htm.
[15] For more information: http://www.ftc.gov/os/adjpro/
d9302/070205opinion.pdf and
http://www.ftc.gov/os/adjpro/d9302/070205finalorder.pdf
[16] eBay Inc. v. MercExchange, L.L.C., 126 S. Ct. 1837, 1839-1841
(U.S. 2006), available at: http://www.supremecourtus.gov/opinions/
05pdf/05-130.pdf
[17] Finisar Corp. v. DirecTV Group, Inc, available at: http://
www.fr.com/news/Finisar-Judgement.pdf
[18] Voda v. Cordis Corp., No. CIV-03-1512, 2006 WL 2570614 (W.D.
Okla. Sept. 5, 2006)
[19] Official publication: http://canadagazette.gc.ca/partI/
2006/20060701/html/regle11-e.html
[20] AstraZeneca Annual Report and Form 20-F Information 2005
[21] Torpham v. Commissioner of Patents and Canada (AG), May 7, 2004
FCTD (MacKay J.) Abuse of Exclusive Rights/Section 65 of the Patent
Act/Compulsory License /Request to Supply Bulk Lisinopril for
Production of Tablets in Canada for Export to the U.S.
[22] Merck v. Brantford Chemicals and Commissioner of Patents and
Canada (Attorney General), February 2, 2005 FCA (Rothstein, Evans,
Malone JJ.A.) Compulsory License/Patent Act/Res Judicata/Functus
Officio/Final Decisions.
[23] http://decisions.fct-cf.gc.ca/en/
2006/2006fc1341/2006fc1341.html. Citation: 2006 FC 1341, Vancouver,
British Columbia, November 7, 2006, Brantford Chemicals Inc. (Sub.
Nom. Apotex Pharmachem Inc.) Appellant, And The Commissioner Of
Patents, Attorney General Of Canada And Merck & Co., Inc.
Respondents. Reasons For Judgment And Judgment.
[24] Van Overwalle, G. & Van Zimmeren, E., "Reshaping Belgian Patent
Law: The Revision of the Research Exemption and the Introduction of a
Compulsory License for Public Health". IIP Forum (Japanese journal)
2006; vol. 64: 42-4.
[25] ARTICLE 5 - OTHER ACTIONS
5.1 Patent Validity; Enforceability. Immediately upon the
Effective Date, or as soon as possible thereafter, ROCHE shall
discontinue any opposition, challenge, compulsory license application
or the like with respect to the CHIRON Licensed Patents.
5.2 Compulsory Licensing. ROCHE covenants and agrees on behalf
of itself and its Affiliates to not support any third party in
seeking compulsory licensing of the CHIRON Licensed Patents in any
jurisdiction. As used in this Section, "support" shall have the same
meanings as in Section 7.2(b).
[26] The Indian Patents (Amendments) Act 2005, available at: http://
www.ipindia.nic.in/ipr/patent/patent_2005.pdf
[27] Translated text of the actual license is available at: http://
lists.essential.org/pipermail/ip-health/2004-December/007233.html
[28] Translated text of the actual license is available at: http://
www.cptech.org/ip/health/c/malaysia/arv-license.html. For more
information: Chee Yoke Ling, "Malaysia=92s Experience in Increasing
Access to Antiretroviral Drugs: Exercising the "Government Use"
Option" (Third World Network, IPR Series No. 9, 2006), available at:
http://www.twnside.org.sg/title2/IPR/IPRS09.pdf
[29] For more information: http://www.cptech.org/ip/health/cl/recent-
examples.html#Korea
[30] Kim Cheong-won, "Health Regulator Seeks to Produce Bird Flu
Drug," the Korea Times.
[31] Kathrin Hille, "Taiwan employs compulsory licensing for
Tamiflu," FT, November 25 2005.
[32] Taiwan issues compulsory license for making Tamiflu, Nov 25, 2005.
[33] Translated text of the actual license is available at: http://
www.cptech.org/ip/health/c/thailand/thaicl4efavirenz.html
[34] Translated text of the actual license is available at: http://
www.cptech.org/ip/health/c/thailand/thai-cl-kaletra_en.pdf
[35] Translated text of the actual license is available at: http://
www.cptech.org/ip/health/c/thailand/thai-cl-clopidogrel_en.pdf
[36] SEC Form 10-Q -- Quarterly report [Sections 13 or 15(d)], Period
of Report: 2006-09-30.
[37] For more information: http://www.essentialinventions.org/drug/
imatinibmesylate/index.html
[38] The letter (in Spanish) is available at: http://www.cptech.org/
ip/health/c/dr/
[39] Lucia Gallardo, "El negocio del VIH/SIDA Patentes farmaceuticas
=BFpara que y para quien?" (2006, Universidad Andina Simon Bolivar).
[40] For more information, http://www.essentialinventions.org/docs/
cameroon/
[41] Text of the actual license is available at: http://
www.cptech.org/ip/health/cl/Ghana.png
[42] Text of the actual license is available at: http://
www.cptech.org/ip/health/cl/Eritrea.png
[43] Translated text of the actual license is available at: http://
www.cptech.org/ip/health/c/mozambique/moz-cl-en.pdf
[44] Text of the actual license is available at: http://
www.cptech.org/ip/health/c/zambia/zcl.html
[45] Text of the actual license is available at: http://
www.cptech.org/ip/health/c/zimbabwe/zim05242002.html
[46] Bio-Technology General Corp., 10-K Report, April 1, 1996.
[47] Savient Pharmaceuticals Inc, Form:10-K Filing Date: 3/26/1998.
----------------------------------------------
James Packard Love
Knowledge Ecology International
http://www.keionline.org
james.love@keionline.org
Washington, DC +1.202.332.2670
"If everyone thinks the same: No one thinks." Bill Walton"