[Ip-health] North-South fight on IP, Benefit Sharing issues in influenza talks

[Sangeeta]

TWN Info Service on Intellectual Property Issues (Dec08/05)
20 December 2008
Third World Network
www.twnside.org.sg


Health: North-South fight on IP, Benefit Sharing issues in influenza talks
Published in SUNS #6614 dated19 December 2008

Geneva, 18 Dec (Sangeeta Shashikant) -- Issues concerning intellectual
property rights and fair and equitable benefit sharing are likely to be
major factors on whether WHO member states are able to reach agreement on a
framework for virus and benefit sharing.

Several delegates participating in last week's Intergovernmental Meeting on
Pandemic Influenza Preparedness (IGM) (under the World Health Organisation)
from countries providing influenza viruses to laboratories and manufacturers
in developed countries, privately mentioned that the positions taken by
developed countries in particular by the US, Japan and the EU on issues such
as intellectual property rights and benefit sharing reveals the  "double
standards" of those countries.

On the one hand, the IGM saw the US, Japan and the EU pushing hard for
relinquishment of sovereign rights, an interpretation of the International
Health Regulations that obligates the sharing of viruses, text that requires
countries to share as "all, as feasible, cases of H5N1 and other influenza
viruses with human pandemic potential" with their laboratories in the name
of global public health and pandemic preparedness.

However, on the other hand, they appear unwilling to commit in particular
their manufacturers and researchers that receive biological materials to any
concrete benefit sharing scheme, or to address IP issues in a manner that
benefits developing countries' public health and pandemic preparedness. Much
of the framework's text that deals with benefit sharing continues to remain
in brackets, denoting there is no agreement.

Whenever reference to "manufacturers" and the need to have a better
understanding of their roles and responsibilities was made by developing
countries at the meeting, the issue was quickly passed over by the Chair of
the IGM, Jane Halton from Australia. And countries such as Japan and the US
insisted that the framework being developed should not dictate what the
manufacturers or the researchers can do with the biological materials, or
their roles and responsibilities.

In fact, interventions by the US, Japan and France on behalf of the EU
suggest that benefit sharing with developing countries could be reduced to:

(1) sharing of pandemic risk assessment, candidate vaccine virus and
diagnostic reagents and test kits to be provided by the laboratories doing
analyses with the receiving biological materials;

(2) laboratory and influenza surveillance and regulatory capacity building
(but subject to national laws) that is provided on request;

(3) antiviral and vaccines stockpiles (the building of which in any case is
already required by existing World Health Assembly resolutions);

(4) general language on providing access to developing countries at
affordable prices, with member states urging vaccine manufacturers to
provide a discounted rate;

(5) voluntary licensing of technology and know-how at commercial rates;

(6) vague language on financing mechanisms, which may be made up of
voluntary contributions.

Due to the asymmetry of power between developed and developing countries;
and the existence of a traceability mechanism which only tracks virus
sharing, the likely result is a system whereby virus sharing will be tracked
closely.

However, with the weak and vague proposals on benefit sharing, little will
materialize in terms of fair and equitable benefit sharing.

During the IGM, the US also objected to the use of any language on "rights",
insisting on reference to only "obligations".

On the issue of IP, several proposals were put forward by several developing
countries. Recent years have seen a dramatic rise in international patent
applications related to influenza (related to the virus itself, vaccines,
treatments and diagnostics). In particular patent activity related to H5
viruses is intensive and increasing sharply.

On whether IP could be claimed over biological materials that were shared,
Brazil proposed "Institutions, organizations and entities providing or
receiving PIP biological materials shall not seek or claim intellectual
property rights over those materials in any form".

This was to replace the proposal in the Chair s text that stated:
"Institutions, organizations and entities providing or receiving PIP
biological materials shall not assert intellectual property rights over
those materials".

In relation to the products and processes developed using biological
materials, Nigeria proposed that "Institutions, organizations, entities or
Member States inventing patentable processes or products using PIP
biological materials shall at all times grant royalty-free licenses to
developing countries to use products and processes developed from PIP
biological materials". Nigeria's intervention was supported by India and
Brazil.

Thailand encouraged WHO member states to exclude from patentability
inventions necessary to protect health as allowed by Article 27.2 of the
TRIPS.

In addition it proposed: "Institutions, organizations, and entities
receiving PIP biological materials shall not seek intellectual property
rights over any method of use, application or specific uses of PIP
biological materials; or over products, processes or other inventions
including vaccines, diagnostics, or pharmaceuticals derived from or
developed using PIP biological materials".

These proposals were to replace the Chair's text which was limited to
allowing royalty free licences to use processes or products developed from
the use of the biological materials shared for non-commercial public health
research and during a pandemic declared by the World Health Organization.

The US vehemently objected to these proposals stating that the "Use of an
MTA [material transfer agreement] shall have no effect on obligations or
restrictions that arise from intellectual property rights. Any intellectual
property rights associated with the materials or its use will not be
disturbed by the conveyance and subsequent distribution of the materials."

It also claimed that in order for there to be technology transfer it is
common for a public sector entity to see a patent on product or technology
for the express purpose it remains in the public domain so that it permits
transfer.

It further added that the IGM was not the right forum for discussing issues
of IP.

Brazil called US argument "interesting" though "fallacious", adding that not
being allowed to claim IP over the biological materials did not prevent the
recipients from selecting the candidate vaccines virus or developing
vaccines and other products.

Brazil also pointed out that the recently adopted Global Strategy and Plan
of Action in WHA 61.21 had strengthened WHO's mandate on IP issues thus it
was the right forum to discuss IP.

While the US wished to delete any reference to IP from the Chair's text, it
sought to relinquish the sovereign rights of the countries providing the
biological materials and proposed "WHO Member states participating in the
WHO Network will not claim sovereignty or ownership rights over viruses as
found in nature".

The US also sought deletion of language in the Chair s text that said "By
providing PIP biological materials, the originating Member States do not
transfer ownership rights over those materials to the receiving institution,
organization, entity or Member state".

The apparent hypocrisy of the US was rejected by Thailand, Brazil, Libya and
Nigeria which proposed that additions by the US be deleted.

A legal expert familiar with US laws noted that it was interesting that the
US which frequently claims sovereignty over its own biological materials is
willing to expressly state a waiver of sovereign rights at the multilateral
level.

Some participants also noted the reaction of the Chair of the IGM Jane
Halton of Australia, who kept insisting that developing countries making
proposals on IP did not understand issues of patentability.

However, the issue at hand is not one of "patentability" (i.e. what can and
cannot be patented). The issue really is on what terms and conditions should
the recipient be receiving biological materials and these terms and
conditions will explicitly be stated in the SMTA.

An Asian delegate also noted that the present virus and benefit sharing
framework provides an opportunity to implement certain elements in the
Global Strategy and Plan of Action on Intellectual Property, Innovation and
Public Health in a concrete manner.

In connection with benefit sharing, one principle that was accepted by the
meeting was that "Member States have a commitment to share on an equal
footing H5N1 and other influenza viruses of human pandemic potential and the
benefits, considering these as equally important parts of the collective
action for global public health."

However, in reality, most of the text in relation to virus sharing is no
longer in brackets while text in relation to benefit sharing (in particular
the parts that place an obligation on or relates to the manufacturers) is
placed within brackets.

The result is a draft text which is lopsided in favor of sharing of
influenza viruses but which shows little by way of concrete benefit sharing
obligations particularly by the manufacturers and researchers that receive
biological materials.

The benefits are listed in Part 6 of the Chair's  text and include headings
such as pandemic risk assessment and risk response, provision of candidate
vaccine viruses, provision of diagnostic reagents and test kits, laboratory
and influenza surveillance capacity building, regulatory capacity building,
antiviral and vaccine stockpiles, access to vaccines for use, tier pricing,
technology transfer, sustainable and innovative financing mechanisms.

Most of the elements in Part 6 are in brackets.

The US, Japan and France on behalf of the EU sought deletion of  language
that proposed that vaccine manufacturers should set aside a portion of the
vaccines produced for developing and least developed countries either during
the pre-pandemic or pandemic periods even where it is voluntary in nature.

With regard to technology transfer, US also proposed deletion of language
that only required member states to urge vaccine manufacturers to grant on
request non-exclusive royalty free licences to vaccine manufacturers to use
IP protected technologies and know-how.

In another paragraph that concerned vaccine manufacturers that receive
biological materials granting royalty free licence on a voluntary basis, the
US insisted on adding "as appropriate and subject to existing licensing
restrictions".

An expert following the issue noted that the US insertion meant that the US
allows technology holders to transfer technology by selling licenses to
developing countries on a commercial basis, which is not a benefit to
developing countries at all but  merely a commercial transaction.

In relation to regulatory capacity building Brazil proposed language that
"Member States should make available through WHO Secretariat in a timely
manner publicly available information related to health regulatory approval
of H5N1 and other influenza viruses with human pandemic potential vaccines
diagnostics and pharmaceutical products including those developed from the
use of PIP biological material. WHO Secretariat should examine the
feasibility of creating a database of such information."

Even such a mild proposal, was resisted by France on behalf of the EU and
the US, as they could not accept language that required the sharing of
regulatory data even when these are publicly available.

On one occasion during discussion on sharing of regulatory data, Halton, the
Chair of the IGM, on hearing Brazil's proposal questioned Brazil whether it
was seeking information that would violate commercial confidence (i.e IP
laws).

A legal expert familiar with US laws privately noted that the if WHO member
states are speaking of pandemic preparedness, the EU, US, Japan and
Australia should be asked to share on a mandatory basis not only regulatory
data that is publicly available but also data that is confidential because
such data is critical for obtaining regulatory approval at the national
level for treatments and vaccines used in the pre-pandemic and pandemic
stages.
The expert said that Article 39.3 of the TRIPS Agreement requires countries
to protect such data against disclosure, except where necessary to protect
the public.

On the issue of sustainable financing, Japan, US and France on behalf of the
EU sought to delete benefits related to a sustainable financing mechanism.
For example Japan sought deletion of the idea of "mandatory contributions
from influenza vaccines, diagnostic and pharmaceutical manufacturers based
on X% of the sales of products developed using biological materials shared".

In relation to WHO antiviral and vaccine stockpiles, Japan doggedly insisted
that any reference to the WHO should be deleted since there were many other
organizations that engaged in stockpiling besides the WHO and this should be
duly recognized.

However, India maintained the need to retain "WHO" in relation to the issue
of stockpile, clearly stating that it had no objection to other regional and
multilateral stockpiles being  treated separately but there is a "certain
sanctity" it attached to the WHO stockpile, stressing that a WHO stockpile
had to be a stand alone item.

The key benefits for developing countries is to enhance national and
regional production capacity of pharmaceuticals, diagnostics and vaccines
and this can only be done through the sharing of technology and know-how by
the manufacturers and researchers as well as a financing mechanism which
could be comprised of mandatory contributions by the recipients of
biological materials.

In addition, manufacturers could be asked to set aside a portion of the
vaccines or pharmaceuticals produced using the biological materials
particularly in the pandemic period for the WHO stockpile as well as for use
in developing countries. This is especially important since during a
pandemic there is likely to be a shortage of vaccines and pharmaceuticals as
developed countries that have already entered into advance purchase
commitments with manufacturers will be given priority.

However, none of the abovementioned benefits feature concretely in the
framework.

A delegate participating in the meeting noted that unless the standard
material transfer agreement (SMTA)  details in the paragraph on benefit
sharing the specific benefit sharing obligations of the recipients of the
biological materials, benefit sharing for developing countries is unlikely
to materialize, adding that rhetorical language similar to that in Part 6
has been seen in many resolutions with little positive effect.

For a concrete commitment on benefit sharing, the SMTA has to detail the
benefit sharing obligations of the recipients of biological materials.

This would also be coherent with the basic accepted foundation of the
framework, i.e commitment to share on an equal footing, since recipients of
biological materials that gain from the framework (such as
manufacturers/researchers) should also commit to return benefits to member
states through the framework. +