[Ip-health] Amendment to the Gilead-Ranbaxy License Agreement

[Judit Rius Sanjuan]

Amendment to the Gilead-Ranbaxy License Agreement
KEI Policy Blog
June 9th, 2008 by Judit Rius Sanjuan
http://www.keionline.org/index.php?option=3Dcom_jd-wp&Itemid=3D39&p=3D122

We have received a copy of an amendment to the September 2006
voluntary License Agreement between Gilead Sciences, Inc and Ranbaxy
Laboratories, Ltd concerning the manufacture and sale of Tenofovir
Disoproxil Fumarate (TDF) and Emtricitabine for the treatment of HIV-
AIDS.

The amendment is basically a letter from Gilead to Ranbaxy, dated May
27, 2008, that deletes section 5.2 of the original License Agreement.

Under Section 5.2 of the License Agreement, the licensee (Ranbaxy)
agreed to =93assist Gilead with regard to the issuing, maintenance and
enforcement o the Patents=94 and to =93reasonably assist Gilead=94 in
enforcement actions or proceedings involving the patents licensed to
Ranbaxy under the License Agreement.

This clause is problematic, especially since some Indian manufacturers
and civil society have opposed the granting of Gilead=92s patents for
TDF. Section 5.2 could be read as Gilead trying to prevent Indian
generic companies that accept the license from opposing Gilead=92s
intellectual property.

The legality of section 5.2 was disputed, especially in the United
States after the 2006 decision on MedImmune v. Genentech where the
U.S. Supreme Court ruled that a licensee could challenge a patent=92s
validity.

The letter, expressly recognizing the activist community=92s concerns,
contains the following language:

=93Nothing in the License Agreement, including Section 5.2, was intended
to hinder Ranbaxy=92s right and ability to bring and maintain any pre-
grant patent opposition proceedings or post-grant actions challenging
the validity or enforceability of Gilead=92s patents in India. It was
never Gilaead=92s intention to interfere with Ranbaxy=92s right to
challenge the legality of any patent applications and issued patents
that are the subject of the License Agreement. However, we do
understand how and why there may have been some confusion. Therefore,
to avoid any further confusion on this matter, by this letter we
hereby delete Section 5.2 from the License Agreement in its entirety.
The rest of the License Agreement will remain unchanged.=94

This amendment is a step in the right direction but more needs to be
done. The terms of the Gilead voluntary licenses continue to be of
concern for civil society.

In February 2007 KEI asked the U.S. Federal Trade Commission (FTC) to
investigate the Gilead effort to control the market for HIV-AIDS
active ingredients and the usually off-patent drug tenofovir to keep
prices artificially high.

A bigger step will be to have a major revision of the terms contained
in this and other voluntary license agreements and to ensure that they
respond to reasonable and non-discriminatory licensing strategies to
enable generic competition to supply developing country markets with
more affordable medical technologies. The revision should consider the
model license terms proposed by the Essential Medical Innovation
Licensing Agency (EMILA) project.


Judit Rius Sanjuan
Attorney at Knowledge Ecology International
www.keionline.org / www.cptech.org
Phone: +1.202.332.2670, x18
Email: judit.rius@keionline.org