[Ip-health] Pointing the finger at Big Pharma - Dutch seizure of generic medicines

[B.Baker@neu.edu]

Pointing the finger at Big Pharma - Dutch seizure of generic medicines
Professor Brook K. Baker
Health GAP, Feb. 10, 2009

Treatment and trade activists and developing countries are justly outraged
at the decision of Dutch customs authorities to seize a cargo of 500 kilos
of Losartan Potassium that was in transit in Rotterdam while on route from
India to Brazil.  This active pharmaceutical ingredient is used in the
production of medicines for arterial hypertension, a dangerous and
potentially fatal disease.  The production of this API in India is
completely lawful, as it is not under patent there, and its use in the
formulation of medicines in Brazil is also lawful because there is no valid
patent on the API or the final product in Brazil either.

So, why did the Dutch customs officials have any even colorable
jurisdiction to seize this in-transit shipment on December 4, 2008, hold it
for 34 days, and then redirect it back to India, thereby frustrating not
only legitimate trade in non-patented products, but more importantly
legitimate trade in life-saving drugs?  Well, they can do so because of
some backroom, closed door lobbying by Big Pharma that resulted in the
passage of EC Council Regulation 1383, which in turn gives impunity to Big
Pharma to make frivolous claims of its "suspicion" that the products
"might" violate intellectual property rights in the Netherlands.
Admittedly, if this shipment was intended for sale and use in the
Netherlands, its importation would violate patent holders rights in the
Netherlands where the API is patent protected.  But this shipment was not
intended for the Netherlands, and was clearly marked for transhipment to
Brazil.  It was part of the regular and legitimate flow of products in
transit via airports, seaports, and other border crossings throughout the
world.

Does every cross border movement of goods in international transit get
stopped if any IP right holder in the transit country has a nonfactual fear
that the product "might be diverted" and thus that it "might" violate its
territorial interests in the in-transit country?  Is international trade as
we know it going to grind to a halt?  Obviously, the vast majority of
in-transit goods go their merry way, something that the GATT Article V and
even the TRIPS Agreement, Article 51, note 13, clearly endorse.
Nonetheless, IP right holders can misuse the EC regulation to make
frivolous claims against medicines and APIs in transit, thereby either
dramatically increasing costs or even deterring legitimate trade in
generics.

Here, the patent holder in the Netherlands, DuPont, and/or the Big Pharma
drug company with marketing rights in the Netherlands, Merck and Co.,
apparently picked up a phone and without legal justification or excuse
"requested" that the shipment be impounded and eventually returned to
India.  So far, far too little attention has been directed at these
corporate criminals who are acting with impunity to thwart lawful generic
competition even in countries where their patents and marketing rights have
no effect.  This embargo of medicines, at the frivolous behest of drug
company bullies, is not only a direct violation of the Doha Declaration on
TRIPS and Public Health that prioritizes access to medicines for all, it is
also an unconscionable violation of the human right of access to essential
medicines enshrined in multiple international treaties.

Unfortunately, Big Pharma is not content with EC Council Regulation 1383,
it and its rich country abettors are intent on expanding extra-territorial
intellectual property enforcement rules and derailing international trade
in generic pharmaceuticals via non-participatory and non-transparent
negotiations at the World Health Organization (IMPACT initiative), the
World Customs Organization, and in many other settings.  Many of these
efforts are under the ruse of stopping "counterfeits," but their true
purpose is to increase their monopoly pricing power by frustrating lawful
generic competition.

Developing countries are correct in yelling "foul" at the World Trade
Organization, as Brazil, India, and a dozen other countries have done.  But
we must also point our collective finger at Big Pharma as well.  It
masterminded the expanded and illegitimate activities of customs
authorities and it hardwired its impunity to make frivolous claims.    It's
hypertension medicine today, but tomorrow its AIDS medicines, cancer
medicines, and pediatric formulations.  Shame on DuPont, shame on Merck.

Professor Brook K. Baker, Health GAP
Northeastern U. School of Law
Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115
617-373-3217 (office)
617-259-0760 (cell)