[Ip-health] Public Citizen's 301 submission on Ecuador's TRIPS-compliant licensing protocol

[peter maybarduk]

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[ Picked text/plain from multipart/alternative ]

Office of the United States Trade Representative

600 17th Street NW

Washington, D.C. 20508

USA



February 16, 2010

Re. USTR-2010-003 (2010 Special 301 Review: Identification of
Countries under Section 182 of the Trade Act of 1974

Dear Sir or Madam:


Public Citizen submits the following comments in response to the
request by the Office of the United States Trade Representative
(USTR) for =93written submissions from the public concerning foreign
countries=92 acts, policies, or practices that are relevant to the
decision whether a particular trading partner should be identified
under Section 182 of the Trade Act.=94

With 150,000 members and supporters, Public Citizen is a national, 501
(c)3 nonprofit consumer advocacy organization founded in 1971 to
represent consumer interests in Congress, the executive branch and
the courts.

Public Citizen believes USTR=92s 2010 Special 301 Report should reflect
the United States=92 commitment, under the 2001 World Trade
Organization=92s (WTO) Doha Declaration on TRIPS and Public Health
(herein =93Doha Declaration=94), to respect countries=92 use of the
flexibilities provided in the WTO=92s  Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPS) to promote access to
medicines for all.

In particular, we wish to emphasize that USTR should not cite Ecuador
for any matter related to that country=92s TRIPS-compliant protocol for
the compulsory licensing of pharmaceutical patents in the public
interest.  USTR should also not sanction Ecuador=92s  compulsory
licensing protocol indirectly, for example, through imprecise
references to alleged IPR-protection failings in Ecuador or through
otherwise unwarranted elevation in Ecuador=92s watch list status.

Antecedents

The WTO=92s TRIPS agreement reserves to WTO signatory nations certain
sovereign rights and flexibilities, including the compulsory
licensing of patents[1] to protect public interests.

At the 2001 WTO Doha Ministerial Conference, WTO Members, including
the United States, unanimously agreed upon a Declaration on the TRIPS
Agreement and Public Health.[2]  The Doha Declaration states:

We agree that the TRIPS Agreement does not and should not prevent
members from taking measures to protect public health. Accordingly,
while reiterating our commitment to the TRIPS Agreement, we affirm
that the Agreement can and should be interpreted and implemented in a
manner supportive of WTO members' right to protect public health and,
in particular, to promote access to medicines for all.[3]
Further, the Doha Declaration states:

Each member has the right to grant compulsory licenses and the
freedom to determine the grounds upon which such licenses are granted.
[4]
Despite the adoption of the Doha Declaration, USTR=92s 2007 Special 301
Report criticized the government of Thailand for its use of
compulsory licenses, stating:

In late 2006 and early 2007, there were further indications of a
weakening of respect for patents, as the Thai Government announced
decisions to issue compulsory licenses for several patented
pharmaceutical products. While the United States acknowledges a
country=92s ability to issue such licenses in accordance with WTO
rules, the lack of transparency and due process exhibited in Thailand
represents a serious concern.
Public health groups, in turn, criticized USTR=92s report.  They
objected to critical references in the Special 301 report to
Thailand's TRIPS-compliant actions, and vague and imprecise
allegations of a "lack of transparency" for Thai government actions
that were both highly transparent and TRIPS compliant.

On October 23, 2009, Ecuador=92s President Rafael Correa issued Decree
118,[5] declaring access to priority medicines affecting the health
of the Ecuadorean population to be a matter of public interest.
Although not required by TRIPS, the Decree satisfies an Andean
Community proviso enabling Ecuador=92s patent office, in cooperation
with the Ministry of Public Health, to receive compulsory license
requests and issue licenses, case-by-case, on public interest grounds.
[6]

As of this submission, Ecuador has yet to issue a compulsory
license.  Ecuador=92s patent office, the Instituto Ecuatoriano de
Propiedad Intelectual (IEPI), has published formal guidance to
license applicants (herein, IEPI=92s =93Instructivo=94).[7]  IEPI has also
met at least twice with the American Embassy in Quito, as well as the
patent-based pharmaceutical companies=92 trade association in Ecuador,
IFI,[8] which issued a public statement[9] accepting Decree 118.

Analysis

There is no substantive basis for citing Ecuador=92s policy on
compulsory licensing in the Special 301 Report.  The protocol
envisioned by Decree 118 is TRIPS-compliant.  Indeed, the Decree
borrows provisions directly from the TRIPS Agreement, in some cases
(non-exclusivity, supplying predominantly the domestic market,
adequate compensation to patent holders, license review and
termination, etc.) employing the TRIPS language word-for-word.
Citing Ecuador=92s compulsory licensing policy in the Special 301
Report would represent an inappropriate effort by the United States
to influence another WTO Member=92s use of rights preserved by the
TRIPS Agreement, with potentially serious consequences for public
health.

The Doha Declaration reiterates countries=92 rights to issue compulsory
licenses =93on grounds of their choosing.=94  Decree 118 declares a
public interest in medicines used to treat =93public health priority
illnesses.=94[10]  IEPI=92s Instructivo further specifies that this
determination is the province of the Ministry of Public Health.[11]
Interagency agreement is required for the issuance of public interest
licenses.[12]  Decree 118 and IEPI=92s Instructivo also require that
license requests be evaluated according to the =93supported=94
circumstances of each case (in accordance with TRIPS Article 31(a)[13]).

Decree 118 requires payment of royalties to patent holders,[14] which
IEPI=92s Instructivo specifies will =93take into account the
circumstances of the case and the economic value of the
authorization.=94[15]  IEPI=92s Instructivo requires license applicants
certify in advance their agreement to these and other universally
applicable license terms.  Decree 118 and IEPI=92s Instructivo each
reiterate that all licenses must comply with =93applicable
legislation.=94[16]

IEPI has published guides and explanatory materials online, held
multiple events for the press and public, and has indicated it
remains open to meetings with the American Embassy in Quito and
pharmaceutical companies=92 trade association.  Under the Ecuadorian
policy, if and when a compulsory license is issued, the patent holder
would have recourse to seek review of license terms and/or the grant
of the license itself within IEPI, as well as through independent
judicial process.  Patent holders would be free to compete with
products introduced under compulsory license.

Ecuador=92s compulsory licensing protocol is in compliance with the
TRIPS Agreement and it neither denies adequate and effective
protection of intellectual property rights nor does it deny fair and
equitable market access to U.S. persons.  It therefore does not merit
direct mention or any indirect reference in 2010=92s Special 301 Report.

Peter Maybarduk

Staff Attorney

Access to Medicines Project Coordinator

Public Citizen

pmaybarduk@citizen.org



[1] TRIPS Article 31.

[2] Adopted November 14, 2001, and available at:  http://www.wto.org/
english/thewto_e/minist_e/min01_e/mindecl_trips_e.htm.

[3] Doha Declaration, Paragraph 4.

[4] Doha Declaration, Paragraph 5(b).

[5] Available online (in Spanish) at: http://www.sigob.gov.ec/decretos/.

[6] More information on Ecuador=92s Presidential Declaration on Access
to Medicines and Compulsory Licensing is available from Essential
Action at:
http://www.essentialaction.org/access/index.php?/categories/8-Country%
20Disputes%20and%20Other%20Issues.

[7] Instructivo, available at: http://www.iepi.gov.ec/Files/
LicenciasObligatorias/InstructivoLicenciasFarmacias.pdf.

[8] Industria Farmac=E9utica de Investigaci=F3n.

[9] On file with Public Citizen.

[10] Article 1.

[11] Chapter IV, Article 8.

[12] See Decree 118 Article 2; Instructivo Chapter IV, Article 8.

[13] TRIPS Article 31(a) requires that =93authorization of such use
shall be considered on its individual merits.=94


[14] Article 4.

[15] Article 10, borrowing the exact language of TRIPS Article 31(h).

[16]  Instructivo Chapter II, Article 4; Decree 118 Articles 2, 4 and
5.