[Random-bits] India, TRIPS, TRIPS+, and new paradigms

[James Love]

http://www.cptech.org/blogs/ipdisputesinmedicine/2006/10/india-trips- 
trips-and-new-paradigms.html

IP Disputes in Medicine
Tuesday, October 10, 2006
India, TRIPS, TRIPS+, and new paradigms
by James Packard Love

India is now engaged in a debate over the appropriate implementation  
of Article 39.3 of the TRIPS.  The Indian government is proposing a  
nuanced system that combines exclusive rights to rely upon data,  
combined with a set of limitations and exceptions to those rights.    
Although not public yet, the outlines of the proposal have been  
widely reported.  In some of these reports, the government will allow  
generic competitors to use data for drug registration if they  
contribute to the costs of the data.  The procedures and standards  
for determining remuneration do not appear to be established at this  
time.

Much of the criticism about the Indian government's proposals focuses  
on the fact that they exceed the obligations of the TRIPS  
agreement.   Of course they do.   Indeed, virtually every  
intellectual property regime we have ever looked at can be described  
as TRIPS plus, if not in the area of data protection, certainly in  
the areas of patent, copyright or plant varieties protection.  The  
TRIPS agreement contains many areas where protection can be narrowed  
and limited, and few countries come close to taking full advantage of  
this.

We think it is a mistake for critics of the Indian government  
proposals to reject the steps toward a system of remuneration for use  
of test data.   First, consider the political realities.  No country  
that has engaged in serious bilateral negotiations on the data issue  
with the US or the EU has been able to maintain a system of no  
economic rights in the data.  If this were not the case, we would  
join those who lobby exclusively for a minimalist implementation of  
Article 39.3 -- a position we think is entirely justified on policy  
and fairness grounds.   But for now there is no evidence that hard- 
line positions, however meritorious on moral or policy grounds, are  
working.

What India is considering is a something new -- a system that would  
implement data protection as a right of remuneration in what appears  
to be a wide set of cases, including not only important cases like  
drugs for AIDS, but for any case where it is unethical to repeat  
clinical testing.   Public health groups should be focusing on the  
implementation of the new remuneration right -- rather than opposing it.

The implementation (of 39.3) should avoid as much as possible any  
notion of exclusive rights to rely upon data, and to provide for  
limited remuneration rights in a set of narrow circumstances, such as  
the first approval of a new molecular entity (NME).[1]

Critics of a compensatory liability/remuneration right approach  
correctly point out that such an approach can be combined with  
complicated and onerous procedures, with that excessive remuneration  
could be a burden on the poor.  This is of course one possibility.    
A different possibility is that India could implement remuneration  
rights with simple procedures and quite reasonable levels of  
remuneration.   Public health groups should focus on the second  
possibility -- and not act as if there are no good ways to implement  
remuneration rights.

Any remuneration right for data is TRIPS plus, and WTO members have  
plenty of flexibility in determining how to approach this.   For  
example, the US government provides for no appeals of remuneration  
decisions in its regime for cost sharing on agricultural data.  India  
could take a similar approach for test data, narrowing or eliminating  
injunctions or appeals, or providing than any review of remuneration  
could only provide for forward looking changes.

Indian could embrace a system of cost sharing, along the lines that  
<a href="http://www.cptech.org/publications/policybrief-no1-cost- 
sharing.pdf">we have advocated elsewhere</a>, or it could provide for  
a simple (low) royalty on product sales.  There is no reason to  
design a system that would not work. [2]

In 1999, Rob Weissman and I drafted section 601 in the Hope for  
Africa bill.  It sought to restraint the US government from calling  
for TRIPS plus rules in Africa.

-------begin indent
HR 772.  Sec. 601  Requirements Relating to Sub-Saharan Africa  
Intellectual Property and Competition Law

Funds appropriated or otherwise made available to any department or  
agency of the United States may not be used to seek, though  
negotiation or otherwise, the revocation or revisions of any sub- 
Saharan African intellectual property or competition law or policy  
that is designed to promote access to pharmaceuticals or other  
medical technologies and such law or policy, as the case may be,  
complies with the Agreement on Trade-Related Aspects of Intellectual  
Property Rights referred to in section 101(d)(15) of the Uruguay  
Round Agreements Act.
------end indent

This proposal was criticized by some in 1999, because Rob and I  
appeared to be endorsing the TRIPS agreement, which was controversial  
then.  But Rob and I had decided that we could win a no-TRIPS plus  
approach at that time, and not a no TRIPS approach.  We never  
endorsed the TRIPS.  We just asked the Congress to stop the executive  
branch from going further than TRIPS, in Sub-Saharan Africa.

No TRIPS+ was, in 1999, a very successful campaign.  By May 10, 2000,  
President Clinton signed Executive Order 13155, "Access to HIV/AIDS  
Pharmaceuticals and Medical Technologies", and on November 14, 2001,  
the WTO adopted the Doha Declaration on TRIPS and Public Health,  
which called upon countries to use the full flexibilities of the  
TRIPS to protect access to medicine for all.

Since 2001, things have gotten much tougher.  One only needs read the  
depressing text the many US/EU/FTA agreements concluded in the past  
four years, and to look at various WTO accession agreements, if not  
the US's unilateral <a href="http://www.ustr.gov/assets/ 
Document_Library/Reports_Publications/2006/2006_Special_301_Review/ 
asset_upload_file473_9336.pdf">301 list</a> and <a href="http:// 
www.ustr.gov/Document_Library/Reports_Publications/ 
2006/2006_NTE_Report/Section_Index.html">NTE reports</a>.

In the short run, public health groups have to choose their battles.   
We are focusing on the US's proposals for (1) drug registration- 
patent linkage, (2) protection of test data, and (3) remuneration on  
compulsory licenses as the three key intellectual property issues.    
We are not taking a hard line on the test data issue.  We are asking  
countries to implement systems of limited remuneration rights/ 
compensatory liability, and opposing exclusive rights.  We think this  
is achievable.  We also think we can win in the US Congress on  
limiting bad FTA provisions on linkage or compulsory licensing  
remuneration.

There is plenty to room for countries to improve systems for non- 
voluntary licensing of patents or data.   Important in this regard  
would more attention to models for the collective management of  
intellectual property rights, such as variations on the proposed  
patent pool for essential medicines.  This can greatly enhance the  
capacity to utilize various compulsory licensing options.

In the longer term, we are looking to new paradigms, to restore  
public health priorities.  One is to push for R&D treaties/agreements  
to replace trade agreements on IP or drug prices.  Another is to push  
the notion of prizes linked to health outcomes as a replacement for  
marketing monopolies, as the chief "pull" incentive for drug  
development.   We think these ideas are also achievable, and hugely  
important.   They are also quite relevant and appealing for India, a  
country that seeks to reconcile its dual role as a home to hundreds  
of millions of very poor persons, and a growing high technology  
biomedicine industry.

The attempt to separate the markets for innovation from the markets  
for medicines is the longer and more sustainable strategy for  
fairness.   We can and should make the point, loud and clear, that it  
is a mistake to link R&D incentives to the prices of medicines.     
The markets for the products (medicines and vaccines) should be  
competitive, driving prices toward marginal costs.   But there can be  
new mechanisms (such as the prize fund approach) to reward  
innovations that improve health care outcomes.   This big idea needs  
greater buy-in from health care advocates.

Notes:

[1] The current government proposals reportedly start with a notion  
of exclusive rights, and then provide for exceptions.   This could be  
changed, so that non-voluntary use of the data would always be  
possible, subject in some cases to remuneration.

[2] See:   May 18, 2006. Judit Rius Sanjuan, James Love & Robert  
Weissman. <a href="http://www.cptech.org/publications/policybrief-no1- 
cost-sharing.pdf">"A cost sharing model to protect investments in  
pharmaceutical test data," CPTech Policy Brief No. 1.

---------------------------------
James Love, CPTech / www.cptech.org / mailto:james.love@cptech.org /  
tel. +1.202.332.2670 / mobile +1.202.361.3040

"If everyone thinks the same: No one thinks."  Bill Walton