The Medicines Patent Pool

The (MPP) is a United Nations-backed organization that aims to improve access to HIV medicines for people living in LDCs. In 2014 they launched the (PHTI) to focus on a pressing concern in the African continent: overcoming barriers to develop paediatric formulations of HIV medications. In , they obtained a licence from Merck to develop paediatric formulations of raltegravir, adding this key drug to their pool that already includes lopinavir and ritonavir with AbbVie Inc.

In the , generic manufacturers in the specified LDCs are allowed to research and develop alternate or improved formulations of raltegravir for children. Considering those living in LDCs cannot afford these medications, Merck will not be cannibalizing its own sales. This agreement is significant because Merck retains the right of first refusal of licensure or purchase if the manufacturer develops an improved formulation and intends to market the product outside of the specified countries they serve.

A Unique Opportunity

Improved or altered formulations are methods for drug manufacturers to retain a portion of market share when the patent of the original drug expires (see for example �����Ի���). By expanding the range of licensing agreements beyond HIV medications, drug manufacturers can outsource R&D of new formulations of their patented drugs at no upfront cost, while improving access to life-saving medicines in LDCs. Empowering LDCs to develop its own drug manufacturing industries has many advantages over the traditional method of directly donating medications.

Win-Win?

In the years to come the effects of the patent cliff will continue to eliminate important sources of revenue for Big Pharma. These companies also face the need to increase R&D budgets to avoid grinding drug development to a halt. Undoubtedly, cost-effective ways to extract value from current patents will be crucial. Thus, Big Pharma should pursue an expansion of licensing opportunities with organizations such as MPP with great interest since it serves the dual purpose of improving drug access in developing nations while potentially extending the life cycle of their patented drugs.

Jason Ho is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

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The TRIPS Agreement has always been heralded as a milestone achievement recorded in the field of intellectual property. It provides a minimum standard of intellectual property protection among WTO members and reduces the differences among national rules.

The debate on the impact of TRIPS Agreement on developing countries has generated much furore. Daniel Gervais’ article titled “Intellectual Property, Trade and Development: The State of the Play” provides us with a debate on the important role that intellectual property protection plays in Foreign Direct Investment (FDI) and the transfer of technology. He considers how developing countries can take advantage of policy flexibilities in TRIPS Agreement to meet their needs.

Attempts to arrive at a definite result on the impact of high levels of Intellectual property protection in developing countries proved futile. Two scenarios emerged from the studies used in the article. First, post-war Japan which emphasized on high IP protection, especially in patent rights enjoyed higher FDI. Second, China with weak IP protection has more FDI than most African countries that have higher levels of IP protection after the TRIPS Agreement. A more astonishing position emerges from Ha-Joon Cheng and Ilene Grabel’s piece titled “Strong IPR Regime: Not in the Interest of Developing Countries”. The paper reveals that the absence of patent laws in Switzerland made her attractive to foreign investors. The logical outcome of this is that there are other factors, other than higher level of IP protection, that lead to FDI.

While we await critical studies to address this dilemma, Gervais’ position is that by embracing “policy flexibilities” embedded in TRIPS Agreement and other policy measures, developing countries can domestically develop their IP regime. He pointed to Article 45(3) which gives room for implementation based on availability of resources by member states. Gervais embraced the TRIPS Agreement on the basis of its provision of minimum standard of IP rules. He also frowned at the TRIPS Plus agreements that are being deployed and argued that the TRIPS Agreement should be integrated and used as a reference and/or defense point against demands in most TRIPS Plus Agreements.

To effectively review the thoughts of Gervais, some instances on the real state of IP protection in developing countries under the auspices of the TRIPS Agreement need to be presented. Professor Vijaya in his article “Sri Lanka at a Disadvantage from the Global TRIPS Agreement” published in Sunday Times of May 2009 noted that the TRIPS Agreement disallows the concept of process patents which were pivotal to the rampant growth of Indian’s pharmaceutical industry. Further, by advocating the protection of test data in this area, TRIPS has restricted another valuable avenue for developing countries to prosper.

In Gayatri’s piece, “TRIPS: Consequences for Developing Countries”, he argued that the imposition of the minimum standard does not benefit developing countries. The minimum standard under the TRIPS are already fixed at the present high level of protection in developed countries who achieved this level through a gradual process of building intellectual property regime and implemented forms of protection tested by experience in other countries. These processes may not be available to developing countries. An Oxfam report titled “Drug Companies vs Brazil: The Threat to Public Health” narrated how the major drug companies, backed by the United States government, are trying to ensure that Brazil buys expensive patented drugs that large pharmaceutical firms manufacture rather than making cheaper generic drugs in Brazil or buying generic drugs from countries such as India.

The area of traditional medicine also provides a clue of the precarious position of developing countries in global IP regime. While efforts are made by developing countries to protect traditional and indigenous knowledge, developed countries sometimes oppose the efforts. Gayatri’s work revealed how the United States opposed the introduction of a new system of registration for medicinal genetic resources and traditional healer’s knowledge by Thai’s government. Even before the draft became public, the Thai patent officer received a very aggressive worded letter from the United States ambassador claiming that the proposal would violate the TRIPS Agreement.

While I applaud his sentiment that developing countries should take advantage of the policy flexibility in the TRIPS Agreement, I think that broader political and economic imbalances that exist between developed and developing countries should be addressed. These issues are like siamese twins in any proposal that is aimed at enhancing the position of developing countries in the global intellectual property regime. Without addressing these issues, the policy flexibilities in the TRIPS Agreement will succeed only in turning the existing “gap” between developed countries and developing countries on IP issues into a “gulf”.

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BACKGROUND

During the early 1990s, the extent of protection and enforcement of Intellectual Property ("IP") rights varied widely around the world. As IP became more important in trade, these differences became a source of tension in international economic relations. New internationally-agreed trade rules for IP rights were seen as a way to introduce more order and predictability, and for disputes to be settled more systematically. Eventually in 1994, negotiators at the Uruguay Round of the General Agreement on Tariffs and Trade ("GATT") developed an agreement to narrow the gaps in the way these IP rights were protected around the world, and brought them under common international rules. This agreement, The Trade-Related Aspects of Intellectual Property Rights ("TRIPS Agreement" or "Agreement"), establishes minimum levels of protection that governments have to give to the intellectual property of fellow WTO members.

Current proponents argue that the Agreement strikes a balance between the long term benefits and possible short term costs to society. Society benefits in the long run because IP protection encourages creation and invention especially when the period of protection expires and the creations and inventions enter into the public domain. To address the potential adverse short term costs the TRIPS Agreement sets out different exceptions for developed and developing countries with respect to transition periods and the WTO has extended until 2016 the transition period during which Least Developed Countries (LDC) do not have to provide protection to pharmaceutical patents.

RESEARCH PROBLEM

The raises a fundamental question: Is the TRIPS Agreement a stringent law which is unjust for developing nations or does the agreement foster innovation so that benefits are eventually redistributed from wealthy societies to poorer ones?

My research proposal will analyze the TRIPS Agreement and examine whether it is a manifestation of structural power in the global political economy. When TRIPS came into being, the trade related issues of IP rights moved from the arcane area of legal analysis to the epicenter of global policy making. The TRIPS Agreement has enormous implications in terms of public health, food security and state sovereignty yet it was placed on the WTO agenda in a surreptitious manner. Only in the aftermath of its appearance as part of the Uruguay Round was the TRIPS Agreement scrutinized in a manner befitting its significance.

My research intends to identify some of the key areas or problems that have been overlooked from the perspective of developing nations.  It is my intention to clarify the issues and generate some proposed solutions through a critical analysis and a comparative study of the trade in IP goods between the developing and the developed nations.

I also intend to examine how conflicts are resolved under the WTO Dispute Settlement Body ("DSB"). 

My research will begin with an analysis of how the regulation of IP rights differs between developing and developed countries. As outlined below, there are three possible contexts for this analysis.

(1) The first context involves examining one specific IP right: pharmaceutical and biotechnology patents. To examine this, I will compare pharmaceutical and biotechnology patents in one developing country to those in a developed country.

(2) The second context is the examination of IP rights in the public health sector of developed and developing countries. The issue of TRIPS Agreement and public health is to see how to assist the developing countries with insufficient or no manufacturing capacities in the pharmaceutical sector to make effective use of compulsory licensing under the TRIPS Agreement. My research paper will render valid reasons for not implanting non-violation complaints into the settlement of the TRIPS related disputes and provides a new insight into this issue from a primary perspective of public health.

(3) The third context of this research paper will be the issue of parallel imports.  A parallel import is a non-counterfeit product imported from another country without the permission of the intellectual property owner. Parallel imports are often referred to as grey product, and are implicated in issues of international trade, and intellectual property. In most of the cases, the product flows from the developed country to a developing country. The underlying issue is that although the products may have been made to comply with the laws and customs of their place of origin, these products or their use may not be compliant in those places where they are used.

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