[Ip-health] TWN IP Info: Fraudulent medicines model law promotes pharma interest

K.M. Gopakumar kumargopakm at gmail.com
Mon Dec 8 22:07:06 PST 2014

*Title :* TWN IP Info: Fraudulent medicines model law promotes pharma
*Date :* 08 December 2014


TWN Info Service on Intellectual Property Issues (Dec1/13)
8 December 2014
Third World Network


*Fraudulent medicines model law promotes pharma interest *

New Delhi, 8 Dec (New Delhi) – A draft model law being developed by the
United Nations Office on Drugs and Crime’s (UNODC) promotes the interest of
pharmaceutical transnational corporations (TNCs).

The draft model law (latest draft dated 17 November 2014) conflate the
quality of medicines with intellectual property (IP) enforcement, thereby
promoting IP enforcement, with the potential to compromise access to
affordable medicines. Further, it follows a criminal law approach instead
of a public health approach to address the issue of medicines with
compromised quality, safety and efficacy without looking at the
complexities of medicines regulation.

Model laws are part of UNODC’s technical assistance program. According to
the UNODC website “model laws were elaborated as tools of technical
assistance, to assist governments translate their obligations under
international treaties into national legislative provisions. The model laws
aim to facilitate the review and amendment of existing legislation as well
as the adoption of new legislation.”

UNODC is holding the second informal expert group meeting to review the
provisions of the draft model law on fraudulent medicine in Vienna, Austria
on 8-10 December 2014.  The objective of the consultation is to finalize
the document.

[UNODC is one of the organisations that public health circles say is
‘captured’ by the pharmaceutical TNCs to further IP enforcement standards.
Earlier similar organisational capture was seen at the World Customs
Organisation (WCO), INTERPOL, Universal Postal Union (UPU) and World Health
Organisation (WHO).  Member States’ objection at WHO led to a deactivation
of WHO’s public private partnership known as International Medical Product
Anti-Counterfeit Taskforce (IMPACT). The INTERPOL Secretariat went to the
extent of accepting Euro 4.9 million from 29 pharmaceutical TNCs to further
IP enforcement activities known as ‘pharma crime’.]

The agenda of the second expert consultation clearly shows a selective pick
of like-minded experts who support the IP enforcement initiatives.
According to the draft agenda obtained by Third World Network, the
following persons are acting as Rapporteurs in various sessions.

General presentation of the draft by the principal drafter, Hugo Bonar
(Drug Regulatory Authority Ireland); *General Provisions *Rapporteur:
Sabine Walser and Vu Thi Hiep (Council of Europe in charge of the European
Medicrime Convention); Messan Halimatou (Ministry of Health Cambodia), Mam
Boravann (Ministry of Health Niger); *Chapter II: Coordination and
prevention *Rapporteur: Bart Wijnberg (Council of Europe Medicrime
Convention), Hashim Yusufu (former Nig้rian Drug Regulatory Authority) and
Sivalingam Rasiah (DrugRegulatory AuthoritySingapore) ; *Chapter III:
Offences *Rapporteur: Wilfrid Roge (International Institute against
Counterfeit Medicine (IRACAM)  Ilisa Bernstein (US FDA); *Chapter IV:
Investigation *Rapporteur: Lynda Scammell (UK Drug Regulatory Authority),
Mickey Arieli (Drug Regulatory authority Israel) and Ashley How
(Pharmaceutical security Institute ); *Chapter V: National and
international cooperation and extradition *Rapporteur: Bernard Leroy
(Director IRACM)and Mercy Fomundam ( NEPAD Partnership);  *Chapter VI:
Prosecution of offences *Rapporteur: Stephane De Spiegeleer (Ministry of
Health Belgium) and Wael Armouti (Ministry of Health Jordan); *Chapter VII:
Protection of and assistance to victims and witnesses *Rapporteur:
Christian Tournie and David Benton (International Council of Nurses); *Chapter
VIII: Miscellaneous provisions *Rapporteur: Maximiliano Derecho (Lawyer
from Argentina)and Cynthia Genolet (International F้d้ration of
Pharmaceutical Manufactures and Associations (IFPMA)).

Interestingly all the Non-Governmental Organisations (NGOs) experts who are
invited for the second expert consultation are known for their support of
IP enforcement initiatives and promoting conflation of quality with IP. In
addition to the International Council of Nurses the other three NGOs are
invited to the consultation are closely linked to pharmaceutical TNCs.
These are: Institute of Research Against Counterfeit Medicines (IRACM),
Pharmaceutical Security Institute (PSI) and International Federation of
Pharmaceutical Manufacturers and Associations (IFPMA).

According to the IRACM website “The IRACM, an initiative of the Sanofi
group, is a French association governed by the 1901 Act advocating in the
fields of information, prevention and training. Its actions are
complementary to other enforcement measures led by specialized national and
transnational organizations such as Interpol and the World Customs
Organization, who are also partners of the Institute.” IRACM partners
include IFPMA and ‘Fight the Fakes’, an initiative by IFPMA for the strict
enforcement of IP.  IRCAM is based in Paris and works closely with various
French institutions.

PSI was established in 2002 in Washington DC by the Security Directors of
14 major pharmaceutical companies. The current membership includes 28
pharmaceutical companies.  PSI’s stated objectives include: protecting the
public health, sharing information on the counterfeiting of
pharmaceuticals; initiating enforcement actions through the appropriate
authorities.  PSI is known for its inflated data on counterfeit and its
effort to conflate quality issues with IP to make a case for IP
enforcement.  PSI maintains a close relation with IFPMA and during the
early days of PSI, the IFPMA Director-General served as the president of
PSI. PSI is also part of INTERPOL’s IP crime unit and was co-chair of WHO’s
defunct initiative IMPACT.

IFPMA, the lobby group for pharmaceutical TNCs, is always at the forefront
of IP enforcement initiatives. It is directly or indirectly (through PSI)
part of all the IP enforcement initiatives, which capture multilateral or
regional organisations to push the TRIPS plus IP enforcement standards.

The International Council of Nurses is part of the IFPMA-led campaign known
as ‘Fight the Fakes’.

Interestingly the agenda shows no participation from the generic
pharmaceutical industry.

According to Stefano Bonino, Research Associate, School of Applied Social
Science, Durham University (UK) the first expert consultation raised
concerns of balance and fair representation. “More than 90% of the
participants came from Europe, with only one participant from Nigeria
representing African interests, and no North Americans, South Americans or
Asians – major countries such as the US, India, Brazil, Russia and China
were not party to the discussions,” noted Bonino (

He further states with regard to UNODC: “For an organisation that prides
itself on representing 193 member states, one wonders if this situation
represents a throwback to an age when a few of European countries ran the

The proposed model law contains 42 articles divided into eight chapters
with commentary: General provisions; Coordination and prevention of medical
products; Offences (General offences; Offences of falsification of
documents and equipment and implement; Offences related to participation in
an organised criminal group; Offences related to obstruction of justice;
Penalties and sentencing considerations); Investigations (Special
investigation techniques); National and international cooperation and
extradition; Prosecution of offences; Protection of and assistance to
victim and witnesses;  Miscellaneous  provisions.

One of the main concerns related to the UNODC model law is the definition
of fraudulent medicine, which gives ample room for the conflation of
quality of medicine with IP.  According to the draft law ‘fraudulent
medical product’ means any medical product with a false representation of:

(1) its identity, including its packaging and labelling, its name or its
composition as regards any of the ingredients including excipients and the
strength of those ingredients;

(2) its source, including its manufacturer, its country of manufacturing,
its country of origin or its marketing authorisation holder; or

(3) its history, including the records and documents relating to the
distribution channels used.

The false representation of identity including the packaging and label as
per the definition can clearly bring trademark infringement within the
scope of fraudulent medicine.  Similarly some experts are also worried that
the false representation of identity and history can even include patent

In a similar situation at the WHO, the Secretariat resolution circulated
during the 124th Executive Board Meeting of WHO in 2009 in its preamble
paragraph clearly mentioned that “Recognizing that disputes about, or
violations of, *intellectual property rights* are not to be confused with
counterfeiting …” However, the next day the Secretariat circulated a
corrigendum, which stated: “Please note that the sixth preambular paragraph
of the draft resolution addressed to the Health Assembly should read as
follows: Recognizing that disputes about, or violations of, *patents* are
not to be confused with counterfeiting”.  Thus it is clear that the false
representation of identity clearly includes trademark infringement.

The model law like any other criminal law recognises criminal intent as a
requisite element to fall within the scope of criminal acts mentioned in
the model law. However, experts point out that the element of intention in
criminal law will be examined only during the prosecution stage at the time
of a criminal trial. Therefore, generic companies can be subjected to
harassment and prevented from competing with brand name companies.  The
model law intends to dilute the criminal intent requirements by imposing an
absolute criminal liability.

According to the commentary, “Common Law jurisdictions consider gross
negligence, criminal negligence and culpable negligence and reckless
disregard as to the consequences of the action as evidence of intent. This
is a matter for the domestic legal system to consider how it defines intent
by reference to its existing statute laws or legal precedent, as
appropriate consideration should be taken to ensure that offences do not
require that the intent in committing the offence is for the purpose of
causing harm. Objectively, causing harm is most likely to be a consequence
of the manufacturing and trafficking of a falsified medical product rather
than its object. The offences in this model law are predicated upon
fraudulent acts”.

Thus the criminal intent is of no consequences under the model to attract
criminal liability. The commission of the act itself makes one liable under
the model law. The criminal approach with stringent provisions can be used
against small producers, especially generic companies.

The model law also contains provisions for the seizure of suspected medical
products. According to draft article 32 “in the event of any offence under
these model legislative provisions, the fraudulent medical product;
documentation; and any ancillary equipment, as enumerated in article 13,
vehicle, vessel, craft or premises used or intended to be used in the
manufacture, trafficking or promotion of fraudulent medical products, shall
be seized immediately upon discovery”.

There is no explicit exemption for medicines in transit. The European Union
has earlier used seizure provisions in EU law to seize goods in transits,
which does not violate IP in either the country of export or import.
Recently the EU has blocked an exemption proposed by India and other
developing countries to exclude medical products from the scope of action
as activities and behaviors which result in Sub-standard, spurious, falsely
labeled, falsified and counterfeit medical products. The EU directive
currently allows the seizure of medical products in transit.

The model law also proposes special investigation techniques such as
infiltration,  assumed identities, controlled delivery and electronic
surveillance to facilitate undercover operations.

Many provisions of the model law are copied and pasted from the Council of
Europe Medicrime Convention.  According to Stefano Bonino, “UNODC copied
some of its draft provisions from yet-to-be-ratified legislation from the
Council of Europe – specifically the Medicrime Convention aimed at
combating the illegal trade in medical products – in the development of
this model law.”  He further observed that, “it seems UNODC is working
closely with the Council of Europe to serve its interests in pushing
forward the Medicrime Convention, which as many others have written in The
Lancet and the British Medical Journal has serious problems, including
unjustifiably criminalising some generic medicines”.

The introductory note in the model law states: “The model legislative
provisions on falsified medicines build on previous legislative instruments
and draft principles for model legislation by international and regional
organizations and bodies including the following:

   - ท      Untied Nations Convention against Transnational Organized Crime
   - ท      The Council of Europe Convention on the counterfeiting of
   medical products and similar crimes involving threats to public health and
   similar crimes (Medicrime Convention) (2011)
   - ท      Directive 2011/62/EU of the Parliament and of the Council of 8
   June 2008 amending Directive 2001/83/EC on the Community code relating to
   medicinal products for human use, regarding the prevention of the entry
   into the legal supply chain of falsified medicinal products (The Falsified
   Medicines Directive) (2011)
   - ท      The World Health Organization’s International Medical Products
   Anti-Counterfeiting Task Force (IMPACT) Draft Principles and Elements for
   National Legislation against Counterfeit Medical Products (2007)”.

 However, it is fact that WHO suspended activities of IMPACT and instituted
a Member-driven process to address the issues of quality, safety and
efficacy of medicines.

The resolution 20/6 adopted at the 20th session of the Commission on Crime
Prevention and Criminal Justice(CCPCJ) does not provide any mandate to
address the issue of medicines within the UN Convention on Transnational
Organised Crimes.  The resolution in its preamble stated: “… underscoring
in that regard the potential utility of the United Nations Convention
against Transnational Organized Crime”. However there was no decision to
address it within the framework of this Convention.

There was an attempt to include the issue of fraudulent medicines within
the framework of the UN Convention against Transnational Organized Crime at
the 22nd Session of the CCPCJ. The resolution proposed by Argentina stated:
“Encourages Member States to make use of the provisions of the United
Nations Convention against Transnational Organized Crime to more
effectively investigate and prosecute activities of organized criminal
groups related to the production of and trafficking in fraudulent
medicines, …”

However, the resolution was withdrawn due to the lack of confidence.

By choosing the model law route the Secretariat is aiming at bypassing the
consensus of Member States. As mentioned earlier the Secretariat is relying
on the mandate provided under resolution 6/20 for technical assistance to
frame the model law.  It is very clear that the developing countries would
not agree to a resolution which promotes IP enforcement; therefore the
Secretariat did not want to consult the whole membership of States and
instead chose a selective approach of consultation.

According to UN observers this is a classic case of vulnerability of UN
organisations, which can be captured with financial resources. In this case
France provided funds to UNODC’s Secretariat to implement its IP
enforcement agenda through the work program on fraudulent medicines,
especially the drafting of model law.

Stefano Bonino remarks: “The French government has also previously directly
funded UNODC’s fight against fraudulent medicines. It is excellent that
France cares to support UNODC’s work in this effort, but given that a good
number of the experts involved in the consultation were French (working for
UNODC, Council of Europe and INTERPOL) and/or representing French
interests, including Sanofi, we need to be careful about how much influence
this one player has and whether the entire world is willing to follow suit.”

*Author :*

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