[Ip-health] WTO TRIPS Council (June 2015): India underscores the importance of de-linkage in discussions of financing innovation

Thiru Balasubramaniam thiru at keionline.org
Wed Jun 10 14:45:57 PDT 2015


http://keionline.org/node/2249

In discussions at the June 2015 WTO TRIPS Council on the role of
intellectual property in financing innovation, India underscored its
commitment to the principle of de-linkage by stating,

Innovation should not be viewed within the narrow prism of intellectual
property monopolies but framed within a holistic, knowledge ecosystem that
includes open innovation, open knowledge approaches and de-linkage of R&D
costs from product prices

and repeating its call to the WTO, WHO and WIPO secretariats to organize a
technical symposium on "New Business Models for Fostering Innovation and
Access: Innovation Inducement Prizes and Open Source Development Models" as
part of their "trilateral cooperation on intellectual property and public
health."

Intervention on Agenda Item 10: Intellectual Property and Innovation: The
Role of Intellectual Property in Financing Innovation

Mr.Chairman, my delegation would like to thank the delegations of the
United States, Switzerland, the European Union and Singapore for tabling an
agenda item on "Intellectual Property and Innovation: The Role of
Intellectual Property in Financing Innovation”.

Mr.Chairman, let me just recall our intervention when the agenda item on
Intellectual Property and Innovation was first introduced in the TRIPS
Council. Our statement is still relevant when we are discussing ‘the Role
of Intellectual Property in Financing Innovation’ under the broad theme of
Intellectual Property and Innovation. In that meeting India pointed out
that the word "innovation" appeared just once in the TRIPS Agreement, in
Article 7, which states that Intellectual Property Rights (IPRs) "should
contribute to the promotion of technological innovation and to the transfer
and dissemination of technology," and not for the sake of innovation
itself, but "to the mutual advantage of producers and users of
technological knowledge and in a manner conducive to social and economic
welfare, and to a balance of rights and obligations." Thus the TRIPS
Agreement makes it very clear that the purpose of the Intellectual Property
system is not solely to protect the commercial interests of the
Intellectual Property holder but it is one of the many tools available to
the society to achieve technological development, its social and economic
welfare and innovation.

Mr.Chairman, according to Petra Moser, faculty at Stanford University,
U.S.A., “ Patents and Innovation: Evidence from Economic History, Journal
of Economic Perspectives—Volume 27, Number 1—Winter 2013—Pages 23–44”.

“Overall, the weight of the existing historical evidence suggests that
patent policies, which grant strong intellectual property rights to early
generations of inventors, may discourage innovation. On the contrary,
policies that encourage the diffusion of ideas and modify patent laws to
facilitate entry and encourage competition may be an effective mechanism to
encourage innovation.

Innovation should not be viewed within the narrow prism of intellectual
property monopolies but framed within a holistic, knowledge ecosystem that
includes open innovation, open knowledge approaches and de-linkage of R&D
costs from product prices.

According to the Trilateral study by WTO, WHO and WIPO on “Promoting Access
to Medical Technologies and Innovation: Intersections between public
health, intellectual property and trade (2013) ”(Page 126),

Patent law is not a stand-alone innovation system. It is only one element
of the innovation process, and one which can be deployed differently in
diverse innovation scenarios. Patent law has little bearing on many other
factors that lead to the successful development of technologies, e.g. the
nature and extent of demand, commercial advantages gained by marketing and
ancillary services and support, commercial and technical viability of
production processes, and compliance with regulatory requirements,
including through effective management of clinical trials data.

Mr.Chairman, the trilateral study also highlights that Innovation in
medical technologies for neglected diseases suffers from market failure as
conventional IP-based incentives do not correspond with the nature of
demand for treatments of these diseases. To overcome the market failure of
the IP system for neglected diseases, the trilateral study mentions about
open innovation structures such as Open Source Drug Discovery (OSDD) model
of India’s Council of Scientific and Industrial Research (CSIR),
collaborative research such as WIPO Re:Search Sharing Innovation in the
Fight Against Neglected Tropical Diseases. The study also talks about the
concept of delinking price of the final product from the costs of R&D by
‘push’ mechanisms such as grant funding and tax credits for investment in
R&D and by ‘pull’ mechanisms that offer rewards for the final outcome of
R&D of certain products like milestone or end prizes. The trilateral study
also talks about the emergence of Product Development Parterships (PDPs),
which are constituted usually with the involvement of non-profit
organizations, foundations and industry, to focus R & D towards diseases
that disproportionally affect low- and middle-income countries (LMICs).
Examples of Product Development Partnerships are Medicines for Malaria
Venture (MMV), the international AIDS Vaccine Initiative (IAVI), the Aeras
Global TB Vaccine Foundation, etc.,

Mr.Chairman, the World Health Organisation (WHO) at the recently concluded
68th World Health Assembly (WHA) has adopted the ‘Global Action Plan on
antimicrobial resistance’. The action plan, inter alia, states that most
pharmaceutical companies have stopped research and development of new
antibiotics and calls it as a “serious market failure” and a “particular
cause of concern”. The action plan also suggests that “the cost of
investment in research and development may need to be de-linked from price
and the volume of sales to facilitate equitable and affordable access to
new medicines, diagnostic tools, vaccines and other results from research
and development in all countries”. The G-7 countries yesterday came out in
full support of the WHO Global Action Plan on anti-microbial resistance.

Mr. Chairman, the Report to the President on Combating Antibiotic
Resistance in September 2014, which was prepared by the United States
President’s Council of Advisors on Science and Technology (PCAST), while
stating that market failure is the reason for the inadequate state of
antibiotic development, it also talks about new mechanisms to incentivize
the development of antibiotics, like ‘push mechanisms (federal funding,
subsidies etc)’ and ‘pull’ mechanisms (user licenses, lump sum prizes,
patent buy-outs etc).

Mr.Chairman, India declared the decade of 2011-2020 as the Decade of
Innovation. The spirit of innovation has to permeate all sectors of economy
from universities, business and government to people at all levels. The
future prosperity of India in the new knowledge economy would increasingly
depend on its ability to generate new ideas, processes and solutions, and
the process of innovation would convert knowledge into social good and
economic wealth.

Mr.Chairman, with regard to financing of Innovation in India, there are
many ways, but due to paucity of time, I would limit myself to few
initiatives of the Government and private sector in India. CSIR-Tech
Private Limited works with laboratories across India to commercialize their
technologies and intellectual property; Grassroots Technological
Innovations Acquisition Fund (GTIAF), which is operated by the National
Innovation Foundation of India, is to obtain the rights of technologies
from grass root innovators after compensating them for the same with the
purpose to disseminate/diffuse them at low cost or no cost for the larger
benefit of the society. Global Innovation and Technology Alliance (GITA),
promoted jointly by Confederation of Indian Industry (CII) and Department
of Science & Technology, Government of India, inter alia, has a mandate of
professional management of Government Fund for the industry through
flexible modes of funding support like grant, loan and equity. Some private
sector initiatives that invests mainly in technology led innovations,
include India Innovation Fund, a venture capital fund promoted by National
Association of Software and Services Companies (NASSCOM) and IKP Knowledge
park, and Tata Capital Innovation Fund, etc.

Mr.Chairman, I would like to conclude by requesting the WTO to organize a
symposium on “New Business Models for Fostering Innovation and Access:
Innovation Inducement Prizes and Open Source Development Models.” This
could be organized by the WTO along with the WHO and the WIPO as part of
their trilateral cooperation on intellectual property and public health.

Thank you.



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