[Ip-health] TRIPS Council (October 2014): India calls for de-linkage and innovation inducement prizes at WTO discussions on IP & innovation

Thiru Balasubramaniam thiru at keionline.org
Mon Mar 30 02:32:57 PDT 2015


TRIPS Council (October 2014): India calls for de-linkage and innovation
inducement prizes at WTO discussions on IP & innovation

http://keionline.org/node/2200

Submitted by thiru <http://keionline.org/user/6> on 30. March 2015 - 11:25

In advance of the World Trade Organization's October 2014 session of the
TRIPS Council, the European Union, Switzerland and the United States made a
written request to the TRIPS Council to discuss "Intellectual Property and
Innovation: Promoting Awareness; Case Studies" under agenda item 12. This
marked the 7th time that the United States tabled an item to the TRIPS
Council relating to intellectual property or innovation.

In the context of these October 2014 discussions of Intellectual Property
and Innovation, the Government of India delivered the following
intervention asserting that,

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 the de-linkage of
R&D costs from product prices.

India highlighted the President’s Council of Advisors on Science and
Technology (PCAST) report - published in September 2014 by the Executive
Office of the President to the United States - on Combating Antibiotic
Resistance which called on new business models to address the "inadequate
state of antibiotic development" with such measures as ‘*delinking’
antibiotic usage from revenues*" and a *variety of incentive models have
been proposed, including user licenses, lump sum prizes, patent buy-outs,
and payments to hold drugs in strategic reserve*".

In relation to trilateral cooperation between the World Health
Organization, the World Intellectual Property Organization and the WTO on
innovation and access to medicines, the Government of India requested these
intergovernmental agencies to "organize a symposium on “New Business Models
for Fostering Innovation and Access: Innovation Inducement Prizes and Open
Source Development Models.”

The entire text of India's intervention on IP and Innovation follows.

Intervention on Agenda Item 12: Intellectual Property and Innovation:
Promoting Awareness; Case Studies

*Mr.Chairman*, my delegation would like to thank the delegations of the
European Union, Switzerland and the United States for tabling an agenda
item on "Intellectual Property and Innovation: Promoting Awareness; Case
Studies.

*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 ‘Promoting
Awareness; Case Studies’ 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, 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 the 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.

Mr.Chairman, the Executive Office of the President to the United States,
President’s Council of Advisors on Science and Technology (PCAST) published
a Report to the President on Combating Antibiotic Resistance in September
2014. According to the Report, antibiotic-resistant infections are
associated with 23,000 deaths and 2 million illnesses in the United States
each year and estimates of annual impact of antibiotic-resistant infections
on the U.S. economy is about $55-70 billion. The report mentions that
market failure is the reason for the inadequate state of antibiotic
development as the economic return on developing new antibiotics is
currently too low to elicit adequate private investment and innovation. The
report also suggests ‘push’ and ‘pull’ mechanisms to incentivize the
development of new antibiotics. One of the pull mechanism suggested is
‘delinking’ antibiotic usage from revenues.

*Page 39 “ A variety of incentive models have been proposed, including user
licenses, lump sum prizes, patent buy-outs, and payments to hold drugs in
strategic reserve. These models would provide reduced risk to potential
developers (the economic reward is defined), reduced risk to users (their
cost is contained), and would allow the resulting antibiotics to be managed
as a strategic resource so as to preserve their effectiveness for critical
uses. In addition, these models would not create incentive for a drug maker
to increase sales of the antibiotic in order to make more money.”*

*Mr.Chairman*, as part of the trilateral cooperation between the WHO, the
World Intellectual Property Organization and the WTO on innovation and
access to medicines, we request these Organizations to organize a symposium
on “New Business Models for Fostering Innovation and Access: Innovation
Inducement Prizes and Open Source Development Models.”

*Mr.Chairman*, with regard to the awareness programmes on IP and
Innovation, 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.

In India, many Government institutions at centre and state level, industry
organisations, non-governmental organisations are involved in creating
awareness about Intellectual Property.

Due to lack of time, I’ll restrict myself to IP awareness programmes of
only two institutions.

(i) Patent Facilitation Cell of Department of Science and Technology

(ii) Intellectual Property Office

*Mr.Chairman*, Patent Facilitating Centre (PFC) was set up by Department of
Science and Technology at Technology Information Forecasting and Assessment
Council (TIFAC) in 1995. Patent Facilitation Centre along with its
26-satellite Patent Information Centres (PIC’s) in various states and 71
intellectual property cells at various state Universities create awareness
about Intellectual Property Rights among the people through awareness
Seminars, Workshops, Lectures, Talks, Exhibitions and Publications.

*Mr.Chairman*, the Indian Intellectual Property Office has undertaken
extensive outreach programs for the last several years for promoting
intellectual property awareness in the country. In the year 2013-14, the
Intellectual Property office focused on the promotion of IP in the
industrial clusters related to specific fields of technology. In the
current financial year, the Intellectual Property Office, in association
with the Industry Associations, is conducting a series of specific
awareness programs on IP. These are 2-day programs out of which the first
day will be used to impart awareness to local industry and government
department officials while the second day will be devoted to creating
awareness about IP in the academia. The programs will specifically target
students, research scholars, lecturers and professors, Micro, Small and
Medium Enterprises (MSMEs) and start-ups and government officers.

Mr.Chairman, I would like to conclude by stating that there is no direct
correlation between ‘Intellectual Property and Innovation’ and the
countries have to define the path depending on their level of socio
economic development.



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