[Ip-health] News: ICTSD Bridges Weekly- Views Differ on WTO's Generics Solution, IPR Enforcement

Terri Beswick Terri at haieurope.org
Mon Dec 20 02:38:01 PST 2010

News and Analysis * Volume 14 * Number 4 * December 2010


Views Differ on WTO's Generics Solution, IPR Enforcement


A rarely-used system intended to help poor countries import generic
versions of patent-protected drugs was the main focus of discussions at
the October session of the TRIPS Council. Developing countries also
raised serious concerns over the Anti-counterfeiting Trade Agreement.


With regard to access to generics, WTO Members reviewed how well the
so-called 'paragraph 6 solution' was working. The term refers to a
paragraph in the Doha Declaration on TRIPS and Public Health, which
instructed the TRIPS Council to find an 'expeditious solution' to the
problem faced by developing and least-developed countries lacking
domestic capacity to manufacture generic versions of patented drugs
under compulsory licence.


The solution, adopted by WTO Members in 2003, allows generics makers to
export drugs under compulsory licence to developing countries without
manufacturing capacity, but also imposes a complex web of requirements
on both exporters and importers, mostly designed to ensure that the
drugs are not re-exported to other countries, where they could threaten
brand-name manufacturers' markets. The procedure has been used only
once, for a shipment of HIV/AIDS drugs from Canada to Rwanda in 2008.


India, Brazil, China, South Africa and other developing countries argued
that this infrequency implied that the system must be too complicated to
use. Canada, backed by other developed countries such as the US,
Australia, Japan and Switzerland, suggested that the system was fine,
and that governments had not used it because they were able to negotiate
better drug prices with patent-holders, or import cheap generics from
countries where the drugs were not under patent.


Canada stressed that once Rwanda had formally signalled its intention to
use the system, it took Canadian patent authorities just 15 days to
grant a compulsory license to generics manufacturer Apotex in 2007. An
eight-month-long public tender process in Rwanda then ensued, which
Apotex won by beating out an Indian competitor on price (eventually
selling at below cost). In September 2008, the company shipped 6,785,000
tablets to Rwanda. A second shipment followed a year later, completing
the country's order.


India reported a much less positive experience. New Delhi's
representative said that a least-developed country lacking adequate drug
manufacturing capacity (believed to be Nepal) had sought to use the
system to import three patented medicines under compulsory licence from
India, but ultimately gave up, dissuaded by the various notification,
packaging, labelling and website tracking requirements set out in the
paragraph 6 solution.


The delegate reminded Members that while India was the source of the
vast majority of donor-funded HIV/AIDS medication, it has been required
by the TRIPS Agreement to provide patent protection to pharmaceutical
products since 2005. Thus, while pre-2005 drugs were for the most part
off-patent in India and thus easily available for generic production,
post-2005 drugs - which include the newer, more expensive HIV/AIDS
treatment regimes - are patent-protected there.


A representative from the World Health Organisation also made a
distinction between pre- and post-2005 drugs. While the official argued
that access to medicines had to do with more than just intellectual
property, he did note that competition from generics had cut prices of
first line HIV/AIDS medicines dramatically over the past decade,
enabling a massive increase in the number of patients receiving
treatment. It could become necessary to use the paragraph 6 solution to
acquire post-2005 medicines at affordable prices in the future, he said.


IP Enforcement Treaty under Fire


A number of developing countries issued stern warnings that the newly
finalised Anti-counterfeiting Trade Agreement (ACTA) would undermine
multilateral co-operation and global rules on intellectual property (see
analysis on page11).


India said that ACTA risked "completely upset[ting] the balance of
rights and obligations of the TRIPS Agreement," and expressed concern
that the treaty might subject non-parties to higher levels of
intellectual property enforcement than those demanded under TRIPS,
distorting the legitimate movement of traded goods in transit, and
weakening the institutional status of the WTO and WIPO.


China called for scrutiny of the consistency and compatibility between
ACTA and the WTO legal framework, particularly about whether it risked
creating additional trade-restricting obligations for WTO members. In
addition, the Chinese delegate criticised the lack of transparency that
characterised much of the ACTA negotiations.


Both China and India also evoked the possibility of trade disputes if
non-parties to ACTA end up affected by the agreement's provisions.


Brazil expressed a strong preference for multilateral solutions and
multilateral fora with legitimate credentials, such as the WTO and WIPO,
"whose deliberations are not only open to more than 140 member
countries, but are also conducted in as transparent a way as possible,
including representatives from civil society and NGOs."


The Brazilian delegate also noted with concern that ACTA contained "the
necessary ingredients that may convert it, over time, into a truly
international organisation dealing with the enforcement of IP rights, a
development whose impact on WIPO and the WTO, especially on
capacity-building and technical assistance, are unpredictable at this


ACTA participants (all but four of the 40 signatories are developed
countries) reportedly rejected these allegations, arguing that the
agreement would not affect TRIPS and was necessary to tackle
counterfeiting, particularly for dangerous counterfeit medicines and
spare parts.



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