[Ip-health] South African Draft IP policy - now with Cabinet

Baker, Brook b.baker at neu.edu
Thu Aug 8 05:23:50 PDT 2013

This is a very positive development, largely resulting from a national
campaign to Fix the Patent Law launched by the Treatment Action Campaign
and Doctors without Borders in 2011, ten years after the Doha Declaration
on the TRIPS Agreement and Public Health.

Although the news story reports that S. Africa will adopt a patent
examination system and that examination will reduce the number of
secondary/evergreening patents, it is hard to assess the depth of the
proposed reforms in the absence of access to draft intellectual property
policy that was promised months ago.  In an earlier draft, the inputs of
industry and pharmaceutical-affiliated lawyers were replete, but civil
society and independent experts have had not true opportunities for access
and input for nearly two years.

TAC and MSF put out a comprehensive release on patent reform on the eve of
an IP event hosted by South Africa, WHO, WTO, and WIPO.  The report laid
out the essence of the reforms that access-to-treatment activist feel are
needed to ensure realization of the right to health.  The news report does
not address many of their most pressing concerns including tightening up
of patentability standards, allowance of opposition procedures, and
simplification of compulsory licensing mechanisms among others.  Activists
would be fully justified demanding immediate release of the draft policy
to the public so that informed input can ensure optimal outcomes.

Regrettably Prof. Dean is acting as an apologist for a system that is
completely broken and that grants a higher percentage of pharmaceutical
patents than even the US and Europe.  As a result, S. Africans are
burdened not just with patents granting 20-year monopolies on new,
break-through medicines, but stacked, successive 20-year monopolies on
virtually every kind of minor modification to an existing medicines - new
uses/indications, new forms/dosages/formulations, etc.  In the absence of
a patent examination system in S. Africa, if you file out the applications
properly and pay your fees, you can get a patent on peanut butter and
jelly sandwiches, then peanut butter and grape jelly, then peanut butter
and apricot jelly ad infinitum.

These excessive secondary patents are not cost free - they drive up the
cost of medicines and extend the period of monopoly pricing by preventing
generic competition. Higher prices, in turn, result in medical apartheid,
where the vast majority of patients might be denied access to life-saving,
but overpriced, medicines as both medical aides and the government deny
coverage because of resource constraints.

South Africa's move to amend its patent laws is not occurring in a vacuum.
Brazil will soon launch patent law reforms that are also designed to
heightened patent standards and reduce the evergreening of pharmaceutical
patents.  Zambia and Uganda too are currently considering patent reforms
in line with reforms enacted in India in 2005 that have succeeded in
greatly reducing the number of secondary patents.

At the same time that countries are belatedly reforming their laws to
maximize use of flexibilities allowed under the WTO TRIPS Agreement, which
sets forth minimum patent and data protection standards but also allows
for nationally-derived flexibilities and exceptions, the US and EU are
aggressively pursuing trade policies that would expand intellectual
property rights and their enforcement and narrow the use of permitted
flexibilities.  IP maximalist, often with the support of elements of
government, are also supporting a glamour campaign for intellectual
property, falsely selling it as the engine of an Africa renaissance.
Contrary to this claim, most credible economic studies show that IP in the
continent, and in poorer countries more generally, does not lead to
increased foreign direct investment, technology transfer, indigenous
innovation, or development.

So a two front battle is being waged - one to enact and then use the
limited flexibilities granted under international law for accessing more
affordable medicines and another being waged against Big Pharma and Big
Power interests that are trying to reshackle African with IP constraints.
We must also begin to explore options like those being discussed at the
WHO that recognize the failures in research and development and access
that are a result of innovation policies wholly reliant on privatizing
monopolies on essential public goods like medicines.

Professor Brook K. BakerNortheastern U. School of Law
Affiliate, Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115 USA
Honorary Research Fellow, University of KwaZulu Natal, Durban, S. Africa
Senior Policy Analyst Health GAP (Global Access Project)
Alternate NGOs Board Member UNITAID
(w) 617-373-3217
(cell) 617-259-0760
(fax) 617-373-5056
b.baker at neu.edu

State hopes big changes to patent rules will cut drug costs
by Tamar Kahn, 08 August 2013, 06:32

THE Department of Trade and Industry is proposing far-reaching changes to
South Africa's intellectual property rights for medicines, which it says
will increase access to cheaper drugs by making it harder for companies to
obtain and extend patents.

Chief director for policy and legislation MacDonald Netshitenzhe said on
Wednesday the draft intellectual property policy, which had been three
years in the making, has been submitted to the Cabinet. It covers South
Africa's entire regime, not just medicines.

Among its provisions is a proposal to introduce a patent examination
office to stop pharmaceutical companies from "evergreening" their patents,
said Mr Netshitenzhe, referring to the controversial strategy in which
companies that have products with patents that are about to expire take
out new patents based on minor changes or new uses.

"These things can improve access to medicines," said Mr Netshitenzhe.
Prices would come down as a result of increased generic competition, he
said. South Africa intended to bring its intellectual property regime for
medicines in line with other developing countries such as India, Brazil,
Egypt and Kenya.

The proposal to introduce patent examination was applauded by activists,
but panned by Owen Dean, who holds the Anton Mostert chair of intellectual
property law at Stellenbosch University. Prof Dean said the department was
"barking up the wrong tree" if it thought introducing an examination
system would reduce the number of patents granted to companies and
increase access to medicines.

"Virtually all the leading economies, including the US, Europe and Japan
have examination systems," he said.

"Most of the patents registered in South Africa emanate in first-world
countries ... and it is highly unlikely that an application here would be
refused if it had been granted there."

South Africa lacked the specialist skills to assess applications for
medicine patents, and would tie patent applications up in red tape if it
introduced an examination system. "The whole system will be slowed down
and a lot of unnecessary cost is going to be incurred," he said.

Medicines Sans Frontieres spokeswoman Julia Hill welcomed the development,
but said the crucial part will be seeing how funds are allocated so that
there are adequate resources to do the job.

South Africa uses a depository system, in which patent applications are
granted without extensive scrutiny. Patents can only be challenged after
they have been granted, she said.

"It allows companies to file multiple patents on the same medicine and
extend the life of their monopoly, keeping prices artificially high," Ms
Hill said.

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