[Ip-health] Hungarian compulsory license for remdesivir raises a stir with BIO, PhRMA and the US Chamber of Commerce

Thiru Balasubramaniam thiru at keionline.org
Mon Mar 8 19:57:23 PST 2021


https://www.keionline.org/35558

Hungarian compulsory license for remdesivir raises a stir with BIO, PhRMA
and the US Chamber of Commerce
Posted on March 8, 2021 <https://www.keionline.org/35558> by Thiru
<https://www.keionline.org/author/thiru>

Whilst TRIPS Council deliberations in 2020 witnessed some lively
deliberations <https://www.keionline.org/33593> on the nature of
legislative amendments to Hungary’ special legal order (State of Danger) to
enable the provision of a “compulsory licence regime for public health
purposes” <https://www.keionline.org/34268>, Hungary’s recent decision to
issue compulsory license for the local manufacture of Gilead’s drug,
remdesivir for the treatment of COVID-19 seems to have escaped the gaze of
many trade and public health experts, including at the World Trade
Organization (WTO)
<https://www.wto.org/english/tratop_e/covid19_e/trade_related_ip_measure_e.htm>
and
at the World Intellectual Property Organization (WIPO)
<https://www.wipo.int/covid19-policy-tracker/#/covid19-policy-tracker/access>
.

However, in submissions to the United States Trade Representative’s (USTR)
Special 301 Review for 2021, the Biotechnology Innovation Organization
(BIO), Pharmaceutical Research and Manufacturers of America (PhRMA) and the
US Chamber of Commerce flagged Hungary’s compulsory license as unnecessary
and unwarranted.

In its Special 301 submission, BIO expressed the following concerns:

BIO and its members are also extremely concerned about emergency
regulations introduced in several countries that call for the unilateral
use of compulsory licenses for COVID products or those implemented under
vague national security grounds. For instance, the Hungarian government,
peremptorily and without consultation with the patentee, used its
compulsory licensing mechanism in respect of remdesivir, a treatment for
COVID-19, while simultaneously obtaining the medicine via the EU Joint
Procurement Agreement negotiated with the patent holder. The Hungarian
government at no time indicated that this supply did not meet national
needs. This action runs counter to the EC’s IP Action Plan, which also
states that CLs can only “be used as a means of last resort and a safety
net, when all other efforts to make IP available have failed.”

In the US Chamber’s submission to USTR’s Special 301 Review for 2021, the
Chamber wrote:

For instance, the Hungarian government used its compulsory licensing
mechanism for remdesivir, a treatment for COVID-19, following a request by
a local company. This is despite the fact that Hungary had already been
procuring and using the medicine through a Joint Procurement Agreement
negotiated between the European Union and the patentee. The Hungarian
government did not engage with the patent holder nor indicated that this
supply did not meet national needs. This action runs counter to Hungary’s
commitments, as well as the European Commission’s position, to use
compulsory licenses as a means of last resort and a safety net, when all
other efforts to make IP available have failed.

Singing from the same hymn sheet, PhRMA upbraided Hungary for its
compulsory license on remdesivir.

In late 2020, the Hungarian Government granted a compulsory license for
remdesivir, a COVID-19 treatment conditionally approved by the EMA, citing
newly promulgated emergency Law Decrees 283/2020 and 478/2020. This action
is unnecessary as Hungary already has full access to Veklury (remdesivir)
via the EC’s Joint Procurement Agreement (JPA) with the patent holder, and
continues to use it to meet its national needs. Throughout this process,
the Hungarian Government did not contact the patentee to suggest that a CL
was needed, and the CL was granted with only a day’s notice to the
patentee. PhRMA and its members believe that this CL is unnecessary and
unwarranted, and runs counter to the EC’s IP Action Plan, which states that
CLs can only “be used as a means of last resort and a safety net, when all
other efforts to make IP available have failed.

While Hungary’s compulsory license by stealth appears to not have drawn the
attention of international media, in October 2020, Reuters did report on
the local production of remdesivir (Hungary’s Richter has manufactured
Remdesivir for 3,000 COVID-19 patients
<https://www.reuters.com/article/us-health-coronavirus-remdesivir-richter-idUSKBN26S283>,
7 October 2020).

Reuters reported the following:


   Beke said the Hungarian government, which owns a 5.25% stake in Richter,
   approached the company during the first wave of the pandemic to explore
   whether Remdesivir could be manufactured locally.


   “We have managed to solve the synthesis of the active substance within
   five months,” Beke said. “The request came from the government and they
   have also financed the development.”

As the TRIPS Council convenes on 10 March 2021 to 11 March 2021, one can
expect European Union trade negotiators to field questions on Hungary’s
compulsory license by stealth.


-- 
Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org


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