Lead Author: Lotti Rutter
Organization: Treatment Action Campaign
Supporting Organizations: AIDS Access Foundation; Thai Network of People Living with HIV/AIDS; FTA Watch; Delhi Network of Positive People (DNP+); ITPC-South Asia; SECTION27
Country: South Africa; Thailand; India

Abstract

The 2001 Doha Declaration affirmed that the provisions of the TRIPS agreement do not prevent governments from taking the necessary policy and legal measures to achieve the right to health. The Doha Declaration explicitly states that the TRIPS agreement should be interpreted in a way that promotes access to medicines for all, and that countries are within their rights to take certain measures to limit intellectual property rights (TRIPS flexibilities) when public health interests demand it to enable access to affordable medicines.

In reality though, many countries have yet to implement such measures effectively, fully or at all. The balance between commercial and public health interests (as intended by TRIPS and the subsequent Doha Declaration) has not been redressed. Some national patent laws have only been moderately amended since the adoption of TRIPS to comply with the 20-year patent requirement and still hark back to pre-independence laws.

This submission calls for developing countries to fully utilise all safeguards available within the TRIPS agreement and Doha Declaration to ensure that public health is protected. Using South Africa and other countries as examples, it will outline in detail the following:

1. The social and public health impact of patents;
2. The economic impact of patents;
3. Key legislative reforms allowed under the TRIPS Agreement (implementation).

Submission

Introduction:

In 2001, WTO members adopted the Doha Declaration reiterating the flexibilities in TRIPS, stating that "the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health"[1]. In reality, many countries have yet to implement such measures effectively, fully or at all. The balance between commercial and public health interests as intended, has not been redressed.

This contribution calls on WTO members to make urgent legislative changes to incorporate all TRIPS flexibilities into national law. Using South Africa and other countries as examples, it outlines:

1. The social and public health impact of patents;
2. The economic impact of patents;
3. Key legislative reforms allowed under the TRIPS Agreement (implementation).

WTO members who are LDCs should make full use of their transition periods [2].

1. Social and public health impact:

Significant evidence exists that highlights how high medicine prices prohibit access to medicines across the world. The lack of a competitive market during the years of patent exclusivity allow pharmaceutical companies to charge unaffordable prices to maximise profits – meaning medicines remain inaccessible for lengthy periods of time.

The success of the antiretroviral scale-up in South Africa was only possible because of major price drops achieved through generic competition. The cost of first-line HIV drug regimens dropped from US$10,000 per person per year (pppy) in the 1990s [3] to around ZAR 1343(US $125) [4] pppy today. As a result, over 3.5 million people have been initiated onto treatment. However, these price drops were largely the result of individual cases of litigation or Competition Commission complaints [5]; rather than the effective use of TRIPS flexibilities.

Costs will significantly increase as people shift to second or third-line regimens that remain under patent protection at ZAR 2932 (US $273) pppy and ZAR 19,369 (US $1803) pppy respectively [6], and as more people are initiated onto treatment in line with changing treatment guidelines [7].Newer antiretrovirals could offer significant clinical benefits–e.g.raltegravir [8] could replace efavirenz in first-line treatment with a better side effect profile and rapid reduction of viral load – but remain only available as third-line due to cost [9].

Furthermore, medicines for other disease areas remain costly. In 2015, the WHO added trastuzumab for breast cancer to its essential medicines list [10], yet access is restricted in South Africa, and elsewhere [11]. Patents have expired, been overturned or withdrawn in India, South Korea and the UK and will expire in the US in 2019. However, in South Africa, secondary (ever-greened) patents could block use of biosimilar products until 2033 [12]. A12 month course of treatment is approximately ZAR 485,800 compared to ZAR 151,520 for a biosimilar in India. This high cost means that despite the additional survival benefits, it is only available in the public sector in limited cases [13] and is not available through medical aids [14].

Hepatitis C (HCV) is a significant public health issue. Sofosbuvir is an important treatment advance that reduces treatment duration by half, has fewer side effects, and higher cure rates than existing treatments. However high prices mean it is inaccessible, leaving people at risk of liver cancer or liver failure. US $84,000 for a 12-week course leaves many US patients excluded [15]. The UK delayed introduction due to £35,000 price-tag [16]. Even in high-burden countries like Egypt, the lowest price is US $900 in the public sector [15]. Research showed it can be profitably produced for US $102 per course [17]. Oppositions have been filed in several countries on grounds that the technologies comprising these patent applications are known and therefore undeserving of a patent grant [18]–stricter patentability criteria may have prevented patents being granted initially.

Despite being curable and preventable, TB is the leading cause of death globally. Drug resistant (DR) TB is growing rapidly. New medicines like delamanid offer important advances in treatment. Currently less than half of DR-TB patients put on treatment are cured, yet delamanid remains out of reach at US$1,700 (ZAR 26,000) per course [19].

TB highlights a second failure of the system –patents fail to incentivise innovation in areas of greatest unmet medical need. Under the existing patent system, research and development (R&D) is motivated by the reward of high profits attained through patents. Inevitably, little incentive exists to develop medicines that will be consumed primarily by the poor. The dire state of DR-TB treatment highlights this. Treatment involves taking 14,600 pills over a two-year period - and a painful daily injection for the first six months [20]. Side effects include nausea, vomiting, hallucinations, diarrhoea, suicidal feelings, schizophrenia, and deafness. Yet despite great need, only three new medicines have come to market in the last 50 years.

Despite promises, increased IP protection has not increased the rate of R&D [21]. Rather it has led to greater investment by industry into ever-greening - developing new formulations, new uses and new forms of existing medicines – that blocks access to medicines for longer. While industry continues to profit from making minor modifications to existing medicines, little incentive exists to invest in riskier, more expensive R&D. A French study found that 68% of new products ‘approved in France between 1981 and 2004 offered “nothing new” over previously available medicines’ [22]. A US analysis showed that more than 75% of medicines approved between 1989 and 2000 ‘have no therapeutic benefits over existing medicines’ [23] [24].

There are many further examples: aripiprazole (depression) [25], entecavir (hepatitis B) [26], sorafenib (cancer) [27], Yasmin (oral contraceptive) [28].

2. Economic impact

2.1. There is no conclusive evidence that IP stimulates the economy, particularly in developing countries [29]. India’s experience of economic growth during the period when it did not uphold IP protection is not unique. Many developed countries provided weak IP protection during their transition into highly industrialised, developed economies. For instance, Japan, Taiwan and South Korea [30][31].

Many of today’s developed countries borrowed and copied technology from wealthier countries to develop local industries and are now accused of “kicking away the ladder” that would allow developing countries to catch-up by pressuring them to adopt strong IP protection [32].

Developed countries themselves utilise TRIPS flexibilities while arguing against their use in the developing world - even pushing for worse TRIPS-plus terms in trade and investment agreements. The US is perhaps the world’s most frequent user of compulsory licensing. Since 2006, six compulsory licenses on medical technologies were granted–notably, the US PEPFAR programme almost exclusively sources generic medicines and is the world's largest consumer of generic products manufactured under compulsory licenses [33].

2.2. Developed countries promised that the implementation and expansion of IP protection would result in greater foreign direct investment to stimulate economic growth. Yet, in South Africa the opposite is true. After adopting TRIPS, South Africa witnessed a massive decline in pharmaceutical production and investment by international multinational companies (MNCs). Between 1994 and 2007, 35 pharmaceutical manufacturing plants, belonging mainly to MNCs, were shut down [34]. The MNCs instead consolidated their operations in regions with skilled labour, low costs of labour and production, and other economic incentives [35]. India by contrast realised US$1 billion foreign direct investment from April-June 2013 in their pharmaceutical industry, despite proactive adoption of flexibilities [36]. One study found countries who attracted foreign investment, while simultaneously retaining ‘lax’ levels of IP protection achieved higher growth rates [37].

2.3. Strong IP protection not only impedes the growth of local industry, but can contribute to a negative balance of trade in developing countries. In South Africa, pharmaceuticals are the 5th largest contributor to the trade deficit [38].By volume, the majority of its medicines are generic. Yet in terms of expenditure, the main driver are patented medicines. It is reasonable to conclude that granting fewer patents of poor quality will reduce the pharmaceutical trade deficit – both by reducing prices and enabling an increase in local production of generics [39].


3. Key legislative reforms

3.1. Substantive patent examination:
In order to ensure a patent system that serves public interest and advances local developmental needs substantive examination of patent applications is necessary. Without substantive examination a patent office has no filter to ensure that patents are granted only when they are deserved.

In South Africa a depository system is in place [40]. The patent office works on the assumption that once an application has been filed, what is claimed to be an invention deserves a patent. Without a filter at their disposal, South Africa is unable to weed out the growing number of applications that claim patent protection but are not in fact worth patent status. With no checks in place, abusive practices abound; South Africa grants 40% more pharmaceutical patents than the US and EU on identical applications [41].

In contrast, the Indian Patent Office examines all applications and has a fee structure ensuring sustainability and revenue generation [42]. In Brazil, the national drug regulatory authority, ANVISA, has a right to review pharmaceutical patent applications for medicines relevant to public health prior to examination by the patent office [43]. This system plays a critical role in curbing ever-greening by MNCs, and has resulted in previously-granted patents on key medicines being overturned on review.

In 2008 alone South Africa granted 2,442 pharmaceutical patents (almost exclusively to foreign companies), while in contrast Brazil granted 278 between 2003 and 2008 [44]. The University of Pretoria found that 80% of patents upheld in South Africa do not meet its patentability standards [45].

Recommendations:
3.1.1. Legislation and regulations establishing and implementing substantive patent examination systems should be enacted including:

3.1.1.1. Developing legislation and guidelines;

3.1.1.2. Recruiting patent examiners with the necessary skills and/or conducting training of examiners where the skills do not exist;

3.1.1.3. Developing appropriate IT systems to ensure transparency and access to information (including simple and consistent classification of patents);

3.1.1.4. Budgetary allocations to achieve this.


3.2. Higher patentability criteria:
To protect public interest, a substantive examination system must be aligned with high standards of patentability recognised in national law [46]. Article 27.1 of TRIPS affords countries significant flexibility when setting patentability criteria. It requires that patents be granted for inventions that are new, involve an inventive step and are capable of industrial application [47].

Countries have adopted widely varying patentability criteria [48]. In India, the bar for patentability is set high [49]; new use patents are not granted and new forms of known substances are patentable only if they “result in the enhancement of the known efficacy of that substance”. The strict interpretation of section 3(d) was upheld by India’s Supreme Court in 2012 in Novartis AG v Union of India[50] which held that the provision has been drafted "in order to leave the door open for true and genuine inventions but, at the same time, to check any attempt at repetitive patenting or extension of the patent term on spurious grounds." This decision is an important example of the implementation of patent law in a manner that considers public health [51].

Similarly, strict standards exist in the Philippines [52] and Argentina, which has excluded from patentability polymorphs and salt forms of drugs, as the various chemical attributes and benefits of these and other forms are common knowledge within the pharmaceutical industry [53]. Other countries, such as Brazil [54], are contemplating a move in this direction.

Coupled with examination, such high standards can reduce the number of secondary patents granted on medicines. Setting higher patentability criteria should create incentives for pharmaceutical companies – whether originator or generic - to invest in new molecular entities and new classes of medicines. By contrast, low patentability criteria simply encourages ever-greening through successive secondary patents. From a developmental perspective, an approach that seeks to reward significant innovation is clearly preferable.

Recommendations
3.2.1. Higher patentability criteria should be set in national patent laws that reject methods of treatment, new uses and new forms including formulation/dosage patents, as well as known processes for making medicines and medical products.


3.3. Patent searches:
Lack of information on patent status and specifications may lead to sub-optimal decisions by a variety of players from health departments to generic companies [55]. Online search databases ensure countries can take advantage of TRIPS flexibilities such as patent oppositions, and allow the public to ensure examination is conducted in line with patentability criteria thus limiting the granting of abusive patents.

Recommendations
3.3.1. Online functional patent search databases should facilitate access to accurate information on patents for ordinary users of the system.

3.3.1.1. Patents should be searchable by the international non-proprietary name (INN), either when known at the time of the filing of a patent application, or when available following the grant of a patent.

3.3.1.2. Complete documents and specifications of a patent application or granted patent should be available, including the abstract and full disclosure of claims [56], as well as any transactions, including the terms and status of any licensing agreements [57].

3.3.1.3. The legal status of patents and patent applications—i.e. pending, granted, rejected, opposed, withdrawn, abandoned, expired or not renewed— should be current and available.


3.4. Opposition proceedings:
In conjunction with examination, countries must establish pre- and post-grant opposition proceedings. These provide additional checks to ensure that only inventions that meet statutory requirements for patentability are granted patents. Third-party interventions are important because, given the volume of applications, examiners often miss information.

Recommendations:
3.4.1. Provisions for meaningful pre- and post grant opposition mechanisms that recognise broad standing inclusive of civil society should be enacted, and the provision of adequate access to information to facilitate such interventions.

3.4.1.1. First, for pre-grant oppositions, it must be decided at which stage opposition procedures should be introduced – whether before, at the time or after substantive examination begins [58].

3.4.1.2. Second, procedures must be in place to ensure adequate time for filing an opposition, and take into consideration the state of access to timely information on patent applications [59].

3.4.1.3. Third, the cost of filing an opposition should not be prohibitive, nor initially subject to court proceedings [60].

3.4.1.4. Finally, standing to file a pre-post grant opposition should be as broad as possible, and include not only generic competitors, but also civil society, academics, and patients. While pharmaceutical companies have challenged the right of patient groups in other countries to file pre- and post-grant oppositions, a court case in Thailand clearly determined the right of such groups to file oppositions, as “interested parties to the granting of a patent” [61].


3.5. Compulsory licensing:
Article 31 of TRIPS [62] recognises WTO members' right to legislate “other use of the subject matter of a patent without the authorization of the right holder”. This use of a patent, without the patentee’s consent, may be “by the government or third parties authorized by the government”. In other words, the state may issue compulsory licenses – either to third parties or itself [63].

Many countries have used compulsory licenses to promote public interest objectives and remedy anti-competitive practices in a variety of technology sectors. In recent years, a number of countries have issued licenses to improve access to medicines, including India, Thailand, Brazil, Malaysia, Zambia and Ecuador [64]. Indonesia recently authorised government use of patents for seven HIV/AIDS and hepatitis medicines which could introduce widespread generic competition, local production and generate potentially massive cost savings in the world's fourth most populous country [65].

Although compulsory licensing and government use are legitimate under international law, their application has faced considerable resistance from developed countries’ governments and retaliations from industry.

Recommendations:
3.5.1. A simple and expeditious administrative procedure should be enacted that is subject only to review proceedings in Court. Government use licenses should not require any review proceedings in Court [66];

3.5.2. Pending any review of the grant of a compulsory license, interim relief should only be available – upon application – in exceptional circumstances and should not be available for the exercise of government use licenses;

3.5.3. Default positions regarding license conditions (including but not limited to royalty rates) and negotiation timelines should expressly be included.

3.5.4. Countries should incorporate into legislation the allowance for compulsory licenses on a range of grounds [67].


3.6. Parallel importation:
TRIPS Article 6 allows for parallel importation; given that patented products are sold at different prices in different markets, this measure enables the import of patented products from countries in which they are sold at lower prices into countries where the same patented product is being sold at a higher price.

Parallel importation gives effect to the principle of exhaustion of rights, that once patentees or other authorised parties have sold a patented product, they cannot prohibit the subsequent resale of that product (since their rights in respect of that market have already been exhausted). Once a product has been sold, the exclusive rights holder has no further right over the sold product – the patentee’s rights are therefore “exhausted”. This principle should apply to international, branded or generic products as well as those manufactured under a compulsory license [68].

Both Kenya and the Philippines have amended their patent law to allow international exhaustion that does not limit the possible source of import from a third country to products put on the domestic market by the original patent holder, but opened it up to equivalent products placed on the market by anybody who was authorised to do so [69] [70].

In order to facilitate the easy use of parallel importation both IP and regulatory issues must be addressed to ensure that products acquired through parallel importation do not encounter undue delays.

Recommendations:
3.6.1. National patent laws should be amended to include international exhaustion;

3.6.1. Parallel importation measures should apply to both branded and legitimately produced generic medicines (including through a compulsory license);

3.6.2. Licensing practices should be regulated to ensure that products acquired through parallel importation do not encounter undue regulatory delays.


3.7. Exceptions to patent infringement:
Article 30 of TRIPS allows countries to legislate limited exceptions to the exclusive rights conferred by a patent. This provision is to be read together with Article 8.1, which permits the adoption of measures necessary to protect public health and promote the public interest in sectors of vital importance to a country’s socio-economic and technological development. Countries may provide exceptions for regulatory purposes (such as medicines registration), as well as for broader research and education purposes [71] [72]. Brazil’s patent law provides for “acts carried out by unauthorised third parties for experimental purposes, in connection with scientific or technological studies or researches” [73]

Additionally, countries should adopt a broad educational use exception to patent rights [74]. Academics and researchers, tertiary institutions, and even secondary institutions must be able to train the next generation of inventors and scientists on research and product development methods and freely use patented products/ processes for the purpose of instruction. Precedents exist in Brazil, India, and Argentina [75].

Recommendations:
3.7.1. National patent laws should incorporate patent limitations and exceptions including for scientific research, educational use and regulatory purposes.

3.8. On TRIPS plus provisions:
Calls for TRIPS plus provisions (including data exclusivity; patent term extensions; patent linkage; patenting of medical methods; lowering the bar of patentability; and new forms of IP enforcement) should be rejected on the basis that they unreasonably and unjustifiably limit access to medicines [76].

Conclusion:
This submission is of the view that countries cannot rely on individual cases of litigation and competition law to ensure access to medicines. Instead there must be effective and undisputed utilisation of TRIPS flexibilities to improve access to medicines systemically. This will require the incorporation into national legislation the full range of TRIPS flexibilities including all recommendations above [77].

We note that developing countries are regularly subjected to outside pressure, whether multilaterally from WTO and WIPO or bilaterally from developed countries. The impetus for policy change over patent regimes thus typically comes from abroad, for example through trade agreements, investment agreements, or international initiatives to harmonise IP rules, rather than from domestic policy objectives. It is principally for this reason that a number of developing countries have failed to take advantage of TRIPS flexibilities. This leads to unnecessary and avoidable barriers to access to medicines.

Recommendations:
1. The UN should recommend that countries fully implement TRIPS flexibilities – and utilise these to promote access to healthcare;

2. The UN should provide assistance to countries to implement TRIPS flexibilities into national law and utilise provisions moving forward;

3. The UN should establish a UN Special 301 Report to keep track of bilateral and multilateral pressure against utilisation of TRIPS flexibilities, and of pressure to adopt TRIPS-plus measures. The report should contain a "Priority Watch List" outlining countries/institutions whose actions are deemed of concern. Third parties (including government/civil society) should be able to submit complaints to be addressed. Warnings should be issued to “Priority Watch List” countries/institutions.

Bibliography and References

1.<In response to evidence that strict intellectual property (IP) protection negatively impacts upon access to affordable medicines, the Doha Declaration re-affirmed the right of WTO members to protect public health through the full use of the safeguards outlined in TRIPS (TRIPS flexibilities).> Doha Declaration, 2001. Available here: http://www.who.int/medicines/areas/policy/doha_declaration/en/

2. <The Doha Declaration also extended the transition period for LDCs for implementation of the TRIPS obligations.>Doha Declaration, 2001. Available here: http://www.who.int/medicines/areas/policy/doha_declaration/en/ and Article 66.1 of the TRIPS agreement. Available here: https://www.wto.org/english/tratop_e/trips_e/art66_1_e.htm

3. Sonenklar, C (2011). "Chapter 6: Treatment for HIV and AIDS". AIDS. USA Today Health Reports: Diseases and Disorders. Minneapolis, MN: Twenty-First Century Books. pp. 90–101.ISBN 9780822585817.

4. NSP Review, June 2015. “Weak rand means South Africa pays more for ARVs in latest tender”. Available at: http://www.nspreview.org/2015/06/10/weak-rand-means-south-africa-pays-more-for-arvs-in-latest-tender/

6. a. <In 2002 TAC lodged a complaint with the Competition Commission regarding the excessive pricing of three antiretroviral medicines - AZT, lamivudine and nevirapine – in a case known as the Hazel Tau case. At the time the price of antiretroviral treatment was over R2 000 per person per month. In 2003 the Commission found evidence supporting Tau’s allegations and the matter was referred to the Competition Tribunal. As a result the companies settled and provided licenses for competitors to make cheaper generics to South Africa and other countries in Sub Saharan Africa.>TAC submission to Competition Commission, 2002. Available at: http://www.section27.org.za/wp-content/uploads/2010/10/TauvGSKevidenceAndLegalSubmissions.pdf

b. <In 2002 TAC approached the Competition Commission regarding the excessive pricing of antiretroviral efavirenzas well as MSD’s refusal to license efavirenz for the manufacture of fixed dose combinations that would simplify treatment, helping people to adhere better. This case was dropped in 2008, when four generic companies were licensed to produce it – this lead to an 80% drop in the cost of efavirenz.>TAC submission to Competition Commission, 2002. Available at: http://www.section27.org.za/wp-content/uploads/2010/10/TACvMSDstatementOfComplaint.pdf

c. <In 2009 the Competition Commission invited input from TAC when it considered a merger between GlaxoSmithKline and Aspen Pharmacare. TAC’s complaint identified that competition for the antiretroviral medicine abacavir would be impacted by the merger. Abacavir is commonly used in the treatment of infants and children with HIV. Based on the input of TAC the Competition Commission ruled that, as a condition of the merger, GSK was required to grant licenses for the generic production of abacavir. The price of abacavir halved in government’s 2011 ARV tender from the 2008 tender price.>
http://www.compcom.co.za/wp-content/uploads/2014/09/02-Sept-09-Competition-Commission-approves-pharma-merger-on-condition-that-Abacavir-is.pdf

6. NSP Review, June 2015. “Weak rand means South Africa pays more for ARVs in latest tender”. Available at: http://www.nspreview.org/2015/06/10/weak-rand-means-south-africa-pays-more-for-arvs-in-latest-tender/

7. WHO, September 2015. Guideline on when to start antiretroviral therapy and on pre-exposure prophylaxis for HIV
http://www.who.int/hiv/pub/guidelines/earlyrelease-arv/en/

8. HIV i-base, 2012. Available at: http://i-base.info/guides/3567

9. NSP Review, June 2015. “Weak rand means South Africa pays more for ARVs in latest tender”. Available at: http://www.nspreview.org/2015/06/10/weak-rand-means-south-africa-pays-more-for-arvs-in-latest-tender/

10. WHO, May 2015. Available at: http://www.who.int/mediacentre/news/releases/2015/new-essential-medicines-list/en/

11. t’Hoen, 2014. Access to Cancer Treatment. Available at: http://apps.who.int/medicinedocs/documents/s21758en/s21758en.pdf

12. Moja, Lorenzo, Ludovica Tagliabue, Sara Balduzzi, Elena Parmelli, VannaPistotti, Valentina Guarneri, and Roberto D’Amico. Trastuzumab Containing Regimens for Early Breast Cancer. In Cochrane Database of Systematic Reviews. John Wiley & Sons, Ltd, 1996. Available at: http://onlinelibrary.wiley.com/doi/10.1002/14651858.CD006243.pub2/abstract

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14. Fix the Patent Laws, February 2016. “Problematic patent laws block access to critical breast cancer medicine”. Available at: http://www.fixthepatentlaws.org/?p=1061

15. <While experts estimate that the production cost of sofosbuvir is USD68-136 (per person for 12 weeks), in HICs, sofosbuvir is sold USD1,000 per pill or USD84,000 per person for 12 weeks in the United States - where it is estimated that 5,367,834 persons are infected with HCV. As a comparison, the median household income in the country is USD51,017 per year, and while it is estimated that 48 million of Americans do not have any health insurance. In France, the cost of sofosbuvir is set at USD913 per pill (USD76,720 per person for 12 weeks).In MICs, Gilead plans to sell sofosbuvir for at least USD2,000 (for a 12-week course). In Egypt, at a minimum price of USD2,000, the cost of sofosbuvir alone for 100% of people with HCV would represent five times the country’s total 2011 public health expenditures. In Indonesia, it would be a little bit more than the total annual health budget in 2011. More generally, at the prices set by pharmaceutical companies, universal access would be practically unachievable, even in countries who have strongly committed to access to HCV care, such as Georgia, Thailand and Egypt.> Londeix, New Treatments for Hepatitis C Virus. March 2014. Available at: http://hepcoalition.org/IMG/pdf/web_daas_strategies_for_achieving_universal_access_en.pdf

16. Boseley, S. “Hepatitis C drug Sofosbuvir delayed by NHS due to high cost”.January 2015. Available at: http://www.theguardian.com/society/2015/jan/16/sofosbuvir-hepatitis-c-drug-nhs

17. <Research conducted by Dr Andrew Hill at the University of Liverpool suggests that sofosbuvir can be profitably produced for as little as $102 per 12-week course.>Hill, A et al. Minimum Costs for Producing Hepatitis C Direct-Acting Antivirals for Use in Large-Scale Treatment Access Programs in Developing Countries. Available at: http://cid.oxfordjournals.org/content/early/2014/02/13/cid.ciu012.full

18. <Patent oppositions have been filed in India, United States, Russian Federation, Brazil, Republic of Korea, Brazil and at the European Patent Office>. Patent Opposition Database. Available at: http://patentoppositions.org/en/drugs/51dfee9097961f0002000020

19. Treatment Action Group, February 2016. “TAG Welcomes Delamanid’s Inclusion in the Stop TB Partnership’s Global Drug Facility”. Available at: http://www.treatmentactiongroup.org/tb/press/2016/tag-welcomes-delamanid-inclusion-in-GDF

20. Test Me, Treat Me: A Drug-Resistant TB Manifesto. Available at: https://www.msfaccess.org/TBmanifesto/

21. T’Hoen E, Berger J, Calmy A & Moon S. Drivinga decade of change: HIV/AIDS, patents and access to medicines for all. Journal of the International AIDS Society 2011, 14:15

22. Ibid.

23. MSF. (2012). Q&A: Patents in India and the Novartis Case

24. <Furthermore, in comparison to global yearly medicine (and other medical tool) sales of US $856 billion in 2010 – the pharmaceutical industry only spent 7.9% of this on R&D efforts (Love, 2011). Expenditure by pharmaceutical companies on R&D pales in comparison to expenditure on marketing and profits. Pharmaceutical companies spend almost twice as much on marketing as they do on R&D (Gagnon, 2008) while simultaneously recouping massive profits. The pharmaceutical industry commonly takes home more in profit each year than it spends on R&D costs. From 1995 – 2002, the pharmaceutical industry was ranked the most profitable industry in the United States. In 2008 and 2009, the industry continued to feature amongst the country’s most profitable business sectors, claiming the third spot in both years (Fortune 500 Rankings). On top of this, even GlaxoSmithKline’s CEO Andrew Witty has publicly stated that the huge price tag of US$1 billion associated with pharmaceutical R&D is "one of the great myths of the industry" (Reuters). Based on the over generous claims made on R&D costs (as detailed below) we can assume that the 7.9% figure is in itself higher than the actual cost>. Rutter & Tomlinson, 2014. The Economic & Social Case of Patent Law Reform in South Africa. Available at:http://www.tac.org.za/sites/default/files/The%20Economic%20and%20Social%20Case%20for%20Patent%20Law%20Reform%20in%20South%20Africa.pdf

25. <The price per mg in South Africa is almost 20% more than in Japan (¥340.70 or R35 per 12mg tablet), where Otsuka holds a sales monopoly. Aripiprazole in South Africa is 35 times more expensive than the average price of a generic in India.> Fix the Patent Laws briefing, October 2014. Available at: http://www.fixthepatentlaws.org/wp-content/uploads/2014/10/Aripiprazole_Finale1_LD.pdf

26. <Only the original manufacturer of entecavir, BristolMyers Squibb (BMS), is registered to market its product in South Africa. Entecavir is not procured by the National Dept. Of Health, and because of the high price, is only available for public sector patients in special circumstances, following approval from a Pharmacy Committee. Medical aid schemes do not provide coverage for entecavir for cost reasons, and HBV patients who need it must purchase the brand name drug through the private sector, which costs R4,775 or R5,500 per month, depending upon the dosage. In India, by contrast, where generics are available through the private sector, the costs of treating a HBV patient with entecavir are much lower—the equivalent of around R400 or R650 per month for generic products, based on the dosage.>Fix the Patent Laws briefing, October 2014. Available at: http://www.fixthepatentlaws.org/wp-content/uploads/2014/10/Entecavir_Final1LD1.pdf

27. <There are no generic versions of sorafenib available in South Africa because the manufacturer, Bayer, holds multiple patents that give it a market monopoly. Sorafenib is a relatively new drug, and Bayer’s global patenting strategy has assisted the company in earning over €771 million (over R10.8 billion) on sales of sorafenib in 2013.>Fix the Patent Laws briefing, October 2014. Available at:http://www.fixthepatentlaws.org/wp-content/uploads/2014/10/Sorafenib-FINAL.pdf

28. <A generic version of a popular birth control pill has been blocked from entering the South African market for the past three years, due to a series of court cases concerning a patent on the original product. United States and European courts have both rejected the validity of the patent, which is held by multinational pharmaceutical company Bayer. A South African court, however, has upheld the patent, preventing marketing of a 30% cheaper product.>Fix the Patent Laws briefing, October 2014. Available at:http://www.fixthepatentlaws.org/wp-content/uploads/2014/10/YasminFinal_3.pdf

29. a. Maskus, 2000. Intellectual Property Rights in the Global Economy.

b. Qian, Y. (2007). Do Additional National Patent Laws Stimulate Domestic Innovation in an International Patenting Environment? Review of Economics and Statistics.

30. Odagiri H, Goto A, Sunami A & Nelson R. Intellectual Property Rights, Development and Catch-up. An International Comparative Study, Oxford Oxford University Press, (2011), pp. 451, ISBN:978-0-19-957475-9

31. <“Japan, Korea and Taiwan have absorbed substantial amounts of technological learning under weak IPR protection regimes during the early phases [of development]”.>Kumar, 2011. Intellectual Property Rights versus Competition Law. See http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2735771
.
32. <A number of academics have argued that, rather than adopting the same level of intellectual property protection upheld in developed countries, developing countries should adopt standards that are more in line with their development goals.> Ha-Joon Chang. (2002). Kicking away the ladder: Development Strategy in Historical Perspective

33. <The United States is perhaps the world’s most frequent user of compulsory licensing, including the government use of defence technologies, and judicially issued licenses to remedy anti-competitive practices in information technology and biotechnology, among other instances.>Love. J. (2012a). “Open Letter to Patent Office, on Its War Against the Global Poor”. Available at: http://www.huffingtonpost.com/james-love/open-letter-to-patent-off_b_1545232.html

34. Maloney C & Segal N. (2007). The Growth Potential of the Pharmaceuticals Sector in South Africa. Genesis Analytics 29 May 2007

35. Naude C & Luiz J. (2013). An Industry Analysis of Pharmaceutical Production in South Africa. s. Afr. J.Bus.Manage.2013,44 (1)

36. The Economic Times. (2013). India receives highest FDI worth $1 billion in Pharma in April-June. Published 1 Septemeber 2013. Available at: http://articles.economictimes.indiatimes.com/2013-09-01/news/41663407_1_pharmaceuticals-sector-highest-fdi-fdi-policy

37. <A recently published study that investigated the relationship between intellectual property protection and foreign direct investment in 103 countries between 1970 and 2009 found that strict intellectual property protection can actually negatively impact on growth associated with foreign investment. The study found that countries that are able to attract foreign investment, while simultaneously retaining ‘lax’ levels of intellectual property protection were able to achieve a higher growth rate The study found that countries that are able to attract foreign investment, while simultaneously retaining ‘lax’ levels of intellectual property protection were able to achieve a higher growth rate .>Kascheeva M. (2013). The role of foreign direct investment in the relation between intellectual property rights and growth. Oxford Economic Papers (2013), doi:10.1093/oep/gpt015

38. DTI. (2011). The South African Pharmaceutical Sector Profile for the Consideration of Designation of Pharmaceutical Products in Terms of the PPFFA. Final Version, 9 November 2011

39. <By volume, South Africa imports the majority of its medicines from India, and the majority of its active pharmaceutical ingredients from China. However, the top 5 countries from which South Africa imports medicines in terms of expenditure are, in order: Germany, the USA, France, India and the UK. These figures strongly suggest that the importation of branded medicines is a significant, if not the main, driver of the deficit.>

40. Section 25(9) of the South African Patents Act.

41. Sampat B, Kapczynski A & Chan P. (2012). South African Pharmaceutical Patenting: An Empirical Analysis. Presentation at TAC/MSF 23 October 2012 meeting. Available at http://www.fixthepatentlaws.org/?p=459

42. Briefing by TAC, MSF and RIC, ‘Why South Africa Should Examine Pharmaceutical Patents’ (January
2013) <http://www.msfaccess.org/sites/default/files/MSF_assets/Access/Docs/Access_Brief_SApharmapatents_ENG_2013_final.pdf> accessed September 15, 2013.

43.One recent example from Brazil is the breast and ovarian cancer drug, docetaxel; in 2006 the drug had its patent revoked after a review by ANVISA, and local production of an affordable generic alternative was allowed. Please see: Rede Brasileira pela Integração dos Povos (REBRIP) and Grupo De Trabalho Sobre Propriedade Intelectual (GTPI), ‘INDIVIDUAL COMPLAINT AGAINST BRAZILIAN STATE URGENT APPEAL’ <http://www.deolhonaspatentes.org.br/media/file/Urgent%20appeal%20against%20Brazil%20%20by%20GTPI%20%28with%20annexes%29.pdf>, page 4, accessed September 15, 2013

44. Vawda, Y, (2011). ‘Pharmaceutical Innovation, Incremental Patenting and Compulsory Licensing Country Case Study: South Africa; Research paper 41, South Centre.

45. Pouris A, Pouris A. Patents and economic development in South Africa: Managing intellectual property rights. S Afr J Sci. 2011;107(11/12), Art. #355, 10 pages. http://www.dx.doi.org/10.4102/sajs.v107i11/12.355

46. This idea is reinforced by TRIPS Article 7: “The protection and enforcement of intellectual property rights should contribute ... 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.” Available at https://www.wto.org/english/docs_e/legal_e/27-trips_03_e.htm

47. TRIPS does not set out what is meant by these three requirements. Instead, the footnote to Article 27.1 provides as follows:
“For the purposes of this Article, the terms ‘inventive step’ and ‘capable of industrial application may be deemed by a WTO member to be synonymous with the terms ‘non-obvious and ‘useful’ respectively.” Furthermore, in the context of Article 27.3 (a), new uses and methods of treatment should expressly be precluded from being granted patent protection; new forms of known substances should not be patentable to the extent that they fail to demonstrate the required degree of inventive step.

48. See Lionel Bently et al, “Exclusions from Patentability and Exceptions and Limitations to Patentees’ Rights”, WIPO Standing Committee on the Law of Patents, SCP/15/3 Annex I (2010), available at http://www.wipo.int/edocs/mdocs/scp/en/scp_15/scp_15_3-annex1.pdf.

49. Ever-greening is the practice of obtaining, in the case of pharmaceuticals, multiple patents on the same medicine for minor incremental changes, in order to extend monopoly protections and thus higher prices. Section 3(d) of the Patents Act, 1970 states that the following are not inventions for purposes of that Act: “the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.”

50. Civil Appeal Nos. 2706-2716 of 2013, available at http://www.indiankanoon.org/doc/165776436/

51. Civil Appellate Jurisdiction of the The Supreme Court of India, Novartis AG v Union of India & Others, Page 38 <http://judis.nic.in/supremecourt/imgs1.aspx?filename=40212>.

52. See Philippines IP Code § 26.2.

53. Argentina has adopted the Guidelines for Patentability Examination of Patent Applications for Chemical and Pharmaceutical Inventions. See Joint Resolution 118/2012, 546/2012 and 107/2012 (Ministry of Industry, Ministry of Health and National Industrial Property Institute), available athttp://www.moellerip.com/index.php?PN=news_detail&FX=1&DX=139&EX=1

54. See “Open Letter from Global Academics in Support of Proposal to Amend Brazil’s Patent Law to Take Advantage of TRIPS-Compliant Flexibilities”, available at http://infojustice.org/support-brazil

55. In 2003 MSF published ‘Patents Under the Spotlight’ with a view to increasing knowledge about the patent barriers for HIV medicines and included information on relevant patents covering formulations, combinations and new medical uses. This allowed a number of governments and PLHIV networks to search for local patents, leading to informed decisions about addressing the barriers to procuring affordable generic medicines from India. See: MSF Access Campaign. MSF Drug Patents under the Spotlight: Sharing practical knowledge about pharmaceutical patents, May 2003 Available from: http://apps.who.int/medicinedocs/pdf/s4913e/s4913e.pdf

56. Singapore offers complete specifications on all patents in a convenient, user-friendly “results formatter”. See: http://www.epatents.gov.sg/PE/

57. See s. 33(3) of the UK Patents Act 1977 which lists the following as able to be registered: assignment of a patent or application, mortgage or grant of a security of a patent or application, grant or assignment of a license, any direction of the court.

58. In India, a third party can file an opposition once the patent application has been published. Accessed September 15, 2013 at: http://www.patentoppositions.org/how_to_build_an_oppositionPatient groups in India have already filed a number of pre-grant oppositions against the granting of the patent applications on HIV drugs on certain technical grounds such as obviousness of the invention. These include several key HIV first and second-line drugs, such as heat-stable lopinavir/ritonavir tablet; tenofovir (TDF) and TDF-based fixed-dose atazanavir.

59. In Thailand, there is only a three-month window to file a pre-grant opposition, meaning that, even before patient groups have found the relevant patent application relating to a drug, the deadline for filing the opposition has usually expired. Accessed September 15, 2013 at: http://www.patentoppositions.org/how_to_build_an_opposition

60. In Argentina, for example, documents must be officially translated in order to file an opposition; this in itself can cost $10,000, making it prohibitively expensive for patient groups. Accessed September 15, 2013 at: http://www.patentoppositions.org/how_to_build_an_opposition

61. In October 2002, civil society won its first major battle in opposing a patent when Thailand struck down Bristol-Myers Squibb’s monopoly on the HIV drug didanosine, after a challenge led by the Thai AIDS Foundation. See:
http://patentoppositions.org/case_studies/500e9b8c7718ea0002000018

62. The footnote to Article 31 defines “other use” as “use other than that allowed under Article 30.”

63.A compulsory license issued by the state to itself, for public non-commercial use, is often referred to as a government-use license. In contrast to compulsory licenses, government-use licenses (as well as emergency and urgent need licenses) do not require prior notice or negotiation with the patent holder, though notification and payment of adequate compensation is required after-the-fact. Countries must clearly define government use as distinct from compulsory licensing in that it does not require prior efforts to obtain voluntary licenses from rights holders on commercially reasonable terms.

64. Beall. R, Kuhn. R (2012). Trends in Compulsory Licensing of Pharmaceuticals Since the Doha Declaration: A Database Analysis. PLoS Med 9(1): e1001154. doi:10.1371/journal.pmed.1001154 Available at: http://www.plosmedicine.org/article/info%3Adoi%2F10.1371%2Fjournal.pmed.1001154

65. Public Citizen. (2012). “Indonesia Licenses Patents for Seven HIV & Hepatitis B Medicines”.
Available at: http://www.citizen.org/PC-statement-on-compulsory-licensing-in-Indonesia

66. TRIPS Article 1 allows member countries the freedom to determine the appropriate method of implementing the provisions and hence to adopt a simpler procedure that does not act as a barrier to issuing compulsory licenses. National patent laws should set up a simple, expeditious administrative (rather than judicial) procedure for hearing applications for compulsory licenses, with opportunity for the patent holder to be heard. National patent laws should also clarify presumptive royalty rates and set time periods for negotiations. Finally, patent holders should not be entitled to stay the operation of a compulsory license should the right holder seek review of the issuance of a compulsory license.

67. Grounds should include where: medicine prices prohibit access, supply is inadequate to need, there is a need for multiple suppliers to avoid stock-outs and shortages, the patent holder has refused to grant a voluntary license on reasonable terms, the medicine is an “essential facility,” there is a need for a novel fixed dose combination medicine comprising ingredients patented by multiple right holders, and the medicine is not being adequately worked in a country. In addition to these specific grounds, there should be specific allowance of compulsory licenses to remedy anti-competitive behaviour (authorised by Article 31(k)) and a more general, “public interest” ground for compulsory licenses.

68. 100 Existing Kenyan legislation (Article 58.2 of the Kenyan Industrial Property Bill) has not been challenged to date by the WTO and allows for the parallel importation of international products, either branded or generic, including those manufactured under a compulsory license: “The rights under the patent shall not be enforceable against any person who imports or in any way deals in the patented product, or a product obtained by the patented process, once the said product has been lawfully placed on the market in any country with the consent of the owner, a licensee or any other authorised person”. For more information on parallel importation in Kenya please see: Munyi. P, Lewis-Lettington. R. (September 2004). “Willingness and Ability to Use TRIPs Flexibilities: Kenya case study” DFID Health Systems Research Centre, Issue Paper – Access to Medicines accessible at http://www.hlsp.org/LinkClick.aspx?fileticket=rB0enzg20-I%3d&tabid=1643

69. The Philippines’ wording of the provision allows for the importation into the country if they have been placed on the market anywhere in the world by “the patent owner, or by any party authorized to use the invention.”

70. In Clause 37 of Kenya’s Intellectual Property Regulations (2002) the international exhaustion regime outlined in the country’s IP Act specifically allows for the importation of “…articles that are imported from a country where the articles were legitimately put on the market”.

71. Such research may be carried out for the following activities: experimentation; scientific research; technological research, which may be done with the intent of advancing commercial or for-profit objectives; non-commercial purposes; registration purposes; activities with a commercial intent that, for example, may be aimed at improving on patented technology insofar as the activity can be classified as experimentation or technological research—this could for example require a compulsory license on a dependent patent to conduct research for follow-on innovations, or be based on independent innovation where a third party develops a new technology which does not infringe upon the patents on which the research was based.

72. Phoebe H Li ‘Rights and responsibilities in patents: a precautionary patent framework in WTO law’ European Intellectual Property Review 2013. See especially page 4-5; Carlos Correa ‘the international dimension of the research exception (January 2005) available from http://sippi.aaas.org/Pubs/Correa_International%20Exception.pdf

73. Article 43, Paragraph II, Law n. 9.279 of 14 May 1996, available at
http://www.jpo.go.jp/shiryou_e/s_sonota_e/fips_e/pdf/brazil/industrial_property_law.pdf

74. For suggested wording of educational use exceptions, see Section 1.b of: www.twnside.org.sg/title2/chapter6.doc

75. Christopher Garrison, Exceptions to Patent Rights in Developing Countries, ICTSD Issue Paper No. 17, p. 66 (2006) available at http://unctad.org/en/Docs/iteipc200612_en.pdf

76. TRIPS does not require data exclusivity or any of the following provisions: patent term extensions, new forms of IP enforcement measures such as detaining shipments suspected of non- criminal trademark infringement, the inclusion of investment provisions whereby foreign investors are able to challenge any action that led to the ‘expropriation’ of their investment in private arbitration proceedings. These provisions are widely acknowledged as TRIPS-plus provisions and would severely restrict access to medicines. As such, countries should reject the inclusion of such measures. At a Workshop on IP and Public Health held by the South African Department of Trade and Industry in Pretoria on 7/8 August 2013, representatives of the WTO and WIPO affirmed that Article 39.3 does not refer to data exclusivity.

77. <In 2012 TAC was admitted as amici curiae in a legal dispute between the brand name drug company Aventis Pharma and the generic company Cipla, over a claim of patent infringement on a drug that treats cancer called Docetaxel. TAC’s intervention aimed to establish as a principle something the Court had not considered before, and that is that Constitutional rights must be factored into the adjudication process when deciding patent infringements>
Available at: http://www.fixthepatentlaws.org/wp-content/uploads/2012/05/TAC-SCA-AVENTIS-CIPLA-HEADS-1.pdf