On 20 October 2017, South Africa delivered the following statement on behalf of Brazil, China, India, and South Africa during the WTO TRIPS Council’s discussions on compulsory licensing. On 31 May 2017, these delegations (along with Fiji) submitted a proposal to the TRIPS Council on “Intellectual Property and the Public Interest” which would serve as an overarching theme for the Council to address issues including access to knowledge and access to medicines. The proponents of IP and the Public Interest proposed compulsory licensing as the sub-theme for the June 2017 and October 2017 TRIPS Council sessions.
South Africa noted that “even though the use of compulsory licenses is commonly referenced in respect health issues, compulsory licenses can also be used in a variety of other situations as well.”
South Africa, on behalf of the proponents recounted three recent developments in the field of compulsory licensing:
On June 6, 2017, Judge William Martin Conley, a United States District Judge of the Western District of Wisconsin, issued a compulsory license allowing Apple Computers to use a patent it had infringed, owned by the Wisconsin Alumni Research Foundation (WARF), in return for an ongoing royalty. This case follows a long line of cases that seem to suggest that court decisions in the United States have allegedly responded to instances of infringement of medical patents by denying injunctive relief, instead granting monetary damages, often in the form of royalty payments, what would in effect provide for compulsory licensing. Public interest is often at the heart of such decisions.
On July 11, 2017, the German Federal Supreme Court announced that it had affirmed the 2016 decision of the Federal Patent Court to issue a compulsory license allowing Merck to continue selling its HIV drug, Isentress. The Federal Court shared the assessment of the Federal Patent Court that a public interest in the granting of a compulsory license was credible.
On 20 September 2017, the Malaysian Department of Health announced that Cabinet had authorized a government use compulsory license in respect generics of the Hepatitis C medicine Sofosbuvir. The decision to initiate the Rights of Government was made after the MOH efforts to include the drug in the Medicine Patent Pool (MPP) and price negotiations with patent holder were unsuccessful.
South Africa’s statement is reproduced in full.
ITEM 13
Intellectual Property and the Public Interest: Continuation of the discussion on compulsory licenses.
Madam Chair,
This statement is read on behalf of Brazil, China, India and South Africa. Following the circulation of IP/C/W/630, the co-sponsors introduced “Intellectual Property and the Public Interest” as a topic for discussion. During the initial discussions, the co-sponsors emphasized that WTO members have the flexibility to design their national intellectual property (IP) systems within the minimum standards set by the TRIPS Agreement, in cognizance of a country’s economic, developmental and other objectives, including public health. The TRIPS Agreement clearly recognizes that the principles of IP protection are based on underlying public policy objectives. Article 8 of TRIPS Agreement entitled “Principles” states that WTO Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement.
Article 8 (2) further states that appropriate measures may be needed to prevent the abuse of IPRs by right holders, or to resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology. The Trilateral Study of the WHO, WIPO and the WTO (2013) point out that prices of medicines are a critical determinant of access to medicines, especially in countries where the public sector is weak and poor people purchase their treatment on the private market (2013:146). It posits that in some developing countries, up to 80 percent to 90 percent of medicines are purchased out-of-pocket, as opposed to being paid for by national health insurance schemes or private insurance schemes (ibid).
In the last session of the TRIPS Council, the co-sponsors invited delegations to share their experiences on the use of compulsory licenses for accessing health and other technologies. Some delegations indicated that the use of compulsory licenses can assist countries to uphold the delicate balance achieved in the TRIPS Agreement, and noted that even though the use of compulsory licenses is commonly referenced in respect health issues, compulsory licenses can also be used in a variety of other situations as well. Various delegations made reference to the entry into force of the Protocol Amending the TRIPS Agreement, while the United Nations Secretary General’s High-Level Panel Report on Access to Medicine was widely quoted.
One delegation expressed the view that a balanced system of intellectual property rights is one that takes account of legitimate interests of users and right holders and endorsed the idea of intellectual property as a fundamental right of every citizen. The right to health is a fundamental part of our human rights and our understanding of a life of dignity and as such the achievement of the highest attainable standard of health is the right of every human being, without distinction of race, religion, political belief, or economic or social condition. This is codified in the 1948 Universal Declaration of Human Rights. In the same vein, SDG Goal 3. Target 3.b relating to support for research and development of vaccines and medicines for the communicable and non-communicable diseases that primarily affect developing countries, promotes access to affordable essential medicines and vaccines, in accordance with the Doha Declaration on the TRIPS Agreement and Public Health, which affirms the right of developing countries to use to the full the provisions in the Agreement on Trade-Related Aspects of Intellectual Property Rights regarding flexibilities to protect public health, and, in particular, provide access to medicines for all.
A common theme that emerged from discussions was how governments use compulsory licenses to substantially reduce the price of essential medicines while striking a balance between the interest of right holders and users. It is however noteworthy that in specific areas, such as access to antiretroviral therapy, where substantial progress has been made, and where substantial price reductions for commonly used first-line ARVs have been achieved, prices for second-line regimes remain much higher (2013:150). The World Health Statistics point out that new health technologies, such as medicines, vaccines and diagnostics are becoming increasingly expensive (2017:19). As one of the co-sponsors pointed out, pubic interest in the achievement of inclusive public health goals call on the active participation of governments, pharmaceutical companies and patient associations alike. As a result, a balanced intellectual property system, through a combination of flexibilities, complementary policies and incentives, guarantee sustainable public health outcomes that harness innovation and promotes access to medicines and health technologies.
Given the continued interest that delegations have expressed in the topic of compulsory licenses, the co-sponsors have decided to continue an inclusive debate on compulsory licenses. Since the last TRIPS Council meeting, several noteworthy developments have occurred in this area.
On June 6, 2017, Judge William Martin Conley, a United States District Judge of the Western District of Wisconsin, issued a compulsory license allowing Apple Computers to use a patent it had infringed, owned by the Wisconsin Alumni Research Foundation (WARF), in return for an ongoing royally. This case follows a long line of cases that seem to suggest that court decisions in the United States have allegedly responded to instances of infringement of medical patents by denying injunctive relief, instead granting monetary damages, often in the form of royalty payments, what would in effect provide for compulsory licensing. Public interest is often at the heart of such decisions.
On July 11, 2017, the German Federal Supreme Court announced that it had affirmed the 2016 decision of the Federal Patent Court to issue a compulsory license allowing Merck to continue selling its HIV drug, Isentress. The Federal Court shared the assessment of the Federal Patent Court that a public interest in the granting of a compulsory license was credible.
On 20 September 2017, the Malaysian Department of Health announced that Cabinet had authorized a government use compulsory license in respect generics of the Hepatitis C medicine Sofosbuvir. The decision to initiate the Rights of Government was made after the MOH efforts to include the drug in the Medicine Patent Pool (MPP) and price negotiations with patent holder were unsuccessful.
On this basis, I would like to invite the co-sponsors and other delegations to intervene on the issues taken up in this statement or any other matter that may be raised in the context of compulsory licenses.