WTO TRIPS Council (October 2017): India asks EU, Malaysia to share details of their respective compulsory licenses

On Friday, 20 October 2017, India delivered the following intervention on compulsory licensing. India briefly recounted the experiences of Brazil, South Africa, and Thailand in using compulsory licensing to secure access to ARVs.

Madam Chair, during the 1980s and 1990s the antiretroviral medicines used to treat HIV/AIDS were priced beyond the reach of most people who needed them in developing countries. Countries like Brazil, Thailand, South Africa and others have used flexibilities under the TRIPS Agreement, including compulsory licenses to bring down the price by increasing the supply of generic ARV medicines for a fraction of the price of the patented equivalents. Indian generic companies, especially CIPLA played an important role by announcing in early 2001 that that triple therapy could be manufactured for less than a dollar a day from the price of standard triple therapy from $US 10,000 per patient/year. Indian generic companies made ARV medicines accessible to all those who needed the drugs but had previously not been able to afford them.

India provided a précis of compulsory licensing and government use provisions in the United States noting that

[t]he Bayh-Dole Act offers the federal government “march-in rights,” and 28 U.S.C. Section 1498 provides the U.S. government with broad ability to use inventions patented by others. Compulsory licenses have also been awarded as a remedy for antitrust violations and a court may decline to award an injunction in favor of a prevailing patent owner during infringement litigation, an outcome that some observers believe is akin to the grant of a compulsory license.

India reaffirmed the findings of the United Nations High-Level Panel Report on Access to Medicines in relation to compulsory licensing noting that many governments were wary of employing TRIPS flexibilities including compulsory licensing for fear of “undue political and economic pressure from states and corporations”. India stressed that “political and economic pressure placed on governments to forgo the use of TRIPS flexibilities violate[d] the integrity and legitimacy of the system of legal duties and rights created by the TRIPS agreement and as reaffirmed by the Doha Declaration.”

India concluded its remarks by requesting the European Union and Malaysia to provide details on the compulsory licenses issued by Germany and Malaysia.

The full text of the intervention is reproduced below.

Agenda Item 13: Intellectual Property and the Public Interest: Follow-up discussion on Compulsory Licensing

Madam Chair, I would like to support the statements made by South Africa and Brazil. During the last meeting of the Council for TRIPS, many Members, including India, shared their experiences on the use of Compulsory Licensing (CL). We have shared details of provisions in our national law regarding Compulsory Licensing, including the one compulsory license issued by India so far, i.e., in March 2012, Indian generic manufacturer NATCO Pharma was granted compulsory License to manufacture Bayer’s drug Sorafenib Tosylate (Nexavar) used for the treatment of Kidney and Liver cancer. Since the last meeting of the Council for TRIPS, Compulsory Licenses were issued by Germany and Malaysia. I would like to thank the delegations of South Africa and Brazil for providing details about the two CLs.

TRIPS Agreement attempts to strike an appropriate balance between the interests of rights holders and users. TRIPS Agreement also recognizes that the principles of IP protection are based on underlying public policy objectives. In furtherance of the objectives and principles of TRIPS enshrined in Articles 7 and 8, a number of safeguards or flexibilities have become an integral part of the TRIPS framework. These flexibilities have been clarified and enhanced by the 2001 Doha Declaration on TRIPS and Public Health that WTO members have the flexibility to interpret and implement the TRIPS provisions in a manner supportive of their right to protect public health.

Madam Chair, Article 31 provides members complete freedom to decide the grounds for issue of compulsory license. The Doha Declaration on the TRIPS Agreement and Public Health has also duly confirmed what was already implicit in the TRIPS Agreement – that WTO Members have the freedom to determine the grounds upon which compulsory licenses are granted.

Madam Chair, during the 1980s and 1990s the antiretroviral medicines used to treat HIV/AIDS were priced beyond the reach of most people who needed them in developing countries. Countries like Brazil, Thailand, South Africa and others have used flexibilities under the TRIPS Agreement, including compulsory licenses to bring down the price by increasing the supply of generic ARV medicines for a fraction of the price of the patented equivalents. Indian generic companies, especially CIPLA played an important role by announcing in early 2001 that that triple therapy could be manufactured for less than a dollar a day from the price of standard triple therapy from $US 10,000 per patient/year. Indian generic companies made ARV medicines accessible to all those who needed the drugs but had previously not been able to afford them.

Madam Chair, now, I would like to provide brief details of the Compulsory Licensing provisions in a developed Member, the United States. According to United States Congressional Research Service Article “Compulsory Licensing of Patented Inventions” dated 14 January 2014, the law in the United States permits for the issuance of compulsory licenses in a number of circumstances, and also allows for circumstances that are arguably akin to a compulsory license. The Atomic Energy Act, Clean Air Act, the Federal Insecticide, Fungicide and Rodenticide Act and Plant Variety Protection Act provide for compulsory licensing. Atomic Energy Act allows for compulsory license if the invention or discovery covered by the patent is of primary importance in the production and utilization of special nuclear material or atomic energy; Clean Air Act contains a similar provision relating to devices for reducing air pollution; and Plant Variety Protection act, Section 44-‘Public Interest in Wide Usage’ provides for compulsory licensing of seed-bearing plant that are protected by plant variety certificate, a patent-like instrument granted by Department of Agriculture. The Bayh-Dole Act offers the federal government “march-in rights,” and 28 U.S.C. Section 1498 provides the U.S. government with broad ability to use inventions patented by others. Compulsory licenses have also been awarded as a remedy for antitrust violations and a court may decline to award an injunction in favor of a prevailing patent owner during infringement litigation, an outcome that some observers believe is akin to the grant of a compulsory license.

September 2016 report of the UNSG’s High-Level Panel (HLP) states that many governments have not used the flexibilities available under the TRIPS Agreement, including compulsory licenses for various reasons, ranging from capacity constraints to undue political and economic pressure from states and corporations, both express and implied.

Madam Chair, political and economic pressure placed on governments to forgo the use of TRIPS flexibilities violates the integrity and legitimacy of the system of legal duties and rights created by the TRIPS agreement and as reaffirmed by the Doha Declaration.

I conclude by quoting the recommendations in the HLP report on Compulsory Licenses. “Governments should adopt and implement legislation that facilitates the issuance of compulsory licenses. Such legislation must be designed to effectuate quick, fair, predictable and implementable compulsory licenses for legitimate public health needs, and particularly with regards to essential medicines. The use of compulsory licensing must be based on the provisions found in the Doha Declaration and the grounds for the issuance of compulsory licenses left to the discretion of governments”.

I would request the delegations of European Union and Malaysia to provide details on the CL issued by Germany and Malaysia respectively. We look forward to listening from other delegations on their experiences on using this important TRIPS flexibility, compulsory licensing.

thiru