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The Rights and Wrongs of Intellectual Property.

The following article is an edited transcript of the Keynote Address of the International Conference on Compulsory Licensing: Innovation and Access for All, held in Bangkok, 21-23 November 2007. Dr Wilson is a Member of the Board of Directors of Médecins Sans Frontières (MSF) and was medical coordinator of the MSF in Thailand until August 2007.

 

I was amazed when the conference organizers asked me to give a talk on this particular topic to this particular audience, because actually I knew nothing about intellectual property before I came to Thailand. So everything I'm going to tell you, you've told me already, many times in the past, so thank you very much for that.

 

If we want to understand patents, we have to go back a bit in time and we have to think: why do patents exist? what are they meant to do? The first patents date from the 17th century in Europe. There are 2 main objectives of patents. They are meant to benefit the inventors by providing an incentive to innovation through the prospect of monopoly pricing. But patents are also meant to benefit the public. To do this, it is necessary to disclose the invention in a patent document. A patent is that it is to prevent trade secrets so as to benefit the public. In a patent, a public authority confers a temporary monopoly in exchange for disclosure of the invention.

 

Can anything be patentable? For a long time, countries considered that there were some things that should not be subject to patent, such as food and seeds. In the case of pharmaceuticals and, in some countries, agro-chemicals, many countries have only introduced patents very recently. In this part of the world, China did not introduce process patents until 1984 or product patents until 1992, and India only introduced product patents in 2005. So we see a wide difference in timing of the introduction of patents in different parts of world.

 

There is a common belief that patents are necessary to stimulate innovation. It is commonly said that there is something called the innovation cycle, which is the process of discovery, research, development and delivery. And one can start anywhere in this cycle. But basic research is often done in universities by academics with government funding. Then other people, and this is commonly where pharmaceutical companies come in, develop the basic product (as in the case of a pharmaceutical) so that it's possible for patients to take the drug and for the drug to work in practice. Then there's a process of market approval and manufacturing the drugs before they can be delivered to the patients. If some small problem is found, there's a demand for something new and better and that leads back to discovery. But I don't see the word patent in the innovation cycle and I don't see the word monopoly in it. So quite how the innovation cycle leads to the need for patents is difficult to see.

 

If we think about the cost of patents, monopoly leads to higher prices. If a patent is granted by the government for the public good, it is obvious that the patent grant comes with obligations to the patent-holder. If these obligations are not fulfilled, government should intervene.

 

So what are these obligations of the patent-holder? These were first described a long time ago and examples of the obligations can be found in the documents from a patent authority in Great Britain from nearly 400 years ago.

  1. The continuous production of the patented article in sufficient quantity.

  2. The maintenance of sufficient stock if the patented product on hand.

  3. The keeping of its quality up to prescribed standards.

  4. And the selling of the product at an easy and reasonable price with reference to a standard price.

 

If the patent-holder does not fulfil these obligations, then how should the government intervene? Compulsory licensing is one important way. The first mention of compulsory licensing anywhere was in the US in 1790, when the US passed its first patent bill, and there was a proposed amendment to patent law, made by the US Senate, to include the idea of a compulsory licence. At that time, the House refused the amendment. About a hundred years later in 1873, this was discussed again at a Patent Congress in Vienna. Many countries supported the idea of compulsory licensing, which was seen as a compromise between two groups, the pro-patent lobby and the free trade group. The free trade group considered that patents themselves were a threat to freedom. So compulsory licensing was a way to allow patents to proceed, but for there to be some checks and balance, some flexibilities in the system.

 

In 1883 the Paris Convention, where nearly 100 hundred nations discussed patent issues, decided to leave the matter of compulsory licensing for the individual member country to decide. 40 or so years later, that Paris Convention was revised and the principle of compulsory licensing was included. Most member countries revised their patent laws to include compulsory licensing.

 

So how does compulsory licensing relate to pharmaceuticals? Early in the 20th century it was of limited significance, because half of the member states of the Paris Convention excluded pharmaceutical products from patent protection; France and West Germany until the 1960s, Switzerland, Italy and Sweden until the 1970s, Spain until the 1990s.

 

So compulsory licensing wasn't really discussed very much early in the 20th century in many countries. When it was discussed, there was support for compulsory licensing from the pharmaceutical sector. For example, Lord Trent, chairman of Boots Pure Drug Company, a big UK pharmaceutical firm (and patents existed on pharmaceuticals in the UK), believed that the license to manufacture a pharmaceutical should be granted to any firm which has the competence to do so up to a satisfactory standard. He also proposed that if international agreements were introduced along those lines, that any competent firm could manufacture a drug, it would lead to a freer exchange of ideas, and wider availability of products, instead of unnecessary and uneconomic dependence by some parts of the world on others.

 

Canada did have patents on pharmaceutical products from early in the 20th century but it had special provisions for compulsory licensing in relation to food and medicines. For the first 40 years or so of these legal provisions, legislation required generic medicines to be produced locally within Canada. But at that time, the market in Canada was quite small and not really big enough for local production to be viable. So only 22 compulsory licences were issued because of the smallness of the market. But in 1969, the law was amended to allow importation of generics under compulsory licence, and in the next 23 years, 613 compulsory licences were issued in Canada. One result was that medicines in Canada were priced among the lowest anywhere in the developed world. And a report in 1983 found that growth of the pharmaceutical industry in Canada was more buoyant than it was in the US. This casts doubt on the need for patents and monopolies to encourage growth of the pharmaceutical sector.

 

In summary, most countries for most of the 20th century didn't have patents on pharmaceuticals and where they did there were many exceptions. We begin to see doubts about the common concept that monopoly is necessary as an incentive for innovation. In 1986, at the launch of the Uruguay Round of the General Agreement on Tariffs and Trade, the Intellectual Property Committee of GATT lobbied more strongly to include pharmaceuticals. One conclusion of the end of the Uruguay Round in 1995 was TRIPS, the WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights. This, among other things, made it necessary to have a minimum standard of protection for intellectual property rights, and in relation to pharmaceutical products, a 20-year patent. There was no differentiation in TRIPS between life-saving medicines and more trivial goods. All member countries of the WTO had a deadline of up to 2005 to implement TRIPS in full.

 

In 1996, intellectual property concerns were raised for the first time at the WHO Annual Assembly, where a resolution in 1996 stated this: ‘The Director-General of the WHO should report on the impact of the work of the Wold Trade Organization with respect to national drug policies and essential drugs and make recommendations for collaboration between the WTO and the WHO.'

 

In 1999, a stronger resolution said not just that the WHO D-G should report, but the WHO should provide support on patent issues and update the WHO's revised drug strategy to reflect concerns regarding new trade rules. Again in 1999, in Seattle, in the World Trade Organization's meeting, the issue of access to medicines came onto the agenda. The EC, for example, proposed that compulsory licensing for drugs should be standard for the drugs on the WHO's Essential Drugs list.

 

Eventually in 2001, the Doha round of international trade discussions produced the very important Doha Declaration on TRIPS and Public Health. "We affirm that the TRIPS Agreement can and should be interpreted and implemented in a manner supportive of WTO members' right to protect public health and, in particular, to promote access to medicines for all." This declaration marks a sea change in thinking about patents on medicines, or maybe I should say a reversion to the state that had existed for a few centuries before, up until the Uruguay round, when pharmaceuticals were generally exempt from patents. And it was followed by a whole series of activities that aimed to go back to this original formulation of intellectual property protection, in that it should be of benefit to society as a whole. It also gave backing to countries to use the flexibilities that were inherent in the TRIPS agreement.

 

Here are some examples of the use of these TRIPS or Doha flexibilities.

  • It has helped increase access to 1st line antiretroviral drugs which could still be produced as generics in countries such as India because they were invented before TRIPS.

  • There is also a paragraph in the Doha Declaration about non-enforcement of patents, and this is quite widespread now in Least Developed Countries, and actively encouraged by UNICEF and IDA. Often these drugs are bought with Global Fund financing.

  • Compulsory Licensing is being applied by Thailand and Brazil to increase access to 2nd line antiretroviral drugs, and in the case of Thailand for cardiovascular disease.

 

Apart from the technical or governmental aspects of the implications of the Doha Declaration, there's been a big change in civil society action with respect to intellectual property. In many countries there are legal opportunities for civil society to challenge patents.

 

An example of this change in the participation by civil society in intellectual property issues occurred in August 1998, when quite a small group of people with HIV demonstrated outside the US Embassy in Bangkok. And this happened at the suggestion of the Thai Consumers Foundation, because an amendment to the Thai patent law was being debated.

 

Another hot issue at the time amongst people with HIV in Thailand was the price of ddI, Didanosine, an antiretroviral drug. Why was it so expensive? There was no answer at the time. But people with HIV and NGOs such as AIDS Access Foundation and MSF spent time learning more about this issue, with the result that in the next year, when the Thai Government Pharmaceutical Organization asked the Thai government to issue a compulsory licence on ddI, people with HIV understood enough about the issue to demonstrate publicly to support the GPO request. And I would say all those hundred people with HIV that took part in the demonstration, understood clearly why they were doing it and what the implications were. That was a major change from the situation of a few years before. The Thai government at that time did not issue a compulsory licence. So three people with HIV together with the AIDS Access Foundation challenged the patent held by Bristol Myers Squibb on ddI in the intellectual property court in Thailand. This court asserted that the primacy of human life was what mattered in trade agreements, and this was recognized internationally at Doha where it was insisted that TRIPS be implemented so as to promote the rights of members to protect public health. This is quite a piece of history because it was the first time that the Doha Declaration was quoted in a legal case.

 

Before this case, the activities of people with HIV in Thailand were geared to income generation, moral support, sharing information about alternative medicines, massage, and meditation. But this particular ddI case led to an increased profile of people with HIV within civil society's support for access to treatment. It also led to increased political challenges facing people with HIV and to the recognition by leaders of people with HIV that community engagement is a crucial way to empower yourself.

 

On the other hand, this was one drug in one country and it was a lot of work by a lot of people. There is still a place for changing the system, changing the legal context, because working one drug at a time, one country at a time, you get somewhere but quite slowly.

 

Following Doha there has been a backlash by the pharmaceutical industry and from some western governments, with the pursuit of increasingly high levels of intellectual property protection that were never even envisaged in TRIPS. Because of this TRIPS-plus approach, there have been studies to try and go back to look at the evidence as to whether intellectual property really does encourage increased innovation, increased research and development and certainly whether or not it leads to accessibility of the new products.

 

In 2003, international NGOs organized a meeting to look at a global framework supporting research in health issues in areas where the market and existing policy had failed. Partly because of lobbying by NGOs, there was a further WHO resolution in May 2003 to establish a Commission on Intellectual Property, Innovation and Public Health. This led to further strengthening of the World Health Organization's mandate to promote policies that increase the availability of generic medicines.

 

As a result of this Commission's mandate by World Health Assembly, there was a wide variety of views, evidence-based conclusions and recommendations. And for the first time an A was added to the three Ds of the innovation cycle. We need access to innovation, otherwise it's meaningless. Another conclusion of the CIPIH report was that patents are actually ineffective in boosting research and development on the diseases of the poor. The main conclusion of this report is that innovation should be driven not by market monopoly but by health needs, because as long as research and development depends on patent monopolies for financing, the core of the problem will not be solved.

 

So in fact, that's why we're all here. How can we move away from this situation of patent monopolies as the main mode of financing innovation? It's a well-known fact that competition, not monopoly, is what is needed to ensure access to anything. The problem is that if most medicines are patentable almost anywhere, then competition will depend on the success of a drug by drug, country by country approach to patent grant opposition, compulsory licensing, voluntary licensing, or some way of managing the intellectual property situation. But in a drug by drug, country by country approach, progress is very slow. If we want a different way forward we have to divorce the price of a drug from the research and development.

 

The WHO seems to have taken this on board and established the Intergovernmental Working Group on Public Health, Innovation and Intellectual Property (IGWG) in 2006. Earlier this year at the World Health Assembly a resolution was taken to encourage the development of health-needs driven research and development. This addresses the linkage between the cost of research and development and the price of medicines and the best mix of incentives to a particular condition or product, with the objective of addressing diseases that disproportionately affect developing countries.

 

The 2nd round of IGWG talks was completed a couple of weeks ago, out of which will come a revised text of the global strategy and plan of action. At some points in this new text is discussion around the issue of finding new financing mechanisms to pay for research and development. Also the WHO has a mandate to take the lead in identifying R&D gaps, but with priorities to be set so as to address public health needs.

 

Some of the outstanding issues on which advocacy is needed are:

  • Should this strategy and global plan of action be restricted to some types of disease or should it cover any disease affecting poorer countries?

  • There is also the issue of technology transfer, which has not really been addressed yet.

  • How can we make the policy role or leadership role of the WHO actually happen in practice, in ensuring access to medicines?

  • Perhaps most challenging of all is finding ways to make it happen. There is discussion around the issue of paying for innovation and moving away from price monopolies, but how is it going to happen? In other words, how can we encourage innovation and access for all?

 

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