WTO and SDGs: Issues before the Nairobi Ministerial TPP, TRIPS and Access to Medicines November 2015 Reji K. Joseph Associate Professor Institute for Studies in Industrial Development

Patents in TPP Patentable subject matter: Patents [shall be] available for any invention, whether a product or process, in all fields of technology provided that the invention is new, involves an inventive step and is capable of industrial application (art ). Each Party confirms that patents are available for inventions claimed as at least one of the following: new uses of known product, new methods of using a known product or new processes of using a known product ( ). TPP allows evergreening. Implications for section 3(d).

Data exclusivity The undisclosed test or other data concerning the safety and efficacy of a new pharmaceutical product, submitted as a requirement of marketing approval shall not be allowed to rely on by third persons to obtain marketing approval for the same or similar product without the consent of the person who had submitted the data. Such data shall be protected at least for five years from the date of the marketing approval ( a). Such data cannot be relied upon by other Parties (as evidence of prior marketing approval in other countries) for the marketing approval of pharmaceutical products for at lest five years from the date of marketing approval ( b). Data exclusivity for biologics – eight years for new biologics and five years for new pharmaceutical products that is or contains a biologic ( ).

Data Exclusivity In addition, protection for at least three years of the test or other data submitted for the marketing approval of a product covering a new indication, new formulation or new method of administration ( a). Would affect the generic industries in the TPP countries. Very high cost for Indian pharma industry if India joins TPP. Exception for CL – A party may take measures to protect public health in accordance with Declaration on TRIPS and Public Health. It may appear that Indian pharma industry will not be affected, if India does not join TPP. That need not be the case. Border measures.

Border measures There are challenges for Indian pharma industry even if India does not join TPP. Each Party shall provide for applications to suspend the release of, or to detain, any suspected counterfeit or confusingly similar trademark or pirated copyright goods that are imported into the territory of the Party ( ). Clarifications have been provided for terms ‘counterfeit trademark goods and ‘pirated copyright goods’. The term ‘counterfeit’ is not clarified (Footnote 115). Lack of clarification for ‘counterfeit goods’ needs careful scrutiny. Concerns – expansion of meaning of counterfeit goods to include patent infringements. Confiscation of Indian generic drugs in European ports.

Border measures The right holder who initiates procedure to suspend release of suspected goods is required to provide adequate evidence that there is prima facie an infringement of the right holder's intellectual property right …( ). Generic drugs from India which have relied on marketing approvals in other countries (data exclusivity), could be vulnerable while in transit.

Patent linkage Linking the marketing approval of a pharmaceutical product that relies on evidence or information concerning the safety and efficacy of a product that was previously approved to the patent holder ( a). The patent holder is to be notified prior to the marketing of such products ( b). Implications: Goes beyond TRIPS. Delay in the introduction of generic drugs.

Patent term extension Each Party shall make available an adjustment of the patent term to compensate the patent owner for unreasonable curtailment of the effective patent term as a result of the marketing approval process ( ). Concern – What is the optimum period of protection? How long can the extension of patent term go on?

TPP definitely would have adverse implications for generic pharma industry and access to medicines. Damage would be more, if India joins TPP. But, the larger question is what impact does TPP have on TRIPS?

TPP Investment Chapter (Ch. 9) Definition of Investment: “every asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk. Forms that an investment may take include: (f) intellectual property rights Expropriation and compensation: No Party shall expropriate or nationalise a covered investment either directly or indirectly through measures equivalent to expropriation or nationalisation (expropriation), except … However, a limited exception has been granted to compulsory licenses under TRIPS Agreement.

Exceptions for CL in TPP ISDS Exceptions to the exercise of Cl has been made conditional to the extent that the issuance, revocation, limitation or creation is consistent with Chapter 18 (Intellectual Property) and the TRIPS Agreement (Art ) Foot note 19 - … the term “revocation” of IPRs includes the cancellation or nullification of those rights, and the term “limitation” of intellectual property rights includes exceptions to those rights. Which would be the forum to check the consistency of a measure? ISDS allows investors to use ISDS to interpret Ch. 18 of TPP and TRIPS Agreement.

Exceptions to IPRs and CL under Performance Requirements No party shall … impose or enforce any requirement, or enforce any commitment or undertaking (Art ): (f) To transfer a particular technology, a production process or other proprietary knowledge to a person in its territory (h) (i) to purchase, use or accord a preference to, in its territory, technology of the Party or of a person of the Party; (i) to adopt: (i) a given rate or amount of royalty under a license contract Above requirements will not apply if use of IPRs is in accordance with Art. 31 of TRIPS or if the disclosure of proprietary information falls within the scope of and is consistent with Art. 39 of TRIPS … The issue of a CL or marketing approval can be subject of dispute under ISDS. Which is the forum to check the consistency of a measure with TRIPS? WTODS or ISDS?

Forum Shifting TPP would have major impact on TRIPS. TPP would lead to a shift in the forum for redressal of disputed from WTO to ISDS. In WTO, only the member countries can initiate a dispute. Investors will have to depend on their states. But in ISDS, the investors can directly initiate a dispute against a country. Intellectual property rights being defined as an investment, any act of host government that have adverse implications for the ‘investors expectations’ or in some cases the normal procedural delays (e.g. time taken for issuing marketing approval) can be subject for ISDS.

Forum Shifting Recent incidents of forum shifting. Eli Lilly Vs. Canada – dispute over nullification of Eli Lilly’s patent (on Strattera) due to insufficient evidence. Eli Lilly demanded $100Mn. as compensation. In this case, an international arbitration tribunal has become the forum checking the validity of Canada’s patent law. CL in India on Bayer’s drug. Client alert by While & Case to pursue Bayer’s claim under India’s BIPAs. Carve outs for issues of concern for advanced countries - for disputes arising out of taxation and anti-tobacco regulations from ISDS (Ch.29).

Conclusion TPP on the one hand raises patent standards and on the other lead to a forum shifting in favour of ISDS which is boon for the pharma giants and doom for access to medicines and right to health. “If big pharmaceutical companies hold sway …the TPP could block cheaper generic drugs from the market. Big Pharma’s profits would rise, at the expense of the health of patients and the budgets of consumers and governments. … The efforts to raise drug prices [by restricting competition from generics and undermining government regulation of drug prices] in the TPP take us in the wrong direction. The whole world may come to pay a price in the form of worse health and unnecessary deaths” - Joseph Stiglitz in The New York Times ( ).