3. The International Patents Regime under the TRIPS Agreement 14
3.3. The Flexibilities: 20
3.3.3. Compulsory licensing 25
expression “other use”, Article 31 aims to extend the scope and freedom of the WTO members to grant compulsory licences, avoiding restricting them only to certain specific situations. The TRIPS Agreement, however, establishes a detailed list of substantive and procedural conditions that are the minimum standard that the WTO members are bound to put in practice in their national legislations. Article 31, while stating that the applications for compulsory licensing need to be evaluated on a case-by-case basis, affirms that applicants must firstly engage in private negotiations with the patent holder in order to obtain a voluntary licence. This condition may be waived in case of national emergency or other circumstances of extreme urgency, such as social and public health threats like epidemics, wars, famines etc., and public non-commercial use, for instance when a governmental institution seeks to achieve the goals of a national health policy by using the patented medicines.90 The TRIPS Agreement especially refers to another two grounds upon which compulsory licences may be granted: anti-competitive practices and dependent patents.
While the former enables competent authorities to issue compulsory licences in order to “correct anti-competitive practices” which include disproportionate pricing and other violation of patent rights;91 the latter ground refers to cases where a compulsory licence is authorised “to permit the exploitation of a patent (‘the second patent’) which cannot be exploited without infringing another patent (‘the first patent’)”, provided that the second patent involves an “important technical advance of considerable economic significance”.92
Furthermore, the use “of the subject matter of a patent without the authorization of the patent holder […] shall be non-exclusive” (Article 31 (d)), “non-assignable […]” (Article 31 (e)) and importantly “shall be authorised predominantly for the supply of the domestic market of the Member authorising such use” (Article 31 (f)).
Regarding the condition set by Article 31 (f), a group of developing countries of WTO members expressed its concerns and requested a clarification from the TRIPS Council regarding the relation between IPRs and access to medicines, in particular as to the inability of countries lacking manufacturing capacity to utilise compulsory licensing under Article 31 of the TRIPS
90 See C. Correa, “Patent Rights” (2008) 235 in C. Correa & A. Yusuf Intellectual Property and International Trade:
The TRIPS Agreement, Kluwer Law International, 2ed.
91 Article 31 (k) of the TRIPS Agreement.
92 Article 31 (l) of the TRIPS Agreement.
Agreement.93
The consequent Declaration which was adopted in November 2001 in Doha, Qatar, clarified that
“the TRIPS Agreement should be interpreted and implemented in a manner supportive of the WTO Members’ right to protect public health and, in particular, to promote access to medicines”
(Paragraph 4).94 The Declaration aimed at finding a balance between IPRs and human rights, particularly by inviting the WTO members to adopt the necessary measures to protect public health.
Most importantly, Paragraph 6 of the Doha Declaration requested that the TRIPS Council find an expeditious solution to the problem regarding WTO members without manufacturing capacity and to report it to the General Council before 2002. The 30th of August 2003 WTO Decision95 set out a temporary waiver of Article 31(f) in order to allow countries lacking manufacturing pharmaceutical capacities to import pharmaceutical products from other WTO exporting members.
This waiver was made permanent only on 6 December 2005, when WTO members agreed to permanently amend Article 31 (f) of the TRIPS Agreement.96
One of the direct effects of the Doha Declaration was the increase in use of the compulsory licensing mechanisms, by developing countries, mainly for the benefit of their domestic market.
Such a tendency revealed the growing intention of developing countries to make available in their national legislation the flexibilities provided in the TRIPS Agreement.97 Despite the admirable trend, only one compulsory licence has been issued using Paragraph 6 of the Doha Declaration, when Canada notified the TRIPS Council of the granting of a compulsory licence allowing the
93 The paper was submitted to the TRIPS Council by the Africa Group, Barbados, Bolivia, Brazil, Dominican Republic, Ecuador, Honduras, India, Indonesia, Jamaica, Pakistan, Paraguay, Philippines, Peru, Sri Lanka, Thailand and Venezuela on the 19th of June 2001. The full text is available online at:
http://www.wto.org/english/tratop_e/trips_e/paper_develop_w296_e.htm, accessed in January 2015.
94 See Declaration on the TRIPS Agreement and Public Health, 20 November 2001, Doha WTO Ministerial Declaration 2001, (note above).
95 See Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and public health, Decision of the WTO General Council of 30 August 2003, (note above).
96 See WTO General Council, Amendment of The Trips Agreement, December 2005 (note above).
97 The Ministers of Health of the Member States of the African Union declared in the Gaborone Declaration, October 2005, to make use of the Declaration on the TRIPS Agreement and Public Health, 20 November 2001, Doha WTO Ministerial Declaration 2001, (note above) “to pursue […] the local production of generic medicines on the continent and to making full use of the flexibilities in the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs) […]”. African Union, Gaborone Declaration on a roadmap towards universal access to prevention, treatment and care, 2nd Ordinary Session of the Conference of African Ministers of Health (CAMH2) 10 – 14 October 2005.
The full text of the Gaborone Declaration is available online at:
www.chr.up.ac.za/undp/regional/docs/audeclaration7.pdf, accessed in January 2015.
generic pharmaceutical company, Apotex, to manufacture and export seven million antiretroviral drugs of TriAvir to Rwanda.98 Regrettably, the whole process of using the compulsory licensing through Paragraph 6 of the Doha Declaration was found “laborious and convoluted”, as declared by the vice president of Apotex’s regulatory and medical affairs, Bruce Clark, “it is almost a waste for us to go through the process”, revealing that Apotex will not use the programme again except if less complex mechanisms were to be implemented.99
The scarce use of this international policy tool, in addition to the complexity of the mechanism, possibly found another cause in the increasing negotiations of bilateral free trade agreements (FTAs), used particularly between the United States, to some extent Europe, and developing countries. In particular, some of these FTAs require a TRIPS-plus protection for pharmaceutical products, which in some instances exceeds the threshold of protection required within the USA itself.100 Notably, the flexibilities available in the TRIPS Agreement have been limited in certain cases by bilateral FTAs, which unavoidably restrict the conditions for using compulsory licensing, for instance the US-Singapore FTA expressly imposes restrictions to Singapore to grant compulsory licences.101 As a result, efforts carried out by developing countries for implementing the TRIPS flexibilities are often discouraged by developed countries, which drive the former to shape their patent laws in the image of developed countries’ domestic patent systems.102 In the described context, the facilitation of access to medicines and public health protection is not adequately addressed; therefore, “countries that are still in the process of negotiation of FTAs
98 See Medical News Today, GSK Gives Consent to Canadian Drug Company to Manufacture Generic Antiretroviral for Rwanda, (12 August 2007) available online at: http://www.medicalnewstoday.com/releases/79432.php, accessed in January 2015. On the same topic, see R. Amollo (note 18 above) 1; and also G. Tsai, “Canada’s Access to Medicines Regime: Lessons for Compulsory Licensing Schemes Under the WTO Doha Declaration” (2009) 50(1) Virginia Journal of International Law 1063-4.
99 See Kaiser Daily HIV/AIDS Report Complexity of Canadian Law Hindering Shipments of Generic Antiretrovirals to Developing Countries, Company Says (24 September 2008), available at http://www.kaisernetwork.org/daily_reports/rep_index.cfm?hint=1&DR_ID=54620, accessed in January 2015.
100 C. Correa, “TRIPS flexibility and access to medicine, the case of new ARV medicines” in Prince Mahidol Award Conference Improving Access to Essential Health Technologies: Focusing on Neglected Diseases, Reaching Neglected Populations (2007) 165.
101 D. K. Nanto, The U. S. Singapore Free Trade Agreement, M. F. Casanova Editor, New York, Nova Science Pub Inc (October 2005) 29.
102 T. Manu, “Essential medicines and the complexity of implementing nationally based compulsory licensing: on the need for a regional system of compulsory licensing in sub-Saharan Africa” in European Intellectual Property Review (2014) 14.
should carefully consider the public health implications of such agreements”.103