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Patents and the Pipeline: Is Access Under Threat?

September 2011

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Table of Contents


Introduction

Access to the pipeline, particularly in developing countries that are home to a disproportionate share of the global population of people with HIV, will by no means be guaranteed. Numerous barriers may stand in the way of timely access, including but not limited to slow drug registration processes, inefficient domestic procurement policies, and problematic supply chain management practices. But, as was the case with access to treatment in the developing world in the late 1990s and early 2000s,1 the single biggest barrier to access may indeed be the high prices of new drugs.

Central to the affordability of medicines is the existence of adequate generic competition. This, in turn, is dependent on a number of intellectual property-related factors, including the patent status of the drug in countries with significant generic pharmaceutical manufacturing capacity (in particular India), the patent status of the drug in the country in whose market generic competition is required, and/or the licensing policy of the relevant patent holder. Some detail on the licensing policies of companies with products in the pipeline is provided below. But before that, this section considers the global context that affects the nature of domestic patent laws.


Threats to Countries' Ability to Manufacture and Supply Affordable Drugs

Since amending its laws in 2005 to ensure compliance with the World Trade Organization (WTO) Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS),2 India has been subjected to numerous threats to its ability to manufacture and supply affordable generic finished products and active pharmaceutical ingredients (APIs). The rapidly changing nature of the Indian generics industry has been accompanied by the rising grant of product patents, with new products for the first time in decades not being subjected to generic competition; this includes many new-generation antiretroviral (ARV) medicines.

While India took great care in ensuring that its amended laws take advantage of a range of public health safeguards and flexibilities in TRIPS, something that many developing countries such as South Africa have thus far failed to do, the post-TRIPS era is one in which access has unquestionably been curtailed. Put differently, an international patent regime that does not require minimum levels of patent protection for all pharmaceutical products would mean more people having access. But instead of a move in this direction, "the policy space to produce or import generic versions of patented medicines [within the context of TRIPS] is shrinking in some developing countries." As 't Hoen et al. explain:

Stringent intellectual property provisions exceeding TRIPS requirements ("TRIPS-plus") have been negotiated into free trade agreements between industrialized and developing countries, and/or investment and WTO accession agreements. Measures, such as patent term extensions, data exclusivity, patentregistration linkage and border enforcement requirements, can all delay access to generics by lengthening, strengthening or broadening monopolies on medicines. In addition, some agreements contain measures that confuse legitimate generics with counterfeit medicines; such policies can undermine public health by restricting access to affordable, quality-assured generic medicines. Countries that enter into agreements that undermine access to medicines are arguably violating their international human rights obligations.3

In recent years and months, India has been under pressure from the European Union (EU) to conclude a free trade agreement (FTA) that, if adopted in the form proposed by the EU, would substantially undermine India's already-constrained ability to produce affordable medicines.4 At the June 2011 UN High-Level Meeting on HIV and AIDS, India formally announced that it will not accept data exclusivity -- a provision that has the potential to limit access to medicines, and that is not required by TRIPS -- as part of the FTA it is currently negotiating with the EU.

But other problematic provisions that threaten access remain on the EU's negotiating agenda.

According to Médecins Sans Frontières (MSF), "Europe is still pushing provisions on the enforcement of intellectual property that are of great concern for procurers and suppliers of medicines ... [that put them] at risk of litigation or court orders that prevent [them] from delivering medicines to patients". In addition, the EU is also proposing an investment chapter that "includes measures to protect the commercial interests of foreign companies investing in India ... [by giving them] the right to bypass Indian courts and sue the Indian government in secret international arbitration panels that do not balance public health against private profit."5


Licensing Policies

While the global context and resultant domestic patent laws are central to determining whether medicines are affordable, so too is the conduct of exclusive rights holders (whether patent holders or exclusive licensees) and their approach to licensing. One option available to companies is the Medicines Patent Pool,6 which was established in the late 2000s and is expected to work as follows:7

Patent holders will make licenses available through the Pool that will allow others to produce low-cost generic versions of patented ARVs for use in developing countries. It will be important that the licenses cover as many developing countries as possible, both to maximize public health benefit and to ensure economies of scale in generic drug production. The licenses are also intended to facilitate the development of FDCs and other formulations adapted for use in resource-poor settings, such as special formulations for treating children, by ensuring that patents do not block generic companies or product development initiatives from carrying out follow-on R&D.

Companies that receive licenses from the Pool will pay royalties on their sales to the patent holders. The Pool will be a systematic and predictable way of making voluntary licences available, offering legal certainty to all parties involved. No change in international or national law is required for the Pool to work; what is required is a change in mindset from the patent holders, without whose collaboration this initiative cannot succeed. In other words, the Patent Pool will work only if patent holders are willing to collaborate to make their intellectual property available to the Pool.

On 12 July 2011, the Medicines Patent Pool announced its first agreement with a pharmaceutical company - Gilead Sciences.8 Whilst the agreement will result in expanded access to the company's products, including those currently in the pipeline, numerous of its provisions have drawn criticism: for example, the agreement excludes a number of developing countries with high HIV burdens and places limits on API sourcing. Given the voluntary nature of the Pool, it is unsurprising that the agreement does not go far enough.

A second option is adopting access-friendly patent enforcement and/or licensing policies. In the next section we consider whether companies with key products in the pipeline have addressed this issue, and if so, how. These companies are:

  • Abbott Laboratories;
  • Boehringer Ingelheim (BI);
  • Bristol-Myers Squibb (BMS);
  • Gilead Sciences;
  • Merck & Co.;
  • ViiV Healthcare;
  • Tibotec; and
  • Tobira Therapeutics.


Abbott Laboratories

Abbott has consistently refused to license any company to produce generic versions of its fixed-dose combination lopinavir/ritonavir (LPV/r); it is, however, prepared not to enforce its patent on the soft-gel formulation of ritonavir (RTV) in South Africa.9 That said, there is currently no patent barrier to the production of generic LPV/r or RTV in India;10 importation from India depends solely on the patent status of the relevant product in the importing country and whether a compulsory licence for importation has been issued in that country (in the event that the relevant product is indeed under patent protection).


BI

According to its policy paper on HIV/AIDS, BI does not enforce its patents on nevirapine and tipranavir in the following countries: low-income countries as defined by the World Bank;11 least-developed countries (LDCs) as defined by the United Nations Development Programme;12 and all African countries that are not classified as low-income or LDCs.

This policy, which applies to immediate-release and extended-release versions of nevirapine, means that companies in eligible countries -- without the need for any legislative or administrative action -- may lawfully manufacture generic products. They may also export products to and/or import them from other eligible countries.

Of concern, however, is that the policy does not cover middle-income countries outside of sub-Saharan Africa, including those such as Brazil, China, India, and Thailand with significant generic pharmaceutical manufacturing capacity. This limits the ability of the eligible countries to import generic finished products and APIs, with manufacturers based in countries such as Kenya and South Africa being almost completely reliant on the importation of APIs.

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This article was provided by Treatment Action Group and HIV i-Base. It is a part of the publication 2011 Pipeline Report.
 
See Also
More on HIV Drug Patent Policies

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