Yesterday, the Cato Institute hosted a panel on the Investor-State dispute brought by Eli Lilly against Canada under Chapter 11 of the North American Free Trade Agreement. The panel featured Mark Schultz from the Southern Illinois University School of Law, Burcu Kilic from Public Citizen, and Christopher Sands from the Hudson Institute. The trade dispute surrounds a Canadian court case in which Eli Lilly’s patent for Strattera was found to be invalid because it did not met the Canadian utility standards. The company alleges that the utility standards applied by the court – which require the patent applicant to demonstrate ‘promised utility’ at the time of filing – amount to an “unlawful expropriation of Claimant’s investments.”
The panelists debated the Canadian utility standard. Schultz argued that it is inconsistent with international norms and unreasonably burdensome for firms (which would need to pay for human tests on drugs before they receive patent protection). Kilic argued that it was compliant with international agreements, including NAFTA, and that the promise doctrine is found in many other legal systems.
The panelists also discussed the use of Investor-State Arbitration to settle disputes. Investor-State Arbitration is one of the more controversial aspects of the Trans Pacific Partnership negotiations, a fact which has brought more attention to the Eli Lilly matter.
Here is the full event, from the Cato page on the event (CC-BY-NC-SA):
