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El-Said, Mohammed K. (2016). American University International Law Review: Vol. 31: Iss. 3, Article 2. Available at: http://digitalcommons.wcl.american.edu/auilr/vol31/iss3/2 Excerpt follows.
Introduction: The debate surrounding the creation of a balanced patent protection regime in countries is not new. For decades, policy makers experimented with the levels of protection.[3] For example, the Netherlands abolished patents in the field of chemistry for decades between 1869 and 1910, in order to catch up with other European countries such as Germany.[4] Similarly, between 1960 and 1980 a number of Asian economies—often referred to as the Tiger economies—adopted a systematic national policy of reverse engineering and imitation.[5] When South Korea introduced patent protection in 1961, the protection term was limited to only twelve years and protection did not extend to foodstuffs, pharmaceuticals, or chemicals.[6] Similarly, many of the developed nations adopted a relaxed protection regime during their initial stages of development, utilizing their preferred intellectual property regime only after reaching a certain level of advancement.[7]
This debate remains as relevant as ever.[8] A 2013 report published in Australia sums up the dilemma facing many governments in the area of public health, noting:
Thus the question of how much patent protection to offer is crucial. Pharmaceutical patent rights that run for too long or that are defined too expansively will deprive people of drugs because purchasers, including Governments, cannot afford them. They can also constrain follow on innovation: too weak a patent system means patients will suffer because the industry has inadequate incentives to develop new drugs.[9]
On March 31, 2015, the Harper Report, triggered by major concerns about the current regime, requested that the Australian government should direct the Productivity Commission to conduct a twelve-month overarching review of the intellectual property regime in the country.[10]
Many factors affect the intellectual property regime in any country.[11] This also means that the responsiveness of intellectual property protection itself to any reform will vary depending on these factors. Therefore, it is baseless to advocate that stronger economic growth in any given country would be triggered by strengthened intellectual property protection.[12] The World Bank, in a 2005 report, concluded that “[e]vidence is inconclusive about the responsiveness of Foreign Direct Investment (“FDI”) to intellectual property regimes.”[13]
Home grown factors, including a country’s level of development and progress, its national priorities, and standards of living are often important factors in shaping the debate. Yet in more recent times, external factors became more visible—and even more influential to that effect—in the formation of such a process. Following the creation of the World Trade Organisation (“WTO”) and its Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPS Agreement”) in 1994, an upward trend in the regulation and enforcement of intellectual property rights in general was noticeable.[14] More recently, TRIPS-Plus rules were included under various bilateral, regional, and multilateral arrangements and forums resulting in strengthened levels of intellectual property protection and enforcement in many parts of the world.[15]
More crucial than any other branch of intellectual property in today’s global debate is the issue of patent protection and its relation to the accessibility and affordability of medicines. The TRIPS Agreement made it obligatory for the first time in history for all member states to provide patent protection for pharmaceutical products and processes.[16] This meant that many developing—and developed—countries are no longer capable of making drugs cheaper and affordable for their citizens, due to the need to pay royalties to the pharmaceutical producers originating from the developed countries.[17] With the support of the major pharmaceutical producers, these developed countries incorporated the protection of intellectual property in their international trade agenda under the auspices of free trade, resulting in, and subjecting developing countries into accepting, higher TRIPS-Plus levels of intellectual property protection under their national legal regimes.[18]
Significantly, many countries—including developed ones—are no longer able to cater and provide adequate public health care coverage for their citizens due to the high costs of medicines. The situation is worsened due to various austerity measures taken by many of these countries.[19]
In the light of the above, this article will provide an overview of the current global debate with relation to public health and access to medicines and its relationship with patent policy. It will also touch upon the flexibilities of the TRIPS Agreement and provide various utilization examples where such flexibilities have resulted in a positive impact on access to medicines and public health in both developed and developing countries. Although there has been extensive discussion in recent years focusing on the importance of incorporating the TRIPS Agreement’s flexibilities under national law, there has been little discussion about the options available to those countries that have already committed themselves to TRIPS-Plus obligations. Taking this into consideration, this article will provide an overview of various examples whereby countries managed to limit the negative impact of TRIPS-Plus rules under their national legal regime through legal and institutional innovative approaches. Finally, this article will also allude to the global debate related to financing of public health care and will explore the viability of one supplementary scheme which could complement the patent protection regime in this regard, namely pay-for-performance schemes.
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3. On the history of the weak regime for intellectual property protection in
the United States, see Jerome H. Reichman, Intellectual Property in the Twenty-
First Century: Will the Developing Countries Lead or Follow?, 46 HOUS. L. REV.
1115, 1116-18, 1120 (2009).
4. ADAM B. JAFFE & JOSH LERNER, INNOVATION AND ITS DISCONTENTS:
HOW OUR BROKEN PATENT SYSTEM IS ENDANGERING INNOVATION AND
PROGRESS, AND WHAT TO DO ABOUT IT 86-90 (2004).
5. See COMM’N ON INTELLECTUAL PROP. RIGHTS, INTEGRATING
INTELLECTUAL PROPERTY RIGHTS AND DEVELOPMENT POLICY 20 (2002) (finding
that East Asian countries, Taiwan and South Korea in particular, imposed weak
patent systems to expand technical knowledge and foster rapid economic
development).
6. See id. at 19-20 (conveying the prevalent belief at the time that states had
to restrict patents on “essential goods” such as food, medicine, and basic
chemicals; the Agreement on Trade-Related Aspects of Intellectual Property
prohibits such discriminatory policies today).
7. See CTR. FOR STRATEGIC STUDIES & DEBATES, BRAZIL’S PATENT REFORM
INNOVATION TOWARDS NATIONAL COMPETITIVENESS 224, 225 (2013) (citing Ha-
Joon Chang who implied that many developed countries mistakenly believe that
stronger intellectual property protection led to their economic growth).
8. There has been a number of reports in recent years of this type including a
report by the Government of the United Kingdom. See COMM’N ON INTELLECTUAL
PROP. RIGHTS, supra note 5, at 155 (weighing arguments for and against stronger
intellectual property rights and deciding that intellectual property rights should be
customized to meet the economic and social needs of the developing country in
question); see also GOWERS REVIEW OF INTELLECTUAL PROPERTY 59 (2006)
(finding that flexibility to choose the strength of intellectual rights is necessary for
developing countries).
9. TONY HARRIS ET AL., PHARMACEUTICAL PATENTS REVIEW REPORT v
(2013).
10. IAN HARPER ET AL., COMPETITION POLICY REVIEW FINAL REPORT 41
(2015); cf. GOWERS REVIEW OF INTELLECTUAL PROPERTY, supra note 8, at 1
(stating that the United Kingdom commissioned a similar report examining
whether its intellectual property regime was meeting its “purpose in an era of
globalisation, digitisation, and increasing economic specialisation”).
11. See Carlos Correa, Designing Patent Policies Suited to Developing
Countries Needs, 10 ECONÔMICA, RIO DE JANEIRO 82, 87 (2008) (discussing,
among other things, growing limitations on a developing country’s ability to shape
their patent system because of TRIPS-Plus provisions in Free Trade Agreements
such as expanding patents to protect “the second indication of existing
medicines”).
12. See generally Fritz Malchup & Edith Penrose, The Patent Controversy in
the Nineteenth Century, 10 J. ECON. HIST. 1 (1950) (presenting how the nineteenth
century arguments for and against patent protections remained unchanged despite
economic changes during that time period).
13. WORLD BANK, GLOBAL ECONOMIC PROSPECTS: TRADE, REGIONALISM,
AND DEVELOPMENT 110 (2005).
14. See Ruth L. Okediji, Legal Innovation in International Intellectual
Property Relations: Revisiting Twenty-One Years of the TRIPS Agreement, 36 U.
PA. J. INT’L L. 191, 205 (2014) (“Certainly, the TRIPS Agreement has not
produced the normative stability many imagined, desired or feared.”).
15. Wadhwa recently explained the developments and change of approach in
following manner:
The framers of the U.S. Constitution were not wrong. Patents did serve an important
purpose during the days when technology advances happened over decades or
centuries. In today’s era of exponentially advancing technologies, however, patents
have become the greatest inhibitor to innovation and are holding the United States
back. The only way of staying ahead is to out-innovate a competitor; speed to market
and constant reinvention are critical. Patents do the reverse; they create disincentives
to innovate and slow down innovators by allowing technology laggards and
extortionists to sue them.
Vivek Wadhwa, Here’s Why Patents are Innovation’s Worst Enemy, WASH. POST
(Mar. 11, 2015), https://www.washingtonpost.com/news/innovations/wp/2015/
03/11/heres-why-patents-are-innovations-worst-enemy/.
16. Essential Medicines and Health Products, WTO and the TRIPS Agreement,
WORLD HEALTH ORG., http://www.who.int/medicines/areas/policy/wto_trips/en/#
(last visited Jan. 26, 2016).
17. See John H. Barton, TRIPS and the Global Pharmaceutical Market, 23
HEALTH AFF., May-June 2004, at 146, 146-48 (noting that India possessed an
established industry in generic drugs that became threatened by the patent
provisions in the TRIPS Agreement).
18. See CAROLYN DEERE, THE IMPLEMENTATION GAME: THE TRIPS
AGREEMENT AND THE GLOBAL POLITICS OF INTELLECTUAL PROPERTY REFORM IN
DEVELOPING COUNTRIES 13 (2008) (“Over a third of the WTO’s 106 developing
country members included a broad range of TRIPS-plus provisions in their laws.
Over half of the countries in this TRIPS-plus group were [least developed
countries]—the same countries that the economic literature anticipates would
adopt the lowest levels of IP protection.”); Courtenay Atwell, Corporate
Involvement in Intellectual Property Policy-making, 36 EUR. INTELL. PROP. REV.
306, 308 (2014) (examining the history of corporate involvement in intellectual
property protections in the United States in the years leading up to the TRIPS
Agreement).
19. See, e.g., Helena Smith et al., Greek Economy Close to Collapse as Food
and Medicine Run Short, GUARDIAN (July 3, 2015),
http://www.theguardian.com/world/2015/jul/03/greece-economy-collapse-closefood-
medicine-shortage.
