Latest news from WTO: amendment on TRIPS patent compulsory licensing finally entered into force

by Giancarlo Moretti

On Monday 23 January, after more than a 11-year waiting, the amendment on the current regime on patent compulsory licensing eventually entered into force. The protocol amending the Agreement has required the acceptance of two third of WTO member countries before taking effect. As remarked by the official statement, this process has been boosted during the last two years, with the deposit of instruments of acceptance by 37% of the members. The contracting parties that have not accepted the amendment yet are still bound to the waiver decided in 2003.

As for the substance, new Article 31bis allows now compulsory licenses for pharmaceutical products to be exported to countries with insufficient or no manufacturing capacity. This provision derogates the requirement of Article 31(f) of the TRIPS Agreement[1], according to which the issuing of a compulsory licensing ‘shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use’.

The discussion about Article 31 (f) and the connected limitation for developing and least-developed countries emerged during the Doha Round. The ‘Declaration on the TRIPS agreement and public health’ recognised the difficulties related to the exploitation of this TRIPS flexibility. In order to tackle this issue, before the amendment signature in 2005, a waiver allowing compulsory licensing for exportation of drugs was adopted in 2003. So far, it has been applied just in one case, with Canada issuing a compulsory licensing in favour of Rwanda for the exportation of anti-retroviral drugs for AIDS.[2]

Despite the discussions occurred last year at UN[3] and WTO,[4] the new amendment could be considered a major step ahead in assuring access to essential medicines to countries with no manufacturing capacity. Indeed, setting up and developing infrastructures that could be able to produce generic drugs may require a long period of time. The new instrument waive Article 31(f) as for the requirement of production for domestic market, but at the same time it provides for adequate remuneration to be be paid to patent holders in accordance with Article 31(h). Except paragraph (f), all the other parts of Article 31 are applicable, in order to try to struck a balance between the interests of the different actors involved.

Eventually, given the partial failure of 2003 waiver, it cannot be predicted if this amendment will be able to provide an efficient tool for addressing the issue of access to medicine. The results will be clearer in the upcoming years. In any case, it can be considered a partial victory for developing and least-developed countries, that could rely on a further flexibility in order to grant effective access to essential life-saving drugs.


 

[1] WTO Agreement on Trade-Related Aspects of Intellectual Property Rights.

[2] For a comment see J. Gibson, Intellectual Property, Medicine and Health Current Debates (Ashgate 2009) 154-156.

[3]See  http://www.unsgaccessmeds.org/#homepage-1.

[4] See https://www.wto.org/english/news_e/news16_e/trip_08nov16_e.htm.

 

Giancarlo Moretti LL.M. (QMUL), Ph.D. Candidate (QMUL) @GCarloMoretti