PATENT POOL & its CONCERNS

Manmohan A Amonkar20 July 2010

Patent Pool

“An Agreement between 2 or more patent owners to license 1 or more of their patents to one another or to third parties”

Way to centralise licensing processes

Stop & Shop Facility

Overcome the “Tragedy of Anti-commons”

WORKING

PatentPool

Patent Owner Generics

R o y a l t y

Timeline of Medicines Patent Pool Foundation (MPPF)

2006: Proposal to UNITAID to establish a patent pool on medicines

July 2008: UNITAID Executive Board (EB) agreed, in principle, to establish a Voluntary Medicines Patent Pool

June 2010: UNITAID EB decided to establish the Medicines Patent Pool Foundation (MPPF) as a separate not-for-profit entity constituted under the laws of Switzerland.

Benefits for Patent Owner

Receipt of Royalties from Generic Companies

Access to new markets

Boost to reputation

Benefits for generic companies

Easier access to IP by Generic Companies

Reduction of licensing transaction costs

Elimination of difficulties due to blocking patents

Benefits to patients: MPPF Goals

Expedited availability of low cost medicines without having to wait for patent term to expire.

In context of need for second-line and newer lines of treatment,– Fixed Dose Combinations

– Pediatric Formulations

– Heat stable formulations

Increased access to affordable medicines in developing countries

Price Reduction

Cryptic Dangers

VOLUNTARY LICENSES (Hidden Devils)

Voluntary Licenses Contd..

Control Generic Competition

2006: Gilead offered voluntary licenses to 11 generic companies (Indian and others) on certain terms and conditions: Licensees should purchase active pharmaceutical

ingredients only from certain authorised sources Licensees should not export finished products to

markets not approved by Gilead (eg Brazil) withdraw patent oppositions on TENOFOVIR

Brazil: Tenofovir costs US$1,387 pppy while, in India, generic versions cost approximately US$ 99 pppy

Restrict Innovation

“One Stop Shop” for purchasing technology

Dependency on innovator companies

Stifle generic companies from developing their own technology

EVERGREENING

“Evergreening” of patents on medicines due to patents on

Fixed dosed combinations

Pediatric formulations

Heat-stable formulations

These new forms are likely to be patented in several countries.

MPPF provides incentives to such evergreening practices

Compulsory Licensing

Compulsory licensing is a recognised flexibility available under the Agreement on Trade Related Aspects of Intellectual Property Rights

Negotiations with MPPF may enable patent holder to delay issuance of compulsory licences or government use

Market Segmentation

MPPF is purely VOLUNTARY in nature

Balance of power titled in favour of patent holders

Insistence on exclusion of countries

Tiered pricing / royalty

Conclusion

We must learn from the previous experience of Gilead voluntary licences

We must ensure that use of TRIPS flexibilities and other mechanisms such as anti-competition laws are not compromised

We must demand greater transparency

We must remember that this is one PROPOSED solution, and continue to work to push for strong public health safeguards in patent laws and oppose the present patenting practices