Policy Issues Concerning Parallel Trade of Pharmaceutical Drugs in the United States - PowerPoint PPT Presentation

Loading...

PPT – Policy Issues Concerning Parallel Trade of Pharmaceutical Drugs in the United States PowerPoint presentation | free to download - id: 31deb-MmI2Z



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

Policy Issues Concerning Parallel Trade of Pharmaceutical Drugs in the United States

Description:

Policy Issues Concerning Parallel Trade of Pharmaceutical Drugs in the United States ... United States patent rights are not exhausted by products of foreign ... – PowerPoint PPT presentation

Number of Views:43
Avg rating:3.0/5.0
Slides: 19
Provided by: james140
Learn more at: http://www.fda.gov
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: Policy Issues Concerning Parallel Trade of Pharmaceutical Drugs in the United States


1
Policy Issues Concerning Parallel Trade of
Pharmaceutical Drugs in the United States
  • James Love
  • CPTech
  • FDA Prescription Drug Importation Meeting
  • 14 April 2004

2
New York Times, April 14, 2004, pages A1, c14,
Gardiner Harris, Price of AIDS Drugs Intensifies
the Debate on Imports.
3
Side Point
  • Parallel trade in medicines would not be
    necessary if the US government declared it would
    issue compulsory licenses on patents when prices
    were unfair to US consumers

4
Parallel trade in medicines should be limited to
countries that should have good regulatory
systems and which are classified as high income
by the World Bank
  • As long as we finance RD from profits on the
    sale of medicines, we need a policy framework
    that explicitly supports market segmentation
    between high and lower income countries.
  • A single world price for medicines would not
    serve the interests of consumers in high or low
    income countries.

5
The US government needs to clarify that the
United States recognizes international exhaustion
of patent rights.
  • Prior to Jazz Camera Photo v. International
    Trade Commission, 264 F.3d 1094 (Fed. Cir. 2001),
    and in some cases in other circuits following
    that decision, the general rule in the U.S. was
    perceived by many to be an international
    exhaustion rule. See Curtiss Aeroplane v. United
    Aircraft, 266 F. 71 (2d. Cir. 1920) (holding that
    U.S. patent holder, in consenting to the use of
    its patent for manufacture of airplanes in
    Canada, had exhausted its right to control the
    importation of the resulting aircraft into the
    United States). In Jazz Camera, the Federal
    Circuit held that the sale of products by a
    patent holder in another country did not exhaust
    U.S. patent rights, stating
  • United States patent rights are not exhausted by
    products of foreign provenance. To invoke the
    protection of the first sale doctrine, the
    authorized first sale must have occurred under
    the United States patent. See Boesch v. Graff,
    133 U.S. 697, 701-703 (1890) (a lawful foreign
    purchase does not obviate the need for license
    from the United States patentee before
    importation into and sale in the United States).

6
The TRIPS framework for exhaustion of rights
should be changed to permit exhaustion only among
countries of similar or higher income
  • Article 6 - Exhaustion
  • For the purposes of dispute settlement under
    this Agreement, subject to the provisions of
    Articles 3 and 4 nothing in this Agreement shall
    be used to address the issue of the exhaustion of
    intellectual property rights.
  • Article 4 - Most-Favoured-Nation Treatment
  • With regard to the protection of intellectual
    property, any advantage, favour, privilege or
    immunity granted by a Member to the nationals of
    any other country shall be accorded immediately
    and unconditionally to the nationals of all other
    Members. . .

7
Article 17(9)(4) of the US-Australia FTA
  • Each Party shall provide that the exclusive
    right of the patent owner to prevent importation
    of a patented product, or a product that results
    from a patented process, without the consent of
    the patent owner shall not be limited by the sale
    or distribution of that product outside its
    territory at least where the patentee has placed
    restrictions on import by contract or other means.

8
Article 16(7)(2) of the US-Singapore Free Trade
Agreement
  • Each Party shall provide that patent owners
    shall also have the right to assign, or transfer
    by succession, a patent and to conclude licensing
    contracts. Each Party shall provide a cause of
    action to prevent or redress the procurement of a
    patented pharmaceutical product, without the
    authorization of the patent owner, by a party who
    knows or has reason to know that such product is
    or has been distributed in breach of a contract
    between the right holder and a licensee,
    regardless of whether such breach occurs in or
    outside its territory. Footnote 16-10 Each
    Party shall provide that in such a cause of
    action, notice shall constitute constructive
    knowledge.

9
U.S.-Morocco Free Trade AgreementArticle 15.9
PATENTS
  • 4. Each Party shall provide that the exclusive
    right of the patent owner to prevent importation
    of a patented product, or a product that results
    from patented process, without the consent of the
    patent owner shall not be limited by the sale or
    distribution of that product outside its
    territory/9/ .
  • fn9/ A Party may limit application of this
    paragraph to cases where the patent owner has
    placed restrictions on import by contract or
    other means.

10
The Hague Convention on Jurisdiction and
Enforcement of Foreign Judgments may inhibit
parallel trade
  • Another possible problem concerns a current
    negotiation on a treaty on cross-border
    jurisdiction, and in particular, the provisions
    that would make contractual choice of court
    provisions automatically enforced globally.
    Sellers of medicines would routinely choose
    courts that uphold restrictions on parallel
    trade. CPTech has asked the US Department of
    State to exclude from the proposed Hague
    Convention on Jurisdiction and Enforcement of
    Foreign Judgments cases involving parallel trade
    or the exhaustion of intellectual property
    rights. For information on this issue, see
  • http//www.cptech.org/ecom/jurisdiction/parallelt
    rade.pdf

11
October 30, 2002 IMS report on parallel trade in
Europe
  • The belief that parallel traded goods are of
    poorer quality is actively encouraged by the
    pharmaceutical industry. . . But for the most
    part, parallel traded products are as good as the
    local product because they are identical - the
    only difference is that they were packaged in a
    box of a different design to appeal to the needs
    of a different European market, a market which
    has exactly the same high quality requirements.
    Parallel traded products are high quality,
    well-packaged and well-distributed and cannot be
    criticized for their inferior quality compared
    with branded products. The market is growing.
  • http//open.imshealth.com/IMSinclude/i_article_200
    21030.asp

12
US Government Funded Inventions should not more
be expensive in the USA than in other High Income
Countries
  • Abbott charges 5 to 10 times the Canadian or
    European price for Norvir, a very important drug
    for AIDS.
  • Pfizer charges 2 to 5 times more for Xalatan in
    the US than it does in Canada or Europe.
  • These and many other drugs were invented in the
    US on government grants.
  • DHHS can declare that it will grant federal
    March-In licenses on government funded drugs when
    prices are unfair to American consumers.

13
Short term mechanism to deal with RD
14
The US Government should require parallel traders
to contribute to an RD fund
  • If innovator profits decline, the pharmaceutical
    industry may reduce RD outlays.
  • Policy makers can address this problem as
    follows
  • Require that parallel traders to pay a fee of 15
    percent of the difference between the
    manufacturers US price and the foreign price,
    into a transparent RD fund.
  • Funding research and development in this way
    could focus RD on public health priorities and
    increase transparency in RD flows.

15
Long term mechanism to address RD
16
We need a new framework for RD
  • Trade agreements should focus on how we share the
    burden of health care RD
  • Related to capacity to pay (GDP per capita)
  • Countries should have flexibility on how they pay
    for RD
  • We need to separate the markets for RD and the
    markets for products
  • Every product should become a generic
  • Innovators should have different rewards than 20
    year marketing monopolies

17
(No Transcript)
18
Further reading
  • January 29, 2004. Essential Inventions, Inc.,
    Petition to use authority under Bayh-Dole Act to
    promote access to ritonavir, supported by
    National Institute of Allergy and Infectious
    Diseases contract No. Al27220.
  • James Love, Evidence Regarding Research and
    Development Investments in Innovative and
    Non-Innovative Medicines, September 22, 2003.
  • Burton A Weisbrod, Solving the drug dilemma,
    Washington Post. Aug 22, 2003
  • Tim Hubbard and James Love, 2004. A New Trade
    Framework for Global Healthcare RD. PLoS
    Biology 2 (2)147-150
About PowerShow.com