The USPTO: Where Up Is Down, Expensive Medicine Saves Lives, And Cheap Alternatives Violate International Law

from the not-a-surprise dept

Well, this is unfortunate. We've written a few times about how various countries, under the TRIPS agreement are able to break patents on important medicines in the interest of public health. Most recently, we wrote about how India did this with a cancer drug made by Bayer called Nexavar. Despite the fact that Bayer has more than made back the money it spent bringing Nexavar to market, it's been pricing the drug at an unaffordable $70,000/year. After India allowed a small bit of competition, the price has dropped. We've seen that the USPTO doesn't like this at all and has tried to claim that high priced drugs are good for one's health, but that's beyond ridiculous to anyone who actually thinks.

Of course, "thinking" and "Congress" aren't words that often go together, so it appears that the USPTO is now trying to pull one over on Congress, with USPTO deputy director Teresa Stanek Rea misleading Congress by suggesting that these efforts violate international agreements like TRIPS. Unfortunately, TRIPS says exactly the opposite:
Rea told the committee, saying she believes the issuance of the Indian compulsory license was in violation of the Agreement on Trade Related Aspects of Intellectual Property Rights, an international pact administered by the World Trade Organization which sets minimum standards for intellectual property regulation. Rea said the USPTO is working to stem the tide of IP infringement in foreign countries by the use of a host of training programs and educational efforts aimed at foreign officials and judges along with the placement USPTO overseas IP attaches in Thailand, China, Russia, India, Brazil and Egypt.

Article 31 of the TRIPS Agreement expressly permits compulsory licenses as does the much earlier Paris Convention on the Protection of Industrial Property. The U.S. Itself routinely makes government use of patented inventions pursuant to Congressional authority under 28 U.S.C. Sec. 1498, but also has other laws allowing compulsory licenses in specific circumstances. Compulsory licenses have been allowed globally in the vast majority of intellectual property regimes since the 19th century. And, the patent on Nexavar in India had been granted under a 2005 Amended Patents Act that clearly articulated compulsory licensing rights at the time that Bayer prosecuted its patent and the patent was granted.

Finally, and most to the point, the US signed the Doha Declaration on the TRIPS Agreement and Public Health that pointedly grants countries the right to issue compulsory licenses, to define the terms upon which such licenses are granted – without restrictions, and to define the emergency circumstances that permit licenses to be granted without any prior notice to or negotiation with the patent holder (note: these expedited, no-negotiation procedures were not used in the Natco case). Under the Doha Declaration, countries are permitted to issue compulsory licenses in order to ensure “access to medicines for all” – something that India has attempted to do via the license granted.
It's a shame that the USPTO appears to be so in the tank for big pharma (they get lots of patents, which helps pay USPTO salaries...), that they're willing to mislead Congress on issues like this, even if it means that very sick people around the globe don't get the medicines they need.
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Filed Under: generic drugs, india, nexavar, trips, uspto
Companies: bayer

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  1. icon
    TtfnJohn (profile), 3 Jul 2012 @ 10:25am


    NOTE: Quote taken out of context
    "placement USPTO overseas IP attaches in Thailand, China, Russia, India, Brazil and Egypt."

    I'm sitting here pondering the not so minor detail that between then China and India account for something slightly more than one third of human population on the planet. That and their individual wealth is growing. If they can't afford the patented drug then by all means use the clause to force outfits like Bayer to issue compulsory licenses to generics makers. How long before Bayer takes a large stake out in the generic maker and continues to rake money in?

    If the size and growing wealth of those two countries isn't enough to provide big pharma incentive to service them then something is truly rotten in the state of Denmark and it's not just the cheese.

    There's a valid argument to be made for patents for new drugs and the research and approval process they need to go through. That argument falls apart the moment the company not only has paid off those costs but is making a profit on the drug in question at the astronomically higher price. (Don't get me started on the renewal process around pharmaceuticals.)

    No matter. If a combined market of over 2 billion people doesn't provide incentive to innovate, particularly when disposable income in that market is increasing rather than North America and the EU where disposable income is decreasing, I don't know what is.

    Before someone reminds me, cancer treatments are hardly optional so the money spent on them can hardly be called disposable income but I think you get my drift.

    What's amusing here is that the USPTO looks like they're going to bat for a German company, which Bayer is, who still sell ASA as Aspirin and do very well by it. More amusing is that India is well within its rights to do what it did. (Anyone interested can look up Bayer's less than stellar role in World War 2.)

    We were all sold a useless bill of goods when we were told that tighter medical patents would do things like bring research dollars, lower prices and what not when we, country by country, adopted them. To a large extent we got nothing of the kind. Oh, and lives weren't made better and illnesses often went and go untreated because people can't afford them. You know, say, a cancer.

    And since when did it become the job of a quasi-judicial body like the USPTO to lobby for a particular industry or group of industries. They need to spend a bit more time examining patents to make sure they're valid, if you ask me. Which they haven't. ;-)

    I don't know if this is a case of putting the cart before the horse but it does seem a case of stepping in what comes out of the south end of a northbound horse.

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