The following is the analysis of Knowledge Ecology International (formerly the Consumer Project on Technology) on the impact of the recent trade agreement between the Democrats and the administration.
http://www.keionline.org/...
On May 10, 2007, Speaker Nancy Pelosi and Ways and Means Chair
Charles Rangel announced a "new biparisan" trade package. KEI has
reviewed the details of the elements of section III of the agreement,
concerning "patents, IPR and access to medicine."
In general, the House Democrats have negotiated important new
concessions from the Bush Administration in three areas. There are
no more obligations for patent extensions, and mandatory linkage has
been eliminated. These are both important changes that will benefit
patients and improve the trade agreements. The changes regarding
protection of test data are more problematic, both because the
agreement still embraces a system of exclusive rights for data,
instead of alternatives such as cost sharing (sometimes referred to
as compensatory liability), and because the flexibility for
limitiations and exceptions to the exclusive right is unfortunately
bound to a poorly drafted side letter, rather than a plain language
provision that makes it clear that countries can waive or limit the
exclusive right when it is necessary to protect patient interests,
regardless of patent status on products. These problems in drafting
may reflect a lack of technical understanding of the issue by certain
parties involved in the negotiation.
The trade agreement also does not address the current problem of
USTR attacking countries for actually using such measures as
compulsory licensing of patents (such as putting Thailand on the 301
priority watch list), or demanding that trading partners set limits
on the grounds for issuing a compulsory license (reportedly one of
the conditions presented in recent FTA negotiations and in the
"action plan" for Thailand to avoid trade sanctions).
In general, the changes are welcome, as a partial but still
incomplete step toward honoring the 2001 Doha Declaration. It is
our hope that members of Congress and Presidential candidates will
begin to think beyond IPR obligations as the only way to address the
global sharing of R&D costs. Strong IPR is a mechanism to raise
drug prices, and high drug prices should be seen as one possible
means to support R&D, rather than an objective of trade policy . We
need to be moving away from IPR agreements that create high drug
prices to a new framework focusing on the support for R&D. This new
approach would give countries the flexibility to consider other
apporoaches to support R&D, which are less restrictive of access to
medicines.
Our comments on Section III of the agreement are given below:
III. Provisions on Patents/IPR and Access to Medicines
A. Data Exclusivity
In general, any regime of "data exclusivity" is objectionable,
since it implicitly requires a generic competitor to replicate
scientific tests on humans, a practice that is both wasteful and
unethical. The House/WH deal does not push the obligation toward one
of cost sharing, which would have avoided these problems.
The benefits of III.A. are very minor, at best shortening the
term of exclusivity by six months, in cases where the foreign
registration is based upon the U.S. registration, and occurs within
six month of the U.S. registration, a set of facts which will often
not apply.
B. Patent Extensions
The replacement of "may" for "shall" means patent extensions are
now optional. This is a significant and welcome change in the IPR
burdens for developing countries.
C. Linking Drug Approval to Patent Status
The elimination of the mandatory linkage between drug
registration and patent status is also an important and beneficial
change.
It was interesting that the language would in fact only allow
linkage when there were "expeditious" ways to challenging patent
validity or relevance, and rewards for challenging patents, two good
provisions that recognize the possiblity that poor patent quality can
be an unwanted barrier to competition and trade.
It would be stronger if it mentioned that the obligations
regarding injunctions should not exceed those that currently exist in
TRIPS Article 44. The U.S. would also benefit from such language,
since U.S. law under the eBay decision provides significant
flexibility to deny injunctions.
D. Side Letter on Public Health
This provision on the side letter is potentially useful, but
only if it is not implemented mechanically, since the existing side
letters are not well written, and subject to interpretations that
limit their usefulness. In particular, there must be clear language
that:
(1) the country may override the exclusive rights in test
data, in a manner similar to a compulsory license on a patent,
including cases where there is no patent on the product (the position
that USTR has taken informally in several seminars and meetings where
this topic has been discussed),
(2) that TRIPS flexibilities are not limited to the flawed
2003/2005 "solution" to paragraph 6 of the 2001 Doha Declaration, but
also include but are not limited to those referenced in Paragraphs 4,
5 and 7 of the 2001 Declaration (which implicitly are also extended
to Articles 6,7,8, 30, 40 and 44 of the TRIPS), and
(3) the U.S. government will not be taking unilateral trade
actions against countries that use such flexibilities in practice,
such as the listing of countries on the 301 list for actually issuing
compulsory licenses.