REPORT PRESENTATION

ASSESSMENT OF THE STATUS OF IMPLEMENTATION OF TRIPS

FLEXIBILITIES IN BOTSWANA

26th March 2013

OBJECTIVES Examine the extent to which public health related TRIPS

flexibilities have been incorporated into relevant national legislation:

Interrogate policy strategies in place to allow Botswana to achieve a balance between international commitments to protect IPR and public health obligations relating to sustainable access to ART and identify further steps:

Interrogate the effectiveness of drug and diagnostics procurement processes currently used by Botswana for the national ART Programme from a cost benefit analysis perspective of the TRIPS:

To exploit the dynamics around the use of the TRIPS by various actors in Botswana.

OVERALL METHODOLOGICAL APPROACH Desk review of the relevant legal and policy

instruments governing the public health aspects of the TRIPS in Botswana:

Literature review of the TRIPS and public health debates. This tool will also be utilised to identify and assess comparative experiences on the implementation of TRIPS flexibilities in the SSA region and elsewhere, e.g. South Asia.

Input/Discussions with the Reference Group from key stakeholders, policy makers, and practitioners in the fields of IPR, public health, medical drugs procurement, production and distribution, and international trade; and

RELEVANCE ON PATENTS Global pharma R&D intensive- efforts &

profits protected by patents:• Patents granted to protect inventions

(prevent others from misappropriating creation for SPECIFIC period):

• Invention refers to any product, process or improvement which is NEW, NOT OBVIOUS to an ordinary person, and useful to society (TRIPS art.27).

• Patents are IPRs protected by the WTO TRIPS Agreement and domestic legislation (Industrial Property Act).

• Working within IPRs has cost implications.

GLOBAL PHARMA INDUSTRYWorld’s Largest Pharma (2010)

PHARMA INDUSTRY Africa represents only 1.3%of global

market; BUT SSA market worth US$3.8 billion

(IFC, 2008)30% of this LOCAL FINAL FORMULATIONSDominated by South Africa (70%)Nigeria, Kenya, Ghana (20%)

US$3B will be invested in SSA health sector 2007-2016:40% in GENERIC FINAL FORMULATION

MANUFACTURING(IFC, 2008)

SADC-EAC PHARMANumber of Manufacturers:

Angol

a

Botsw

ana

Burun

diDRC

Kenya

Leso

tho

Madag

asca

r

Malaw

i

Maurit

ius

Mozam

biqu

e

Namib

ia

Rwanda

Seyc

helle

s

Sout

h Afri

ca

Swaz

iland

Tanz

ania

Ugand

a

Zambi

a

Zimba

bwe

0

5

10

15

20

25

30

35

40

45

REGIONAL PHARMA Sub-Saharan Africa pharmaceutical

market to be worth US$3.8 billion. 37 Sub-Saharan African countries

have some pharmaceutical production, South Africa dominates the sector with over 70 percent of the region’s annual pharmaceutical production.

Botswana has no pharma producers.

HEALTH FINANCING 2001 Abuja Declaration (15% of

budget to health) WHO 2000 Health Report est. $60

per capita for comprehensive health system.

WHO High Level Task Force (2009) recommended $54 per capita to meet health related MDGs

SSA PER CAPITA EXP.Position of Botswana:

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100

Bur

undi

DR

C

Libe

ria

Gui

nea-

Bis

sau

Eth

iopi

a

Gam

bia

Mal

awi

Sie

rra

Leo

ne

Erit

rea

Rw

anda

Nig

er

Uga

nda

Tan

zani

a

Tog

o

Mad

agas

car

CA

R

Moz

ambi

que

Gui

nea

Bur

kina

Fas

o

Mal

i

Leso

tho

Cha

d

Gha

na

Ben

in

Nig

eria

Ken

ya

Sen

egal

Zam

bia

Mau

ritan

ia

Côt

e d

'Ivoi

re

Cam

eroo

n

Sud

an

Zim

babw

e

Con

go

Sw

azila

nd

Nam

ibia

Ang

ola

Mau

ritiu

s

Gab

on

Bot

swan

a

Country, sorted by per capita GDP in 2007

He

alt

h e

xp

en

dit

ure

($

US

, 2

00

7)

Government spending

$250-$499 $500-$999 $1000+

WHO target ($54)

<$250

Sources: WHOSIS database, IMF World Economic Outlook 2007, and author’s calculations

BOTSWANA POSITION Public sector predominant

provider of care

80%+ receive care from public sector (RNHP, 2011)

Nominal Cost Recovery

POLICY CONTEXT-INTERNATIONAL Resolution WHA60.30 of May 2007:Requested the Director-General "to

provide… in collaboration with other competent international organizations, technical and policy support to countries that intend to make use of the flexibilities contained in the agreement on Trade-Related Aspects of Intellectual Property Rights and other international agreements in order to promote access to pharmaceutical products"

WHO PRINCIPLES Access to essential medicines is a human right;• Essential medicines are not simply another

commodity, TRIPS safeguards are crucial;• Patent protection has been an effective

incentive for R&D for new drugs;• Patents should be managed in an impartial

way, protecting the interests of the patent-holder, as well as safeguarding public health principles; and

• WHO supports measures which improve access to essential medicines, including application of TRIPS safeguards.

See too AU Roadmap (Pharma Plan)

POLICY CONTEXT-INT. 2006 UN General Assembly Political

Declaration on HIV/AIDS: find “appropriate solutions to overcome

barriers in pricing, tariffs and trade agreements, and to making improvements to legislation, regulatory policy, procurement and supply chain management in order to accelerate and intensify access to affordable and quality HIV/AIDS prevention products, diagnostics, medicines and treatment commodities.”

 

POLICY CONTEXT-INT. UNDP (2010) Good Practice Guide:

Improving Access to Treatment by Utilizing Public Health Flexibilities in the WTO TRIPS Agreement provide a critical international policy guideline and reference point.

AU (2007) Pharmaceutical Manufacturing Plan for Africa (the Plan).6 PRIORITY AREAS (INCLUDES IPRS)

The SADC Pharmaceutical Business Plan (2007-2013)

POLICY CONTEXT- INT.KEY SADC STRATEGY:

“Collaborate with development partners to enable countries to protect, include and take advantage of the flexibilities that exist in the TRIPS Agreement as well as to assist countries in bilateral trade negotiations to conclude agreements that are not detrimental to public health.”

POLICY CONTEXT-DOMESTIC

VISION 2016- PILLAR 3; Compassionate, Just & Caring Nation:

NDP 10 – GOALS 8-9 aim to achieve:Affordable and Quality Healthcare;

andPrevent new HIV/AIDS infections.

REVISED NATIONAL HEALTH POLICY(RNHP, 2011)

National Trade Policy

RNHP-KEY STRATEGIES TO EXPLORE POTENTIAL FOR LOCAL

PRODUCTION THROUGH COLLABORATION WITH OTHER COUNTRIES:

TRANSFORMATION OF LOCALLY AVAILABLE MEDICINAL PLANTS INTO INDUSTRIALISED MEDICAL PRODUCTS:

REGULATORY REFORM (DRUG REGULATORY UNIT TO AUTONOMOUS INDEPENDENT BODY.

STRENGTHEN NATIONAL DRUG QUALITY CONTROL LABORATORY.

TRADE POLICY (2009)

“Government ensures that Intellectual Property Rights protection functions as a stimulus for innovation and technology diffusion. Government is committed to the protection, recognition and equitable sharing of intellectual property rights trade benefits in line with her national and international commitments.”

ABUSE OF IPRS Horizontal Cartels: Through licensing agreements

that fix prices, limit output, or divide markets. Raising Barriers to Market Entry: e.g. Tie-in sales

of protected product and another product, competitor forced to enter both markets hence raising costs.

Predatory Behaviour: Purchasing exclusive rights with no intention of

using them Bad Faith Litigation: damages SMALL

ENTERPRISES. PAY-FOR-DELAY DEALS (USA) (patent challenged,

generic maker wants to launch before expiry)

TRIPS PLUS PROVISIONS Extending Patent Terms Restricting Patent Opposition Forbidding generic licensing where there is a valid patent.

Limiting Compulsory Licenses only to cases of national emergencies.

Limiting Parallel Imports.

BOTSWANA LEGAL CONTEXT Industrial Property Act (2010)

31st August 2012 through SI70 of 2012

Industrial Property Act Regulations.

Impact of relevant FTAs

ASSESSMENT CRITERIA Patentability Criteria Exclusion from Patentability Patent Opposition Patent Examination Parallel Imports Exceptions Compulsory Licences Use of Competition Law EnforcementNB See Legal Analysis in the Detailed

Report.

PATENTABILITY CRITERIA

Section 8 adopts the minimum standard as defined under art.27(1) ( new, involves an inventive step, and is capable of industrial application ).

Not precise enough to prevent “evergreening”.

The fact that the Act provides room for pre and post patent grant challenges may provide some degree of vigilance over evergreening. NB CAPACITY REQUIRED.

EXCLUSION FROM PATENTABILITY

The Act goes beyond the TRIPS Agreement by clearly adding other grounds for excluding patentability. NOT patentable in Botswana:a discovery or a plant, animal, micro-organism

or substance as found in nature, including the human body;

a scientific theory or mathematical method; a literary, dramatic, musical or artistic work or

other aesthetic creation; a scheme, rule or method for doing business,

performing a mental act or playing a game; a computer program.

PATENT OPPOSITION Follows UNDP Good Practice Guidelines

makes provision for both pre-grant and post-grant patent opposition, section 36(1) complements s21(5) by permitting any interested party to make an application (either to the Registrar or to the High Court) to invalidate a patent already granted by the Patent Office).

NB OMISSION to make substantive provision for process of making such challenges in the Regulations (But objection procedure for trademark registrations provided for).

PATENT EXAMINATION

Section 22(1) of the Act gives the Registrar powers to examine an application for a patent for compliance with the Act before deciding whether or not to grant a patent.

But s22(2):“The Minister may, by regulations, prescribe the categories of inventions in respect of which an examination under this section shall not cover the requirements of novelty and inventive step”. Lowers the patentability criteria created under

section 8 and the TRIPs Agreement! Difficult to object to such a patent grant.

PARALLEL IMPORTS

Permissible under s25(1) where the patented article is put on the Botswana market or abroad by the patentee or by another person acting with the patentee’s consent, or having an economic tie to the patentee.

Ten specific exceptions which enable the exploitation of a patent are provided for under s25(1).

COMPULSORY LICENCES

The Act has provisions for the issuing of compulsory licences under 3 scenarios.

Compulsory licences in the public interest or for competition (s31), For importation of patented products by Government or a third

party (s32). For failure to exploit a patent (s33). The Act hence makes use of

the TRIPS flexibilities and also goes as far as incorporating the August 30 Decision/article 31 bis of the TRIPS Agreement (see sections 31(3), 32(2), and (4). But see further below on the status of competition law and institutions with respect to IPRs in Botswana.

The 30 August Decision introduced a waiver of the requirement of Article 31(f ) for predominant domestic use and purported to provide a mechanism that allows WTO Member States to issue compulsory licenses for export of generic equivalents of patented medicines to countries with no pharmaceutical manufacturing capacity, or insufficient capacity.

USE OF COMPETITION LAW (1) Industrial Property Act: The issuance of a compulsory licence by the Minister where a

court or administrative body has determined that the manner of exploitation of the invention by the patentee is anti-competitive or constitutes an abuse of the patent (s31(1)(b).

The issuance of a compulsory licence by the Minister where a competition authority has determined that the manner of exploitation of a patent in the field of semi-conductor technology is anti-competitive (s31(11); and

Acts of unfair competition; where at the request of the owner of a title of protection under this Act, or of any competent authority or any person, association or syndicate, the court may grant an interdict to prevent an act of unfair competition, award damages or grant any other remedy as the court may deem appropriate (s114(1)). Section 114(2) provides an inclusive list of acts that may constitute unfair competition, these acts are largely to do with trade matters, e.g. passing off, unfairly discrediting a competitor, misleading claims etc. VERY LIMITED SCOPE.

USE OF COMPETITION LAW (2) Competition Act: Section 25-26 provides

for detailed treatment of prohibited RESTRICTIVE PRACTICES and abuses of DOMINANT POSITIONS.

BUT: does not apply, s3(b) thereof to-“any agreement to the extent that the agreement relates to the protection, exercise, licensing or assignment of rights under any law governing intellectual property rights.”

IPR law limited scope, Competition Act not applicable.

ENFORCEMENT

TRIPS Agreement (art.61) requires members to criminalise at least cases of wilful trademark counterfeiting or copyright piracy on a commercial scale. Act provides so.

BUT s134(4) (NB error on s24/25 ref) of the Act creates a criminal offence for patent infringements in Botswana. This is a TRIPS-Plus provision. NB USA FED COMMISSION 2010 STUDY- 30% of

disputed patents ruled INVALID after litigation: RBC Capital Markets Corp. of 371 cases during

2000-2009 found brand-name companies won 89 at trial compared to 82 won by generic drug makers.

ENFORCEMENT-PATENTS Who prosecutes?

Who is prosecuted?

At what cost?

At whose cost?

Then what????

FTAS & TRIPS- IDEAL FRAMEWORKIdeal Framework

ART Program

me

TRIPS Agreeme

nt

Competition Act

Related Domestic Policies

Industrial Property

Act

FTAs

Related Internatio

nal Policies

FTAS AND TRIPS FLEXIBILITIIES Motivations SACU-USA SADC-EC-EPA SACU-EFTA FTA

Art.26- Harmonisation of IPREC Supplementary Protection

Certificate for Medicinal Products (NORWAY implemented)

European Patent Organisation & Convention

2014 Convention Unitary Patent System

TRIPS FLEXIBILITIES-FTA REALITYThe Current Reality

SACU-EFTA FTA

TRIPS Agreement

Competition Act

Related Domestic Policies

ART Programme

Industrial Property Act

Other FTAs

Related International

Policies

THE MAKE OR IMPORT DEBATE One strategy for price reduction-

LOCAL PRODUCTION:

Option: POOLED PROCUREMENT

MIXTURE OF BOTH

REQUIRE ENABLING ENVIRONMENT

AU POSITION“The African Union argues that domestic

drug production develops the appropriate industrial and technical infrastructure that can enhance long-term health security, self-sufficiency, employment, foreign exchange, in addition to access to essential medicines.

In other words, local manufacturing potentially can bring economic and symbolic gains to a country.”

BOTSWANA POSITION“In the policy context (Revised

National Health Policy), the Ministry of Industry and Trade has been tasked with “collaborating with the Ministry of Health to promote the establishment of pharmaceutical and biomedical manufacturing companies in Botswana”.

TANZANIA EXAMPLE Government considered domestic

production as a means to scale up treatment

Local manufacturer Tanzania Pharmaceutical

Industries (TPI) entered an agreement to produce a triple FDC 17 of first-line ARVs

PHARMA INVESTMENT SCOPE

KEY LESSONS-TANZANIA TRIPS provisions offer governments the ability to put

health before trade objectives, but many developing countries and LDCs simply cannot utilize these provisions is reinforced.

  Barriers in administration, politics, policy, and capacity

limit the use of TRIPS flexibilities in LDCs.

  Successful technology transfer arrangements and

manufacturing initiatives require long-term coordination and planning across health, industrial, and science and technology sectors.

Efforts to develop industry will have great difficulty in succeeding if driven entirely by the health sector.

The need to address adequate economies of scale of [QA = quality assured?] production must be established from the start in the initial business plan

BOTSWANA BASELINE Government put in place critical

REGULATORY FRAMEWORK:Requires some enhancements (see

recommendations) POLICY FRAMEWORK in place:

Requires alignment with sector and multi-sector policies (see recommendations)

Government supportive of private sector initiatives.

Scope for REGIONAL collaboration exists:Bilateral, Sub-regional etc.

RECOMMENDATIONSSUBJECT CONTEXT

ENABLING ENVIRONMENT INDUSTRIAL PROPERTY ACTCOMPETITION ACT

TRADE POLICY TRIPS FLEXIBILITIES & NEGOTIATING POSITIONS (E.G. SACU-EFTA FTA)STAKEHOLDER LIAISON

OPTIONS FOR DRUG PROCUREMENT

FEASIBILITY OF LOCAL PRODUCTIONPOOLED PROCUREMENT

INSTITUTIONAL STRENGTHENING

REGULATORS & RESEARCH AND DEVELOPMENT

REC- LEGAL REFORM 1:There is need to ensure that patent

examiners develop a stringent criteria for the application of s8 in the context of applications for secondary patents. This requires constant capacity building at the Marks, Patents and Designs Office (the Patents Office):

2:The additional grounds for exclusion of patentability add stringency to the patentability criteria and this is a positive use of the policy space that Botswana has in the context of the TRIPS flexibilities and this should be maintained.

REC-LEGAL REFORM 3:Amend the Regulations by providing for a

section along the lines of s41 to cover the process for the filing of objections to applications for patents. If costs are to be provided for in the regulations they should not be too prohibitive (thus discouraging serious challenges) or too low (thus encouraging frivolous challenges).

3.1.: Capacity Building:  Capacity building seminars, training workshops etc

on the key aspects of the patent regime, its links with the public health concerns of the country, and its potential to enhance Botswana’s development plans.

Demystifying the whole concept of patents through regular media interactions with the public.

Training media practitioners in order to increase the level of awareness on patents and health

REC-LEGAL REFORM 4: Section 22(2) is a substantive

drawback to an otherwise positive Act, it should be repealed.

5:repeal s134(4), or the very least to conduct an in-depth review, and question the assumptions upon which this provision is based in the context of Botswana’s development needs.

6: Section 3 (a) of the Competition Act should be amended to create a more holistic approach to dealing with anti-competitive practices in the IPR system in general.

REC- TRADE POLICY 7: SACU-EFTA FTA NEGOTIATIONS: Align

the IPR issues under the SACU-EFTA FTA with:The Revised National Health Policy;The National Trade Policy;The TRIPS flexibilities adopted within the

Industrial Property Act; andBotswana’s negotiating position on the

trade-related issues under the negotiations for the comprehensive EPA with the EU.

REC- TRADE POLICY 8: STAKEHOLDER LIAISON

MOH, NACA, ELHR STAKEHOLDERS: TRAINING IN NATIONAL TRADE POLICY: STRONG, REGULAR AND SUBSTANTIVE

PARTICIPATION IN NATIONAL TRADE POLICY IMPLEMENTATION MECHANISMS

MOT, DIT, IPR REGULATORS, COMPETITION REGULATORS: JOINT TRAINING IN NATIONAL HEALTH POLICY

PRIORITIES LINKAGES BETWEEN TRIPS FLEXIBILITIES &

HEALTH PRIORITIES TO BE EMPHASISED.

REC- LEGAL REFORM 6: Section 3 (a) of the Competition

Act should be amended to create a more holistic approach to dealing with anti-competitive practices in the IPR system in general: Example of suggested amendment:

“This Act does not limit any right under any law governing intellectual property rights except to the extent that such a right is used in a manner that is inconsistent with Part V of this Act.”

REC- INSTITUTIONAL 9: Institutional Strengthening; The

Industrial Property Act does not create a new regulatory authority for patents, the Marks, Patents and Designs Office established by the repealed Industrial Property Act, Cap 68:03 still exists. New cost implications may arise from the nature of regulatory powers assumed by the Registrar.Technical Expertise;Technology.Legal Reforms.

REC- RESEARCH & DEVELOPMENT 10:Support to technical aspects of the National Health Policy’;Feasibility Study for Local Pharmaceutical Production;

Feasibility Study for Pooled (Regional) Procurement in the context of the SADC Pharmaceutical Business Plan.

……../THANK YOU