Under the heading ‘TRIPS and Public Health’ the Doha Declaration identified the rights of governments in the following instances.
Compulsory licensing is the granting of licenses to use a patent without the consent of the patent holder. This is however subject to the payment of adequate compensation to the patent holder. Article 31 of the TRIPS agreement permits compulsory licensing in specific instances. According to the text, such licensing is permitted to a government or a third party where the proposed user has made efforts to obtain authorization from the rights holder on reasonable commercial terms and conditions and that such efforts have not been successful within a reasonable period of time, unless there exists a national emergency. The agreement goes on to state that:
The rights holder shall be paid adequate remuneration considering the circumstances of each case, taking into account the economic value of the authorization - any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use.
The Declaration on the TRIPS and Public Health has adopted a more liberal attitude and states that ‘Each member has the right to grant compulsory licences and the freedom to determine the grounds upon which such license are granted’. Looking at the domestic law one sees that section 86 of the IPA is identical to that in Article 31 of TRIPS.
The importance of compulsory licensing was correctly stressed in the Supreme Court determination on the Intellectual Property Bill. The Draft Bill did not contain provisions envisaged in the TRIPS agreement, nor did it contain those recognized under the Doha Declaration with regard to compulsory licensing. The Supreme Court clearly stated that the exclusion of these mitigatory features in the Bill amounted to a violation of Article 12(1) of the Constitution relating to the equal protection of the law. The Court noted that the TRIPS agreement is applicable to developed, developing and least developed countries which cannot be considered as equals. As such the enforcement of the TRIPS agreement is to be carried out with the regard to the special and differential needs of countries.
In a national emergency, the government is permitted to issue license without the authorization of the patent bolder, and this is not subjected to the restrictions contained in Article 31 of the TRIPS agreement, discussed before, Section 86(2) (c) of the IPA states that Director General of Intellectual Property may waive the requirements set out in 86 (2) (b) if he is satisfied of the existence of a national emergency or any other circumstance of extreme urgency, or in case of a public non-commercial use for purposes such as national security, nutrition, health or for the development of a vital section of the national economy. The latter part of section 86(1)(c) referring to public non-commercial use is utilized liberally by many developed countries such as United Kingdom, USA and Canada to issue compulsory licences.
It must be also noted that with regard to government use the patent holder is granted compensation. Section 86(1)(f) of the IPA sates that taking into consideration the economic value of the patent adequate remuneration will be paid to the owner of the patent.
Parallel importing
The TRIPS Agreement and the Doha Declaration allow for parallel importing, which is the import and resale of patented products. As such an importer can freely import a patented product from a manufacturer in another country. This right to import patented products is not implicit and must be included in the laws within the country.
The Supreme Court determination on the Intellectual Property Bill correctly stressed the importance of parallel importing to a developing country. Even though the imported goods are patented, this introduces the possibility of benefiting from the lowest prices available in the world market. Section 86 (1)(iv) of the IPA provides for parallel imports, but does not directly refer to the international exhaustion of rights. In light of the Doha Declaration and the reading of the TRIPS agreement, the present law is sufficient to permit parallel imports, in the widest sense of the international exhaustion of rights. In this regard more progressive provisions were brought into the Intellectual Property Laws of countries such as South Africa and Malaysia in the recent past.
National Medical Drug Policy
Access to affordable and quality medicinal drugs is an essential component of any form of effective healthcare. In recognition of this fact, the Sri Lankan government has formed a National Medicinal Drug Policy which seeks to regulate matters such as the import and prescription of medicinal drugs.
The drug policy reflects many universal human rights principles. It embodies the universal principle of non-discrimination and is based on the fact that the right to heal must include the availability and accessibility of affordable medicinal drugs. The policy identifies that the responsibility of ensuring an uninterrupted supply of essential drugs lies not only with the state but also with the private sector. This significantly increases the importance of the private sector in providing health care.
As expressed in the Maastricht Guidelines, the obligation on the State is not only to introduce an effective legal regime but to buttress legal intervention with complementary administrative, budgetary, judicial and other measures that would contribute to the full realization of rights. Unless people understand this wide scope of the right to health and demand that the State fulfills its obligations towards attaining this standard of health, there can be no real development of this right. People must be aware of the ethical responsibility of health care givers and the rights of patients.
(The writer is Retired Professor in Law in the University of Sri Jayewardenepura, he is an attorney at law and holds PhD in law as well.)
Part I of this article was published yesterday.
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