Innovation Patent

Informing the pharma innovation debate: Harmonised IP standards and its effects


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[Since this is a more theoretical post, in the interests of our readers, I’m stating at the outset that this piece is essentially regarding policy questions that ought to arise while considering global drug innovation policies, either patents or otherwise. For the purposes of this post, I’m keeping the “access to medicines and drug innovation policy” debate as the context, and for purposes of convenience I am broadly dividing the parties in this debate into two sides – pro strong(er) IP rights vs the rest.]
World over, several bilateral and multilateral treaties are being negotiated much to the chagrin of many activists and academics who believe stronger IP provisions (for this is what nearly all, if not all of the  treaties mentioning IP are trying to bring into force) are detrimental for a variety of reasons. The EU-India FTA is a good example of a bi-lateral treaty, and the ACTA is a good example of a multilateral treaty – both of which have raised several concerns, especially amongst the access to medicines crowd. While these are going on in the foreground, what happened to the TRIPS Agreement? The TRIPS Agreement, having settled into a unique position of making neither of the two sides (referred to in the 1st paragraph) happy, is now having two effects:
  1.  US, EU and other developed nations are just stepping around it, ie circumventing it to continue their push for stronger rights.
  2. The ‘rest’, having been pulled into raising their nascent IP laws to match the standards laid out by the TRIPS Agreement continue to struggle to make the most practical usage of the flexibilities that were negotiated into the TRIPS Agreement.
An increasingly strong IP standard has not only failed miserably to address the medical needs of the vast majority of the developing world, but further, the TRIPS Agreement has also prevented developing countries from being able to address these issues on their own. This however has also led to mobilisation around these very IP rights, and increased knowledge and meaningful participation in the relevant policy debates by actors representing ‘the rest’. (For more on this, see Amy Kapczynski’s paper on the A2K mobilization and the new politics of IP
This current ferment however may also prove a ripe time for re-examining some of the fundamental reasons for such agreements.
The current system for drug innovation has been up till now patent rights: a market based incentive structure based on the assumption that private use and management of intellectual property rights will align the management of such property with the best interests of society as a whole. To be blunt, this has failed.
Considering that the current innovation system for drugs is inefficient and inequitable, scaling up these policies to a global level also scales up these problems. There is not merit, but also a need for a better drug innovation system. However, does this necessarily mean that a globally uniform or set innovation system is the answer? I’m putting together a few points below. They all require a much further in depth study of course, but for the purposes of this blog post, I believe it’s sufficient. 
Arguments as to why a globally harmonized system may be desirable:
  • Distributive Justice: There’s no reason that patients in poorer countries don’t deserve to get the same health benefits that similar patients in other parts of the world are getting. A global system would take them into account as well. These patients would be given at least equal, if not higher priority (due to them being currently worse off) unlike current arrangements. 
  • Corrective Justice: This is similar to the Climate Change justice debate. The argument goes that a major reason that richer countries are where they are today is due to the transfer of wealth that happened when they were colonizing / exploiting developing countries for oil/coal/minerals/etc. Similarly, the current socio-political situation of many developing countries is also directly due to past interference by these richer countries. As such, they now ‘owe’ poorer countries, and thus should take into consideration the needs of patients of the developing world, which they currently do not. (Admittedly, this argument seems a little shaky) 
  • Equal/equitable sharing of drug innovation budget: This argument is a little counter intuitive. Richer countries currently shoulder all/nearly all of the funding for drug innovation. Considering that (a) developing countries do benefit from copies of these drugs / the existence of these drugs post patent period and (b) there are nevertheless patients in the developing world who buy the product at patent price; it’s been suggested that it would be more fair to spread the costs over all beneficiaries. If this is coupled with a (non patent based) drug innovation system that reflects lower costs of drugs (ie, more efficient), this will probably not result in unreasonable high contributions from poorer countries. This of course depends on the type of system that is used. 
Arguments as to why a globally harmonized system may not be desirable: 
  • Focusing on expanding a system should not reduce focus on the pros and cons of the system itself – such as the patent system allowing certain flexibilities which would make it more equitable or efficient, but existing mostly just on paper. 
  • Depending on different countries varying capacities to innovate, a global system can potentially reduce the political bargaining power of certain countries which are not involved in the knowledge creation / innovation part of the system. 
  • SovereigntyDue to varying social / political / economic situations, nations may have other priorities upon which they’d rather contribute their resources towards. Eg, Switzerland potentially could wish not to contribute to a global fund, for instance, or Bangladesh may wish to focus solely on ‘access’. 
  • And is free-riding a concern when countries wish not to join in a global joint program? 
As mentioned, all these reasons certainly require much more careful study before one can take an informed stance on any of these issues, however at first glance at least, it does seem that a globally joint effort can contribute to a better and more effective drug innovation system. However, either way, with the range of bilateral treaties, multilateral treaties and alternative innovation systems that are currently floating around, these certainly are points that policy makers ought to be keeping in mind before we have another TRIPS on our hands. Readers comments are welcome! 
(This post benefited from a previous discussion with Prof Talha Syed of UC Berkeley)

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