AMTC Submission on Article 39.3. of TRIPS to Ministry of chemicals and Fertilisers, GoI

[Guest guest]

Affordable Medicines and Treatment Campaign (AMTC) made presentaion before the

Committee for the Implementaion of Article 39.3 of TRIPS. The committee is

established by Ministry of chemicals and Fertilisers , Government of India.

Affordable Medicines and Treatment Campaign (AMTC)

Submission before the Committee for the Protection of Undisclosed Information

under Article 39.3 of the TRIPS Agreement

Introduction

1. The Affordable Medicines and Treatment Campaign (AMTC), is a national

campaign aimed at creating an environment that will ensure sustained

accessibility and affordability of medicines and treatment for every individual

in India, including access to affordable Anti-retroviral Therapy (ART) for

persons living with HIV/AIDS. As part of our campaign we monitor the

implementation of the TRIPS Agreement in India and its implication for the

accessibility and availability of drugs. We are concerned about the

implementation of Article 39.3 of the TRIPS Agreement because it may have

serious implications on the accessibility and affordability of drugs. We have

come across reports that certain multinational pharmaceutical associations are

seeking exclusive rights for the data submitted for market approval. We would

like to submit that Article 39.3 does not mandate the creation of any exclusive

rights on the data and the central obligation under Article 39.3 is to protect

the data submitted for market approval from unfair competition in accordance

with Article 10 bis of the Paris Convention on Industrial Property ('the Paris

Convention').

2. The following paragraphs discuss the nature of obligations under the TRIPS

Agreement, the nature of obligations under Article 39.3 and the desirable way to

implement the obligations without compromising the accessibility and

availability of drugs and the Right to Health, as guaranteed by the Constitution

of India (Article 21) and the International Covenant on Economic, Social and

Cultural Rights - ICESCR (Articles 12 & 15).

Nature of TRIPS Obligations

3. The Preamble of TRIPS states that measures and procedures to enforce

intellectual property rights should not themselves become barriers to legitimate

trade. Further, the Preamble recognises the underlying public policy objectives

of national systems for the protection of intellectual property, including

developmental and technological objectives.

4. According to Article 1 of TRIPS, members " shall not be obliged to, implement

in their domestic law more extensive protection than required by this

Agreement " . Thus there is no obligation under TRIPS to provide extra protection

to any intellectual property rights other than what is mentioned in the TRIPS

Agreement. Further, TRIPS permits states to " determine the appropriate method "

to implement the provisions of the TRIPS Agreement within their legal system. As

a result it is up to each state to decide the mechanisms for implementation of

Article 39.3 of the Agreement. Hence, there is no need for the Committee to look

at whether 'data protection can be offered under an appropriate new

dispensation'. We submit that the implementation of Article 39.3 should be

carried out within the framework of the Drugs and Cosmetic Act, 1940.

5. The objective of TRIPS mentioned in Article 7 states that " the protection and

enforcement of intellectual property rights should contribute. to the mutual

advantage of producers and users of technological knowledge and in a manner

conducive to social and economic welfare. " . Further, principles of

implementation under Article 8 state that " members may, in formulating or

amending their national laws and regulations, adopt measures necessary to

protect public health and nutrition, and to promote the public interest in

sectors of vital importance to their socio economic and technological

development. " . These concerns are further clarified and articulated in the Doha

Declaration on TRIPS and Public Health. It states that " .TRIPS Agreement does

not and should not prevent members from taking measures to protect public

health. These principles is also recognaised in the Patents Act ( section 83).

Accordingly, while reiterating our commitment to the TRIPS Agreement, we affirm

that the Agreement can and should be interpreted and implemented in a manner

supportive of WTO Member's right to protect public health and, in particular, to

promote the access to medicines for all " . Hence, India has a legal right to

interpret and implement the TRIPS Agreement to promote access to drugs.

6. According to Articles 31 and 39 of Vienna Convention on the Law of Treaties

(Appendix 1), preambles, objectives, principles, preparatory documents and

subsequent agreements between parties are relevant tools to interpret the

provisions of treaties.

7. Further, TRIPS implementation should not result in the compromise of any

right guaranteed by any previous international treaty. Therefore, as India is a

party to the ICESCR, it cannot compromise the right to health (Article 12,

ICESCR) and the right to enjoy the benefits of scientific progress and its

applications (Article 15, ICESCR). The right to health also falls within Article

21 of the Indian Constitution ( Panikurlangara v Union of India 1987 (2)

SCC 165). The Supreme Court has recoganised that Article 21 has to be

interpreted in consonance with international treties. Hence, the implementation

of any provision in TRIPS should not result in the denial of any of the rights

guaranteed under the ICESCR and the Constitution of India.

8. In the absence of a contrary statute enforceability of ICESCR and the

International Covenant on Civil and Political Rights (ICCPR) in India has been

upheld by the Supreme Court through a number of judgements (Vishaka v State of

Rajsthan (1997) 6 SCC 241).

Nature of Obligations under Article 39.3

9. The obligations under Article 39.3 should be understood in the light of

Article 39.1 of the TRIPS Agreement. According to Article 39.1 members are to

protect data submitted to the government or government agencies in the course of

ensuring effective protection against unfair competition as provided in Article

10 bis of the Paris Convention. Article 10 bis of the Paris Convention defines

unfair competition as " any act of competition contrary to honest practices in

industrial or commercial matters " (Appendix 2). The examples given in the same

Article do not talk about any exclusive rights on the undisclosed information.

The World Intellectual Property Organisation (WIPO) model provision on unfair

competition also does not give any exclusive rights on undisclosed information

(Appendix 3). Hence there is no obligation under Article 39.3 to extend

exclusive rights on data submitted for marketing approval.

10. Further, according to Article 1.2 of TRIPS " the term intellectual property

refers to all categories of intellectual property that are the subject of

sections 1 to 7 of Part II " . Section 7 of the Agreement titled " Protection of

Undisclosed Information " does not deal with any other sui generis system for

data protection. Hence, the obligation under Article 39.3 is to protect

undisclosed information as mentioned in the Paris Convention.

11. There are two obligations under Article 39.3 viz. 1) to protect data

submitted for market approval against unfair commercial use and 2) to protect

such data against disclosure by the authorities. In the second case disclosure

can be made only in two exceptions i.e. to protect the public and to disclose

data after taking steps against unfair commercial use. Hence, there is no

obligation under Article 39.3 to create exclusive rights on the data submitted

for market approval.

12. Protection of data against unfair commercial use does not prevent government

or its agencies from using the same data to evaluate the safety and quality of

the same drug submitted for subsequent market approvals. Such use by government

or its agencies is permissible because such use is not commercial use, let alone

it being unfair commercial use. The purpose of such use by government and its

agencies is to ensure safety and quality of drugs in the public interest. This

is permitted under Article 8 of the TRIPS Agreement. Further, the obligation is

to protect the data against unfair commercial use. This necessarily implies that

the data can be used for fair commercial use. Use of data for subsequent market

approval is a fair commercial use for the competitor and fair use for the

government authorities and therefore permitted under Article 39.3.

13. The negotiating history of Article 39.3 justifies this position. The text

for the Brussels Ministerial Conference on Uruguay Round Agreements contained an

explicit provision for preventing use of data for subsequent market approval.

The Brussels text reads that, " Unless the person submitting the information

agrees, the data may not be relied upon for the approval of competing products

for a reasonable time, generally no less than five years, commensurate with the

efforts involved in the origination of the data, their nature, and the

expenditure involved in their preparation " . This provision was removed from the

final text. This shows that there was no intention to prevent governments and

its agencies from using the data for subsequent market approval.

14. India's submission to the World Trade Organisation (WTO), along with other

developing countries, expressed the above position. India's submission to the

TRIPS Council on 29 June 2001 (IP/C/W/296) states: " Article 39.3 of the TRIPS

Agreement leaves considerable room for Member countries to implement the

obligation to protect test data against unfair competition practices. The

Agreement provides that 'undisclosed information' is regulated under the

discipline of unfair competition, as contained in Article 10 bis of the Paris

Convention. With this provision, the Agreement clearly avoids the treatment of

undisclosed information as a 'property' and does not require granting

'exclusive' rights to the owner of the data " . We do not find any valid reason

for India to change its position.

15. State practices also justify such position. Argentina implemented Article

39.3 without granting any exclusive rights on the data submitted for market

approval. The US request for constitution of the panel under the WTO Dispute

Settlement Understanding against Argentina was withdrawn. Further, Israel one of

the major drug exporters to the USA, does not provide any exclusive rights on

test data.

16. Therefore the first obligation under Article 39.3 is to protect data against

unfair commercial use in accordance with Article 10 bis of the Paris Convention.

This protection is against using the data for unfair commercial purpose and does

not prevent government authorities for using the data for subsequent market

approval. To qualify for protection under Article 39.3 the data should satisfy

the following criteria: the data should be 1) related to new chemical entities,

2) undisclosed or other data, and 3) the origination of data should involve

considerable effort. These terms are not defined in the TRIPS Agreement.

Therefore it is up to each member to define these terms. We would like to

suggest the following:

a. New Chemical Entities: should be defined to exclude new uses and dosage

formulations. Hence the data to be protected can be restricted to only new

chemical entities.

b. Undisclosed or Other Data: this should not include data, which is already in

the public domain.

c. Considerable Effort: The data, which is entitled to protection should involve

considerable effort in the origination of data. Therefore the data created for

local conformity etc. should not be entitled for protection.

1. Further, the protection should be confined to those data submitted on demand

of regulatory authorities. The protection should not extend to those data, that

is submitted voluntarily by the parties.

2. The current practice in India as mentioned in 122 A to E, Schedule Y and Form

44 of the Drugs and Cosmetic Rules, 1945 does not demand pre-clinical and

clinical trial data for every marketing approval of new drugs. It demands all

data only when the drug is discovered in India and not approved anywhere in the

world. If the drug has already got market approval in a foreign country only

local re-conformity data is required for market approval. Hence, the

implementation of the first obligation under Article 39.3 i.e. protection of

test data against unfair commercial use does not need any change in the present

rules.

3. The protection of undisclosed information is already provided under common

law.

4. The implementation of the second obligation under Article 39.3 i.e. to

protect the data (if it fulfills all qualifying criteria) against disclosure

should safeguard peoples' right to access the data for evaluating safety and

quality of drugs. Accessibility of safe and quality drug is an important

component of right to health guaranteed under Article 12 of the ICESCR and

Article 21 of the Indian Constitution. The Supreme Court as reiterated this in

Panikulangara v Union of India. The Court states that " the issues raised

are of vital importance as they related to maintenance of approved standards of

drugs in general. The issues that fall for consideration are not only relating

to technical and specialised matters relating to therapeutic value,

justification and harmful side effects of drugs but also involve examination of

the correctness of action taken by the government on the basis of advice, the

matter also involves the interest of manufacturers and traders of drugs as also

the interest of patients who require drugs for their treatment... every

indigenous drug manufacturer must have an obligation by law to disclose formula

of preparation and other statutory information on the national language and at

least one or two other languages, keeping in view the place of manufacture of

the drug and the area of its circulation. Any statutory warning to be

administrated also follow the same course " .

5. The implementation of the second obligation under Article 39.3 i.e.

protection of data against disclosure should not hamper the availability of data

for fair commercial use. Towards this objective the exceptions available under

Article 39.3 should be used. These exceptions include 1) disclosure for

protecting public and 2) disclosure after taking steps that data will not be

used for unfair commercial use. Data can be made available against a payment for

competitors for the purpose of further research and under a compulsory license

mechanism to meet the public needs or as a remedy against anti-competitive

measures.

6. Lastly, we submit that there should not be any linkage between patent rights

and registration for market approval as advocated by the US through Free Trade

agreements.

For AMTC

Anand Grover

K M Gopakumar

Appendix 1

Article 31

General rule of interpretation

1. A treaty shall be interpreted in good faith in accordance with the ordinary

meaning to be given to the terms of the treaty in their context and in the light

of its object and purpose.

2. The context for the purpose of the interpretation of a treaty shall comprise,

in addition to the text, including its preamble and annexes:

(a) any agreement relating to the treaty which was made between all the parties

in connection with the conclusion of the treaty;

( any instrument which was made by one or more parties in connection with the

conclusion of the treaty and accepted by the other parties as an instrument

related to the treaty.

3. There shall be taken into account, together with the context:

(a) any subsequent agreement between the parties regarding the interpretation of

the treaty or the application of its provisions;

( any subsequent practice in the application of the treaty which establishes

the agreement of the parties regarding its interpretation;

© any relevant rules of international law applicable in the relations between

the parties.

4. A special meaning shall be given to a term if it is established that the

parties so intended.

Article 39

General rule regarding the amendment of treaties

A treaty may be amended by agreement between the parties. The rules laid down in

Part II apply to such an agreement except in so far as the treaty may otherwise

provide.

Appendix: 2

Article 10 bis

[unfair Competition]

(1) The countries of the Union are bound to assure to nationals of such

countries effective protection against unfair competition.

(2) Any act of competition contrary to honest practices in industrial or

commercial matters constitutes an act of unfair competition.

(3) The following in particular shall be prohibited:

1. all acts of such a nature as to create confusion by any means whatever with

the establishment, the goods, or the industrial or commercial activities, of a

competitor;

2. false allegations in the course of trade of such a nature as to discredit the

establishment, the goods, or the industrial or commercial activities, of a

competitor;

3. indications or allegations the use of which in the course of trade is liable

to mislead the public as to the nature, the manufacturing process, the

characteristics, the suitability for their purpose, or the quantity, of the

goods.

Appendix 3

WIPO MODEL PROVISIONS ON PROTECTION AGAINST UNFAIR COMPETITION (1996)

Article 1 General Principles

(1) [General Provision]

(a) In addition to the acts and practices referred to in Articles 2 to 6, any

act or practice, in the course of industrial or commercial activities, that is

contrary to honest practices shall constitute an act of unfair competition.

( Any natural person or legal entity damaged or likely to be damaged by an act

of unfair competition shall be entitled to the remedies referred to in ...

(2) [Relationship Between Articles 1 to 6 and Provisions Protecting Inventions,

Industrial Designs, Trademarks, Literacy and Artistic Works, and Other

Intellectual Property Subject Matter] Articles 1 to 6 shall apply independently

of, and in addition to, any legislative provisions protecting inventions,

industrial designs, trademarks, literary and artistic works, and other

intellectual property subject-matter.

Article 2 Causing Confusion with Respect to Another's Enterprise or Its

Activities

(1) [General Principle] Any act or practice, in the course of industrial or

commercial activities, that causes, or is likely to cause, confusion with

respect to another's enterprise or its activities, in particular, the products

or services offered by such enterprise, shall constitute an act of unfair

competition.

(2) [Examples of Confusion] Confusion may, in particular, be caused with respect

to

(i) a trademark, whether registered or not;

(ii) a trade name;

(iii) a business identifier other than a trademark or trade name;

(iv) the appearance of a product;

(v) the presentation of products or services;

(vi) a celebrity or a well-known fictional character.

Article 3 Damaging Another's Goodwill or Reputation

(1) [General Principle] Any act or practice, in the course of industrial or

commercial activities, that damages, or is likely to damage, the goodwill or

reputation of another's enterprise shall constitute an act of unfair

competition, regardless of whether such act or practice causes confusion.

(2) [Examples of Damaging Goodwill or Reputation]

(a) Damaging another's goodwill or reputation may, in particular, result from

the dilution of the goodwill or reputation attached to

(i) a trademark, whether registered or not;

(ii) a trade name;

(iii) a business identifier other than a trademark or a trade name;

(iv) the appearance of a product;

(v) the presentation of products or services;

(vi) a celebrity or a well-known fictional character.

( [Definition of ADilution@] For the purposes of these Model Provisions,

" dilution of goodwill or reputation " means the lessening of the distinctive

character or advertising value of a trademark, trade name or other business

identifier, the appearance of a product or the presentation of products or

services, or of a celebrity or well-known fictional character.

Article 4 Misleading the Public

(1) [General Principle] Any act or practice, in the course of industrial or

commercial activities, that misleads, or is likely to mislead, the public with

respect to an enterprise or its activities, in particular, the products or

services offered by such enterprise, shall constitute an act of unfair

competition.

(2) [Examples of Misleading] Misleading may arise out of advertising or

promotion and may, in particular, occur with respect to

(i) the manufacturing process of a product;

(ii) the suitability of a product or service for a particular purpose;

(iii) the quality or quantity or other characteristics of products or services;

(iv) the geographical origin of products or services;

(v) the conditions on which products or services are offered or provided;

(vi) the price of products or services or the manner in which it is calculated.

Article 5 Discrediting Another's Enterprise or Its Activities

(1) [General Principle] Any false or unjustifiable allegation, in the course of

industrial or commercial activities, that discredits, or is likely to discredit,

another's enterprise or its activities, in particular, the products or services

offered by such enterprise, shall constitute an act of unfair competition.

(2) [Examples of Discrediting] Discrediting may arise out of, advertising or

promotion and may, in particular, occur with respect to

(i) the manufacturing process of a product;

(ii) the suitability of a product or service for a particular purpose;

(iii) the quality or quantity or other characteristics of products or services;

(iv) the conditions on which products or services are offered or provided;

(v) the price of products or services or the manner in which it is calculated.

Article 6 Unfair Competition in Respect of Secret Information

(1) [General Principle] Any act or practice, in the course of industrial or

commercial activities, that results in the disclosure, acquisition or use by

others of secret information without the consent of the person lawfully in

control of that information (hereinafter referred to as " the rightful holder " )

and in a manner contrary to honest commercial practices shall constitute an act

of unfair competition.

(2) [Examples of Unfair Competition in Respect of Secret Information]

Disclosure, acquisition or use of secret information by others without the

consent of the rightful holder may, in particular, result from

(i) industrial or commercial espionage;

(ii) breach of contract;

(iii) breach of confidence;

(iv) inducement to commit any of the acts referred to in items (i) to (iii);

(v) acquisition of secret information by a third party who knew, or was grossly

negligent in failing to know, that an act referred to in items (i) to (iv) was

involved in the acquisition.

(3) [Definition of Secret Information] For the purposes of this Article,

information shall be considered " secret information " if

(i) it is not, as a body or in the precise configuration and assembly of its

components, generally known among or readily accessible to persons within the

circles that normally deal with the kind of information in question;

(ii) it has commercial value because it is secret; and

(iii) it has been subject to reasonable steps under the circumstances by the

rightful holder to keep it secret.

(4) [use or Disclosure of Secret Information Submitted for Procedure of Approval

of Marketing] Any act or practice, in the course of industrial or commercial

activities, shall be considered an act of unfair competition if it consists or

results in

(i) an unfair commercial use of secret test or other data, the origination of

which involves considerable effort and which have been submitted to a competent

authority for the purposes of obtaining approval of the marketing of

pharmaceutical or agricultural chemical products which utilize new chemical

entities, or

(ii) the disclosure of such data, except where necessary to protect the public,

or unless steps are taken to ensure that the data are protected against unfair

commercial use.