Transcript DRUG PATENTS – INFRINGEMENTS Dr. V. R. Srinivas

SEIZURE OF INDIAN GENERIC MEDICINES
BY EUROPEAN CUSTOMS IN THE NAME OF
COUNTERFEIT
Dr. Alka Mehta
Cipla Limited
INTELLECTUAL PROPERTY
An intellectual property is any product or invention of
human intellect that is unique, novel, and non-obvious and
has some commercial value
Types of Intellectual Property
• Patents
• Copyrights; and
• Trademarks
Patent - Definition
A patent is a monopoly right granted to an inventor, giving the
inventor the right for a limited period of time to prevent others from
making, using or selling his invention without due permission from
the inventor.
A patent can be
a) bought,
b) sold,
c) rented; or
d) hired
Infringement
whoever without authority makes, uses, offers to sell, sells, or
imports any patented invention during the term of the patent,
infringes the patent.
Introduction:
Many countries do not have manufacturing capacity to produce
medicines and rely on the import of affordable generic medicines from
abroad in order to treat their populations. As such, the trade in
legitimate medicines between countries is fundamental to ensure
access to medicines for millions of people in the developing world.
Ensuring access to medicines in developing countries, as enshrined in
the Doha Declaration and the WTO decision, cannot be implemented
effectively if, on key transit routes, the risk exists that supplies can be
regularly subject to interception based on the assertion of patent
infringement in the transit country.
If patent protection is absent in the country of destination, there is no
basis for provisional holding actions to prevent possible foreign
infringement.
When drug X is patented in Netherlands, but not South America, and a
Company exports X from India to South America, and the flight
containing drug X makes a stopover in Netherlands on the way to
South America, the drug on board the flight does not infringe the
Netherlands patent.
However, if the Company has reason to suspect that the (possible)
Dutch patent holder will have formulated a request for notification for
that particular drug; an alternative routing can prevent delay by
customs/seizures. This would force exporters to look at alternative
routes to send the medicines, which is likely to impact the cost
competitiveness of Indian generic drugs.
Council Regulation (EC) No. 1383/2003, permits customs authorities to seize goods passing through customs
of an EU member state when these goods are suspected of infringing patents granted and subsisting in these
countries, provided that the patent holder has registered in advance with the customs authorities.
The regulations permit customs to hold these goods for ten working days (or a further period provided for in
the regulations) and inform the patent holder of the seizure. The patent holder then has to apply to a civil court,
request a civil seizure and initiate legal proceedings in order to prove that infringement has taken place.
This authority to seize goods not only applies to goods that are destined for the EU country to which these
regulations apply, but also to goods that are merely passing through these ports on their way to another country
outside the EU. For example goods bound from India to South America, which are passing through an EU
member state, are also liable to be seized.
Courts in different EU member states appear to have pronounced different views on the legality of these
provisions, when the goods are not intended for an EU member country and the law is not completely settled in
this regard.
These provisions may have a significant impact on Indian companies, most of which use the EU route to
transport pharmaceutical products to markets where the patent is not recognized or the product is off patent. By
forcing Indian companies to opt for a different route to transport the goods to the intended market, the cost of
transport may significantly add to the cost of producing the pharmaceutical product, thus adversely impacting
the India's ability to remain competitive.
This is especially relevant in the case of bulk exports from India of the API (active pharmaceutical ingredient)
because it is one of the largest exporters in the world of these products. India's cost advantage may be reduced
if companies are constrained to send pharmaceutical products such as the bulk drug used for formulating much
needed medicines in the developing world through alternative routes. This will, obviously, also impact the
availability of much needed medicines in developing countries, to which India exports these goods.
Facts
Three consignments of Indian-manufactured generic medicines –
seized last year while in transit in the EU – have been earmarked for
destruction by EU authorities. These consignments – of clopidogrel,
rivastigmine and olanzapine – were being exported from India to other
developing countries to treat patients with serious and life-threatening
conditions such as heart attacks, strokes, Alzheimer's disease,
Parkinson's disease and psychosis. Yet they were seized by Dutch
customs authorities on the basis of alleged patent infringement.
Although these medicines are not under patent in India or in the
destination countries, EU customs legislation still permits the
destruction of these life-saving medicines. A humanitarian
organisation, Médecins Sans Frontières (MSF), has highlighted several
other recent cases of generic medicines in transit in the EU that have
been detained, seized or destroyed.
The root of the current wave of seizures is the blurring of the definition
between legitimate generic medicines and illegal counterfeit
medicines. It is vital to differentiate between illegal counterfeit
medicines – which the World Health Organization defines as medicines
having a false representation of identity and/or source – and legitimate
generic medicines, which are, in most cases, simply unbranded
versions of patented medicines.
The current definition of counterfeit medicines by the World Health
Organization (WHO) and the one proposed by the WHO-backed International
Medical Products Anti-Counterfeiting Taskforce (IMPACT) is leading to such
interpretation of in-transit drug consignments from India.
Definition of “Counterfeit Goods”
1) Customs Legislation: Regulation (EC) 1383/2003 concerning customs
action against goods suspected of infringing certain IPR rights (…); Art. 2
Nr. 1a
i. goods, including packaging, bearing without authorization a trademark
identical to the trademark validly registered in respect of the same type of
goods…
ii. any trademark symbol (including a …brochure…) on the same conditions as
the goods referred to in point (i);
iii. packaging materials bearing the trademarks of counterfeit goods, presented
separately, on the same conditions as the goods referred to in point (i);
2) WHO Definition (2007):
“A medicial product is counterfeit when there is a false representation in
relation to its identity, history or source”.
 does not include IPR violations!
According to Pharmexcil, companies whose consignments also ran into similar trouble
(other than as listed below) include JB Chemicals and Pharmaceuticals Ltd, Medico
Remedies Pvt. Ltd, Titan Pharma India Pvt. Ltd, and Mission Pharmaceuticals Ltd, all
based in Mumbai, and Hyderabad-based Sainor Pharma Pvt. Ltd.
Listed below are the consignments of Indian companies that were seized on grounds of
patent infringement by the Dutch customs authorities.
1.15.10.08: Ind-Swift Laboratories Ltd (Clopidogrel Bilsulphate- API): Destined for
Columbia
A consignment valued at some $100,000 (Rs 49 lakh) of Ind-Swift in transit for
Venezuela was seized in November by customs authorities in the Netherlands under
suspicions of being counterfeit.
The product was the generic drug pantoprazole, used for treating ulcers, in the form of
pellets that were to be filled in capsules and sold in Venezuela, where Ind-swift has
marketing rights for it.
Contd..
2. 27.11.08: Cipla Ltd, through Uni World Pharma Ltd, Dubai
(Olanzapine 10 mg Tabs): Destined for Peru.
3. 27.11.08: Cipla Ltd, through Uni World Pharma Ltd, Dubai
(Rivastigmine 3 mg Tabs): Peru.
4. 24.12.08: Dr Reddy’s Laboratories Ltd (Losartan - API): Destined for Brazil
A DRL shipment of the generic version of losartan was seized in transit in the
Netherlands. This shipment, on its way to Brazil, was held by the customs
authority at Rotterdam, which said it infringed the patent of the original
drug—Cozaar. Losartan is not patented in India or Brazil. The patent for
Cozaar in the Netherlands is held by DuPont, while US-based pharma
multinational Merck and Co. holds the marketing rights."
5. A consignment of HIV/AIDS medicines by Aurobindo Pharma Ltd meant
for use in Nigeria was seized by Dutch officials. The grounds on which they
were allegedly seized again is that they contained counterfeit goods.
Dr. Reddy's Case
Background: A consignment of 500 Kg of Losartan potassium was
bound for Brazil. It was seized in transit by the Netherlands customs
authorities under the authority of an EC council regulation, permitting
the seizure of goods on suspicion of patent infringement in the
Netherlands. Apparently, Losartan is protected in the Netherlands by a
product patent of Merck/Dupont which is valid until September 2009.
The only issue was one of patent infringement in the Netherlands. The
value of the consignment seized is $ 55,000 and not $500,000 as
mentioned in the media.
Subsequently Dr. Reddy's discussed the matter with the patent holders
and secured the release of the goods from the custody of the customs
authorities. Merck/Dupont agreed to release the goods to Dr. Reddy's
on Thursday (8th Jan) and the goods are now back in India.
The Dutch government has asked the European Commission (EU) for
a review of the EU Customs regulations. The Dutch government has
taken up this damage control exercise after developing countries
strongly criticised the seizure of consignments of Losartan.
Subsequent to these seizures which prompted India and Brazil to issue
very strong statements against this action, DRL opted to back down
and have its consignment returned to India.
In addition to Brazil and India, those voicing concerns about access to
medicines and customs were: Argentina, Bolivia, Burkina Faso, China, Costa
Rica, Cuba, Ecuador, Egypt, Indonesia, Israel, Nigeria, Pakistan, Paraguay,
Peru, South Africa, Thailand and Venezuela.
The statement made by the European Commission, on behalf of the
European Union, at the WTO General Council on 3 February, stresses
that the seizure was allowed by TRIPS and that it was based on
provisions in EU customs law that allow customs to temporarily detain
goods.
However, the EC Regulation No 1383/2003 goes beyond the
obligations required under the TRIPS Agreement, in which a footnote*
clearly states that goods in transit can be kept outside the field of
application of the general customs procedures.
*Footnote: It is understood that there shall be no obligation to apply such procedures to
imports of goods put on the market in another country by or with the consent of the right
holder, or to goods in transit.
Article 41 of the TRIPS Agreement also states that any intellectual enforcement
measures should “be applied in such a manner as to avoid the creation of barriers to
legitimate trade.” Finally, the 2001 Doha Declaration on TRIPS and Public Health –
signed by the members of the European Union - underlines that “the TRIPS Agreement
can and should be interpreted and implemented in a manner supportive of WTO
Members' right to protect public health and, in particular, to promote access to
medicines for all.”
Article 51
Suspension of Release by Customs Authorities
Members shall, in conformity with the provisions set out below, adopt procedures to
enable a right holder, who has valid grounds for suspecting that the importation of
counterfeit trademark or pirated copyright goods
may take place, to lodge an application in writing with competent authorities,
administrative or judicial, for the suspension by the customs authorities of the release
into free circulation of such goods. Members may enable such an application to be made
in respect of goods which involve other infringements of intellectual property rights,
provided that the requirements of this Section are met. Members may also provide for
corresponding procedures concerning the suspension by the customs authorities of the
release of infringing goods destined for exportation from their territories.
As per Generics Bulletin dated March 11, 2009
Dutch customs officials contradicted the World Trade Organization’s (WTO’s)
agreement on trade-related aspects of intellectual-property rights (TRIPS) and broke the
European Union’s commitments under the WTO’s Doha Declaration, members of the
European Parliament (MEPs) have asserted in a letter to the EU Commissioners for
Trade and for Taxation and Customs Union.
Highlighting recent Dutch seizures of losartan being shipped from India to Brazil and of
abacavir that was in transit from India to Nigeria, the MEPs insist “seizures of generic
drugs within the EU are becoming an increasingly widespread problem”. The European
Regulation cited by the European Commission at the WTO General Council
(Generics bulletin, 13 February 2009, page 11) “goes beyond the obligations required
under the TRIPS agreement, in which a footnote clearly states that goods in transit can
be kept outside the field of application of the general customs procedures”, the MEPs
maintain.
Latching onto a letter sent by Médicins Sans Frontières (Generics bulletin, 6 March
2009, page 13), the MEPs call on the Commission to clarify its position on EC
Regulation 1383/2003 and its application to medicines.
At the WTO TRIPS Council of 3 March the DG Trade official justified
the recent seizures of generic medicines on the basis of the need to
combat the entry of fake medicines into the EU. The cases that we
have outlined above involved legitimate generic medicines and not
fake, counterfeit or pirated medicines.
The original purpose of Regulation 1383/2003 was to combat
counterfeit and pirated goods and not to detain goods that infringe
IPRs.
The EC Regulation 1383/2003 must be changed in order that customs
officials have clear guidance on its implementation and therefore avoid
disrupting legitimate trade.
WHO issues mild statement on transit of medicines, on March 13th,
2009
The WHO has just issued a statement on the transit of medicines. It is
short and mild. The statement does not mention goods in transit in the
title. It does not mention at all that medicines have been seized. The best
part of the statement is the following quote:
“ Ensuring that the interests of trade and health are appropriately
managed, also means that the flow of legitimate medicines, including
generic medicines, is not impeded”
The action part of the statement is weak, however:
“ In relation to this issue, WHO is continuing to follow developments and
consulting with Member States and relevant international
intergovernmental organizations. WHO also understands that there is
ongoing dialogue among the parties concerned to resolve the matter.
Given the public health impact of this issue, WHO remains ready to
provide, upon request, technical and policy support to Member States.“
Views of NGOs
The following are the views of few NGOs on role of the WHO in addressing public
health concerns over goods in transit.
Buko Pharma-Kampagne, Christian Wagner-Ahlfs ([email protected]).
"Cheap generics are essential for developing countries. Each attempt to label legally
produced generics as counterfeit or product piracy, affects public health. We ask WHO
to use its mandate for public health by encouraging European governments not to block
generic imports to developing countries.“
HAI Global, Tim Reed, (+31 20 683 3684, [email protected]).
"As an NGO who has worked collaboratively with the World health Organisation
(WHO) for many years on delivering increased access to essential medicines and the
rational use of medicines in low and middle income countries, Health Action
International is dismayed that WHO has remained quiet for so long about the recent
spate of generic medicine seizures in Europe. This is an opportunity for WHO to show
strong leadership and promote its own principle of universal access to essential
medicines, with a clear message that the actions in European ports are unacceptable.
Instead, we have a deafening silence."
Contd…
HAI Europe, Teresa Alves, (+31 20 683 3684, [email protected]).
"The public health dimension of the European seizures of generics cannot be ignored.
Yet, the clock is ticking while the international health community awaits WHO's
reaction. WHO must act decisively to drive global health advocacy and represent the
interests of those who do not have access to the medicines they need.“
Knowledge Ecology, James Love, (office +1 202-332-2670, mobile +1 202-361-3040,
[email protected]).
"The WHO should protect the poor, and champion access to medicine. There is a
campaign by a handful of giant pharmaceutical companies and trade associations to
undermine legitimate trade in generic medicines. As noted by the Director General of
the World Trade Organization (WTO), the seizures of medicines in transit to developing
country markets is a serious issue. There are many resolutions and declarations that
speak to the need to promote access to medicines, and the WHO clearly has a
mandate in this area. The WHO needs to find its voice, and act."
Contd…
TransAtlantic Consumer Dialogue, Anne-Catherine Lorrain (+32 473 99 97 92,
[email protected]).
"The silence of the World Health Organisation (WHO) sends the wrong signal on the
crucial issue of the supply of legitimate generic medicines to developing countries.
Consumers are looking to the WHO to provide leadership and expertise in resolving this
issue, which is critical for our life and health.“
Third World Network, Sangeeta Shashikant (office: +41 22 908 3550,mobile: +41
78 757 2331, [email protected]).
"The lack of a prompt response by WHO on an issue that affects access to medicines in
developing countries is extremely disappointing.It suggest a lack of commitment and
leadership in WHO. As an organisation tasked with the attainment by all peoples of the
highest possible level of health, WHO must without any further delay push the EU to
amend its Directive. WHO should also assess and speak out against the anticounterfeiting initiatives such as IMPACT, WCO's SECURE, ACTA that could have
serious consequences for the availability of generics and access to medicines."
Vote of thanks
My sincere thanks to Pharmaexil for Pharmaexil's efforts and to
Government of India to support the Indian companies, especially Cipla in
fighting this unjust seizure in the name of Intellectual property violation
when Netherlands was used merely as a transit for goods intended for
Peru.
My sincere thanks to my colleagues Ms. Patsy Jeffery and Ms. Bhakti Vajratkar in preparing
this presentation
My sincere thanks to Spicy IP colleagues for allowing me to reproduce the data.
THANK YOU FOR YOUR TIME AND PATIENCE