IP, Development and Access to Medicines

1. IP and development: the arguments

• For stronger IP. It attracts foreign direct investment and technology licensing, rewards local innovation, and supports creative industries. Some economies that strengthened IP after industrialising, such as South Korea, did so as their own firms began to innovate.
• Against. Developing countries are net importers of technology, so strong IP raises the price of what they buy and transfers rent abroad. Patents in poor markets are often not worked locally. Research follows the money, so diseases of the poor receive little investment however strong the patent. The UK Commission on Intellectual Property Rights (2002) found little evidence that strong IP raised growth in low-income countries.
• The middle view. IP protection should be matched to the level of development, which is what every developed country did historically (see the history note and Ha-Joon Chang’s Kicking Away the Ladder).

2. The TRIPS flexibilities

The flexibilities are the textual room in TRIPS that allows national policy choices:

1. the objectives and principles in Articles 7 and 8;
2. freedom to define patentability criteria strictly, such as India’s section 3(d) and the definition of inventive step;
3. exclusions under Article 27(2) and (3), including methods of treatment and plants;
4. limited exceptions under Article 30: research use and regulatory review (Bolar);
5. compulsory licences and government use under Article 31, with freedom to choose the grounds;
6. parallel imports through international exhaustion under Article 6;
7. pre- and post-grant opposition and strict examination;
8. competition law remedies under Articles 8(2) and 40; and
9. transition periods for least-developed countries under Article 66.

3. The HIV/AIDS crisis and the Doha Declaration

By the late 1990s the price of patented anti-retroviral treatment was beyond the reach of most patients in Africa. In 2001 Cipla offered a triple-drug combination at a fraction of the patented price. South Africa’s Medicines and Related Substances Control Amendment Act, 1997 allowed parallel imports and generic substitution; thirty-nine pharmaceutical companies sued the government (the PMA case), and withdrew in April 2001 under public pressure. The United States also dropped a WTO complaint against Brazil’s local working requirement.

The Declaration on the TRIPS Agreement and Public Health was adopted at the Doha Ministerial Conference on 14 November 2001. Its main paragraphs:

• Paragraph 4: the Agreement does not and should not prevent members from taking measures to protect public health; it “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.”
• Paragraph 5: each member has the right to grant compulsory licences and the freedom to determine the grounds; each member may determine what constitutes a national emergency or other circumstance of extreme urgency, and public health crises such as HIV/AIDS, tuberculosis and malaria can be such; and each member is free to set its own regime of exhaustion.
• Paragraph 6: members with insufficient or no manufacturing capacity could not make effective use of compulsory licensing, because Article 31(f) limits a compulsory licence to use predominantly for the domestic market. The TRIPS Council was told to find a solution.
• Paragraph 7: the transition period for least-developed countries for pharmaceutical patents was extended.

4. The paragraph 6 system and Article 31bis

The General Council decision of 30 August 2003 waived Article 31(f) so that a member could grant a compulsory licence to manufacture a medicine for export to an eligible importing member that notifies its need. The waiver was converted into a permanent amendment, Article 31bis, adopted in 2005 and in force from 23 January 2017. India implemented it through section 92A of the Patents Act. The system has been used once: Canada licensed Apotex to export an AIDS combination to Rwanda in 2008. Critics, including Médecins Sans Frontières, say the procedure is too burdensome and drug-by-drug, country-by-country notification deters generic producers.

5. COVID-19 and the 2022 Ministerial Decision

In October 2020 India and South Africa proposed a temporary waiver of TRIPS obligations on patents, designs, copyright and undisclosed information for COVID-19 vaccines, diagnostics and treatments. After long opposition from the EU, Switzerland and the UK, the Twelfth Ministerial Conference adopted a Ministerial Decision on the TRIPS Agreement in June 2022. It is narrower than the proposal: it covers vaccines only, clarifies and eases the use of compulsory licences for them, including for export, and does not waive the other rights. A decision on diagnostics and therapeutics was postponed and not taken. Supporters of the original proposal regard the outcome as modest; others argue that manufacturing know-how and regulatory capacity, not patents alone, were the real bottleneck.

6. India as the pharmacy of the developing world

Under the process-only regime of 1970 to 2005, Indian firms reverse-engineered patented drugs and became the main suppliers of generic medicines to the developing world. The 2005 Act kept that role alive through four devices:

• Section 3(d), upheld and applied in Novartis AG v. Union of India, 2013 INSC 198, (2013) 6 SCC 1, which refused a patent for a new crystalline form of imatinib. The Court described the provision as meant to prevent evergreening and to protect access to medicines.
• Pre-grant opposition, used by patient groups and generic firms against secondary patents.
• Compulsory licensing: Bayer Corporation v. Natco Pharma (licence 2012, upheld by the Bombay High Court in 2014) for sorafenib.
• Section 107A (Bolar and parallel imports).

The constitutional anchor is the right to health under Article 21, read with Article 47. The courts have treated access to medicines as part of the public interest that patent remedies must weigh. In Roche v. Cipla the Delhi High Court (single judge, 2008) declined an interim injunction against a generic version of erlotinib, partly because of the price difference and the public interest in access to a life-saving drug.

7. The WIPO Development Agenda

Brazil and Argentina, with the “Group of Friends of Development”, proposed in 2004 that WIPO take development into account in all its work. In 2007 the WIPO General Assembly adopted 45 recommendations in six clusters, covering technical assistance, norm-setting with flexibilities and the public domain, technology transfer and access to knowledge, and assessment, and set up the Committee on Development and Intellectual Property (CDIP). The Marrakesh Treaty of 2013 for blind and visually impaired persons is the clearest product of this shift, along with the 2024 treaty on genetic resources and associated traditional knowledge (see IPR II).

How this is examined

Questions: “IP and access to medicines,” “Doha Declaration,” “TRIPS flexibilities” or “IP and development.” Build the answer as problem (price and access), legal frame (TRIPS Articles 7, 8, 27, 30, 31), the Doha Declaration and paragraph 6, India (section 3(d), Novartis, Bayer v. Natco), and the TRIPS-plus threat. Close with your view on whether the flexibilities are enough in practice.