|Infringement for the public good?|
|The threat of bioterrorism undercuts the strength of patents during a national crisis.
The Canadian connection
Bayer was stunned and, although not threatening a lawsuit over infringement on its Canadian Cipro patent, which it holds until 2004, company officials spoke of keeping their options open. They openly questioned the source and validity of the ministers information, grandiosely showing off a Toronto warehouse full of Cipro.
Weve been working closely with the government to meet all of their current demands and their future requirements, said Doug Grant, vice president of public policy and communications for Bayer Health Care, in a Toronto interview.
Eventually, Rock backed down, continuing to work with Bayer and offering to swallow Apotexs costs.
Meanwhile, in the United States . . .
We cannot just rely on Bayer to ensure we have a sufficient supply of Cipro, Schumer said in an October 16, 2001, press release. First, Bayer can only produce so much Cipro, and we should not put our best response to anthrax in the hands of just one manufacturer. Second, buying Cipro only from Bayerwho charges a lot more than generic manufacturers wouldmeans we spend a lot more and receive a lot less. Hopefully, we wont even need to use the Cipro we already have on hand, but if we make arrangements to purchase it from multiple generic drug manufacturers, well have it if we need it.
Although the dispute was far from settled, Bayer moved to improve public relations by dropping the price of Cipro tablets in both the Canadian and American markets to $0.95. The new deal met with the approval of both Thompson and Schumer.
A defining moment
According to patent lawyer Kevin Carton, the Canadian Patent Act allows the government to rescind patent protection, with permission of the Commissioner of Patents, under conditions of national emergency, in which case it would be up to the patent holder to dispute the decision in court. The situation, however, seems to be cloudier in the United States.
Although Secretary Thompson considered the possibility of overriding Bayers patent, he routinely questioned his authority to do so and deferred to Congress. In an open letter, however, Ralph Nader and James Love, director of the Consumer Project of Technology, pointedly stated that Thompson had the authority. The U.S. government has used 28 USC 1498 in many cases for less serious matters to authorize contractors to use patents held by others in order to provide goods and services for the government, they wrote. This includes cases involving pharmaceutical products in far less difficult circumstances.
The advocates are making reference to the part of Title 28 of the U.S. Code (USC) that deals with patent and copyright cases. Under 28 USC 1498, the U.S. government retains the right to use or manufactureor contract another party to manufactureany invention described by a U.S. patent without license of the owneressentially, to override the owners patent. In return, the owner of the patent can sue the government for the recovery of his reasonable and entire compensation for such use and manufacture. Exactly what is implied by reasonable compensation is poorly understood, but it is generally thought to include manufacturing costs and income from lost sales.
In the late 1960s, the Veterans Administration (VA, now the Department of Veterans Affairs) purchased meprobamate, a tranquilizer, from a Danish company at $1.55 per 500 tablets, even though the same product was available from the U.S.-based pharmaceutical firm Carter-Wallace at $26 per 500 tablets, more than 17 times the price. Had the VA invoked 28 USC 1498, it would have been able to contract an American company to produce meprobamate at a fraction of the price being charged by the pharmaceutical firm. As it was, Carter-Wallace filed suit against the VA, Department of Defense, and General Accounting Office to recover compensation under 28 USC 1498 for what it saw as an infringement on its patent for meprobamate.
In the Bayer case, however, the problem of lawsuits was avoided by its decision to reduce the price of Cipro, relieving Secretary Thompson from having to invoke 28 USC 1498, ask Congress to do so, or accept Bayers position. But, although Bayers decision largely made the U.S. situation moot, the events in Canada and the United States were also being watched abroad, and people were still asking what exactly constitutes a national emergency.
What about the developing world? Annually, more than 2 million people die in Africa due to complications from AIDS, but a pill that costs a few dollars to manufacture might carry a price tag 10 to 100 times higher. Yet efforts to reduce the costs of AIDS-related drugs through the production of generics are routinely met with threats of lawsuits. A case in point is the threat by 39 drug companies last year to take the South African government to court when it considered buying generic versions of AIDS drugs.
Tommy Thompson may not know it, but he became our ally when he threatened that patent, said Jose Viana in an interview. Viana is an adviser to the Health Minister of Brazil, another country ravaged by diseases for which drugs are available but expensive. He did what he thought was in the best interest of his country. Why cant others do the same?
Thus, the desire to provide low-cost pharmaceuticals for their own people while denying them to others is the reason that many people see the positions of the American and Canadian governments on drug patents as hypocritical. Although companies like Bayer give some drugs away for freea little good willthere is still a lot of pressure to prevent manufacturers of generic drugs from lowering prices.
Activists for expanded access to medicines have called on companies and governments to recognize the World Trade Organizations (WTOs) TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement. Article 31(b) of this agreement basically states that a member state can use the subject matter of a patent without the authorization of the patent holder if, before such use, the member has made efforts to obtain authorization and that such efforts have not been successful within a reasonable period of time.
This requirement may be waived, however, in cases of national emergency or other circumstances of extreme urgency, although the right holder should be notified as soon as reasonably practicable. But again, the problem of how to define a national emergency rears its ugly head.
At the November 2001 meeting in Doha, Qatar, the WTO reaffirmed Article 31 in the light of worldwide public health concerns over diseases such as AIDS, tuberculosis, and malaria, leaving it up to the individual member states to define a national emergency as they see fit. How this reaffirmation will influence implementation, however, remains to be seen. The changed legal and political landscape that has resulted from the actions of Rock and Thompson puts the WTO position in a much different light than it would have been only months earlier. Perhaps because of the precedent in Canada, developing countries will have a firmer foot upon which to stand in achieving affordable health care.
The last word
Randall C. Willis is a senior associate editor of Modern Drug Discovery. Send your comments or questions regarding this article to email@example.com or the Editorial Office by fax at 202-776-8166 or by post at 1155 16th Street, NW; Washington, DC 20036.