Crisis Averted On Whether to Include a Definition of Biopiracy

Definition of BiopiracyImage by John & Mel Kots via Flickr

Definition of Biopiracy
8th ABS Working Group Meeting
Montreal, Canada
13 November 2009
Day 4 Update
Crisis Averted On Whether to Include a Definition of Biopiracy
By Elpidio Peria

MONTREAL, Canada – 12 November 2009 – Negotiations for the International Regime on ABS nearly got unraveled today, when the EU insisted that its proposed definitions on misappropriation/misuse be included in the negotiations on the text of compliance, but eventually a compromise was arrived at by inserting a footnote in the text that this can be done later after the Montreal meeting of the ABS Working Group.
It was difficult for the LMMC to agree to the compromise but the agreement had the effect of unblocking one of the impediments to the negotiations.

During the plenary this morning another key negotiation impediment clarified involved the so-called “parking lot” and subheadings in the text currently before the delegates.
This so-called “parking lot” was the term used by the various contact groups this week to refer to the destination of various texts on compliance, traditional knowledge, access and benefit-sharing which they cannot agree to place within the existing subheadings and components in the current text of the International Regime on ABS.

The Co-Chairs decided there are three categories of these “parking lots” at the moment, one category refers to operative text on a main component but should belong to another component.
An example of this is the the African Group proposal made on the component on traditional knowledge involving disclosure requirements in applications for intellectual property rights, product registration and plant variety registration but should properly belong to the component on compliance.
Another type of “parking lot” involved text that does not belong in the contact group which took it up, but does not also belong either to any other component but one Party wants it taken up and for this type of “parking lot”, a category was created called “implementing and other operative text for further discussions and negotiations”.

The Co-Chairs clarified that this category can be dealt with later in the subsequent negotiations of the International Regime, but the text in this category will not be negotiated at this stage.
The Mexican proposal made in the compliance contact group creating an international compliance mechanism patterned after a similar mechanism under the Cartagena Protocol is an example of text belonging to this “parking lot”.

Finally, the Co-Chairs referred to “bridging elements” containing cross-over issues, which require further thought but difficult to approach in a compartmentalized fashion.
The EU proposal made in the compliance contact group on the definition of misappropriation/misuse can belong to this category of “parking lot” but the EU is insisting that its proposal rightfully belongs in the compliance component of the International Regime.

The fluidity of the negotiations and the challenges of dealing with the various concepts and ideas on how to deal with the key issues of the International Regime is challenging negotiators here in Montreal, but these things will eventually sort itself out in the last day of this meeting.
This is true on the issue of subheadings, which has somehow become superfluous in the negotiations on the text on capacity-building, but is still useful for giving precision to the discussions on compliance and on access and benefit-sharing, while giving some headaches to the negotiations in the text on traditional knowledge for being repetitive.

This appears to be the reason for the EU to keep on insisting that it be retained, to prevent the emergence of a clear form and content of the International Regime.

These subheadings were the “bricks and bullets” previously arrived at during the 6th meeting of the ABS Working Group in Geneva in January 2008, which proved crucial in clarifying the consensus of the Parties then on what may constitute the various components of the International Regime.
In the 7th ABS Working Group meeting in Paris, France in April 2009, these “bricks and bullets” were deemed also to be an impediment to the negotiations as it gave unequal status to the proposed text to those that have consensus among the Parties and those which did not.

By the end of this negotiations, there could be a decision whether it is ripe to have another breakthrough on this issue of sub-headings.

In the contact group on capacity building, the Philippines was given a chance to re-insert its proposal for a capacity-building measure involving training in tracking the use of biological resources and genetic resources across sectors including understanding cases of biopiracy and the 'digitalization of biopiracy'.

These proposals came out from the conference organized recently by the ASEAN Center for Biodiversity in Singapore in September 2009.

There was a lot of consternation among delegates on what “digitalization” meant but this was understood by the proponent to refer to the burgeoning field of bioinformatics, where fragments of genes and compounds are being placed in various databases that are used and exchanged among research centers worldwide and developed into something more useful, like diagnostic kits for certain diseases or a new medicine to deal with emerging diseases, or simply to advance the frontiers of biological/genetics research which have evolved into the various “omics” field- genomics, proteomics, metagenomics, etc.

Another proposal raised by Philippines for capacity-building involved the use by academia and research institutions of alternatives to intellectual property rights systems such as open-source licenses and a study of their impacts on realizing benefit-sharing.

As is usual in these meetings, these new concepts are bracketed by other delegates which gives it time to be further reflected and studied upon until the next meeting of the ABS Working Group.
In the contact group on traditional knowledge, the Philippines tried to push the concept of 'traditional knowledge associated with genetic resources' as one of the concepts that will be taken up when definitions are dealt with, but this caused a lot of dismay among developed country delegates that it was eventually withdrawn.

The delimitation of the concept of traditional knowledge to this category, that it is only “associated with traditional knowledge' is seen as an attempt to chop the concept of traditional knowledge and genetic resources into several pieces when it is an accepted notion in bioprospecting, that where plants and other biological material are explored for their medicinal and other industrial uses, they cannot be identified unless the traditional knowledge of indigenous peoples have been tapped to determine where they may be located.
It is also a fact that there are also chemical compounds, like the ones taken from marine species, that are identified without the use of traditional knowledge.

This is also important to clarify the eventual scope of the International Regime, considering that the General Assembly of the World Intellectual Property Organization or WIPO, has given a renewed mandate to the Intergovernmental Committee on Intellectual Property, Genetic Resources, Traditional Knowledge and Folklore or IGC, to negotiate a legal instrument to deal with the misappropriation and misuse of traditional knowledge.

These and other matters will get sorted out in the subsequent meetings of the ABS Working Group which is now said to have been transferred to Rome, Italy, and not anymore in Colombia.
oOo

Thoughts on Philippine IPR Rights Week

Image by mk30 via Flickr

Intellectual Property Office of the Philippines (IPOPhil)
What Is There To Celebrate About Intellectual Property ?
By Atty. Elpidio Peria

The Intellectual Property Office of the Philippines (IPOPhil) celebrated Intellectual Property Rights (IPR) Week this last week of October, ostensibly as a mandate of Presidential Proclamation 79 (1992), which, as pointed out by IPOPhil Director General Cristobal, is an expression of the fundamental policy that “recognition and adequate protection of the rights of inventors, authors and trademarks owners would enhance the economic environment needed to attract foreign investments.”
First off, is there evidence worldwide that increasing recognition and protection of the rights of inventors, authors and trademark owners would attract foreign investments?

The answer is not as straightforward as it seems. Ha-Joon Chang of Cambridge University asserts there is little evidence that protection of IPRs plays any role in foreign direct investment (FDI) decisions. Indeed, according to him, Switzerland’s experience suggests the opposite: the absence of patent laws made the country attractive to foreign investors. Much the same has been shown for historical flows of FDI to Canada and Italy and he even cites some analysts like Vaitsos who also noted that patents are often a substitute (and not a prerequisite) for FDI.

More recently, however, Keith Maskus of the University of Colorado in a 2000 study said that “while there are indications that strengthening IPRs can be an effective incentive for inward foreign direct investment, it is only a component of a broader set of factors”.

He noted that there are complementarities among IPRs, market liberalization and deregulation, technology development policies and competition regimes which lead to complicated trade-offs for various market participants.

He also noted data problems in analyzing the relationship between IPRs and foreign direct investment that it might be useful to study these further rather than to state uncritically that there is such correlation. These problems are : one, data on international FDI flows remain scarce; two, there are inherent measurement problems as it is difficult to capture the economic incentives generated by an IPR system, as they form part of a broader business framework which may have variable impacts in different situations, and three, current econometric models are inadequate in delving deeply into the relationship between foreign direct investment and IPRs.

In a 2004 study, Rod Falvey, Neil Foster and David Greenaway of the University of Nottingham and University of Vienna, reviewed 80 countries including the Philippines, to assess the impact of IPR protection on economic growth. They found that for low and high income countries stronger IPR protection significantly improves growth but for middle income countries no such relationship is found.

Perhaps the IPOPhil may want to ask the study authors in what category they placed the Philippines, but it can be assumed that the Philippines is one such middle income country. These study authors note that these middle income countries do not engage in innovative activities to any extent, but may well rely on imitative activities. They also say that the lack of a relationship between economic growth and IPRs may well be the result of opposing forces that cancel each other out : the positive impact of IPR protection on growth that works indirectly through trade and foreign direct investment is offset by the negative impact of IPRs that slows knowledge diffusion and discourages imitation.

That economic growth has been facilitated not because of strong IPRs may well be borne out by the economic history of the developed countries themselves as studied by Ha-Joon Chang of Cambridge University. According to Chang, Switzerland introduced a patent law that protected mechanical inventions in 1888, but a comprehensive patent law was introduced only in 1907. The Netherlands first introduced a patent law in 1817, but then abolished it in 1869 because patents were seen to create a monopoly that was inconsistent with the country’s commitment to free trade and free markets. Patent law was reintroduced in the Netherlands only in 1912. Interestingly, the 19th-century economists that were most committed to free trade and free markets rejected patents because of the monopoly argument.

Ha Joon Chang continues: other industrialized countries had patent laws by the mid-19th century. But until well into the 20th century these laws fell well short of the stringent standards now demanded of developing countries through the TRIPS agreement. For instance, in the 19th century many countries granted patents to inventions that were imported from abroad, and generally did not check for originality prior to issuing a patent. Japan, Switzerland and Italy did not recognize patents on chemical and pharmaceutical substances (as opposed to the processes of creating them) until the 1970s. Canada and Spain did not recognise these types of patents until the early 1990s. Up until quite recently, India took the same approach to patents on chemical and pharmaceutical substances.

What is it about intellectual property that we are celebrating given that there is no clear link between IPRs and foreign direct investment and it is not even clear that IPRs will contribute to a country’s economic development, especially so when that country is middle-income?

Perhaps the celebration is on the part of the holders of intellectual property, as now, with the help of the IPOPhil and its drive towards enforcement of their property rights, they can be assured of a steady stream of royalties which is guaranteed income for them for the duration of the said intellectual property.

But shouldn’t the IPOPhil be concerned more about the developmental aspects of IPR, including the notion of whether it promotes the right kinds of incentives to foster creativity and innovation ?

An academic from the University of Hawaii at Manoa, Debora Halbert did a case study on Chad and Mali, two countries in Africa, to assess whether the activities of the World Intellectual Property Organization or WIPO, the United Nations body that promotes intellectual property, had been beneficial to the two countries. She found that while WIPO has contributed to institution building of the two countries, their economic, social, cultural and political development have not been substantially enhanced, notwithstanding the almost four decades of meetings and educational activities facilitated or organized by WIPO with the local authorities.
If our own IPOPhil will put emphasis on the enforcement of intellectual property rights, rather than on the developmental aspects or concerns of the greater populace, then perhaps, the Philippines may end up like the two African countries.

Take the case, for example, about the recent suit of Pfizer against UNILAB for the alleged infringement of the latter’s patent on Lipitor, an anti-cholesterol drug. This is an occasion for the newly-enacted law, the Cheap Medicines Act (Republic Act 9502) to be tested, whether its provisions on the flexibilities in the way patent law is exercised can apply in this case.

Flexibilities in the patent laws are recognized even by the World Trade Organization, to take into account a country’s level of development in the way drug patents are enforced.

This brings to mind also what the IPOPhil is supposed to do under the Cheap Medicines Act, which is to develop a Manual for Patent Examiners, which are supposed to tighten the rules on what are patentable, in order to prevent “evergreening” – a bad practice of pharmaceutical companies where they seek to extend the lifetime of existing drug patents in order to continue monopolizing a market for a particular kind of drug.

Along with the promotion of greater access to medicines with the enforcement of the above-mentioned Cheap Medicines Act, the IPOPhil has to show more efforts that it is more concerned about the broader development of the Filipino nation, culturally, economically, technologically rather than on the narrow aspects of strong enforcement of intellectual property, which only benefits the few rights holders.
If IPOPhil Director-General Cristobal really believes that more economic incentives are in order for one to really work hard for something, then does this mean that he needs more economic incentives now? If he says “yes”, then he is not working as hard as he should be and if he says “no” then it means he is not well-compensated for his efforts. Or does it mean that there are reasons for people to do what they are doing, and incentives fostered by intellectual property do not give the proper incentives ? But that last question deserves another discussion for another occasion.

The Cheap Medicines Act wins against the Special Law on Counterfeit Drugs

Image via Wikipedia

“In this corner, Round 1:
The Cheap Medicines Act wins against the Special Law on Counterfeit Drugs”
By Atty. Ping Peria

The recent Supreme Court (SC) decision in G.R. 149907, in Roma Drug and Romeo Rodriguez v. The Regional Trial Court of Guagua, Pampanga, the Provincial Prosecutor of Pampanga, Bureau of Food and Drugs and Glaxo Smith Kline has shown the possibilities of the almost a year old Cheap Medicines Act (Republic Act 9502) in legitimating actions that will effectively bring down the prices of medicines in the country, this on the eve of the one-year anniversary of the said law signed by President GMA last 6 June 2008.

The SC decision has not yet been appealed by the losing sides and Marvin A. Tort of Business Mirror (May 15-16, 2009) opined this may result in unscupulous retailers directly importing near-expiry drugs or medicines that are cheap and pass this on to the public for profit. While the concern is valid though completely unsupported by proof that such had actually happened, there are broad implications of the Supreme Court decision that indicates the case may just be an opening round of what may eventually become a highly-contentious area of litigation between the general public and the pharmaceutical industry. Where are the government agencies in this dispute? They will be forced to choose between taking the side of the public and uphold the Cheap Medicines Act or side with the multinational corporations who will also fight hard to maintain their prerogatives promoted by the Special Law on Counterfeit Drugs, the law which was effectively sidelined but not nullified by the SC decision..

Justice Tinga, the ponente or the writer of the decision, was a gifted law student and a bar topnotcher and he was previously a Congressman before he was appointed to the bench in 2003. He was presented, at first glance, a most momentous of cases in a magistrate's life, on whether to invalidate a law on the ground that it violates the Constitution. Being more of a politician than a jurist, he was trying to be friendly to all sides while attempting to do his duty to do justice.

Had he been concerned with fostering clear guidelines to aid future litigation on these types of cases and cement his legacy as a remarkable Justice in the highest Court of the land, he could have ruled on the constitutional law issues raised by the drugstore owner, such as the following :
1) whether the Special Law on Counterfeit Drugs violates the equal protection clause of the Constitution, the legal principle which states that every one is equal before the law and there shall be no special treatment of subject matter which is not properly classified;
2) whether the Special Law on Counterfeit Drugs violate the mandate of the Constitution in sec. 11, Article XIII which calls on the State to make essential goods, health and other social services available to all people at affordable cost;
3) whether the Special Law on Counterfeit Drugs violate the mandate of the Constitution in sec. 15, Article II which states that it is the policy of the State to protect and promote the right to health of the people and instill health consciousness among them.

Too bad, there is case law which says that if a court can decide a case avoiding the constitutional issues raised, the court will take the path of least resistance and go for the easier route. This is because courts are reluctant to overrule the will of the legislator, in this case, those who passed the law, as they are deemed to be full of wisdom, they being the representatives of the people and the laws they have passed are presumed valid and in accord with the Constitution.

In a legal sleight-of-hand, the SC here waved aside those weighty constitutional law issues and declared them moot as there is another law which must be taken into account, the Cheap Medicines Act, passed in 2008. Remember that this case got started in the year 2000, when the government agencies raided the store of Petitioner Roma Drug in Pampanga.

So, does this mean that being a social legislation at the same time, the Cheap Medicines Act can just look at certain acts, even if it had happened in the past, and declare such acts invalid ?The SC did not give such explicit guidance, but illustrated how a law protecting the rights of a broader set of people might be applied, by quoting the provisions of the law in the decision and saying all these provisions apply.

Thus, the Supreme Court avoided a messier result in constitutional litigation, that of nullifying the Special Law on Counterfeit Drugs, a law which was passed through the aggressive lobbying efforts of the pharmaceutical industry in the Philippines. Perhaps Justice Tinga was concerned about the howl that may result had he penned his valedictory ponencia differently, but he said quite a mouthful about the said law being a “heartless, soulless legislative piece”. Lawyers will not take this to heart even if it may please most public health advocates, as such statement is devoid of legal meaning, it is what is called in law school, obiter, or an aside. It sounded more like playing to the audience or the gallery, this populist piece of rhetoric in the SC decision.

What happens now with this result? This establishes a precedent which, if it does not get modified and further qualified after the motion for reconsideration which in all likelihood may be filed by the losing side in this case, will most likely affect the following :
1) the prosecution and trial of similar cases under the same provisions of the Special Law on Counterfeit Drugs which face possible dismissal based on this decision, if their counsels would find it fit to identify and use the precedent of this case;
2) the 2001 case filed by the grouping of multinational drug companies in the Philippines, the Pharmaceutical and Healthcare Association of the Philippines (PHAP), against the Department of Health on parallel importation, still currently undergoing litigation in a Makati trial court, should now be dismissed with the legal principle enunciated in this case though it is up to the Office of the Solicitor-General to make such assertion in such a way that may not contradict its position in cases involving the Special Law on Counterfeit Drugs which it may have also sought to uphold;
3) The current debates in Congress on the pending BFAD Charter amendments, where the concept of “misbranding” is undergoing deliberation - there are those who argue that “misbranding” should also refer to intellectual property rights (IPR)-related cases which will bring back the problem of linkage where the BFAD will resolve IPR-related cases which is outside its competence; advocates for the Special Law on Counterfeit Drugs might just explicitly state in this BFAD Charter amendment that the law on parallel importation which has been liberalized by the Cheap Medicines Act, might just have to take into account what are “counterfeit” drugs, which in effect will limit the reach of the Cheap Medicines Act, using the procedural justification used by Justice Tinga in this case, which is the what happens when a law on a similar topic is passed affecting a previous law also dealing with the same topic.

Just the same, this emerging area of litigation for public health advocates bears close watching in the years to come and the key question is : on whose side will our government agencies be in the future ? The answer to this will be revealed in the next set of cases around these issues.
oOo