[e-drug] Comment on reporting in Brazil compulsory licensing case

[James Love <love@cptech.org>]

E-drug: Comment on reporting in Brazil compulsory licensing case
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I am in Zimbabwe this morning, having spent several days talking to
African trade and health officials about public health aspects of
intellectual property and trade rules. While it was of course
dramatic to read the headlines of the Brazil statements on the
issuance of a compulsory license for nelfinavir, I was appalled by
some aspects of the reporting (and headline writing), particularly
when compared to reporting on compulsory licenses in the North. 

On August 15, 2001, the New York Times reported matter of factly
that the US Federal Trade Commission was launching an investiga-
tion to determine if it should issue compulsory licenses on the
Unocal patents on anti-smog devices, in response to a request from
ExxonMobile
(http://www.nytimes.com/2001/08/15/business/15GAS.html). The
next day, on August 16, 2001, the United States Department of
Justice's Antitrust Division issued a press release
http://www.usdoj.gov/atr/public/press_releases/2001/8810.htm)
announcing it would require 3D Systems and DTM Corporation
license their combined portfolio of North American patents for the
field of use for stereolithography or SLS RP Technology. The
compulsory licenses would be perpetual, assignable, transferable
and fully paid-up (zero royalty). The US DOJ also required
compulsory licenses to all copyrights necessary for a new entrant to
enter the market in North America. 

The US government decision to issue compulsory licenses in the
3D/DTM case was barely noted in the US or global news media,
and indeed, it was not particularly novel, as the US government has
issued dozens of such licenses in recent years on technologies as
diverse as tow truck parts, computer technologies, software, corn
germplasm, hemophilia gene rights, dicyclomine tablets, and many
others.

When the Brazil government announced it would issue a
compulsory license to the government to produce an affordable
version of nelfinavir, a protease inhibitor that currently represents
28 percent of the country's antiretroviral drug budget, the global
press issued headlines all over the world claiming the Brazil
government would "break," "violate" or "ignore" the patents on the
product. No mention was made of the fact that the US Department
of Justice had issued a compulsory license on August 16, a few
days earlier, or that on July 3, the European Union had issued a
compulsory license in Germany for an IMS database on
pharmaceutical sales, or that in the case of the nelfinavir patents,
the Brazil government would pay royalties (unlike the US
compulsory licenses on the 3D/DTM patents). 

I think this is bad reporting or editing (often the headlines were the
worst), and has the predictable effect of demonizing the actions of
governments in developing countries who if anything should be
criticized for not acting sooner on compulsory licensing. Northern
governments surely would not have waited this long to act. Such
reporting harms the poor, because it acts as a deterrent for more
compulsory licensing, as developing countries are obsessed with
attracting investors. Reporting that incorrectly presents developing
countries as acting outside of recognized global norms on the
protection of intellectual property are widely perceived by
developing countries as harmful. Governments in developing
countries, and particular trade and industry officials, the people
most likely to be decision makers on patent issues, do not feel that
they are in a strong position to be portrayed as disregarding
property rights. It would have been much more accurate, and
certainly more beneficial to the interests of the millions of persons
who are infected with HIV, if the reports had noted that the Brazil
government was following procedures that have been employed by
the United States and Europe, and that the Brazil government would
compensate the patent owner, consistent with the standards set
out in the WTO agreement on intellectual property rights.

James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC 20036
voice: 1.202.387.8030 fax 1.202.234.5176 mobile 1.202.361.3040
e-mail: love@cptech.org
http://www.cptech.org

(Note on the development of nelfinavir. The patents on the drug
were filed on Feb 2, 1994. The US FDA marketing application was
filed December 26, 1996, and approved on March 14, 1998, four
years and a month after the patent was filed. The FDA marketing
approval was based upon two Agouron sponsored clinical trials
involving 605 patients. As of 2 years ago, the US government had
sponsored 40 clinical trials using nelfirnavir.)


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