Battle on the horizon over intellectual property policy draft

The trade and industry department's intellectual property policy, released last week, was met with criticism by some, but was welcomed by health activists. Wilmot James, the Democratic Alliance spokesperson for trade and industry, called the document "remarkably unimpressive", suggesting "the drafters appear not to fully understand intellectual property law".

He is not alone: speaking to online publication Tech Central this week, Brian Wimpey, intellectual property lawyer at Norton Rose Fulbright South Africa, called the policy "vague" and "in some cases, almost contradictory". But the Treatment Action Campaign, Section27, and Médecins Sans Frontières welcomed the policy, which they say "lays [the] foundation to prevent abusive patents from blocking access to affordable medicines".

The policy is meant to co-ordinate and streamline intellectual property legislation within South Africa. According to the policy’s objectives, it also aims "to improve access to intellectual property-based essential goods and services, particularly education, health and food" and "introduce a public health perspective into intellectual property laws".

It is also meant to inform legislative amendments on a multitude of intellectual property-related legislation, according to Macdonald Netshitenzhe, chief director of policy and legislation at the department of trade and industry. A 30-day public comment period on the policy will close on October 4.

Calling Netshitenzhe "legally illiterate", James said that the policy "lives up to the mediocre standard that we have come to accept from the intellectual property division of the department of trade and industry". But while Yousuf Vawda, access to medicine expert at the University of KwaZulu-Natal's law school, agrees that the policy isn't well written, he says, "the core principles and elements are good … I think it’s a step forward".

Netshitenzhe says that the policy is meant to be a framework for discussion on intellectual property legislation within South Africa, and welcomes dissenting views. Submissions are expected from a wide range of players, with legal bodies like the South African Institute of Intellectual Property Law and the Licensing Executive Society preparing comment within hours of the policy's release. Industry interests are expected to loom large in the discussion: According to his company’s website, Wimpey has represented the likes of Google and GlaxoSmithKlein, supporting, amongst other efforts, GlaxoSmithKlein's "attempt to enforce the shape of a tablet as a trade mark." 

James has worked with Professor Dean Owen of Stellenbosch University on a traditional knowledge bill that acts as an alternative to a department of trade and industry proposal, which he submitted earlier this year. Owen holds the university's chair of intellectual property law, but is also a consultant for Spoor & Fisher, considered one of South Africa's top intellectual property law firms and historically responsible for representing big-name pharmaceutical companies.

Netshitenzhe says the policy has been in the works for five years, but Paul Anley chief executive of PharmaDynamics, a South African generic pharmaceutical company, surmises its release, and its focus on health, is largely a result of heavy campaigning by Médecins Sans Frontières, the TAC, and Section27.

"There has been very … long lobbying by TAC, Médecins Sans Frontières, Section27 and general consumer lobbies," says Anley. "We've got a terrible burden of HIV and TB and South Africa deserves access to cheaper medicines." In a statement released on Tuesday, Médecins Sans Frontières, TAC and Section27 said they had been pushing for two years for the government to include provisions in the country’s patent laws to protect health.

Patent examinations
The policy suggests strengthening patentability criteria so that patents are not granted for combining previously existing drugs, or finding a new use for a medicine already on the market. India is famous for including such a provision in its law, which allowed it to strike down patents on drugs such as Gleevec, the blockbuster anti-cancer medicine made by Swiss drug-maker Novartis.

The policy also suggests allowing for patents to be opposed before and after they are granted. Currently in South Africa, patents can only be fought through a court challenge, and only after a patent has been granted. Pre- and post-grant opposition is used in other countries such as India, where generic companies and civil society groups have successfully blocked patents on key drugs, including some antiretrovirals, paving the way for cheaper versions to come on the market.

Most notably, the policy also recommends a patent examination system. Currently, South Africa hosts a patent depository system, through which patents are granted so long as paperwork is submitted and fees paid, without the substance of the patent application being considered. As such, there are often multiple patents on a singular product, which Anley says can extend the life of a patent and block generic competition. "We have had a patent system for years that has been abused by multinational originator pharmaceutical companies in that they have been applying for and been granted multiple patents, and I mean up to thousands of patents which are essentially covering the same product," says Anley.

Patent examination systems are used across the globe, from Europe to Brazil. According to a 2011 study by the South Centre, because Brazil examines patents, it only granted 273 pharmaceutical patents in 2008. South Africa, by comparison, granted 2 442 in the same year. Brazil's patent office also works with the country’s health ministry when considering patent applications for health products, to ensure that patents won't impede access. The department of trade and industry's policy has suggested a similar mechanism in South Africa.

?Not everyone is in support of an examination system. "We are worried that South Africa has neither the skills nor the capacity for such an undertaking," James told the Mail & Guardian. "Setting up such an office in South Africa will be immensely expensive and will in all likelihood not achieve its goals." But Vawda says that while it will take time to train enough patent examiners, it’s important to start now.

"South Africa needs to consider how other countries, like Brazil and Egypt, have started from scratch to build something sustainable … Unless they commit to it now, you'll never have it, not in five years, never." A 2012 study by Médecins Sans Frontières showed that by slightly raising patent application fees, India’s patent office is not a financial burden, but is actually revenue generating.

Tim Ball, patent attorney with the firm Brian Bacon & Associates, who has represented generic companies in the past, says that instituting an examination system could actually make it harder for generic companies to fight patents, as only stronger patents would make it through. He says that greater attention should be given to the way the court favours patent holders in legal disputes, arguing that the onus must be placed on originator companies to prove the validity of their patent, rather than on generic companies to prove that a patent is bad, as is the current case. BUt TAC's Marcus Low says an examination system "will provide much more legal clarity as to whether patents are actually valid. At present, we often see litigation between generic manufacturers and patent holders because of this lack of clarity".

While PharmaDynamics is thus far the most vociferous generic company speaking on the policy, others are also expected to submit comments by the deadline. PharmaDynamics has its own battle with South Africa’s multitudinous patents, as it is currently in the midst of a court case with multinational company Bayer over their bringing a generic version of the contraceptive Yasmin to the South African market.

While the initial patent had expired, Bayer cited secondary patents in a request for injunction, which was granted. According to Anley, PharmaDynamics’ version, called Ruby, sold for R72.28 before the company had to take it off the market, compared with Bayer’s R109.26. Anley says that while only the Bayer product is available here, generics can be bought in the US and Europe. Anley is also the head of the National Association of Pharmaceutical Manufacturers, which represents 14 generic companies. He said the association would also make a submission.

An intellectual property unit at UCT’s law faculty is also currently considering the policy. TAC, Section27, and Médecins Sans Frontières will also submit comments, and are expected to hold public events in the coming month.

Netshitenzhe explains that once the public comment period concludes, the amended document, including comments, will be brought to Cabinet, who may suggest further changes before giving its approval. Once the policy is finalised, the department of trade and industry will draft legislative amendments to be vetted by Cabinet and Parliament, ideally in March of next year.


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