Working for access to quality public healthcare in South Africa since 1998
28 April 2016

SA Government takes Promising Stand on Patents

  • But public remains in the dark regarding stalled policy process

The Fix the Patent Laws (FTPL) coalition welcomes recent public comments made by Minister of Trade and Industry Rob Davies and Minister of Health Dr Aaron Motsoaledi about patents and patent law in South Africa and in other developing countries.

Earlier this month Minister Davies delivered a landmark keynote address at the World Intellectual Property Organisation’s (WIPO) International Conference on Intellectual Property and Development in Geneva. In his speech Minister Davies dispelled a number of commonly held myths about the role of intellectual property in development. He said that “there is no unambiguous evidence that stronger IPRs (intellectual property rights) foster industrial development and countries may require different approaches and policies dependent on their level of industrial development.”

Davies confirmed: “The role of patent protection in promoting innovation has also been controversial. There are arguments that patents are unlikely to foster innovation in developing countries at early stages of industrialization. The evidence on the extent to which patent protection, which is of particular relevance in the context of industrial policies, contributes to encouraging innovation is, at best, inconclusive. Some studies contend that other factors, notably ‘first mover’ advantages, are more decisive in promoting innovation.”

One of the key aims of the FTPL coalition is to reduce the number of secondary and poor quality patents granted in South Africa. In this regard we are encouraged by Davies’s comment that “governments retain an important role in ensuring that patentability standards such as the requisite level of inventiveness are appropriate and rigorous in order to avoid the introduction of patents that unnecessarily stifle local innovation and production.”

We are also encouraged by Minister Davies’s comments on compulsory licenses. The FTPL coalition is advocating for amendments to the compulsory licensing provisions in South African law so that broader grounds and simpler procedures are in place to make the granting of compulsory licenses easier. “Compulsory licenses are another avenue of policy flexibility permitted under the TRIPS Agreement that may be used as an instrument to promote domestic production where voluntary licenses are not available on reasonable commercial terms. There are several examples around the world where compulsory licenses were issued and employed successfully to ease access to affordable medicines,” Davies said.

Minister Davies also affirmed that South Africa is in the process of transitioning from a depository patent system to a patent examination system. The establishment of a patent examination system in South Africa has been a key objective of the FTPL coalition. We welcome the progress and commitments in this regard. He stated, “We are now engaged in a process to strengthen the capacity of the Companies and Intellectual Property Commission (CIPC) so that it is able in due course to undertake substantive examination of patent applications. For reasons of allocation of scarce resources, South Africa has traditionally used the “depository” system in terms of which patent applications are examined to determine whether they meet the patentability criteria only if the patents are challenged in litigation.”

In relation to the ongoing process of policy reform in South Africa, Minister Davies said “As we review our IP policy, we are seeking to ensure that appropriate balances are struck in providing protection for innovation and ensuring that benefits are shared in society.”

South Africa published a Draft National Intellectual Property Policy in September 2013. While we note the Minister’s comment that the policy is still under review, we are deeply concerned by the very long delay in the finalisation of this policy.

Earlier this month Minister Motsoaledi also made some encouraging statements on the public record. When asked on radio station Power FM about providing access to an expensive breast cancer drug, the Minister indicated that he will consider issuing a government use compulsory license. He said: “If we have to do that, we want it to be a government use license and we’ve got no problem with that”.

South Africa has never issued a compulsory license on a medicine. Countries who grant compulsory licenses typically come under great pressure from the United States – even if the granting of these licenses are in compliance with World Trade Organisation rules.

While we are encouraged by the comments made by Minister Davies and Minister Motsoaledi, we are also keenly aware that no concrete steps have been taken. South Africa’s IP policy remains stalled. The price of Herceptin remains too high for many women who need it. Our patent laws continue to place the private interests of foreign pharmaceutical companies ahead of the right to access healthcare.

We call on Minister Davies to translate the encouraging policy statements at the international forum into concrete steps of changing the national patent law system, and explain to the people of South Africa why the IP policy has stalled. We also call on him to share the timelines for the finalisation of the IP policy and subsequent law reform with the South African public.

For more information contact Lotti Rutter on lotti.rutter@tac.org.za or 081 818 8493

Minister Davies’s speech can be downloaded here: https://www.keionline.org/node/2456

The Power FM interview can be heard here: https://soundcloud.com/powerfm987/the-dangers-of-sa-medical-patent-laws-in-their-current-form

ANNEX:

Key Recommendations to change Compulsory License Rules in South Africa’s Patent law:

On patentability criteria:

·       The Patents Act should be amended to include stricter patentability criteria

·       In the context of medicines and other health-related products, new uses and methods of treatment should expressly be precluded from being granted patent protection; new forms of known substances should not be patentable to the extent that they fail to demonstrate the required degree of inventive step, strictly construed

On patent searches:

·       CIPC online patent search database should be improved to facilitate access to accurate  information on patents for ordinary users of the system. This would in turn help stakeholders, such as civil society take action to limit the granting of abusive medicines patents

On substantive patent examination and opposition proceedings:

·       Recognising that the Patents Act already requires substantive patent examination, we call for the making of regulations dealing with the establishment and phased implementation of a  substantive patent examination system

·       The Patents Act should provide for meaningful pre- and postgrant opposition mechanisms that recognise broad standing requirements inclusive of civil society and adequate access to information to facilitate such interventions

On the relationship between medicines registration and patent protection:

·       Other than what is already contained in section 69A of the Patents Act, no linkage between medicine registration and patent protection should be recognised

·       Remedies for addressing delays in medicine registration processes should exclude patent extensions

On compulsory licensing and parallel importation:

·       The current process in terms of section 56 of the Patents Act should be replaced by a simple, expeditious administrative procedure that is subject only to review proceedings in the High Court or the Court of the Commissioner of Patents. Government use licenses should not require any review proceedings in the High Court

·       Pending any review of the grant of a compulsory licence, interim relief should only be  available – upon application – in exceptional circumstances and should not be available for the exercise of government use licenses

·       Default positions regarding licence conditions (including but not limited to royalty rates) and negotiation timelines should expressly be included in sections 4 and 56 of the Patents Act

·       Licensing practices should expressly be regulated, as contemplated by Article 40 of TRIPS

·       Regulation 7 of the General Regulations made under the Medicines and Related Substances Act 101 of 1965 (“the Medicines Act”) should be amended to give full effect to section 15C(b) dealing with parallel importation

On research and development (“R&D”), public funding, innovation and access:

·       The Department of Trade and Industry (“the DTI”) should collaborate with relevant  departments and statutory councils to ensure that publicly-financed R&D in South Africa is aimed at delivering affordable inventions

·       In particular, the dti should engage with the Department of Science and Technology (“DST”) regarding the need to consider possible amendments to the Intellectual Property Rights from Publicly Financed Research and Development Act 51 of 2008 (“the IPRs from Publicly Financed R&D Act”)

On exceptions to patent infringement:

·       The Patents Act should exempt those aspects of scientific research that are not covered by section 69A

·       The Patents Act should also include an educational use exception

On data protection and exclusivity:

·       Calls for data exclusivity should be rejected on the basis that they are not required by Article 39.3 of TRIPS and they unreasonably and unjustifiably limit access to medicines

·       The status quo in this regard should be retained, with the Patents Act only making provision for data protection.

See full text: http://www.fixthepatentlaws.org/wp-content/uploads/2013/10/S27-TAC-MSF-Submission_on_IP_Policy.pdf