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08 September 2008
Burgeoning activity in the patents scene has given prominence to the allied issues of marketing and information disclosure for pharmaceutical products. While patents are meant to reward innovations by providing inventors with a monopoly right for a fixed term, the regulatory approval system seeks to ensure that only medicines of high-level safety, efficacy and quality enter the market. A request for approval requires the submission of clinical data about the drug and the drug must go through three different trial phases before its efficacy is established. Data submitted to the regulatory authorities may be made available to the public, thus raising important questions about confidentiality.
Data exclusivity prevents the regulatory authorities from assessing the safety and efficacy profile of a generic drug application for a period of time beginning from the first marketing approval of the originator product. However, since generic medicines contain well-known, safe and effective substances, unnecessary animal testing and clinical trials on humans performed by the originators are not repeated. Generic manufacturers usually conduct bio-equivalence tests to prove that their product is similar to the originator product. This appraisal is carried out internally by the authorities.
Article 39.3 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) mandates protection of this confidential information, particularly when the pharmaceutical in question involves new chemical entities. It reads as follows:
“Members, when requiring, as a condition of approving the marketing of pharmaceutical or agricultural chemical products which utilize new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, members shall protect such data against disclosure, except where necessary to protect the public or unless steps are taken to ensure that the data is protected against unfair commercial use.”
The Indian government established the Satwant Reddy Committee to recommend steps for adhering to Article 39.3 and to decide whether data exclusivity could be included in existing legal provisions or whether a new statute was required. After meeting with stakeholders from the industry and the government, the committee concluded that a separate statute on data exclusivity was not desirable. Instead, provisions could be made under the Drugs and Cosmetics Act 1940, which regulates the manufacture and marketing of drugs and traditional medicines, and the Insecticides Act 1968, which deals with agricultural chemicals. To make government officials liable for the protection of test data, amendments could also be effected to the Official Secrets Act.
The committee suggested a three-pronged approach to protecting such test data. While it recommended that test data for pharmaceutical drugs be protected as trade secrets under common law, companies registering new agro-chemicals will have three years of exclusive rights for their test data and companies registering new pharmaceuticals will have a five-year exclusivity period for their test data. The committee endorsed concerns that a balance must be struck between the public need to have access to medicines and the pharmaceutical industry’s need to generate revenues for research and development.
The committee concurred with the oft-levelled assertion that there is ample flexibility in the TRIPs Agreement for a country to determine appropriate means to protect test data. It relied on Article 4 of the Doha Declaration, which refers to the interpretation and implementation of World Trade Organization provisions in a manner supportive of members, public health and affordable medicines. Notably, adoption of Article 39.3 of the TRIPs Agreement has not been uniform and countries have devised their own specific data exclusivity periods.
At the same time, the term ‘unfair commercial use’ is not sufficiently defined by the TRIPs Agreement. Article 10bis of the Paris Convention defines ‘unfair competition’, but does not identify the practices that would fall within the ambit of ‘unfair commercial use’. Reference may also be made to the World Intellectual Property Organization model provision on protection against unfair competition. Article 6 of this provision lays down acts that would amount to unfair competition in respect of secret information. It reads as follows:
“Applying it to pharmaceutical products utilizing new chemical entities, when undisclosed data is submitted to the Drug Regulatory Authority, it becomes the trustee of that data and the originator remains the person lawfully in control of the data or 'the rightful holder'. As the authority is not the 'rightful holder', it cannot use the data for any purpose other than that for which it is submitted without the consent of the 'rightful holder'. Therefore, the regulatory authority should not be allowed to rely on that data without the consent of the originator to evaluate the safety and efficacy of the subsequent applications.”
This proposition supports a common law protection of clinical test data, but leaves doubt about the separate requirement of data exclusivity when patent protection is already in place.
India has emerged as an important producer of generic medicines and data exclusivity provisions would have a significant impact on this market. As such, there has been prolonged debate on the enactment of such provision in India. Since the Indian pharmaceutical industry ranks first among developing countries, and worldwide ranks fourth in terms of volume (holding an 8% share in the global market) and thirteenth in terms of value (holding a 1% share in the global market), the crucial issue of direct and indirect use of clinical test data for the registration of subsequent products similar to those already registered needs to be addressed expediently.
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