Preliminary Comments on the Completed Trans Pacific Partnership (TPP) Intellectual Property Chapter
Dr Deborah Gleeson, School of Psychology and Public Health, La Trobe University
10 October 2015
Today, Wikileaks has released the leaked completed text of the TPP’s intellectual property (IP) chapter. The legal scrub is still to be done, and there could also be side letters between the United States and particular countries revealed at a later stage. But the chapter contains no brackets, indicating that the provisions contained therein were agreed between the parties at the conclusion of the negotiations.
This brief provides some general comments on the pharmaceutical provisions in the final TPP IP chapter and then focuses specifically on problems with the provision for market exclusivity for biologic products.
The TPP’s intellectual property chapter represents nothing less than a disaster for global health. Many harmful provisions still remain in the final chapter, bearing out the concerns of public health advocates. These include:
- Patents for new uses and new methods of using existing products (Article QQ.E.1.2, p. 17);
- A low inventiveness threshold – potentially preventing countries from tightening the criteria for granting patents (Footnote 33, p. 17);
- Patent term extensions to compensate for delays in granting patents (Article QQ.E.12, p. 20) and delays in marketing approval (Article QQ.E.14, p. 22);
- Data protection for small molecule drugs – at least 5 years for new pharmaceutical products plus 3 years for new indications, formulations or methods of administration (Article QQ.E.16, p. 23-24);
- Patent linkage provisions likely to result in delays in marketing approval for generic drugs (Article QQ.E.17); and
- Market exclusivity for biologics, provided through one of two options: at least 8 years of data protection, or at least 5 years of data protection and other measures to “deliver a comparable outcome in the market” (Article QQ.E.20, p. 25-26).
This is the first time a provision for market exclusivity for biologic products has ever appeared in a trade agreement – and this is a new obligation for many TPP countries.
The outcome of this suite of obligations will be delayed competition from follow-on generics and biosimilars – which means delayed access to affordable medicines, placing them out of reach altogether for many people in developing countries. Even countries like Australia, the TPP obligations will lock in current intellectual property standards, making it difficult or impossible to reform our system to improve access to affordable medicines in future.
All countries will eventually have to adopt all the rules in the intellectual property chapter. There are transition periods for the four poorest countries (Malaysia, Mexico, Peru and Vietnam) but these are far too short for the realities these countries face (only 3-10 years) and apply to only a few of the TPP’s obligations. For example, Vietnam will only have 3 years to implement patent term extensions and patent linkage provisions. It appears that countries will have to graduate to the higher level IP protections regardless of their rate of development.
The pharmaceutical industry has expressed disappointment over the failure of the U.S. to obtain 12 years of market exclusivity for biologics, but in reality it has gained enormous concessions. If the TPP countries ratify the deal, Big Pharma will have succeeded in cementing intellectual property standards that will stymie access to medicines for up to 800 million people in the short term, and more if additional countries sign up in future. Furthermore, the TPP’s intellectual property chapter sets a new norm that is likely to become the template for future trade agreements: its implications are global as well as regional.
The governments of TPP countries have been complicit in a global health disaster of unimaginable proportions - a deal that will prevent untold numbers of people from obtaining medicines that those in many developed countries take for granted.
Market exclusivity for biologics
Biologic products are produced through biological processes and include many new treatments for cancer and immune conditions such as rheumatoid arthritis. They include some of the most expensive medicines on the market, some of which cost hundreds of thousands of dollars per patient per year. Monopolies on just ten biologic drugs listed on Australia’s Pharmaceutical Benefits Scheme cost Australian taxpayers over $205 million in 2013-14.
The United States was seeking 8-12 years of market exclusivity for biologics. Battles over the length of monopolies on clinical trial data submitted to regulatory agencies (such as Australia’s Therapeutic Goods Administration) plagued the TPP negotiations, and proved to be an almost insurmountable stumbling block over the final days.
The Australian Government’s brief about the TPP outcomes for biologics says:
In the TPP, Australia has negotiated protections that are consistent with Australian law and practice. Australia is not required to change any part of its current law, including data protection for biologics, or our patent regime. There will be no adverse impact on the Pharmaceutical Benefits Scheme and no price increase for medicines.
But the final text of the TPP’s IP chapter contains some problematic language and troubling ambiguities.
Article QQ.E.20.1 (p. 25-26) outlines two options that countries can implement to protect new biologics:
- At least 8 years’ protection of clinical trial data (QQ.E.20.1(a)); or
- At least 5 years’ protection of clinical trial data along with other measures to “provide effective market protection” and “deliver a comparable outcome in the market”
Whatever the understanding reached between parties in the negotiating room, according to the agreed legal text, it appears that the TPP parties are obliged to ensure the same market exclusivity outcomes regardless of which option they choose.
The legal language provides room for the United States to continue to pressure the other TPP countries to ensure that they keep biosimilars (more affordable follow-on products) off the market for eight years, in order to provide equivalent “effective market protection” and a “comparable outcome” to eight years of data protection. This pressure may occur even before the TPP is enforced. In the past, the US has applied pressure to countries to adopt stronger IP protection during the period between signing and ratification.
Article QQ.E.20.2 (p. 26) of the leaked IP chapter requires countries to apply the provision on biologics to a very broad range of products:
For the purposes of this Section, each party shall apply this provision to, at a minimum, a product that is, or alternatively, contains, a protein produced using biotechnology processes, for use in human beings for the prevention, treatment, or cure of a disease or condition.
Including any product that is, or contains, a protein captures a very broad array of products, and reduces the prospect for governments to narrow the scope of the obligation and define for themselves which products it applies to. While the meaning of biotechnology processes is left to be decided through domestic law and practice in each country, it is unclear how much flexibility this will actually provide.
Article QQ.E.20.3 (p. 26) provides for a review of both the length of the monopoly protection and its scope by the TPP Commission after 10 years (“or as otherwise decided by the TPP Commission”). This could result in countries being pressured to provide market exclusivity for more products, or to lengthen the period of protection.
Despite resistance by the majority of TPP countries to the US pharmaceutical industry agenda throughout the negotiations, many provisions remain in the final text that will dramatically reduce access to affordable medicines, particularly in developing countries. These problems will be exacerbated by limited, short and inflexible transition periods for developing countries to implement the obligations. While the United States has clearly been the demandeur, all TPP countries have been complicit in agreeing to settings that will cost people’s lives.
The provisions relating to biologics are problematic and ambiguous. They appear to commit countries to providing either eight years of clinical trial data protection, or five years of clinical trial data protection along with other measures to deliver comparable outcomes. While the Australian Government has said that the regime for biologics in Australia will not change, the language leaves room for continued pressure by the United States to ensure that TPP countries prevent biosimilars from entering the market for eight years. The definition of biologics is very broad and likely to limit countries’ flexibility in determining the scope of the obligation. A review by the TPP Commission of both the length and scope of protection after ten years provides a further mechanism for US pressure to expand and extend monopolies on expensive biologics.
The Big Deal about Biologics
This is a good clear explanation about TPPA impacts on health, from The Australian Hospital and Healthcare Bulletin.
What is the TPPA?
The Trans Pacific Partnership Agreement (TPPA) is a regional trade agreement currently being negotiated by 11 Pacific Rim countries, excluding China. While the negotiations are being conducted under a veil of secrecy, substantive leaks over the past 4 years have revealed a broad view of the proposed contents.
As it stands the TPPA poses serious risks to global public health, particularly chronic, non-communicable diseases. At greatest risk are national tobacco regulations, regulations governing the emergence of generic drugs and controls over food imports by transnational corporations.
For more information:
NZNO challenges the secrecy of the TPPA
The New Zealand Nurses Organisation (NZNO), along with others, launched legal proceedings in the high court today, that challenge the secrecy of the Trans-Pacific Partnership Agreement (TPPA) negotiations. The action follows a review by Chief Ombudsman, Dame Beverley Wakem DNZM, CBE, of Trade Minister Tim Groser’s blanket refusal to release information sought by University of Auckland Professor Jane Kelsey this year under an Official Information Act (OIA) request.
The information requested included a category relating to government-funded assessments and cost benefit analysis of specific provisions and impacts on particular sectors. "This is exactly the information the health sector has been asking for in relation to PHARMAC" says Keri Nuku, NZNO Kaiwhakahaere. "NZNO's challenge is not about trade, but about the impact that higher costs for existing and future medicines will have on health. New Zealanders have a right to know the costs as well as the purported benefits of the agreement and such analysis needs to be open to scrutiny."
NZNO is seeking an urgent application for a judicial review, along with co-applicants the Association of Salaried Medical Specialists, Consumer NZ, Internet NZ, Ngati Kahungungu, Greenpeace, Consumer NZ, Oxfam, the Tertiary Education Union and others.
Legal challenge to TPPA secrecy lodged 5 August 2015
Ahead of a TPP Negotiators Meeting in Hawaii, the Information Technology and Innovation Foundation and 106 other advocacy groups sent a letter to the Administration and the USTR urging strong support of IP policies. They demand:
- 12 years of data exclusivity for biologics
- Due process and clarity in the manner and timeliness in which foreign governments approve and list biopharmaceuticals for reimbursement.
Declaration Supporting Incentives for Medical Innovation in Trade Agreements
On Monday 3rd August, claimants received the decision on whether the Waitangi Tribunal will grant an urgent hearing on the Trans-Pacific Partnership applications for an urgent hearing. The Tribunal sees the scope for "significant prejudice to Māori" and made the comment that the Crown treats Māori as "domestic stakeholders, not Treaty partners".
Tribunal criticises Crown’s Treatment of partner
New research concludes proposals would have cost Australia’s Pharmaceutical Benefits Scheme an extra $203 million in 2013 - Gleeson, D., Lopert, R. and Moir, H.V.J. (2014)
Implications of proposals for extending data protection for biologics in the TPPA – potential consequences for Australia
'Evergreening' explained - how big PHRMA keeps drug prices high
Health implications of free trade agreements have become a front line political concern in the UK: TransAtlantic Trade& Investment Partnership "designed to meet interests of corporations not patients, and imperative that it is stopped in its tracks" BMJ 2014; 349
The Trans Pacific Partnership Agreement: Exacerbation of inequality for patients with serious mental illness - Monasterio, E. and Gleeson, D. (2014). Australian and New Zealand Journal of Psychiatry, published online 1 November.
The vulnerability of being ill informed: the Trans-Pacific Partnership Agreement and Global Public Health - Greenberg, H. and Shiau, S. (2014). Journal of Public Health, 36(3): 355-357.
Health professionals call on Groser to give trade deal a health check
The impact of the Trans-Pacific Partnership on health: Why an independent, comprehensive health impact assessment is crucial prior to signing
New Zealand laws must be made by New Zealanders - NZNO senior policy analyst Marilyn Head asks "Who's in charge here?"
"Will your party hand our right to make laws over to the US?" ask doctors
The Trans-Pacific Partnership Agreement (TPPA)
NZNO remains opposed to the secrecy of the TPP (no text will be released prior to signing) and intellectual property provisions which dramatically extend patents. These will increase the cost of medicines, deter innovation and generic drug production, and, through the threat of private investor litigation, limit the ability of governments to make decisions benefitting public health, for example by challenging decisions altering tobacco, alcohol and advertising controls. NZNO does not support additional patenting of treatments, techniques and operations which will increase healthcare costs, and is concerned by the dual attack on PHARMAC through:
- transparency clauses which would undermine the commercial processes which ensure New Zealand pays less for its medicines than other countries, and through
- patent extensions which would effectively cut off the supply of generic medicines on which it relies.
A number of events throughout the country are planned over the negotiating period - See itsourfuture.org.nz for further information.
TPPA on health in New Zealand
A new report on the impact of the TPPA on health in New Zealand Wyber R, Perry W. The Trans-Pacific Partnership: An analysis of the impact on health in New Zealand. Nyes Institute; 2013.http://www.nyesinstitute.org/home/wp-content/uploads/2013/11/NyesReviews_TPP.pdf
PM urged to ensure New Zealanders’ health not signed away
Prime Minister urged to ensure New Zealanders’ health not signed away
Public Health Association media release, 4 October 2013
A new generation of trade policy: potential risks to diet-related health from the trans pacific partnership agreement
Sharon Friel, Deborah Gleeson, Anne-Marie Thow, Ronald Labonte, David Stuckler, Adrian Kay and Wendy Snowdon
Read the aticle here: http://www.globalizationandhealth.com/content/9/1/46/abstract
How the Trans Pacific Partnership Agreement could undermine PHARMAC and threaten access to affordable medicines and health equity in New Zealand
New Zealand's Pharmaceutical Management Agency (PHARMAC) has been highly successful in facilitating affordable access to medicines through a combination of aggressive price negotiations, innovative procurement mechanisms, and careful evaluation of value for money. Recently the US government, through the establishment of a series of bilateral and plurilateral “free” trade agreements, has attempted to constrain the pharmaceutical access programs of other countries in order to promote the interests of the pharmaceutical industry. The Trans Pacific Partnership Agreement (TPPA) represents the latest example; through the TPPA the US is seeking to eliminate therapeutic reference pricing, introduce appeals processes for pharmaceutical companies to challenge formulary listing and pricing decisions, and introduce onerous disclosure and “transparency” provisions that facilitate industry involvement in decision-making around coverage and pricing of medicines (and medical devices)
Read the paper here: http://www.healthpolicyjrnl.com/article/S0168-8510(13)00210-8/abstract
Public Health and the TPPA
PHARMAC'S effectiveness is threatened by patent extensions which undermine the production of cheaper generic drugs that it relies on, and "transparency" provisions which allow greater pharmaceutical company interference. Public health is threatened by Investor State Dispute Settlement (ISDS) which allows international companies like Philip Morris tobacco to sue the government if their profits are threatened. The call will be to get rid of ISDS which will limit future governments' ability/appetite for regulation in the best interests of public health.
Read the report PUBLIC HEALTH will be a Major Loser under the TPP (PDF)
Nurses are advised of Petition to the Prime Minister RE: the Trans Pacific Partnership Agreement
Open to all health professionals, organised in support of Smoke Free Aotearoa. Please take time to read the petition carefully. Remember to fill in your job title and qualifications to ensure the petition captures the spread of services and skills of the health professionals signing it.
15 good reasons to challenge the Trans-Pacific Partnership free trade agreement (PDF, 569KB, 2 pages)
Report on Auckland TPP Negotiations by Bill Rosenberg, NZCTU Policy Director/Economist (PDF, 169KB, 4 pages)
TPPA Alert – Hands off our public health system! by Professor Jane Kelsey, School of Law, University of Auckland. 28 January 2011 (PDF, 2 pages)
Article by Deborah Gleeson and Sharon Friel exploring emerging threats to public health from regional trade agreements such as the TPP
The Lancet has published an article by Deborah Gleeson and Sharon Friel exploring emerging threats to public health from regional trade agreements such as the TPP (The Lancet, March 1, 2013). It states that:. The decision by Australia's High Court to uphold the constitutionality of the country's ground-breaking tobacco plain packaging laws has been heralded as a victory for national sovereignty over vested interests. However, the ability of governments worldwide to introduce and implement public health policies and laws is increasingly threatened by trade and investment treaties that privilege investors over governments and provide avenues for international corporations to challenge democratically enacted public health policies in different countries.
http://www.thelancet.com/journals/lancet/article/PIIS0140-6736%2813%2960312-8/fulltext Access is free but you will need to register/log in to view and download the paper. Note also recent statements around plain packaging and that the govt is waiting for the outcome of the Aussie case before going ahead indicating that the TPP is already having a chilling effect on public health legislation.