Regulatory Focus™ > News Articles > New Chinese Patent Rules Could Make Country Compulsory Licenser to the World

New Chinese Patent Rules Could Make Country Compulsory Licenser to the World

Posted 12 June 2012 | By Alexander Gaffney, RAC 

Following closely in the footsteps of India, China has announced the release of a new patent system in which it can grant compulsory licenses to generic pharmaceutical manufacturers to allow them to make copies of on-patent branded medicines.

Compulsory licenses are used by countries to override patents when a country deems that a health crisis warrants such action. While compulsory licenses have been granted in moderation since the signing of theDoha Declaration in 2005, the use of them has generally fallen below initial expectations. In 2005 under Doha, some stakeholders feared countries would seek to issue as many compulsory licenses as possible in an attempt to reduce healthcare spending and improve public health.

A recent study published in the Public Library of Science (PLoS)Medicine found those fears to be largely unwarranted. Researchers found the pressures exerted by pharmaceutical companies have generally discouraged the widespread use of compulsory licenses in upper-middle income countries, and after a brief spike in 2006 the number of compulsory licenses issued fell sharply.

Reuters reports under China's new patent system, companies will be granted compulsory licenses to meet emergency situations, unusual situations or public health needs. Notably, the latter includes the public health needs of other countries, which would allow companies to export pharmaceutical products to areas experiencing a health crisis. The changes could make China the de facto compulsory licenser to the world, and seem intended to bolster the country's generics manufacturing sector.

Read more:

SIPO - Patent Compulsory Licensing

Pharmalot - China Changes Patent Laws to get Cheap Drugs

Reuters - China changes patent law in fight for cheaper drugs

Fierce Pharma - China now carries a big compulsory-licensing stick

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