After five years of negotiations, the release of the final text of the long-awaited trade deal, known as the Trans-Pacific Partnership (TPP), on Thursday, as well as concessions made to the US in the WTO’s TRIPS (trade-related aspects of intellectual property rights) deal announced Friday both offer new insight into the strength of the pharmaceutical industry’s lobbying and negotiating powers.
Early last month, a number of questions emerged over a sticking point in the deal: How many years of biologics exclusivity should be provided under the TPP, particularly for smaller countries like Malaysia, Vietnam and Singapore, where patients may suffer if cheaper biosimilars are restricted for longer periods of time?
Trade representatives from the US and Japan favored a longer period of protection – up to 12 years – in order to protect and encourage new innovation, while others, such as Australia, expressed fears that delaying the entry of biosimilars for that long would raise costs.
Like the leaked text from October, the final TPP documents leave some wiggle room for how countries should address biologics exclusivity, providing five years of exclusivity in some cases with added provisions and eight years in other cases.
And although neither side (pharmaceutical industry groups nor nonprofits seeking to expand the use of cheaper medicines) offered praise for the final decision on market exclusivity, the deal is clearly a win for industry as some countries involved, like Brunei and Malaysia, currently don’t offer any years of biologics market protection, and the US will still get its 12 years of protection.
Other parts of the TPP deal, which in some cases mirror the position of the US, add new provisions for the pharmaceutical and device regulators from other countries involved, including Singapore, Brunei, New Zealand, Chile, Australia, Peru, Vietnam, Malaysia, Mexico, Canada and Japan.
Some provisions restrict countries from using “sale, pricing or related financial data concerning the marketing of the product” as part of a decision to approve a particular drug or medical device for a given market, according to an annex to Chapter 8 on the technical barriers to trade
James Love, director of the non-governmental organization Knowledge Ecology International, notes that: “While there are arguments in favor of focusing drug registration decisions on medical considerations only, there is also a paucity of information on drug prices, revenues and other relative information on the economics of the pharmaceutical market. Linking marketing approval to providing reports on these issues should not be prohibited by the TPP.”
In addition, the TPP text adds a provision that would keep pharmaceuticals in the markets of countries even while regulators are reauthorizing their use.
The text notes that when a country’s regulator requires periodic reauthorization for a pharmaceutical product that has previously received marketing authorization, the deal requires that country to “allow the pharmaceutical product to remain on its market under the conditions of the previous marketing authorization pending its decision on the periodic reauthorization, except where a Party identifies a significant health or safety concern.”
A portion of another transparency annex also calls for countries to give drug and medical device companies more rights to monitor and challenge government decisions on drug reimbursements – another win for industry.
In addition, multi-national pharmaceutical and medical device companies will be happy to see another provision that restricts countries involved in TPP from requiring a product to be manufactured locally as a condition for approving a product.
The TPP deal could also add some new provisions for the drug and medical device regulators of the countries involved, as the deal seeks to improve collaborations on pharmaceutical inspections.
Under the deal, regulators would be required to notify a country prior to conducting an inspection, “unless there are reasonable grounds to believe that doing so could prejudice the effectiveness of the inspection.” And in some cases, the deal says countries should permit representatives from a country’s competent authority to observe other countries’ inspections of pharmaceutical manufacturing sites.
In addition, regulators conducting inspections in other countries would also be required to notify each other of inspection findings “as soon as possible following an inspection and, if the findings will be publicly released, no later than a reasonable time before any such release.”
However, for countries like the US, which routinely inspects manufacturing facilities in foreign countries, the inspecting country “is not required to notify its findings if it considers that its findings are confidential and should not be disclosed.”
In addition to the TPP deal, the World Trade Organization (WTO) agreed on Friday to allow the world’s least-developed countries to be exempted from patent rules for 17 years.
The exemptions allow local manufacturers and other international programs to supply necessary drugs, such as HIV treatments, in affected countries without having to deal with patent infringement lawsuits.
However, prior to this 17-year agreement, the European Commission and others offered support for an indefinite exemption for such countries until they cease to be an LDC.
In a statement on the deal from Friday, Doctors without Borders, KEI, Public Citizen and others noted that the indefinite exemption “received almost universal unequivocal support from civil society globally, international and UN agencies (WHO, UNDP, UNAIDS, UNITAID) and the European Union with no declared opposition from the WTO members except for the United States. Had the WTO-TRIPS Council granted the LDCs their desired and valid requests, it would have demonstrated to the world that the WTO will take the necessary steps to protect the poor and vulnerable.”
The groups also “urgently call on all Least Developed Countries to actively use the created policy space this renewed transition period provides and accordingly to take immediate steps to amend their respective national laws to exclude pharmaceutical products from patent protection and test data protection with explicit provisions that this would be until 1 January 2033 or the expiry of such later transition period that may be granted by the WTO Council for TRIPS.”
TPP Full Text
TPP Annex 8-C: Pharmaceuticals/Annex 8-E Medical Devices
Statement on WTO’s TRIPS Decision