As part of an effort to help the US Trade Representative understand and preserve strong intellectual property (IP) protections for US companies, the Biotechnology Innovation Organization (BIO) recently put together a report highlighting challenges worldwide and noting that IP reforms outside the US could improve conditions for exporting biotech products.

"These challenges hinder or prevent innovators from securing patents (patent backlogs and restrictive patentability criteria), maintaining and effectively enforcing patents (compulsory licensing, and weak patent enforcement) and protecting regulatory test data (regulatory data protection failures)," the report, signed by BIO SVP of international affairs Joseph Damond, says.

Regulatory Data Protection and Compulsory Licenses

Regulatory data protection (RDP), which BIO says is "particularly critical for biologic medicines," provides for the temporary protection of the package of information biopharmaceutical companies submit to regulators to demonstrate the safety and efficacy of a medicine.

"Unfortunately, many US trading partners do not provide adequate, if any, RDP. This is clearly contrary to WTO rules, which require parties to protect regulatory test data against both disclosure and unfair commercial use," BIO says.

For instance, BIO notes that some countries, like Algeria, do not provide such protections for regulatory data, meaning pharmaceutical products can receive marketing approval but "leave innovators subject to unfair use of their data that can result in unfair early entry of follow-on products."

Similarly, governments have issued or threatened to issue compulsory licenses, which allow local companies to make, use, sell or import particular patented medicines without the consent of the patent holder.

"In the case of medicines, BIO strongly believes governments should grant CLs only in accordance with international rules and only in exceptional circumstances and as a last resort," the report says, highlighting the 2012 example of Bayer’s Nexavar (sorafenib) in India, though other recent "attempts to secure CLs were made after the Sorafenib decision but no additional CLs have yet been granted."

Similar to that example, BIO also highlights the 2012 decree issued in Indonesia authorizing government use of patents for nine patented pharmaceuticals.

"The indiscriminate use of compulsory licenses draws investment away from the biotechnology sector that is heavily reliant on patents to generate investment funding," BIO said.

Brazil, Canada and China

The industry group also takes issue with Brazilian law, which establishes that the regulatory authority, known as ANVISA, must provide prior consent on the grant of a pharmaceutical patent before the country’s National Industrial Property Institute (INPI) issues a patent.

"ANVISA has interpreted this requirement as an obligation to review patentability criteria (novelty, nonobviousness, and utility)," BIO says, advising that such reviews "should not, under any circumstance, review patentability requirements since this is a function that is squarely and solely within the purview of the INPI."

Similarly, BIO takes issue with Canada’s Patented Medicines Review Board (PMPRB), which "has jurisdiction over ex-factory pricing of patented drugs and routinely imposes significant price controls."

In addition, the PMPRB asserts jurisdiction over circumstances "where there is even the slightest tenuous relation (a ‘mere slender thread’, as the courts have put it) between the patent and the product, e.g. a patented container technology that is not used-- but could someday be used-- for a patented medicine. The result is that price controls are imposed on unpatented medicines because patents exist that ‘pertain to’ them but do not cover them."

Meanwhile, in China, BIO notes that the patent examination backlog and regulatory review delays at the China Food and Drug Administration (CFDA) "significantly curtail the effective rights of IP owners."

While calling the current system for preventing the approval and sale of infringing drugs in China "fairly ineffective," BIO says CFDA’s more recent priority review policy, which can provides accelerated regulatory review and approval to applications that meet "urgent and unmet medical needs," China has yet to provide a definition for "urgent and unmet medical needs."

BIO also says it has "significant concerns" regarding CFDA’s proposal to create a drug price ceiling in order to receive regulatory approval, adding that maintaining regulatory assessments independent of pricing considerations "is crucial to ensuring that drugs and biologics reaching the market are evaluated objectively against evidence-based clinical and scientific standards for safety and efficacy."

BIO further raises serious concerns about China as the world’s top manufacturer of pharmaceutical ingredients, as such manufacturers of bulk chemicals that can be used as active pharmaceutical ingredients (APIs) are required to register with CFDA if the product manufactured is intended for use in medicinal products.

"However, if a company manufacturers a bulk chemical that can potentially be used as an API, but does not intend or declare that the bulk chemical will be used in a finished pharmaceutical product, then CFDA would not serve as the competent authority," BIO notes. "Furthermore, Chinese manufacturers that only export their products are not subject to regulatory oversight or review."

BIOTECHNOLOGY INNOVATION ORGANIZATION 2017 SPECIAL 301 SUBMISSION