Note on ACTA and Access to Medicines

Sean Flynn

The Anti-Counterfeiting Trade Agreement extends minimum enforcement and legal remedy requirements to a broad range of intellectual property laws far beyond the limited terrain of criminal trademark counterfeiting. Counterfeiting in U.S. law and under TRIPS refers to the intentional deception of consumers through spurious marks that are substantially identical to registered trademarks. ACTA as it is written now applies a wide range of counterfeiting remedies -- from border seizures to destruction of goods and criminal sanctions -- to goods that are suspected of infringing trademarks in other ways (e.g. being "confusingly similar"). It also continues to have language extending the agreement's scope to all intellectual property rights, including patents, and proposes requiring in-transit border measures in ACTA member countries. These provisions may pose serious threats to access to generic medicines and other knowledge imbedded goods around the world.

This note flags a few issues of particular interest to access to medciines advocates.


API SUPPLIER LIABILITY

There are several provisions in the ACTA text that would appear to require remedies against API suppliers who unknowingly provide ingredients to entities that violate trademark or other IP rights with their final product. For example, the Injunctions chapter mandates that right holders be in the position to apply for injunctions against third parties “whose services are used . . . to infringe an intellectual property right.” As written, this would appear to allow injunctions against active pharmaceutical ingredient providers whose products are used by generic companies who are found to “infringe” a trademark or patent law, even in unintentionally.

IN TRANSIT BORDER SEIZURES

The text contains a great deal of language proposing to require that countries provide procedures for the seizure of goods “suspected” of violating trademark or other IP laws, including goods “in-transit” (that is, only in the country by virtue of being transported between two other countries). Seizures are required where there is a mere “prima facie” case of infringement, including by bearing a label that is “confusingly similar” to a trademarked good. This is a detailed fact-specific determination that is prone to mistaken conclusions and strategic misuse by rights holders to thwart competition. In the case of access to medicines, wrongful detentions can cost lives dependent on access to affordable drugs.

For in transit detentions, there is no requirement that the laws being violated are those of the country ultimately using the product. A footnote and proposed text explicitly propose that countries should apply the law of the in-transit country, not the destination country, in seizure determinations. This is the legal framework in the EU that led to the “Dutch seizures” of legal medicines in transit, even where the goods did not violate the laws of the importing or exporting countries.

The text applies border measures and requirements for the destruction of goods for any object found to “infringe” a trademark, even if not a counterfeit. Bracketed text also proposes to require destruction of a product that infringes any IP right.

Extending border suspensions and goods destructions to mere trademark infringements should be particularly worrying for generic medicines manufacturers. Generic labels are required to be similar to the brands. They must use the same words identifying active ingredients, the same warnings and indications and other information. In addition, they often desire to have similar packaging and presentation as the brand drugs to help patients switch between brand and generic with comfort. Requiring border officials to identify which medicine labels are too “similar” to allow into the market is bound to lead to many more unjustified supply interruptions than if the measures were limited to criminally counterfeit products that intentionally use identical marks.

There is no process required for a reply where the TM owner makes a complaint to customs alleging suspected infringement. At minimum, public interest concerns, especially for medicines, demand more protections to thwart wrongful suspensions of legitimate competing products.

THREATS TO COMPULSORY LICENSING

In several instances, proposed ACTA text would limit TRIPS-compliant compulsory licensing.  For instance:

  • In Chapter II (“LEGAL FRAMEWORK FOR ENFORCEMENT OF INTELLECTUAL PROPERTY RIGHTS”), Art. 2X, there is a new section in brackets stating that a provision on limitations on remedies for government use of intellectual property will be inserted. This is a welcome development. But the language must extend beyond government use to third parties authorized by the government, as is provided for in Article 31 of TRIPS.
  • In the Civil Enforcement and injunctions sections, proposed text would require that judicial procedures, including injunctions, be available to enforce any intellectual property right. This would negate the ability to implement administrative government use compulsory licenses which grant patent holders the right only to be compensated for, not to enjoin, infringement by parties authorized by government.

INSTITUTIONAL ARRANGEMENTS

The text calls for a new oversight committee, which would bypass existing more open and public forums for international rule making, such as WIPO. It appears that consumer representatives will be locked out of the organization. The text only envisions that “nongovernmental groups of intellectual property stakeholders,” not consumers, will be able to obtain observer status in the new institution.

 


Image of medicines (cc) Rodrigo Senna.

 

 

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