Commentary

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Changes in global pharmaceutical patent strategy due to intergovernmental cooperation

Takeshi S Komatani*

…although there are many “initiatives underway around the world to harmonize intellectual property, tensions and policy decisions at the local level exist that make ‘complete’ harmonization difficult.



Intergovernmental cooperation such as bilateral/International Free Trade Agreements (FTA) or Economic Partnership Agreements often has a great impact not only on agricultural or industrial products, but also on intellectual property and healthcare fields including patent and pharmaceutical policies of the countries involved therein. For example, South Korea, which reached a Free Trade Agreement with the USA in 2011, has been forced to implement a number of amendments to the patent act, particularly with respect to the pharmaceutical field in 2012, such as the introduction of patent linkage system, Abbreviated New Drug Application system and the like (patent laws amended in order to implement Korea-USA FTA [1]). As such, FTA have great and sometimes surprising impacts on domestic or regional intellectual property system and practice. Taking the wider view, currently, around the Pacific Rim, relatively large international negotiations are under way – The Trans-Pacific Partnership (TPP) Agreement. On the other hand, many intellectual property offices have begun to cooperate between the offices to expedite and harmonize patent examination, including Patent Prosecution Highway (PPH) and other intergovernmental cooperations. As such, although there are many initiatives underway around the world to harmonize intellectual property, tensions and policy decisions at the local level exist that make ‘complete’ harmonization difficult. In this article, recent international changes and moves concerning intellectual property, particularly those relating to the pharmaceutical field, are focused and reviewed from a practitioner’s point of view, in order to appropriately prepare and create efficient and strong intellectual property strategies to survive in challenging circumstances in the pharmaceutical industry. Will TPP change the rule of pharmaceutical patent protection?

TPP Agreement is an international agreement, which includes the USA and Japan, and other countries in the Pacific Rim including Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Japan, the second largest pharmaceutical market in the world, has announced its participation thereto in July 2013, soon after the change of the prime minister from Mr Noda of The Democratic Party of Japan (Minshuto) to Mr Abe of the Liberal Democratic Party in late 2012. Recently, South Korea has also reportedly *SHUSAKU YAMAMOTO, Patent & Law, Grand Front Osaka Tower C, 3-1 Ofukacho, Kita-ku, Osaka, 530-0011 Japan [email protected]

Keywords: biological diversity • data exclusivity • diversification • Economic Partnership Agreement • evergreening • Free Trade Agreement • genetic resources • harmonization • intergovernmental cooperation • Patent Prosecution Highway • The Trans-Pacific Partnership • traditional knowledge

10.4155/PPA.14.4 © 2014 Future Science Ltd

Pharm. Pat. Anal. (2014) 3(2), 133–136

ISSN 2046-8954

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expressed its interest in joining the TPP [2]. The TPP originally started among four countries (Brunei, Chile, New Zealand and Singapore), which is called the 2005 Trans-Pacific Strategic Economic Partnership Agreement (or P4) in order to further liberalize the economies of the Asia-Pacific region [3]. Since 2010, it has been expanded to and been replaced with the TPP. The TPP is often reported in newspapers in connection with vehicle manufacturing, customs policies and agricultural policies; however, important aspects of the negotiations are actually related to intellectual property including patents and drugs.

will become more important “ Glocalization for a successful patent portfolio. ” Due to negotiation secrecy, there is little information officially available as to how such a reform with respect to intellectual property issues, including those relating to the pharmaceutical industry, is discussed. However, there are a number of reports from news sources including WikiLeaks. According to WikiLeaks, it appears that a number of radical proposals are discussed in the TPP negotiation. In this regard, WikiLeaks states that “[The] chapter published by WikiLeaks is perhaps the most controversial chapter of the TPP due to its wide-ranging effects on medicines, publishers, internet services, civil liberties and biological patents” [4]. Extension of patent protection appears to be a major issue in the negotiations. For example, in September 2013, it was reported that the “US, Japan mull joint TPP proposal on 2-track drug patent protection,” which will call on developed countries to extend the period of patent protection for medicinal drugs while allowing shorter periods in developing countries, as a compromise for harsh disputes between developed and developing countries. Additionally, so-called ‘data exclusivity’ (or data protection), which also deals with extension of exclusivity of an intellectual property right, is also an issue, which is also noted in the WikiLeaks’ information (specifically, there are four sections [Articles QQ.E.16–19] which deal with data exclusivity) [4]. According to a different new source, it has been reported that the US government requested that new clinical information that is essential to the approval of the pharmaceutical product should be protected at least 3 years (data exclusivity) [5]. In this regard, the Biotechnology Industry Organization published a White Paper entitled ‘The Trans-Pacific Partnership and Innovation in the Bioeconomy: The Need for 12 Years of Data Protection for Biologics’ [6], and stated that due to the complex and challenging nature of biologic pharmaceutical products, referring

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to the fact that the regulatory approval standard for a biosimilar product does not require identity with the innovator product it references, the report stated “[This] creates a potential “patent protection gap” that – without an extended period of data protection – could create a situation in which it is possible to rely on the innovator’s regulatory approval while eluding an innovator’s patents.” As a result, the US Congress has adopted a system which allows at least 12 years of regulatory data protection for innovative biological products. Apparently, the Biotechnology Industry Organization also requests the same level of protection in the international society including the TPP. In this regard, Japan appears affirmative for longer period for data exclusivity, and proposed 8 years as a compromise between 5 years proposed by developing countries and 10  or 12 years proposed by the USA [7,8]. Although the final conclusion is still unclear, it appears that we may be able to say that longer protection of a pharmaceutical product is an issue of the TPP negotiation including patent term extension and data protection, and that there may be two types of manners how the patent term extension, which is equivalent to the Supplementary Protection Certificate in Europe, shall be protected in each member of the TPP. Furthermore, we may be able to say that the data exclusivity may be harmonized. Additionally, so-called ‘evergreening’ of a known drug may also be an issue. According to some information including, for example, Médecins Sans Frontières’ report leaked from the US government [9], which is also noted in the WikiLeaks’ information (e.g., Article QQ.E.1: [Patents/Patentable Subject matter] Paragraph 1 [4]), although the Agreement on Trade-Related Aspects of Intellectual Property Rights includes important flexibilities for governments to decide what type of pharmaceutical products deserve to be protected by patents in a given country. The Office of the United States Trade Representative has reportedly proposed that the TPP should implement patenting of a ‘new form, use or method of using’ and ‘new formulations’ of an existing product, or second medical use. As such, protection of second medical use may also be an important issue in the TPP negotiation. However, it appears that there is tendency for protection of such second medical use to be well accepted in developed countries, but not so much in emerging countries. Last but not least, traditional knowledge, genetic resources and biological diversity are also discussed as an important intellectual property (in the WikiLeaks’s report, there is an article, Article QQ.E.23, which deals with Traditional Knowledge, Traditional Cultural Expressions and Genetic Resources [4]). This means that the sources of information and data of pharmaceutical

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Changes in global pharmaceutical patent strategy due to intergovernmental cooperation

products will also play an important role in obtaining reasonable intellectual property. As discussed above, there are still many issues to be solved in the TPP (see e.g., second release of secret Trans-Pacific Partnership Agreement documents [10]) and, thus, practitioners should be sensitive to the most updated information. Global PPH starting from 2014 – harmonization in the patent system over the world?

On November 1 2013, the Japan Ministry of Economy, Trade and Industry announced that the Japan Patent Office will start ‘Global PPH’ in January 2014 with 12 intellectual property offices of the following countries and regions across the world: the USA, South Korea, the UK, Denmark, Finland, Russia, Canada, Spain, Nordic Patent Institute, Norway, Portugal and Australia [11]. The PPH is a system to expedite patent prosecution and examination, and enables an application whose claims have been determined to be patentable in the Office of First Filing to undergo an accelerated examination in the Office of Second Filing, with a simple procedure upon a request from an applicant on the basis of bilateral office agreements. It is stated that the purpose of the PPH is to facilitate an applicant’s acquisition of a patent at an early stage worldwide, and to enhance the utilization of search and examination results between the IP Offices so as to reduce the burden of examination and to enhance the quality of examination worldwide. However, the PPH started back in 2006 between the Japan Patent Office and the US Patent and Trademark Office, and it has subsequently expanded to an international and multinational system that utilizes results of an international search report, which is published in the course of the examination of an international patent application under the Patent Cooperation Treaty. This is also called ‘Patent Cooperation Treaty-PPH’. Furthermore, so-called ‘PPH MOTTAINAI’ has also been introduced, in which the order of first and second countries to which the order of filing of priority or later filing can be disregarded (see e.g., Japan Patent Office website [12]). As a result, the current PPH system has become a complex system, and it is extremely difficult for applicants, and even practitioners, to understand which PPH route is applicable to a particular case in issue. In order to simplify the complexity of the PPH system, the above-mentioned ‘Global PPH’ will be launched. According to the Global PPH, in principle, a patent application filed within the member countries or regions should be eligible without restriction and thus, in principle, an applicant should be able to use PPH for expediting prosecution of a patent application as long as at least one condition is satisfied for the PPH qualification. Therefore, the Global PPH is a measure to ‘harmonize’ the patent prosecution.

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Commentary

Harmonization or diversification? Glocalization will be necessary for pharmaceutical patent portfolio

As briefly summarized above, within the international society in terms of pharmaceutical patents, there are two directions that completely oppose each other – harmonization and diversification. With respect to patent prosecution systems, the international society is proceeding in the direction of harmonization. On the other hand, practically speaking, the international society will permit the existence of diversity amongst the members of the society and will allow diversification in patent protection for pharmaceutical inventions. In other words, patent examination regarding formality will be harmonized, but substantive examination may and will be allowed to have variations. Then what should we do? It will, of course, be necessary to collect all updated information around the world, and then react as quickly and efficiently as possible. Particularly, in terms of substance, one should consider variations when preparing patent portfolio in the premise that there will remain two extremes in the patent protection in terms of pharmaceutical inventions – a country or territory where only a single patent is allowed, and a country or territory where unlimited ‘evergreening’ strategy is permitted. Glocalization will become more important for a successful patent portfolio. Disclaimer This article describes the opinions and observations of the author as a Japanese patent attorney and does not necessarily represent the viewpoints of the author’s employers or author’s firm. By its nature, the subject article provides the author’s general opinion and necessarily limited discussion of various topics; it does not purport to give specific legal advice or a substitute for legal counsel. As legal advice must be tailored to the specific circumstances of each case, nothing provided herein should be used as a substitute for advice of competent counsel. The author and the author’s firm assume no liability for the use or interpretation of information contained herein. The author and the author’s firm expressly disclaim all liability in respect of anything done or omitted to be done wholly or partly in reliance of this material.

Financial & competing interests disclosure The author has no relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert t­estimony, grants or patents received or pending, or royalties. No writing assistance was utilized in the production of this manuscript.

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References Papers of special note have been highlighted as: of interest n

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Patent laws amended in order to implement Korea-US FTA. www.international­lawoffice.com­/newsletters/ detail.aspx?g=e8b4505b-ee2b-4ec6-a272– 1a9dd6f79b3f Explains major changes made to the to the Patent Act and Pharmaceutical Affairs Act to implement the Free Trade Agreements, which includes patent term adjustment, novelty grace period, patent revocation provision, trade secrets obtained during patent litigation in terms of patent act, and patent-product approval linkage, patent listing, notification by generic companies, stay of generic product approval.

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South Korea moves closer to joining TPP trade talks. www.reuters.com/article/2013/11/29/uskorea-trade-tpp-idUSBRE9AS06M20131129

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Trans-Pacific strategic economic partnership agreement. www.mfat.govt.nz/downloads/tradeagreement/transpacific/main-agreement.pdf

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Secret Trans-Pacific Partnership Agreement (TPP) – IP Chapter. http://wikileaks.org/tpp WikiLeaks disclosed its ‘first’ publication on November 13, 2013, and subsequently release its ‘second’ publication on December 9, 2013 [11].

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Comparative table of data exclusivity provisions in U.S. Free Trade Agreements and the U.S. proposal to the Trans-Pacific Partnership (TPP) Agreement. www.citizen.org/documents/ dataexclusivitytable2wrdfinal.pdf The Trans-Pacific Partnership and Innovation in the Bioeconomy: the need for 12 years of data protection for biologics. www.bio.org/sites/default/files/TPP%20 White%20Paper%20_2_.pdf

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TPP negotiation regarding intellectual property including new drugs: Mr. Amari, the minister of Ministery of Economics, Trade and Industries (METI) stated “there is significant progress”. Nikkei Newspaper (Japanese), 25th October (2013).

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TPP conference regarding Intellectual Property – negotiation under way for protection of a new drug for 8 years: compromising proposal between the US and emerging countries. www.nikkei.com/article/DGXNASFS2402K_ U3A021C1MM8000

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How does evergreening restrict access to medicines? http://aids2012.msf.org/2012/the-transpacific-partnership-agreement-evergreening

concluded if the Asia-Pacific countries back down on key national interest issues, otherwise the treaty will fail altogether.” 11 We will start Global Patent Prosecution Highway. www.meti.go.jp/pre ss/2013/11/20131101007/20131101007.html (in Japanese) n

The Japanese government has already started patent prosecution highway since 2006 with the USA, and broadened applicable countries and territories to 30 countries/regions according to this website, and also started Patent Cooperation Treaty-patent prosecution highway based on international patent application (a patent application according to Patent Cooperation Treaty, and patent prosecution highway MOTTAINAI, which is applicable under relaxed conditions.

12 Japan Patent Office. Patent Prosecution Highway (PPH). www.jpo.go.jp/cgi­/linke.cgi?url=/­ torikumi_e/t_torikumi_e/­patent_highway_e. htm

10 Second release of secret Trans-Pacific Partnership Agreement documents. https://wikileaks.org/Second-release-of-secretTrans.html n

The second release concludes “[This] suggests that the TPP negotiations can only be

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