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The Politicization Of The US Patent System

The Washington Post story, How patent reform’s fraught politics have left USPTO still without a boss (July 30), is a vivid account of how patent reform has divided the US economy, preempting a possible replacement for David Kappos who stepped down 18 months ago. The division is even bigger than portrayed. Universities have lined up en masse to oppose reform, while main street businesses that merely use technology argue for reform. Reminiscent of the partisan divide that has paralyzed US politics, this struggle crosses party lines and extends well beyond the usual inter-industry debates. Framed in terms of combating patent trolls through technical legal fixes, there lurks a broader economic concern – to what extent ordinary retailers, bank, restaurants, local banks, motels, realtors, and travel agents should bear the burden of defending against patents as a cost of doing business.


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    At WHO, Pharma Suggests Payment Plan For Influenza Virus Use

    Published on 8 October 2012 @ 1:57 pm

    By for Intellectual Property Watch

    The World Health Organization advisory group on pandemic influenza preparedness met with pharmaceutical industry representatives, civil society members, and other stakeholders last week to move toward a recommendation on a partnership contribution formula to determine payment modalities for influenza virus sharing.

    The cash-strapped UN health organisation is keen to get partners to pay for their use of the Pandemic Influenza Preparedness (PIP) benefit sharing system by the end of the year. So advancing the partnership contribution was a top priority for the PIP advisory group, which met from 3-5 October at the WHO.

    Member States adopted the PIP Framework [pdf] over a year ago during the 64th World Health Assembly to ensure the fair access and sharing of influenza viruses, vaccines, and other benefits by all countries. So far, influenza viruses are being shared, but industry partners have not yet paid for the use of the system

    Under Section 6.14 of the PIP Framework, influenza vaccine, diagnostic and pharmaceutical manufacturers, using the WHO Global Influenza Surveillance and Response System (GISRS), are expected to pay half of its operating cost -about US$ 28 million annually.

    “It is true that viruses are being shared, so the benefits should be shared. It is a bit surprising that in an age when you can transfer money with the click of a button that making payments take more time than sharing viruses,” Professor Didier Houssin, PIP advisory group chair, told Intellectual Property Watch.

    One payment plan, put forth by the pharmaceutical industry, has been suggested and its basic tenets were well received during the consultations.

    An Offer on the Table

    The International Federation of Pharmaceutical Manufacturers and Associations (IFPMA) submitted a revenue-based proposal to the WHO Secretariat on 5 September. During the industry and civil society joint consultations, Michael Watson, vice president of vaccination policy and advocacy at Sanofi Pasteur, presented elements of the proposal on behalf of the association.

    “We spent six months working on this with a third party, thinking very carefully how to achieve this. It is based on a combination of pandemic and seasonal revenues,” Watson said.

    Representatives of the Biotechnology Industry Organization (BIO) and AdvaMedDx, a diagnostic manufacturers advocacy organisation, also present during the consultations, expressed their support for the IFPMA proposal, which bases the partnership contribution on influenza vaccine sales.

    When asked for more details on the contribution breakdown, Watson explained, “Our proposal has three elements to it. It has an element of pandemic sales from the past pandemic, it has an element of seasonal sales, and pre-pandemic sales.”

    Members of non-governmental organisations (NGOs) including Knowledge Ecology International (KEI) and the Third World Network (TWN) requested to review the proposal. At the time of this writing, the WHO Secretariat has not responded to additional requests to make the proposal public.

    Also in an effort to define who should start contributing to the PIP benefit-sharing system, the advisory group likely will recommend the need to establish a comprehensive list of vaccine manufacturers with their development and/or production capabilities through a questionnaire which will be developed by the WHO Secretariat.

    Evaluating Intangibles

    Although the IFPMA proposal is widely supported by industry, there may other ideas circulating in terms of how to approach contributions.

    During the consultations with civil society, WHO Director General Margaret Chan, who was also present during industry consultations, said: “Industry is not homogenous and they may have different opinions, different positions. We are listening to industry from developing countries. DCVMN [Developing Countries Vaccine Manufacturers Network] was connected by teleconference and gave us their view and opinion, and we listened.”

    The director general was also very receptive to hearing the ideas put forth by civil society groups, which also included the Berne Declaration and the Medicines Patent Pool (MPP). One key issue evoked was the importance of including the full scope of users benefiting from the WHO virus sharing system.

    Sangeeta Shashikant, TWN coordinator and legal advisor, pointed to the broad definition of “influenza vaccine, diagnostic and pharmaceutical manufacturers” under Section 4.1 in the Framework, which includes “academic institutions, government owned or government subsidized entities, non-profit organizations or commercial entities that develop and/or produce human influenza vaccines and other products derived from or using H5N1 or other influenza viruses of human pandemic potential.”

    In order to capture some of the value that comes from the use of PIP biological material that is not necessarily measurable by vaccine sales, such as the acquisition and licensing of intellectual property rights, James Love, director of KEI, suggested an additional measure by which users would self-evaluate these assets.

    “Companies would establish how they value their intellectual property rights in the narrow area of the field-of-use licence and the assessment would be based upon that self-evaluation. The understanding would be that the WHO could acquire the licence or they could assign it to someone else to acquire it for whatever the self-evaluation is, which would be a disincentive for undervaluing it,” Love explained.

    KEI will submit further details on how self-evaluation of IPR would work in this context to the WHO Secretariat in the coming weeks.

    Although there may not be unanimity amongst all stakeholders, the advisory group was pleased to see broad convergence around basing contributions on influenza vaccine revenues as a starting point.

    “Of course it would be ideal to be perfect, to have a definition that covers all manufacturers, but since things have to go rapidly, it is important if we could define and start with a first group of manufacturers,” Chair Houssin told Intellectual Property Watch.

    Country Allocations

    Beyond the partnership contribution, the advisory group also discussed how funds would be allocated once they are collected. The WHO Executive Board adopted the advisory group’s recommendation to allocate 70 per cent of contributions for preparedness and 30 per cent for response activities last May (IPW, WHO, 26 May 2012).

    During these consultations, the chair emphasised during a presentation [PPT] that the PIP Framework principles should be taken into account, including “fairness, equity, public health risk and need of all Member States and the particular vulnerability of H5N1.”

    Houssin added that the allocations should be “evidence based and consider indicators adapted to the Framework such as IHR [International Health Regulations] core capacity, income, health and epidemiology.”

    During the consultations, the WHO Secretariat provided an update on the negotiations of Standard Material Transfer Agreements 2 (SMTA 2), the contracts that allow the sharing of viruses with entities outside the WHO GISRS.

    There are currently five contracts being negotiated with companies, including GSK, Sanofi, Novartis, Baxter, Serum Institute of India. The Secretariat hopes that one will be concluded by the end of the year.

    The advisory group will submit its suggestions to the Director General who will present her recommendations at the Executive Board meeting in January 2013. The advisory group is looking at reconvening next March, but a date has not yet been confirmed.

    Related article:

    http://www.ip-watch.org/2012/05/26/world-health-assembly-member-states-call-for-acceleration-on-pandemic-flu-preparedness/

    Rachel Marusak Hermann may be reached at info@ip-watch.org.

     

    Comments

    1. Packed WHO Executive Board Agenda Highlights Need To Streamline Priorities | Intellectual Property Watch says:

      [...] Executive Board members will review a report from the PIP advisory group meeting in October with pharmaceutical industry representatives, civil society members, and other stakeholders last week to move toward a recommendation on a partnership contribution formula to determine payment modalities for influenza virus sharing. [...]


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    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website. By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website.

    By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

    1. You agree that you are fully responsible for the content that you post. You will not knowingly post content that violates the copyright, trademark, patent or other intellectual property right of any third party or which you know is under a confidentiality obligation preventing its publication and that you will request removal of the same should you discover that you have violated this provision. Likewise, you may not post content that is libelous, defamatory, obscene, abusive, that violates a third party's right to privacy, that otherwise violates any applicable local, state, national or international law, that amounts to spamming or that is otherwise inappropriate. You may not post content that degrades others on the basis of gender, race, class, ethnicity, national origin, religion, sexual preference, disability or other classification. Epithets and other language intended to intimidate or to incite violence are also prohibited. Furthermore, you may not impersonate others.

    2. You understand and agree that Intellectual Property Watch is not responsible for any content posted by you or third parties. You further understand that IP Watch does not monitor the content posted. Nevertheless, IP Watch may monitor the any user-generated content as it chooses and reserves the right to remove, edit or otherwise alter content that it deems inappropriate for any reason whatever without consent nor notice. We further reserve the right, in our sole discretion, to remove a user's privilege to post content on our site. IP Watch is not in any manner endorsing the content of the discussion forums and cannot and will not vouch for its reliability or otherwise accept liability for it.

    3. By submitting any contribution to IP Watch, you warrant that your contribution is your own original work and that you have the right to make it available to IP Watch for all purposes and you agree to indemnify IP Watch, its directors, employees and agents against all damages, legal fees and others expenses that may be incurred by IP Watch as a result of your breach of warranty or of these terms.

    4. You further agree not to publish any personal information about yourself or anyone else (for example telephone number or home address). If you add a comment to a blog, be aware that your email address will be apparent.

    5. IP Watch will not be liable for any loss including but not limited to the following (whether such losses are foreseen, known or otherwise): loss of data, loss of revenue or anticipated profit, loss of business, loss of opportunity, loss of goodwill or injury to reputation, losses suffered by third parties, any indirect, consequential or exemplary damages.

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    8. For any content that you post, you hereby grant to IP Watch the royalty-free, irrevocable, perpetual, exclusive and fully sub-licensable license to use, reproduce, modify, adapt, publish, translate, create derivative works from, distribute, perform and display such content in whole or in part, world-wide and to incorporate it in other works, in any form, media or technology now known or later developed.

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