Trans-Pacific Partnership Agreement: Did US Move Threaten Public Health?

Civil society groups say a leaked document from regional free trade negotiations between countries bordering the Pacific Ocean shows the United States favouring giant pharmaceutical companies at the expense of public health. Separately, the tobacco industry is allegedly also trying to push for a clause to prevent plain packaging.

The Trans-Pacific Partnership agreement (TPP) is being negotiated by Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the United States and Vietnam. The negotiation is being conducted behind closed doors. The aim is to “set the outlines” of an agreement by the November meeting of the Asia-Pacific Economic Cooperation (APEC), according to the US Trade Representative’s office website.

An alleged leaked negotiating paper [pdf] from the United States sought to challenge pre-grant opposition to patent applications from countries signing the agreement, saying that it is lengthy, costly and prone to abuse. The document, purportedly circulated recently to negotiators, presents the US examination procedures, which include prior art submission and protest procedures, as an alternative to pre-grant opposition found in some parties’ current laws.

Pre-grant opposition allows a patent to be challenged before it is being granted. According to several civil society groups, pre-grant opposition procedures allow “any person, including researchers, NGOs, health organizations, and market competitors to oppose a patent application by submitting information and analysis to patent examiners.”

As such, the civil society groups said, pre-grant opposition prevents undue pharmaceutical monopolies, which “contribute little to innovation but greatly to price.”

The United States, the groups said in a “briefing memo”, are trying to suppress pre-grant opposition from the laws of the TPP negotiating countries. This effort is also trying to isolate India’s system, they added.

The briefing memo was written by Public Citizen, the Health Global Access Project, the Initiative for Medicine, Access and Knowledge, and the Third World Network.

It is not clear from the leaked document whether the US outright opposes pre-grant opposition, or if it simply prefers to leave it to each country to choose its own practice.

[Update:] According to Public Citizen, a previously US leaked document shows language that would eliminate pre-grant opposition. In particular, Article 8.7 states: “Where a Party provides proceedings that permit a third party to oppose the grant of a patent, a Party shall not make such proceedings available before the grant of the patent.”

Should this language be incorporated in the TPP, Public Citizen told Intellectual Property Watch, it would require countries with pre-grant opposition to change their laws and eliminate it. Five TPP countries currently use pre-grant opposition, it said: Australia, Chile, New Zealand, Peru and Vietnam.

The leaked June US paper is supportive of their proposed language in the February document. A consolidated negotiating text has allegedly been drafted recently, incorporating some inputs from different countries party to the TPP, but the text does not seem to be available, according to Public Citizen. The NGO is conducting an analysis of how the TPP at that stage would impact the legislation of each of the parties. They provided an analysis on Vietnam and will follow with Australia, New Zealand, Malaysia, Singapore and Brunei. [end of update]

The Indian patent law has been under suspicion by some of not satisfying the terms of the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) because of Section 3(d) of the Indian Patent Act, which tries to prevent patent ever-greening and defines what is not patentable.

According to the civil society groups, “pre-grant oppositions filed in India by health groups have warded off lengthy monopolies based on follow-on patents filed for HIV/AIDS medicines, including lamivudine/zidovudine, paediatric nevirapine, tenofovir, darunavir, and recently heat-stable lopinavir/ritonavir.”

Substandard patent applications are a persistent problem, they said, and pre-grant opposition increases certainty for business decisions and improves regulatory efficiency and accuracy. The leaked US document said that third parties can overburden “already strapped patent offices, decrease the efficiency of examination, and delay the granting of pending rights.”

The TPP has been under negotiation since March 2010. Seven rounds of negotiations have taken place, the last one in Ho Chi Minh City, Vietnam, from 15-24 June. According to the Australian government, TPP parties made steady progress and “draft text is now on the table in each of the negotiating groups.”

“Parties worked to consolidate existing text and considered new text proposals in various working groups, including intellectual property, services, transparency, telecommunications, customs and environment. In a range of areas it is expected that further textual proposals will be tabled,” the Australian Department of Foreign Affairs website said.

Public Health, Tobacco Plain Packaging

The TPP has stirred significant debate over the course of negotiations. NGOs in March called for a United Nations intervention into the negotiations (IPW, Public Health, 28 March 2011). A 22 March letter written by a multi-country set of non-governmental organisations and academics was sent to Anand Grover, the UN special rapporteur on the right of everyone to the enjoyment of the highest attainable standard of health. The letter warned against intellectual property provisions in the trade agreement.

According to other sources, such as Australian academics writing in a 7 July blog, here, the TPP, by creating binding obligations on member countries, could also limit Australia’s capacity to regulate for public health. In particular, it could endanger the Australian’s tobacco plain packaging legislation, the authors said. The tobacco industry may be lobbying for the inclusion in the TPP of a clause on investment that would allow them to legally challenge any plain packaging legislation, according to sources. Industry sources were not reached to confirm this.

Philip Morris Asia announced on 27 June that “it has served a notice of claim on the Australian government, stating its intention to pursue legal action over plans to introduce plain packaging in Australia for tobacco products.” This legal action is taken under the Australian Bilateral Investment Treaty with Hong Kong.

Philip Morris, which describes itself as the leading international tobacco company, claims that “the forced removal of trademarks and other valuable intellectual property is a clear violation of the terms of the bilateral investment treaty between Australia and Hong-Kong.” Philip Morris said that the notice served on the Australian government “begins a mandatory period of three months during which the parties must attempt to negotiate a satisfactory outcome.”

The issue of the Australian draft law on tobacco plain packaging was also discussed at the World Trade Organization, during the last Trade-Related Aspects of Intellectual Property Rights (TRIPS) Council (IPW, WTO, 16 June 2011). The Dominican Republic supported by several other developing countries, challenged the Australian legislation as being incompatible with the Australia’s TRIPS obligations. Industry circulated material to governments participating in the WTO meeting.

According to the Australian Fair Trade and Investment Network, a civil society network, the next rounds of negotiations was scheduled to take place in September in San Francisco, US, followed by 24-28 October in Lima, Peru, and at the APEC meeting in November in Honolulu, Hawaii, US. [Update: sources say that the next meeting has been moved from San Francisco to Chicago, on 6-16 September.]