Canada and the WTO Patented Drugs Policy for Developing Countries

For many developing countries, the cost of prescription drugs required to fight widespread diseases such as AIDS, tuberculosis and malaria is prohibitive and keeps the drugs out of the hands of many who need them. As reported previously in E-TIPSâ„¢, (Vol 2, No 9, October 9, 2003), the World Trade Organization (WTO) initiated efforts to encourage developed countries to provide inexpensive drugs to developing countries. Canada has become the first country to answer this call. In February 2004, Bill C-9 was re-introduced in Parliament in the form of a complex series of amendments to the Patent Act and the Food and Drugs Act. The legislation would allow generic drug manufacturers to produce patent-protected drugs for sale to developing countries, through a compulsory licensing scheme. However, a provision in the Bill gives patent holders a right of first refusal to fill the orders for the drugs. Although the legislation has been welcomed, it has been argued that the insertion of a right of first refusal removes an incentive for generic drug makers to seek out and set up deals with developing countries, as there is no guarantee that patent holders will not choose to fill such orders. In response to these concerns, the Canadian federal government has indicated that it is willing to further amend the Bill. The changes are expected to remove any disincentive for generic firms to arrange supply contracts, but will also give brand-name companies a chance to bid on contracts. In addition to the right-of-first-refusal issue, humanitarian groups have also raised concern over the limited list of drugs to be included in the new provisions and the limited number of beneficiary countries designated in the legislation. It is not clear whether these issues will be addressed by the expected further amendments. A link to the WTO decision can be found at: http://www.wto.org/english/tratop_e/trips_e/implem_para6_e.htm. For a copy of the currently proposed Canadian legislation Bill C-9, visit: http://makeashorterlink.com/?O23624CB7. Summary by: Sue Diaz