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The role of intellectual property rights in treatment access

challenges and solutions

Hoen, Ellen ‘ta; Passarelli, Carlos Andréb

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Current Opinion in HIV and AIDS: January 2013 - Volume 8 - Issue 1 - p 70-74
doi: 10.1097/COH.0b013e32835b6e5a
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Increasing access to antiretroviral (ARV) treatment in the developing world is not possible without low-cost medicines. Intellectual property related to pharmaceutical products, and in particular patents, play an important role in determining whether low-cost generic versions of HIV medicines can be made available, which is particularly relevant for the developing world where resources are scarce and healthcare underfunded.

Highly Active Antiretroviral Therapy (HAART) became available in wealthy nations in the early nineties. The high cost of the drugs discouraged any planning to provide ARV treatment to people in developing countries, and instead, the global community focused on prevention [1]. At that time, ARVs were almost exclusively produced by western multinational companies that also held the patents on these drugs. A patent prevents any third party from producing, selling, offering for sale or using the product patented. A patent thus forms a barrier to the introduction of generic versions of HIV medications.

Countries such as Brazil and Thailand, the first developing countries that adopted policies to provide access to HIV treatment in the early 1990s, faced significant challenges in attempts to overcome ARV patent barriers. Thailand and Brazil adopted a strategy of locally produced generic ARVs in government-supported facilities. However, both countries experienced challenges from companies and trade pressures from wealthy nations [2,3].

Box 1:
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In 2001, the conflict between 39 multinational drug companies and the government of South Africa gained the attention of the world [4▪]. In 1998, the companies sued the South African government over provisions in its Medicines Act that were aimed at making access to generic medicines easier and allowing parallel imports of lower priced patented medicines. This policy was in accord with the WHO's recommendations that aimed at stimulating national drug policies on the basis of the provision of generic medicines [5]. Civil society and HIV activists around the world mobilized campaigns and petitions, and companies came under fierce criticism. The drug companies, faced with a massive global outcry over their actions, dropped the case unconditionally in 2002.

The disputes in South Africa, Thailand and Brazil were widely publicized. The result was that the public health community began to focus on issues related to intellectual property and the cost of medicines, in particular for HIV and the role of the World Trade Organization (WTO).

With the establishment of the WTO in 1995, the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) came into force. The TRIPS Agreement laid out minimum standards for intellectual property protection including an obligation to provide pharmaceutical product patents of at least 20 years [6]. It also provided for transition periods, which allowed certain medicines-producing countries to delay the introduction of pharmaceutical product patents until 2005. This became a significant window in the ARV treatment history. For example, the Indian Patent Act of 1970 did not provide patents for products. As a result, the generic medicines industry thrived. India took maximum benefit of the transition period. Generic manufacturers made ARVs, showing that triple therapy could be offered for a fraction of the price demanded by multinational companies. The Indian producers were also not hampered by patent barriers that often prevented formulating the ARVs in fixed-dose combinations, which helped to simplify treatment and to increase adherence. In February 2001, the Indian company Cipla offered the first triple therapy for US$350 per patient per year, shattering the deep-rooted belief that providing HIV treatment in the developing world would never be feasible for cost reasons [4▪]. Multinational drug companies have responded with price reductions, but have never been able to compete with the price drops that are the result of robust generic competition [7].

At the policy level, the debate on intellectual property and public health intensified and moved from the WHO to the WTO TRIPS Council. This debate led to the adoption of the Doha Declaration on TRIPS and Public Health by the WTO ministerial conference in November 2001 [8].

The Doha Declaration clarified the rights of countries with regard to the use of safeguards contained in the TRIPS Agreement and described the measures governments could take to protect public health. Perhaps the most relevant of the measures spelled out in the agreement is the ability of governments to provide licenses to third parties to make use of the patent without the consent of the patent holder, so called compulsory licenses. The Doha Declaration also allowed least developing countries (LDCs) to delay the granting and enforcement of medicines product patents until 2016. In 2003, the WTO members agreed to the ‘August 30 decision’, a mechanism that allows production for export under a compulsory license.

The political momentum created by the adoption of the Doha Declaration, the Indian generic ARV production capacity, civil society mobilization and the establishment of financing mechanisms for HIV treatment have been key ingredients for the scale up of treatment in the developing world and in particular in Africa. However, in 2005, India amended its patent law to comply with the TRIPS Agreement and began to grant product patents for medicines. This change in India poses challenges for access to low-cost ARVs for the developing world. Currently, over 8 million people in the developing world have access to ARVs. The international community made a commitment to increase this number to 15 million people by 2015.

Key intellectual property related challenges today are how to respond to a changed intellectual property environment ensuring that low-cost versions of newer and more widely patented drugs are available in formulations that are easy to use and adapted to the needs of people [9]. Licenses, both voluntary and compulsory, can play an important role in making sure that generic manufacturers can continue to produce and market ARVs at a low cost.


It is no surprise that in 2011, 10 years after the adoption of the landmark WTO Doha Declaration on TRIPS and Public Health, much of the literature describes the implementation of the Declaration and the effects it has had on access to HIV treatments. The literature focuses on the use of compulsory licensing, which has been an important tool in increasing access to lower cost versions of patented ARVs for the countries that have used it.

However, other forms of licensing play a role in HIV treatment access. For example, seven out of eight ARV patent holding companies grant voluntary licenses on a bilateral basis. Voluntary licenses have been important to provide legal certainty to generic producers of ARVs and play an important role in increasing access to generic ARVs. A recent analysis by Park et al.[10] shows a wide variation in voluntary licensing practices, with geographic scope ranging from one to 112 countries; number of licensees ranging from one to unlimited; royalty rates ranging from 0 to 5% of the generic price; freedom to coformulate ranging from none to unlimited; and access to technology transfer and regulatory data ranging from minimal to extensive. Although in general the geographic scope of the licenses is made public, they note that these licenses may contain other terms and conditions with important public health impact, but the lack of transparency hampers a full assessment of the licenses.


Beall and Kuhn [11▪] analysed the trends in compulsory licensing from 1995 to 2011 and is perhaps the first comprehensive overview of compulsory licensing after the adoption of the Doha Declaration. They identified 24 (for 22 products of which 16 concerned drugs for HIV/AIDS) episodes of compulsory licensing in 17 countries of which half led to the actual granting of a license. They note that countries that signalled their intention to grant compulsory licenses but in the end not did so nevertheless benefited from price reductions, for example through discounts or voluntary licensing by the patent holder. They found higher levels of compulsory licensing activity in upper-middle income countries than in the low-income countries. Although compulsory licensing receives ample attention in the literature, it remains a little known fact that LDCs have used the Doha Declaration on a large scale to allow the procurement of ARVs on the international competitive market. ‘t Hoen et al.[4▪] note that 26 out of 32 least developed country WTO members authorized importation of generic ARVs, with reference to Paragraph 7 of the Doha Declaration, a provision that allows the delay of granting or enforcing medicines’ patents by LDCs until at least 2016 and therefore does not require the issuance of a compulsory license.

One of the episodes described concerns the much publicized Canadian compulsory license for the production and export of lamivudine/nevirapine/zidovudine combination by Apotex to Rwanda using the WTO's ‘August 30 decision’ for the first time. They note, as others have done [12,13], the bureaucratic constraints and inefficiency of the ‘August 30 decision’ compulsory licensing system. In the end, Rwanda paid a price that was still higher than for comparable products from Indian producers.

In general, the use of compulsory license by countries remains rare, which as some commentators point out, can be explained by the fact that the political pressure on developing countries to refrain from making use of this TRIPS flexibility is strong [14].


The important role of large-scale generic producers with export capabilities such as ARV supply from India in treatment scale-up cannot be overestimated. Waning et al.[15] present dramatic data on the basis of donor-funded purchases: Indian generic manufacturers dominate the ARV market, accounting for more than 80% of annual purchase volumes. Among paediatric ARV and adult first-line ARV products’ markets, Indian-produced generics accounted for 91 and 89% of 2008 global purchase volumes, respectively. From 2003 to 2008, the number of Indian generic manufactures supplying ARVs increased from four to 10, while the number of Indian-manufactured generic products increased from 14 to 53. Ninety-six out of 100 countries purchased Indian generic ARVs in 2008. Waning et al.[15] join others in expressing concern about the effects of the reintroduction of pharmaceutical product patents by India in 2005 and the potential effects of ‘TRIPS-plus’ provisions currently under discussion in free trade negotiations on India's ability to continue the supply of low-cost generic medicines [15–18]. Babovic and Wasan [16] argue that ensuring access to newer ARVs affected by the 2005 amendments to the Indian patents act and thus likely to be patented will demand additional measures including purchasing commitments from large donors.

India has shown awareness of its role as ‘pharmacy of the developing world’ and built in significant safeguards when it amended its patent laws to be compliant with the WTO TRIPS Agreement in 2005. For example, India has a simple and straightforward provision for compulsory licensing for export to countries that lack their own production capacity. India has also set strict patentability criteria aimed at preventing patent awards for trivial innovations or patent extensions of existing products. A system of pregrant opposition enables anyone including public interest groups to oppose the grant of a patent. Several articles describe pregrant oppositions by civil society organizations such as the rejection by India's patent office of Abbott's patent application for the heat-stable version of lopinavir/ritonavir [19,20].


A recurrent question in the ARV treatment access debate is whether domestic production can contribute to access to medicines and decrease dependencies on western pharmaceutical corporations. Brazil's HIV treatment programme has heavily relied on domestic production of ARVs [21,22]. Meiners et al.[22] analysed the trend in prices paid for ARV in Brazil between 1996 and 2009, which shows a steady decline. They note that maintaining generic market dynamics remains important in particular now that the need for newer and more expensive ARVs is increasing. But they also highlight the intellectual property challenges and the need for political leadership to act on them [22].

The case study of Tanzania's domestic production of ARVs illustrates the challenges for a LDC of developing an efficient production that can compete with large-scale WHO prequalified international producers. A key hurdle is the inability to create economies of scale to ensure cost efficiency. The authors list various critical success factors that should be addressed upfront by countries that want to embark on domestic production of ARVs as part of their access strategies [23].


Predictable and health-oriented licensing of ARV patents can ensure that in today's changed intellectual property environment, vigorous generic competition can take place. With this in mind, in 2010, UNITAID founded the Medicines Patent Pool (MPP) [4▪,24]. The principle of a patent pool is to facilitate the availability of new technologies by making access to patents and other forms of intellectual property more readily available to entities other than the patent holder. Through this mechanism, patent holders voluntarily offer, under certain conditions, the intellectual property related to their inventions to the patent pool. Any company that wishes to use the intellectual property to develop medicines can seek a license from the pool against the payment of royalties and may then produce the medicines for use in developing countries. The MPP now has obtained and granted its first licenses for ARVs [25].

Public health oriented licensing such as through the MPP can offer relief from the constraints of more widespread patenting and has the potential to go beyond the controversy because it operates within the current system. The MPP is often described as a fresh breath of air in a controversial battlefield. Ultimately, its success will depend on the willingness of sufficient pharmaceutical patent holders to license to the Pool [4▪,13,14,21,22,24–27].


Some of the literature in 2011 discusses more fundamental changes in the system and points at the need to reconsider whether the patent system is indeed the most efficient mechanism for stimulating innovation [3]. The theme of the annual Varsity Medical debate between Oxford and Cambridge in 2011 was ‘Should patents for antiretrovirals be waived in the developing world?’. Although the arguments from the defendants of the maintenance of the current system prevailed over those who called for a new order, participants agreed that there is a difficult tension between the protection of the commercial interest and the protection of human rights but offered no solutions how to do so [27]. Grover et al.[28] suggest holding pharmaceutical companies directly accountable under international human rights law.

Some authors point to the fact that access challenges are not confined to HIV and that pressure from developing countries for access to new treatments in the area of noncommunicable diseases will require global action and coordination [14]. The proposal for a medical R&D treaty as recommended by the WHO Consultative Expert Working Group [29] is an example of such coordination. Such a step has the potential for the global health community to design incentive mechanisms for medical innovations that are public health driven and access oriented. One example of such proposals is delinking paying for the cost of medical innovation from the price of the end-product.

The field of intellectual property and treatment access is volatile and subject to constant change. As this study goes to press, the Indian Supreme Court is hearing a case brought by Novartis that challenges Section 3(d) of the Indian Patents Act. Section 3(d) discourages the granting of patents for incremental innovations unless significant therapeutic advantages over known compounds can be shown [30]. If successful, this challenge may have far-reaching consequences for pharmaceutical patenting in India, with repercussions throughout the developing world. In July 2012, the Global Commission on HIV and the Law recommended that the United Nations Secretary General convene a process to ensure that intellectual property regimes are consistent with human rights and to recommend a new intellectual property regime for pharmaceutical products. The Commission recommended a moratorium on TRIPS while this work was carried out [31].

Although debates and disagreements about intellectual property and access are likely to continue into the next decade, one cannot lose sight of the fact that it is important to meet the needs of people living with HIV today. The current system offers opportunities to do so but requires political will and governments that prioritize health. Initiatives such as the MPP have shown it is possible to bring parties together and broker agreements that bring benefit for public health.



Conflicts of interest

Ellen ‘t Hoen is a senior consultant to the Medicines Patent Pool. Carlos A. Passarelli has no conflict of interest to disclose.


Papers of particular interest, published within the annual period of review, have been highlighted as:

  • ▪ of special interest
  • ▪▪ of outstanding interest

Additional references related to this topic can also be found in the Current World Literature section in this issue (p. 82).


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This article provides one of the rare historical overviews of how the scale-up of HIV treatment has driven change in the thinking about and the implementation of intellectual property protection in the health field.

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access to HIV treatment; antiretroviral drugs; generic medicines; HIV/AIDS; intellectual property rights; voluntary and compulsory licensing; World Trade Organization Doha Declaration on the TRIPS Agreement and Public Health

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