Tuesday, 27 October 2009

Its official – Ecuador grants obligatory patent licenses

The Presidential Decree which grants obligatory patent licenses to some pharmaceuticals has been enacted. Since October 23, Ecuador woke up to a new patent system where approximately 2000 medicines may be affected.

Under this system, the State can oblige patent owners to release an authorisation by which third parties are allow to copy the patent and thus, compete at the same level. According to the Instituto Ecuatoriano de la Propiedad Intelectual (IEPI) there has been more than 2000 patent applications but when reviewed only 480 were registered. From these, it is considered that only 200 will be enter on the list of obligatory licenses which are those that attack illnesses relating to cancer, AIDS, diabetes, hypertension, among others.

The IEPI claims that they are ready to start granting obligatory licenses but they are waiting for the ‘list’. The Health Minister is the institution which is elaborating the file of medicines that are to be under this new system. Then, once they pass the list, the IEPI will start receiving applications from those nationals that would like to produce the medicines.

There are 243 pharmaceutical working in Ecuador and 87% of these are transnational companies. As expected there are notorious opinions. The School of Chemist and Biochemist explains that they are concerned with the quality control of the medicines. One owner of a pharmacy affirms that there will be shortage since only 5% of the stock is from national labs.

Observing closely, the Presidential Decree set up in Art 4 that those who opt for an obligatory license must paid to the patent owner some royalties. The amount will be decided (hopefully case by case) by the IEPI. It seems pretty clear however, that this will raise concerns. Transparency and adequacy of this process may be tainted by corruption (Corruption perception index 2008:2.0 - 151 out of 180). What is more of concern is that Art 1 establishes that ‘the decree will not apply to cosmetic, aesthetic and cleaning medicines and generally, those that are not use for treating illnesses. For the rest, specifically those illnesses that affect the Ecuadorian population and are considered priorities for the public health, licenses will be granted.’ Clearly, the list appears to be open. In fact, the question is: what is to be considered ‘priorities’? Once again, the issue of corruption comes to mind.

The Pharmaceutical Research Industry (IPI in Spanish) in Ecuador said that they did not wish to comment on the issue until they did not know the extent of the Decree. (see comments here).

Ecuadorian Decrees can be accessed here, see No 118 for more info.

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