Study Guide ALSA Forum Jakarta 2020

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Table of Contents A. Introduction to the International Patent Law in Relation to International Pharmaceutical Development

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a.

IP Law

1

b.

Patent Law

2

c.

International Patent Law

8

B.

Relevant Topics around Pharmaceutical Development

15

a.

Biologics

15

b.

Drugs

16

c.

Definition of Essential Medicines

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d.

Drugs Accessibility

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e.

De-Linking of Research and Development Cost from Drug Price

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C.

Case Examples

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a.

Patent Law and Drug Accessibility: Diabetic Medicine Development

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b.

Thailand Compulsory Licensing Program

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c.

Biopiracy Controversy: The Maya-ICBG Controversy

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d.

Parallel Import Violation Case: Hong Kong

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e.

Recent Crisis: COVID-19 Drug Development

28

D.

Chamber Main Topics

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a.

Improving Accessibility of Patented Medicine in Times of Emergency

30

b.

Protection of Traditional Medicine through International Patent Law

31

c.

Alternative to Patent Law to Support Pharmaceutical Research and Development Efforts

32

d.

A Look Forward: A Review of Current Patent Law in Pharmaceutical Development

33

E.

Further Reading

34

F.

References

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Hello, ALSAians! It is an honour for me to have the privilege of serving as the Managing Director on Events of ALSA Forum Jakarta 2020. I am very delighted that ALSA Local Chapter Universitas Indonesia (“ALSA LC UI”) is able to host and co-organise the ALSA Forum. On behalf of the Events’ Division, it is my utmost pleasure to welcome you to the Academic Activities of ALSA Forum Jakarta 2020! I would like to express my sincere appreciation for the Academic Activities Team: Faqih; Arminta; Ayska; Anggita; Saras; and the Staffs of Academic Activities for their outstanding work in conducting the event and for creating this masterpiece. As many of you may already know, ALSA Forum is an annual ALSA International event that is usually held offline. However, with the current pandemic, we must shift to an online ALSA Forum instead. We hope that despite the change, you can keep your enthusiasm for the event! Let me begin the introduction by providing some background to help you reach a common understanding before the event. Albert Einstein once said, “Creativity is intelligence having fun”. This quote is what starts the idea of Intellectual Property and is the source of our inspiration. Intellectual Property, as we all know, is basically a relationship between Law and Creativity. With pharmaceutical development progressing rapidly now more than ever, the theme of Academic Activities, “Pharmaceutical Development”, was indeed timely and relevant. Through this theme, we invite law students to examine the responsibility and the roles in the patent law regarding pharmaceutical development. And to do so, the academic activities are created to provide an opportunity for law students across Asia to research and participate in a larger discussion around the topic. Other than helping you prepare, this Study Guide will also help spread knowledge regarding the topic that is going to be discussed at the forum to a more extensive audience across Asia. I would like to congratulate the contributors and editors for making this publication possible, and I believe this product has opened opportunities for future collaboration. People deserve the best of you, so be around those who bring out the best in you. With that in mind, I hope that you will bring with you the best contribution that can help ALSA, and all of us, grow in the coming years. If you have any questions, want to tell me about any possibilities or just want to discuss something, please don’t hesitate to reach me out! Have fun and thank you all for joining us. Sincerely, Moris Rajalabis Managing Director on Events ALSA Forum Jakarta 2020

mrajalabis@gmail.com

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Hello, ALSAians! It is both my honor and pleasure to welcome you to the Academic Activities at ALSA Forum 2020. My name is Faqih, and I am your Head of Academic Activities. The entire purpose of my role is to ensure that you have the best possible experience during the activities. For the past months, the Academic Activities team has worked tirelessly to create and execute our vision for this year’s forum. With law students from all across Asia participating, ALSA Forum’s Academic Activities are truly an organ of impact. I am currently a junior at Universitas Indonesia, planning to concentrate on international law or business law. I was a staff of the Research and Development Division at ALSA Local Chapter Universitas Indonesia, and had also participated in ALSA Indonesia National Moot Court Competition XXIII. I have received much from ALSA, not just work ethics, but also connections and friendships I have made during its activities. Other than ALSA, I am also an active participant of Model United Nations (“MUN”), most recently representing Indonesia in The European International MUN 2019 in The Hague, Netherlands. Since its inception, ALSA has been an important melting pot for law students across Asia to discuss important and pressing issues, especially this year. With COVID-19 Pandemic still raging on, we are forced to conduct our Forum through online means. However, physical distance should not be a barrier for us to learn together and discuss. And as always, opinions from all delegates are always welcome in order for us to be able to craft the most comprehensive recommendation. With that in mind, this Study Guide has been written by the Academic Activities team over several months, and will serve as the best source of preparation for our Seminar and Table Discussion. I highly encourage you to read the entire guide, as well as taking note of the Rule of Procedures document as well. This will ensure you to be well prepared for our activities. You can always feel free to reach out to myself or one of our team members with any questions or concerns. Stay safe, and see you in August! Sincerely, Muhammad Faqih Adhiwisaksana Head of Academic Activities of ALSA Forum Jakarta 2020 m.faqihadhiwisaksana@gmail.com

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Academic Activities Team Profile 1. Anggita Reina Alfonso, Person in Charge of Seminar My name is Anggi and I’m currently a junior year law student at Universitas Indonesia. I have become very interested in business law and keen to enhance my knowledge around such fields. I’m a former staff member of the Legal Research and Development division of ALSA Local Chapter Universitas Indonesia and have participated in several events in ALSA. One of them was being a staff of Liaison Officer at Seminar and Workshop National Chapter of Indonesia in 2019. Through many experiences and knowledge that I have gained from ALSA, I learn that every soft skills, connections and experiences are important for the long run of my career in the future. If you have anything to ask, I’m available to be reached through my email alfonso.anggita@gmail.com 2. Arminta Kinanti, Person in Charge of Table Discussion Hello delegates! It is my pleasure to welcome you to ALSA Forum 2020! My name is Aimee, and I’m currently a third year student in the Faculty of Law, Universitas Indonesia. Since the beginning, ALSA has become a central part of my life in college. I am a former staff of the Organization and People Development Division of ALSA Local Chapter Universitas Indonesia, and my experience has taught me a lot. It is unfortunate that we couldn't meet in person this year due to the pandemic. However, I hope that you can still gain a lot of knowledge and contribute in finding solutions to the current problems at hand. In the meantime, if you have any questions, feel free to contact me through my email at armintakinanti26@gmail.com . See you in August!

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3. Ayska Karissa, Person in Charge of Seminar Hello delegates! My name is Ayska, I’m a third year student at the Faculty of Law, Universitas Indonesia. Since the first year in college, I have always engaged myself with various organizational activities, such as the Student Executive Board and ALSA. I was a staff in the Legal Research and Development Division of ALSA Local Chapter Universitas Indonesia Board of 2019, and now I am the Coordinator of Legal Events Legal Research and Development Division of ALSA Local Chapter Universitas Indonesia Board of 2020. During my experience in ALSA and other organizations, I have always been fascinated with Business Law, especially Patent Law. I hope that you can enjoy the Seminar that we have prepared, and learn a lot from it as well. If you have any questions, please feel free to reach me through my email at ayskarissa@gmail.com. Stay safe and see you! 4. Saras Shintya Putri, Person in Charge of Table Discussion Welcome delegates! My name is Chacha, I’m currently a second year law student at Universitas Indonesia. I’m a member of ALSA Local Chapter Universitas Indonesia and have participated in several events in ALSA, one of them being a staff of the Care Division at the Care and Legal Coaching Clinic held by ALSA Local Chapter Universitas Indonesia. I have recently grown interest in law related issues towards Intellectual Property Law. Which leads me to participate in other activities on campus, other than ALSA, such as becoming a researcher in Intellectual Property Law. Ever since I got into law school, I always push myself to the fullest and commit to everything I do. In essence, law school has taught me that a strong will, connections, and professional work ethic are the essentials things we need to have. In this unfortunate situation, although we are restricted to physically socialize, hopefully you can still gain a lot of insights and knowledge. For further inquiries, you can kindly contact me through my email at shintyasaras@gmail.com.

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Staff of Academic Activities

Bianda Callista Prawira ALSA LC UI

Aliya Ilysia Irfana A ALSA LC UI

Estella Nava Prasetya ALSA LC UI

Qonita Syahfitri M Z ALSA LC UI

M. Fariza Hanif Iskandar ALSA LC UI

Jasmine Theresa Hoo ALSA LC UB

Wafa Raniah Putri Akbar ALSA LC UI

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A. Introduction to the International Patent Law in Relation to International Pharmaceutical Development a. IP Law According to the World Intellectual Property Organization (“WIPO”), Intellectual Property (“IP”) can be anything that refers to creations of the mind such as inventions, literary and artistic works and symbols, and also names and images used in commerce. There are 2 categories of IP (WIPO, 2004): 1. Industrial property, such as patents for inventions, trademarks, industrial designs, and geographical indications; and 2. Copyright, things that are correlated with, but limited to literary works, films, music, artistic works, and architectural design. Taking the definition of IP, it is clear that everything that is made by someone can fall into the category of Intellectual Property. Then, if so where does this position the creator? In its most basic sense, the creator has the right from their creation that falls under the classification of Intellectual Property just like any other right to an object. The creator can benefit from their creation or investment in a creation. All of this is related to one of the most important documents in International Law, the Universal Declaration of Human Rights (“UDHR”). According to WIPO, Intellectual Property Rights correlates with Article 27 (2) of the UDHR, which states (WIPO, 2004): “Everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author”.

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The law regarding IP varies from many countries, especially regarding what objects are protected in each country, and the mechanism of applying IP protection. The common ground regarding IP law in each country can be seen in The Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPS”), which applies to all members of the World Trade Organization (“WTO”). Under Article 1 Paragraph 2, objects that are classified as Intellectual Property are: a. Copyright and Related Rights; b. Trademarks; c. Geographical Indications; d. Industrial Designs; e. Patents; f. Layout-Design (Topographics) of Integrated Circuits; g. Protection of Undisclosed Information; and h. Control of Anti-Competitive Practices in Contractual Licenses. TRIPS also regulate dispute resolution methods. Under TRIPS, member states should enforce the protection of IP mentioned above through measures, including criminal proceedings if offenses of willful trademark counterfeiting or copyright piracy on a commercial scale are found (World Trade Organization, 1994). b. Patent Law i.

Definition Patent law is the branch of intellectual property law that deals with new inventions. Patent, according to WIPO, is an exclusive right that is granted for an invention, which is a product or process that provides a new

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way of doing something, or that offers a technical solution to a problem. An owner to a particular patent has these following rights (WIPO, 2004): 1. To decide who may or may not use that invention during the period of time that patent is in their possession; 2. Give permission to other parties or license other parties to use that invention on terms agreed by both parties; and 3. Sell that patent to another party. When the sell is done, the possession changes to the buyer. To get a patent, technical information about the invention must be disclosed to the public in a patent application. Traditional patents protect tangible scientific inventions, such as circuit boards, car engines or heating coils. However, over time patents have been used to protect a broader variety of inventions such as coding algorithms, business practices, or genetically modified organisms. In general, a patent can be granted if an invention is (FindLaw, 2016): 1. Not a natural object or process Not involving or manifesting natural means or processes; 2. New A novel invention is one that is currently not for sale or public display. In many countries any public disclosure at any time prior to patent filing removes the novelty factor; 3. Useful To be considered useful an invention must perform a useful function, must actually work as described and must be of some benefit to society. If one can establish from biological data that a specific invention, such as a drug or gene therapy, has a reasonable chance of working in humans then it is not necessary

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to provide data from clinical trials in order to apply for a patent; and 4. Not obvious The nonobviousness requirement is fulfilled if the idea is far different from what has been used or described in previous inventions (FindLaw, 2018). Hence, the previous inventor would not find it obvious to make the change. A principle or an idea alone cannot be patented, but an application of a principle or an idea may be patentable (Albert Einstein College of Medicine, n.d.). ii.

Duration of a patent Once granted, a patent gives the inventors the exclusive right to sell their invention for a specific period of time, generally twenty years. For example in Indonesia, a simple patent for one invention is granted for a period of ten years while other forms of patents are valid for twenty years. Patent holders are required to manufacture their products in Indonesia; this is aimed at providing job opportunities or technology transfer (Albert Einstein College of Medicine, n.d.). Other than a patent registered by its inventor, patent assignment also exists. Assignment of a patent is the transfer of the inventor’s rights and titles to his or her employer. In most institutions, employees are required to assign their rights to their employers (Albert Einstein College of Medicine, n.d.). Sometimes inventors give other companies a license to manufacture and sell the invention in exchange for a fee (FindLaw, 2016).

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When the duration for a possession of a patent ends, that invention enters public domain. When it happens, nobody is the owner, nor entitled for possession of that invention and thus it can be exploited by everyone. Patent provisions in International IP Law can be found on Section 5 of TRIPS Agreement, and within that section it is explicitly mentioned the subject matters that can be patented in which are (World Trade Organization, 1995): 1. Any inventions whether products or processes in all fields of technology; and 2. Provided that they are new, involve an inventive step and are capable of industrial application. iii.

Forms of Patent Different types of patent applications exist so that inventors can protect different kinds of inventions. Savvy inventors can utilize the different kinds of patent applications to secure the rights they need to protect their inventions. There are four different patent types (Joe Runge, 2017): 1. A utility patent is what most people think of when they think about a patent. A utility patent is a patent that covers the creation of a new or improved and useful product, process, or machine. A utility patent, also known as a “patent for invention,� prohibits other individuals or companies from making, using, or selling the invention without authorization. When most people refer to a patent, they are most likely referring to a utility patent (Investopedia, 2019);

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2. A provisional patent goes hand in glove with a utility patent. For example, United States law allows inventors to file a less formal document that proves the inventor was in possession of the invention and had adequately figured out how to make the invention work. Once that is on file, the invention is patent pending. If, however, the inventor fails to file a formal utility patent within a year from filing the provisional patent, he or she will lose this filing date; 3. A design patent protects an ornamental design on a useful item. The shape of a bottle or the design of a shoe, for example, can be protected by a design patent. The document itself is almost entirely made of pictures or drawings of the design on the useful item. In recent years, software companies have used design patents to protect elements of user interfaces and even the shape of touchscreen devices; and 4. A plant patent protects new kinds of plants produced by cuttings or other nonsexual means. Plant patents generally do not cover genetically modified organisms and focus more on conventional horticulture. iv.

Function of Patent Law The purpose of the patent system is to encourage innovation by granting inventors a patent for their inventions. A patent is a governmental grant to inventors of a right to exclude others from making, using, offering for sale, or selling or importing their invention. In exchange, after the patent term expires, the invention is dedicated to the public. Inventors must teach the public how to make and use the invention so that after the

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limited time period for which the patents are enforceable has expired, the public can then take advantage of the innovations taught by the inventor. This way, a patent system is a contract with the government. The benefit of the patent system for the government and the public is that new inventions propel technological advances that the public can use after the expiration of the patent. The benefit to inventors is that they are granted an exclusionary right similar to a monopoly over the patented invention for a limited time (Yang, 2018). v.

Correlation Between Patent and Trademark A trademark is defined as a sign that is capable of distinguishing the goods or services of one enterprise from those of other enterprises and is protected by intellectual property rights (World Intellectual Property Organization, 2013). In other words, a trademark is a symbol that characterizes a certain product and enables customers to recognize a certain product or service (Swedish Intellectual Property Office, 2012). There are several forms of trademark such as the name, symbol, catchphrases, figure or mascot, or lyrics (Malek, 2012). These forms are used by several companies to keep its competitors from copying their original work and to gain recognition. In the pharmaceutical industry, a drug is known to have a chemical name, generic name, and also a brand name (Gangwal, 1999). Although the generic name is considered as a public domain, the brand name is owned solely by the manufacturer and can be created as soon as the generic name has been approved. The choice of brand name is motivated by

marketing

considerations

and

is

solely

thought

by

the

innovator/organization.

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As stated before, a patent is defined as a right granted to an investor that permits the inventor to exclude others from making, selling, or using the invention for a period of time as is designed to encourage inventions to society (FindLaw, 2019). However, there are several differences between a patent and trademark. A trademark protects any word, phrase, symbol, logo, or other devices and provides the right to prevent others from an unfair competition by using similar marks. Other than that, a trademark does not need registration, however it does offer several legal benefits. On the other side, a patent-eligible invention is one that is novel, useful, and non-obvious. It has the right to exclude others from making, selling, using, or importing a particular product and needs to be registered (Henry, 2018). c. International Patent Law i.

Brief History Here is a look at some historical milestones in the long history of patents (Timofejeva, 2018): 1. Ancient times The historians date the first patent filed back to 1474 AD, when a Patent Statute was declared in Venice. This might be the first reliable evidence of the intellectual property law that specified the concept of intellectual property and defined the importance of protecting inventors’ rights; 2. The British Empire During the reign of Queen Elizabeth the first in the 17th century, the royal court of England used to grant monopolies well-known techniques and goods, as well as over inventions. After the declaration of the Statute of Monopolies and the limitation of Crown’s rights, the only valid monopolies were those on actual

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novel inventions. This approach encouraged innovation, promoted the development of technology, and inevitably led to the stable economic growth of the country; 3. International Collaborations: Paris Convention The industrial revolution at the end of the 19th century led to a close collaboration between European countries in terms of economic and social relations, as well as in terms of protection of intellectual property which resulted in the creation of the Paris Convention in 1883. This agreement created a uniformed national patent system among various countries, providing the same protection to inventions in all signatory states. This convention also adopts the priority rights, an ability to apply for protection of the protection rights in other signatory states within a certain period; 4. International Collaborations: Patent Cooperation Treaty (“PCT”) Although the Paris Convention defined many basic principles around patents, national procedures regarding patents still used to be significantly different. After the adoption of PCT in 1970, the national system for the filing, searching, and the examination for patents were harmonized. PCT made it possible to seek protection for an invention simultaneously in numerous countries through a single application; and 5. International Collaborations: European Patent Convention (“EPC”) The EPC was signed in 1973 and turned up as an important development. Through this agreement, independent national industrial property systems of the contracting states were harmonized in terms of novelty and prior art. International Collaborations: TRIPs agreement TRIPs agreement is the modern mechanism that forces its contracting states to acquiesce to minimal criteria set in previously adopted treaties for the regulation of different forms of intellectual property.

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ii.

WIPO WIPO is the global forum for services, policy, information, and cooperation related with IP to enhance the development of a balanced and effective international IP system that pushes innovation and creativity (World Intellectual Property Organization, 2013). WIPO has three main activities, which are norm setting, economic development, and services to industries (Jewell, 2008). Norm setting aims to create a progressive development of international IP law for an IP system that is considered balanced and responsive to emerging needs, effective in encouraging innovation or creativity, and sufficiently flexible to accommodate national policies by providing information on current and emerging issues in IP through reviews or discussions of several issues. Economic development aims to maximize strategic use of IP through updating IP legislation, improving IP infrastructure, demystifying IP, and promoting understanding of policies by understanding every state's specific need. On the other hand, services aim to enhance global protection systems to simplify and reduce costs of obtaining protection in multiple countries for patents, trademarks, industrial designs, geographical indications, and micro-organisms.

iii.

Budapest Agreement The Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purpose of Patent Procedure. This treaty stated that if there is a party from one of the member states that wants to patent their invention or innovation in the field of microorganisms, they do not need to store their deposit requirements inside an “international depositary authority� (WIPO, 2018).

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iv.

TRIPS The TRIPS agreement, also known as the Berne and Paris-plus agreement is a multilateral agreement on intellectual property that is considered to be the most comprehensive as it adds a substantial number of additional obligations on matters where it was not seen in the previous conventions (World Trade Organization, 2001). The TRIPS Agreement provides minimum standards of protection that needs to be fulfilled by all member states and further explains the main elements of protection, rights to be conferred with its exceptions, and minimum duration of protection by following the obligations of the main conventions of the WIPO,

Paris

Convention,

Berne

Convention

(World

Trade

Organization, 2001). As stated earlier, TRIPS is a minimum standards agreement. Therefore, members have the ability to set a more extensive protection of intellectual property rights and are able to decide the preferred method to implement the Agreement based on each member states’ conditions. There are several controversies found in the TRIPS Agreement. TRIPS is perceived as an agreement that was forced by developed states without understanding the perspectives of developing states. For instance, during the 1980s, competition in manufacturing and technology between developed states and Asian countries was a concern (Oh, 2000). Intellectual Property Rights (“IPR�) protection which enables monopoly rights was later granted to prevent imitation and was considered a tool to maintain the advantage that these developed countries have had. In terms of pharmaceutical development, the TRIPS Agreement would create problems for developing states. For example,

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the “Twenty-year protection” enables a pharmaceutical company to have a monopoly over its patented drug which allows the inventor to set high drug prices in the market and would not allow generic equivalents to come until the patent has expired (Oh, 2000). For developing countries, access to medicine to achieve public health would be difficult not only because several patients do not have the capability to afford these medicines, but also due to the fact that cheaper alternatives are not provided as generic equivalents are not allowed to come in the market. Access is a major issue due to the fact that every state has the responsibility to provide health care for its people. Without clear access for medicines, public health is difficult to achieve. Countries, especially developing countries should not be left alone in solving this issue as mentioned in articles 66 and 67 of the TRIPS Agreement. Another problem would be the fact that this agreement is a threat for the domestic pharmaceutical industry as they have to compete with large Transnational Corporations (“TNCs”). As stated earlier, during the twenty year period, generic equivalents are not allowed to be sold in the market. Therefore, generic drug makers are only allowed to conduct research and development for the patented product and sell it to the market after the expiry date. If this condition is applied, monopoly for the patented product will still exist after the patent has expired. To overcome this issue, the Bolar Provision, a part of the TRIPS Agreement, is applied in several places such as the United States, Europe, or Malaysia. The Bolar Provision is used to protect generic drug makers by allowing them to conduct studies, research, and manufacturing of patented drugs before the expiry date of the patent (Kandiah, 2013). This provision is clearly beneficial for

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generic drug makers and the general public as these generic equivalents are considered more accessible due to its cheaper price. Every country has its own perspectives when it comes to the protection of IPR. For instance, protection of IPR is not a priority for developing and underdeveloped states as it would ensure availability of needed goods in affordable prices for its citizens, reduce unemployment of local industries, and save their budget for not spending huge amounts to enforce IPRs of citizens of advanced states due to the fact that more than 80% patents in developing and underdeveloped countries are owned by citizens of advanced countries (Abbas, 2013). In the end of the 1900s, public health was for the first time considered as a political priority at international level due to the outbreak of HIV/AIDS pandemic (Bird et al., 2008). Hence, the relationship between access to medicines and the TRIPS Agreement were discussed at the World Health Organization (“WHO”) and WIPO to address problems faced by developing and under developing states. WIPO stated that conflicts may arise between the Doha Declaration and WTO General Council’s Waiver Decision whereas the third world countries raised their perspectives at the 2001 WTO ministerial conference (DeRoo, 2011). As a result, changes were made whereas poorer countries are given flexibility in the TRIPS Agreement. TRIPS flexibility in a form of compulsory licensing is known as a license issued by a state authority to a government agency or another party to use a patent without the patent holder’s consent (Durojaye, 2011). Compulsory licensing is used to prevent the misuse of monopoly rights given by the TRIPS Agreement and to deal with situations of public health crisis especially in third world countries. Compulsory

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licensing may be considered as a violation of the rights of the patent owner. However, third world countries believe that it is necessary to achieve accessibility towards medicines which goes in line with the international human rights law. v.

Doha Convention There have been concerns on how patent rules might restrict access to affordable medicines for populations in developing countries as patent rules enable the inventor to set a high price for a limited time. Therefore, in 2001, WTO members adopted a declaration at the Ministerial Conference in Doha to respond to these concerns regarding the obstacles developing countries have in terms of access to affordable medicine by clarifying ambiguities in the TRIPS Agreement (World Health Organization, 2001). This declaration was later on known as The Doha Declaration. The Doha Declaration recognizes concerns about the effects of the TRIPS Agreement on prices and refers to several aspects of TRIPS such as the right to grant compulsory licenses and the freedom to determine which licenses are granted, the right to determine what constitutes a national emergency and circumstances of extreme urgency, and the freedom to establish the regime of exhaustion of intellectual property rights which creates flexibilities in the TRIPS Agreement to fulfill the public health needs. The Doha Declaration reaffirms the rights of WTO Members to use TRIPS flexibilities to the fullest extent possible to promote access to medicines and to solve public health problems. This declaration also states that Members are free to apply an international principle of exhaustion of rights that allows parallel importation of an

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IPR protected product that has been marketed in another country (South Centre, 2011). Exhaustion of intellectual property rights or “first-sale doctrine� means that right holders lose the right to control the resale of protected goods. Parallel imports increase the distribution and availability of goods with a beneficial effect on prices (Bonadio, 2011). This is highly beneficial for developing and least developed countries which have weak production capacity and heavily relies on exports. B. Relevant Topics around Pharmaceutical Development a. Biologics Biologics or a biological medicine is a medicine that is manufactured in a living system such as a microorganism, or plant or animal cells (Biotechnology Innovation Organization, n.d). These kind of medicine are used for many diseases such as cancer, diabetes, or rheumatoid arthritis (International Alliance of Patient’s Organization, 2013). Meanwhile biosimilar is a category known in the biological products industry which consists of products that are highly similar to their approved, brand-name comparators. Biosimilar is made to provide more treatment options, increase access to lifesaving medication and potentially lower healthcare costs due to the fact that the legalization of biosimilar drugs can create competition. Biosimilar drugs can also be patented if it contains or involves a different process in its method of creation such as new formulations, combinations, and even mode of delivery of that particular drug (US Food and Drug Administration, 2020).

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b. Drugs Different from biologics, a drug is a medicine manufactured (Biotechnology Innovation Organization, n.d.). Every drug has both a branded version which is trademarked, and a generic version of the drug. A generic drug is a medication created to be the same as an existing approved brand-name drug in dosage form, safety, strength, route of administration, quality, and performance characteristics. In the United States, this standard applies to all Food And Drug Administration (“FDA�)-approved generic medicines. Each country usually has their own regulations regarding the patent and selling of generic drugs. Approved generic medicines are generally only sold after patents and exclusivities protecting the brand-name version end. Patents and exclusivities are forms of protection for drug makers that may affect how and when a generic drug is approved and can be sold. New brand-name drugs are usually protected by patents (in the United States, by the U.S. Patent and Trademark Office) that prohibit others from selling generic versions of the same drugs. Periods of marketing exclusivity for brand-name drugs can also impact the approval of generic drugs. Once these patents and marketing exclusivities expire (or if the patents are successfully challenged by the generic drug company), the generic drug can receive full approval and can be sold. Generic medicines tend to cost less than their brand-name counterparts because they do not have to repeat animal and clinical (human) studies that were required of the brand-name medicines to demonstrate safety and effectiveness. In addition, multiple applications for generic drugs are often approved to market a single product; this creates competition in the marketplace, typically resulting in lower prices (US Food and Drug Administration, 2018).

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Meanwhile, Me-Too Drugs are essentially drugs that are chemically related to the prototype, or in this case the real drug. Me-Too Drugs can also be defined as other chemical compounds which have identical mechanisms of action. This sort of drug can be argued as an improvement of the efficacy of the prototype, and also being less-expensive. In the context of its effectiveness, MeToo Drugs can produce a less identical clinical outcome, thus this effectively undermines the intent of patent protection. Basically, in order to determine between a pioneer drug and a me-too drug in the context of Patent Law, we need to take an eye on the extent that drug is differentiated (Hollis, 2004). If it is not being differentiated to a proper extent, then it is safe to assume that the drug is indeed just a Me-Too (Garattini, 1997). c. Definition of Essential Medicines Essential medicines are those that satisfy the priority health care needs of the population. Essential medicines are selected with due regard to disease prevalence and public health relevance, evidence of clinical efficacy and safety, and comparative costs and cost-effectiveness. Essential medicines are intended to be available within the context of functioning health systems at all times in adequate amounts, in the appropriate dosage forms, with assured quality, and at a price, the individual and the community can afford. Currently a guideline for essential medicines exists in the form of a WHO Model List of Essential Medicines, most recently made in 2015. The Model List is a guide for the development of national and institutional essential medicine lists. Since its inception, Model List has led to a global acceptance of the concept of essential medicines as a powerful means to promote health equity. Most countries have national lists and some have provincial or state lists as well. The concept of essential medicines is forward-looking, and incorporates the need to regularly update medicines selections to reflect new therapeutic

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options and changing therapeutic needs, the need to ensure drug quality, and the need for the continued development of better medicines, medicines for emerging diseases, and medicines to meet changing resistance patterns. Once thought of as relevant only in resource-constrained settings, the WHO Model Lists are now seen as equally relevant to high-, middle- and low-income countries, particularly with the inclusion of new, highly effective, and expensive medicines in more recent years (World Health Organization, 2016). d. Drugs Accessibility Patent gives the patent owner a significant power by excluding all others from making, using, selling, offering to sell, keeping the product or importing anything covered by the patent claims in all countries. This condition enables companies to charge high prices for their medicines. For example, when acquired by Turing Pharmaceuticals, the price of tablets containing the drug Daraprim rose from $13.50 a tablet to $750 a tablet overnight. Cycloserine has also increased from $500 for 30 pills to $10,800 for 30 pills after it was acquired by Rodelis Therapeutics (Gubby, 2020). The idea of patent was originated to promote innovation and creativity. However, after seeing these cases, it is shown that patents are currently used to maintain a monopoly in order for companies to receive as much profit as possible. There are several probabilities that could occur from these high prices of drugs. First of all, consumers would have to pay a high price as it is the only option they have to access those medicines. On the other hand, a deadweight cost or fewer transactions could exist due to the high price and the amount of reimbursement programs that may be decreased. Public health should always be a priority for countries. Therefore, it is considered problematic and controversial for a law to endanger the health of the people.

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Debate arises on whether or not patents should be implemented in the biomedical sector, especially on pharmaceutical industries as it is often misused and highly influential to the lives of the people. Understanding this condition, there are several alternatives that could be used in the current patent system such as the patent reform approach, abolition of intellectual property rights, state funding, and rewards (Gubby, 2020). Patent reform approach and abolition of intellectual property rights is needed as the current system is outdated and flawed which led to higher cost and uncertainties (Keating, 2008). e. De-Linking of Research and Development Cost from Drug Price Companies have the tendency to misuse their patent by setting high prices to achieve profit. In order to prevent this problem, de-linkage is proposed for the development of pharmaceutical drugs and isolate the profitability of a drug from its volume of sales. In the de-linkage model, lump sums would be used to reward companies for research and development in exchange for restricting the price charged to promote better access, especially for the poor (Zarocostas, 2017). Assistance to finance companies’ research and development (“R&D�) would yield products that are cheaper and available. De-linkage aims to eliminate monopolies, radically lower drug prices and expand access, efficiently fund research and development, and save money for consumers, tax payers, and employers (Delinkage, 2016). Patents and monopolies have always been considered as the only way to both push innovation and fund R&D. The delinkage model aims to prove that there are better ways to achieve those objectives. There are different views when it comes to de-linkage. Over the past decade, several countries such as India, The Netherlands, and the Group of 77, representing 134 developing nations have given their support regarding de-

19


linkage believing that the current system is breaking down (Fletcher, 2019). On the other hand, several developed countries including Switzerland, Japan, Australia, and the European Union stated that the existing patent system is needed for the backbone to stimulate R&D investments and that discussing possibilities to improve access to medical products is fine as long as it does not undermine a largely functional system to offset unquestioned distortions in subsectors of the market for medicines.

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C. Case Examples a. Patent Law and Drug Accessibility: Diabetic Medicine Development It is known that there are three types of diabetes, which are type 1, type 2, and gestational diabetes. Pharmaceutically-made insulin is urgently needed by people with type 1 and 2 diabetes. In its most basic sense, this kind of insulin falls under the category of patent, where the creator of a medicine has the right to make profit out of their invention for a limited amount of time, as explained before. Currently, the three major makers and the companies who have the patent right to this medicine are Eli Lilly, Novo Nordisk, and Sanofi (Belluz, 2019). But how does a medicine which has existed for more than half a century have a patent period that long? The problem lies in a common practice especially for the development of this drug that is called “evergreening�. Evergreening is a practice in the pharmaceutical industry where a company whose patent to a particular medicine is about to expire creates a modified but very similar version of that medicine. Then they file a patent for that new and modified version of that medicine, thus extending the patent period and ensuring the company can profit for a longer period of time (Canadian Medical Association, 2013). This has allowed for the three companies mentioned to hold to their patents longer. A brief example for this practice can be found in the insulin-maker company Sanofi. They created the insulin drug called Lantus and thus they filed for its patent in 1994. The United States’ FDA approved this filing in the year 2000, and this patent should last until 2015. But before the patent expired, Sanofi created a slight modification for this medicine thus extending its patent period to 2031 (Dunn, 2018). The fact that this practice is legal is why biosimilars are crucial to ensure a more accessible diabetic medicine. For insulin, the company mentioned earlier, Eli Lilly, has created a biosimilar for insulin called Basaglar, and if this

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practice keeps on being done, then it can do more good to the society in general (Biopharma Dive, 2018). Another example is a medicine approved in 2015 called Synjardy. Different from other diabetic medicine, Synjardy is administered through oral, and its contents does not have insulin. Instead, that drug’s content blocks some of the glucose in someone’s system from reentering their blood through the kidneys. It also causes the body to get rid of more glucose through urine (Slowiczek, 2020).

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b. Thailand Compulsory Licensing Program In April 2006, Thailand’s National Health Security Board established a subcommittee to implement compulsory licenses for pharmaceuticals for government use. The criteria established were the following (Thailand. The Ministry of Public Health and The National Health Security Office, 2007): drugs “priced too high for the government to afford its citizens with universal access to essential medicines, listed in the National Essential Drug List, or be necessary in emergency or a situation of extreme urgency, or solve important public health problems, or help prevent and control of outbreaks, epidemics, or pandemics, or necessary to save lives”. Since then, the Thai government has issued a compulsory license for numerous Human Immunodeficiency Virus/ Acquired

Immuno/Deficiency

Syndrome

(“HIV/AIDS”),

cancer,

and

cardiovascular drugs to the government-owned Thai company Government Pharmaceutical Organization (“GPO”) (Program on Information Justice and Intellectual Property, 2009). This decision has been lauded by public health advocates, but also raised questions regarding the quality of the GPO produced drugs. Investigation by the Mahidol University in 2005 found that in three hundred HIV patients treated with GPO-Vir, a copy of HIV treatment that GPO made, between 39.6% to 58% developed resistance to the drug (Bate, 2007). This necessitates a much more expensive second line therapy to be applied to the patients. With that in mind, in reviewing examples of compulsory licensing delegates can use the following six aspects: Objective, Implementation, Quality, Price, Market Demand, and Evaluation (Lybecker & Fowler, 2009).

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c. Biopiracy Controversy: The Maya-ICBG Controversy In 1996, a project was initiated by the International Cooperative Biodiversity Group (“ICGB”) to collect ethnobotanical information in Chiapas, Mexico. The multiple aims of the project included preservation of local medicinal plant knowledge and its use to discover new therapies for a range of local and internationally important diseases, as well as the development of local economic and scientific capacity. Controversy erupted as some local and external groups charged that the project was exploitative, while the project partners defended it as mutually beneficial and socially responsible. The collection of plant materials for bioprospecting was never initiated, and the disputes led to withdrawal of the local public research center partner, cessation of funding, and termination of the project (Global Forum on Bioethics in Research, 2015). The project never reached the stage of collections for research with commercial development potential. However, the participating organizations had begun drafting agreements regarding intellectual property. The draft ICBGMaya Joint Ownership agreement stipulated that Maya communities would receive a quarter of any royalties and co-ownership of any licenses that emerged from the research—the other shares were divided in equal fourths among the US university, the biotech company, and the Mexican research institution. The Maya share was to be paid to a Non-Governmental Organization (“NGO”) called PROMAYA. Decisions taken regarding the use of PROMAYA funds were to be made by representatives from each of the participating communities; however, funds could also be used for projects that benefited other local communities that declined to participate in the research. From the beginning of negotiations regarding the project, the local indigenous healer's group was not involved; they had been informed of the

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project informally by the Mexican research partner during the grant-writing stage. They did not join in the planning or grant-writing stages of the project, although they did attend a public workshop about the project after the grant was obtained. In 1999, the healers’ consortium directed a letter to local and federal authorities calling for a halt to the project. Denunciations of the ICBG project were published on numerous websites and gathered increasing media attention, and support from observers unconnected to the case or to the region. In 2001 the Mexican research institution withdrew from the project, citing the difficulties arising from the challenges of the healer’s consortium and the NGO, the need for a self-organized indigenous partner, and for national-level regulation to provide some resolution of the impasse. Without a local research partner, the project was no longer eligible for US government grant support, and in November 2001 the project folded (Global Forum on Bioethics in Research, 2015).

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d. Parallel Import Violation Case: Hong Kong Back in December 2019, there were seven suspects that were arrested after customs discovered a counterfeit medicine operation in Hong Kong. Customs confirmed that this case was the biggest seizure in decades with up to 2.4 million tablets and 470 liters of fake medicine (The Standard Newspaper Publishing, 2019). The perpetrator violates the provisions of the Trade Descriptions Ordinance, which stated that selling or processing fake products carries a maximum penalty of five year in prison and a HK$500.000 fine (South China Morning Post, 2019). Besides, this act also violates regulation regarding patents infringement stated in Section 73 of the Patents Ordinance, which states that the patentee of the product can prevent third party from making, putting on the market, using or imparting the product or stocking the product, whether it's for the market in Hong Kong or elsewhere (Hong Kong. Department of Justice, 2019). The fact has shown that the perpetrator breached the regulation, seeing that the product itself was already sold as a ‘counterfeit’ to cross-border parallel import traders from mainland China via pharmacies. Regarding the parallel import itself, Section 20 of Trade Marks Ordinance (“TMO”) stated that it’s not a patent infringement to use a registered trade mark in relation to goods as long as it is done by the owner and with the owner's consent. Other than that, there are also health and safety concerns regarding consumer products such as pharmaceutical or edible products, because the different origin of the products could affect not just the materials used, but regulations on production procedures as well (ONC Lawyers Hong Kong, 2017). Breach of parallel importation regulation, as well as the distribution of counterfeit medicines are among the vulnerabilities of parallel importation that exist not just in Asia, but Europe as well. Other vulnerabilities included the

26


artificial multiplication of intermediaries and systematic repackagic, making control of counterfeit drugs difficult (International Institute of Research Against Counterfeit Medicines, n.d.). Furthermore, parallel trade can even makes it unprofitable for pharmaceutical industry to serve low-income markets, and it is argued that it is more beneficial to restrict parallel imports and increase the degree of price discrimination (Hausman, J. and J. MacKie-Mason, 1988). WIth that in mind, delegates should consider if parallel importation is the way to go in ensuring medicine accessibility, and is there a way to improve it if it’s still going to continue.

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e. Recent Crisis: COVID-19 Drug Development In the end of 2019, a newly discovered coronavirus was found in Wuhan City, Hubei, a Province of China, and rapidly spread around the world. This virus was later on known as Coronavirus disease 2019 (“COVID-19”), and was declared as a global pandemic by the WHO Director General in March 2020 (World Health Organization Indonesia, 2020). Until now, specific vaccines or treatments to cure COVID-19 have yet to be found (World Health Organization, 2020). As of now, the COVID-19 pandemic is getting worse as Covid-19 have killed more than 488,467 people globally (Cha, 2020). Several drugs have been studied on whether or not its effect is able to cure and become a treatment for COVID-19. One of those drugs is known as hydroxychloroquine, a drug developed by Sanofi that has been used to cure malaria, systemic lupus erythematosus, and rheumatoid arthritis (Clinical Trials Arena, 2020). This drug has also shown its efficacy in facing Severe Acute Respiratory Syndrome-Coronavirus-2 (“SARS-CoV-2”) and proven to be efficient in handling COVID-19 patients in China. Sanofi is currently working with the Biomedical Advanced Research and Development Authority (“BARDA”) to find a vaccine for COVID-19. However, hydroxychloroquine is currently halted in some trials due to safety fears as no clinical trials have recommended the use of hydroxychloroquine to combat COVID-19. Another example would be Remdesivir, a drug treatment that appears to shorten recovery time for people with coronavirus (Roberts, 2020). UK regulators have stated how there is enough evidence to approve that Remdesivir could be used for COVID-19’s patients. Currently, Remdesivir is the first drug that is proven to be effective to combat coronavirus in human trials and has been approved to be used for emergency use by several countries such as Korea, Japan, India, and the United States (News Desk, 2020).

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The continuing race for a cure and vaccine for COVID-19 has ignored the elephant in the room, which is should the patent for the cure and vaccine be sidelined for the greater good? And if so, how can we ensure that the pharmaceutical industry is adequately rewarded for their efforts. Delegates need to examine this situation thoroughly in trying to provide the best solution.

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D. Chamber Main Topics a. Improving Accessibility of Patented Medicine in Times of Emergency i.

Short Description The COVID-19 crisis highlights the urgency of having a vaccine and medicine to cure it as soon as possible. However, ensuring medicine accessibility risks not giving adequate reward for the pharmaceutical industry for their efforts. How should Asian countries answer this dilemma, and is there a way for asian countries to work together on the issue? This will be discussed in this chamber.

ii.

Relevant Questions to be Discussed: 1. Which should be put first during an emergency? Accessibility or exclusivity of the drugs and biologics? 2. Can vaccines for pandemics count as “Essential Medicines� under existing international law? 3. Is compulsory licensing needed for vaccines in times of emergency or pandemics? Or is there a better way to ensure vaccine accessibility during the pandemic? 4. Is an easier regulatory pathway for potential COVID-19 drugs or biologics needed? 5. How countries in Asia can cooperate to ensure accessibility of patented medicine in times of emergency?

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b. Protection of Traditional Medicine through International Patent Law i.

Short Description According to the WHO, 65–80% of the world’s healthcare practice involves the use of traditional medicine, commonly referred to as complementary and alternative medicine, in some way (Hindawi, 2014). In 2011, representatives from more than 35 countries participated in a meeting hosted by WIPO and India’s Council of Scientific and Industrial Research (“CSIR”) that discussed a database documenting traditional medicinal treatment, concluding that such a mechanism can fuel future innovation and benefit-sharing in their own nations by protecting traditional knowledge from misappropriation. This will be an important question to be discussed in this chamber, keeping in mind that countries in Asia have a wealth of traditional medicines. Cooperation between the pharmaceutical industry and the traditional community for both parties' benefit is important to be discussed as well.

ii.

Relevant Questions to be Discussed: 1. How does the patent law in each country protect traditional medicines? 2. How can countries further prevent biopiracy? 3. Is there a way for a cooperation between the pharmaceutical industry and the traditional community to empower the traditional community through their ownership of traditional medicine knowledge? 4. How countries in Asia can cooperate regarding the protection of traditional medicine through international patent law?

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c. Alternative to Patent Law to Support Pharmaceutical Research and Development Efforts i.

Short Description Patent law is considered as a barrier for the accessibility of medicine, especially in developing countries. Yet it is still used for pharmaceutical research to push creativity and innovation. However, there are alternatives to support pharmaceutical R&D efforts such as a global research and development agreement, push and pull mechanisms, or delinkage (Quigley, 2015). These alternatives are not easy and pose challenges. Nevertheless, these alternatives should be considered necessary as drugs or medicine must always be accessible for all countries as every country has the obligation to fulfill public health. The question is, which alternative is considered realistic and can still maintain creativity and innovation in the pharmaceutical industry?

ii.

Relevant Questions to be Discussed: 1. What are any alternatives to patents that have been implemented in countries? 2. What are alternatives to patents that can be further implemented to stimulate research and development of medicines in countries? 3. Is bilateral or multilateral cooperation such as research sharing viable for pharmaceutical development? If so, what is the best way to do it 4. Is there a way for a more effective public and private partnership to be conducted to support pharmaceutical R&D efforts?

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d. A Look Forward: A Review of Current Patent Law in Pharmaceutical Development iii.

Short Description As mentioned before, each country has their own regulation regarding patents for medicine that is based on TRIPS. However, is it possible for countries to try to learn from each other and find a way to build upon one another’s regulation to form a better law regarding patent law for medicine? Furthermore, rapidly developing technology has resulted in the birth of Artificial Intelligence (“AI�) developed medicines. How should Asian countries approach this new enigma at hand?

iv.

Relevant Questions to be Discussed: 1. How does Patent Law regarding Pharmaceutical Development in Asian Countries Compare with each other? 2. Can asian countries learn from each other to formulate a best practice for patent law in pharmaceutical development? 3. How should patents regarding AI developed medicines be regulated? Who is the patent holder in this case?

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E. Further Reading Baiq, Rachel. (2013, April 10). Biopiracy Rips Off Native Medical Knowledge. Deutsche

Welle.

https://www.dw.com/en/biopiracy-rips-off-native-medical-

knowledge/a-16732044. Maskus, Keith E. (2001). Parallel Imports in Pharmaceuticals: Implications for Competition and Prices in Developing Countries. World Intellectual Property Organization.

https://www.wipo.int/export/sites/www/about-ip/en/studies/pdf/

ssa_maskus_pi.pdf Reichman, Jerome H. (2009). Comment: Compulsory Licensing of Patented Pharmaceutical Inventions: Evaluating the Options. The Journal of Law, Medicine & Ethics. https://doi.org/10.1111%2Fj.1748-720X.2009.00369. United Nations News. (2011). Saving traditional medicines from ‘bio-piracy’ patents the goal of UN Forum. https://news.un.org/en/story/2011/03/370182-savingtraditional-medicines-bio-piracy-patents-goal-un-forum. World Intellectual Property Organization (2013). Summaries of Conventions, Treaties and Agreements Administered by WIPO. World Intellectual Property Organization.

https://www.wipo.int/edocs/pubdocs/en/intproperty/442/wipo_pub_

442.pdf World Intellectual Property Organization. (2004). WIPO Intellectual Property Handbook. World Intellectual Property Organization. https://www.wipo.int/edocs/ pubdocs/en/intproperty/489/wipo_pub_489.pdf. Zarocostas, John. (2017). Perspective on Access to Medicine and IP Rights. https://www.wipo.int/wipo_magazine/en/2017/06/article_0002.html.

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