IP Strategies International

Kevin P. Ashby, B.Sc.(Chem.Eng.), LL.B.

August 2004

CLIENT CIRCULAR #2: FTA TRENDS - TODAY PHARMA

What do the Olympics have to do with the Australia/USA Free Trade Agreement (FTA)?

Apart from both countries participating in both, nothing much - except that an unintended consequence of Mark Latham’s FTA amendments may be that performance enhancing drugs end up becoming cheaper. Perhaps we can all improve our golf game.

The perception that US drug companies in particular make excessive profits at our expense is fertile ground for populist politics. These profits are seen to be protected and guaranteed by patents, locking out the manufacture or importation of less dear substitutes. By amending the patent law to take away protection for certain pharmaceuticals, low cost competitors would be free to enter the market. Kudos for the ALP.

This is not a new argument, nor the start of a trend. In South Africa, the AIDS lobby, led by the Treatment Action Campaign, has tasted some measure of success in getting the government not only to alter its stance on AIDS, but also to provide more antiretroviral drugs (ARVs) through state clinics. In turn, the government was forced to put pressure on the pharmaceutical multinationals. How did it do this? By attacking the Patents Act, of course.

The point may be that the pharma start-up must not assume that its key patent will be there for 20 years to protect its market or, on the other side of the coin, that it will always be excluded from areas covered by existing third party patent rights. It should develop IP strategies that do not hinge on a single piece of IP.

Today drugs, tomorrow other elements of basic human needs: Clients in other industries cannot sit back and wait to be targeted – water treatment, food and nutrition, housing, infrastructure, power, other utilities. Raw materials? Which of these produces products that are “overpriced” and out of reach of the ordinary person? Already some countries restrict patenting in certain fields apart from the usual medical treatment methods and biology fields. Pakistan, for example, severely restricts patenting inventions relating to food.

Could we see a renewed socialist debate into the rights to private property and in particular the legitimacy of intellectual property ownership and human rights?

Perth-based IP Strategies International presents solutions to IP management and strategy issues from coast to coast. We question practices and look for alternatives.

Next week: Fundamentals. Recognising an IP strategy.

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