Thursday, November 21, 2013

Draft Trans-Pacific Partnership Treaty – Regulatory Review Exception

The leaked TPP treaty contemplates a regulatory review exception in Art E.13, but there is some controversy over the scope. There is considerable debate over the precise wording (which makes the annotated draft difficult to read), but main debate is over whether the exception should be confined to getting marketing authorization for pharmaceuticals, or whether it should extend to any kind of  regulatory approval. The US proposal is representative of the more restrictive position, and the Canadian proposal is representative of the broader position. I have parsed out their positions below, with my underlining to highlight the differences. (No other countries support either of these positions exactly, but several support each of them with some deviations.)

US proposal
Article QQ.E.13: {Exceptions / Regulatory Review Exception}
Consistent with paragraph QQ.E.5 (patent exceptions and limitations), each Party shall permit a third person to use the subject matter of a subsisting patent to generate information necessary to support an application for marketing approval of a pharmaceutical product, and shall further provide that any product produced under such authority shall not be made, used, or sold in its territory other than for purposes related to generating such information to support an application for meeting marketing approval requirements of that Party.

If the Party permits exportation of such a product, the Party shall provide that the product shall only be exported outside its territory for purposes of generating information to support an application for meeting marketing approval requirements of that Party.

Canadian proposal
            Article QQ.E.13: {Exceptions / Regulatory Review Exception}
Consistent with paragraph QQ.E.5 (patent exceptions and limitations), each Party shall permit a third person to use the subject matter of a subsisting patent to support an application for regulatory or marketing approval or sanitary permit of a product [and] that Party may also provide that any product produced under such authority may be made, constructed, used, or sold in its territory for purposes related to meeting regulatory or marketing approval or sanitary permit requirements of that Party or another country.

Each Party shall permit a product to be exported outside its territory to support an application for meeting regulatory or marketing approval or sanitary approval requirements of that Party or another country.

While there are several differences in the wording, the main substantive difference is that the US proposal is restricted to pharmaceuticals and marketing authorization, while the Canadian proposal would apply to any product, and any kind of regulatory approval. Consistently with this, Canada, along with four others, also proposes a general regulatory review exception in Article QQ.E.5bis.

Article QQ.E.5bis: {Regulatory Review Exception}
Consistent with Article QQ.E.5 (Exceptions), each Party may provide that a third person may do an act that would otherwise infringe a patent if the act is done for purposes connected with the collection and submission of data in order to comply with the regulatory requirements of that Party or another country, including for purposes connected with marketing or sanitary approval.

A second substantive difference is that under the Canadian proposal, the patented products may be exported to satisfy regulatory requirements of another country (presumably normally the importing country), while under the US proposal, exporting would only be permitted if necessary to satisfy the regulatory requirements of the exporting country. Presumably that would be relatively rare – perhaps if the facilities necessary for testing required by a country's regulatory regime are not available in that country.

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