Carlos Correa - June 2002

Executive Summary

1. As a condition for registering pharmaceutical products, national authorities normally require registrants to submit data relating to drugs’ quality, safety and efficacy (“test data”), as well as information on the composition and physical and chemical characteristics of the product. A particularly important issue is the direct or indirect use of the data for subsequent registration of products similar to those originally registered.
2. The World Trade Organization’s Trade Related Aspects of Intellectual Property Agreement (TRIPS), Article 39.3, requires member countries to establish protections for submitted test data. But this requirement is in fact narrowly drawn, and countries maintain substantial flexibility in implementation. The public interest in limiting protections for data is to promote competition, and to ensure that data protections do not become the means to block the timely entrance of generic competitors to off-patent drugs. Generic competitors drive down price, thereby promoting greater accessibility of medicines.
3. Article 39.3 requires governments to provide protection to marketing approval data only under certain conditions. Test data must be protected if national authorities require its submission. Article 39.3 does not require protection be given to already public data. Protection is required only for new chemical entities. Members have considerable discretion in defining “new,” and may exclude applications for second indications, formulations and dosage forms. And, prior to granting protection, national regulatory authorities may request the applicant to rove that the information for which protection is sought is the result of significant investment.
4. Article 39.3 requires countries to protect against “unfair commercial use” of marketing approval data. Countries have considerable discretion to define “unfair” in the context of their own national laws and culture. Use by the government to assess the efficacy and toxicity of a pharmaceutical or agrochemical product is not a commercial use subject to Article 39.3. Granting marketing approval to a second entrant, based on the second product’s similarity to a previously approved first product, is not a proscribed “use” under Article 39.3. These interpretations are supported by United States and Canadian Supreme Court decisions interpreting national laws.
5. Countries can meet their obligations to protect against “unfair commercial use” under Article 39.3 by barring “dishonest” uses of test data. This would require, for example, proscribing situations in which a competitor obtains the results of testing data through fraud, breach of confidence or other “dishonest” practices, and uses them to submit an application for marketing approval for its own benefit. It would also apply in cases where the government provides access to undisclosed testing data in order to provide an advantage to a firm which did not produce them or share their cost.
6. Countries are not obligated under Article 39.3 to confer exclusive rights on the originator of marketing approval data.
7. The pharmaceutical industry and some countries have argued for much broader coverage of Article 39.3, and for a requirement that countries confer exclusive rights on originators of marketing approval data. But these positions are not well grounded in either the text or negotiating history of TRIPS. TRIPS negotiators specifically considered and rejected language requiring grants of exclusive rights to test data.

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