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Promoting the Right to health in Kenya

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CHAPTER ONE
INTRODUCTION

1.1. Background to the study

The Constitution of the Republic of Kenya provides for one’s right to health.

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It states that every person has the right to the highest attainable standard of health, which includes the right to health care services including reproductive health care.

For one to wholly appreciate the magnitude of this right, it is imperative to have a basic understanding of the term ‘health’. The preamble of the 1946 World Health Organization’s (WHO) Constitution defines health as a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity. It goes on further to state that the enjoyment of the highest attainable standard of health is one of the fundamental rights of every human being without distinction of race, religion, political belief, economic or social condition. This right is broad in its scope and entails the right to access essential medicines.

The International Covenant on Economic Social and Cultural Rights, Article 12, states that the steps taken by the state parties to the present covenant (such as Kenya) to achieve the full realization of the right to health shall include those necessary for the prevention, treatment and control of epidemic, endemic, occupational and other diseases and the creation of conditions which would assure to all, medical services and medical attention in the event of sickness. This right[2] was expounded by the United Nations Committee on Economic, Social and Cultural Rights in its General Comment No. 14 on the ‘Right to the Highest Attainable Standard of Health’ paragraph 12, to include access to essential medicines. In fact, it went further to explain access to essential medicines to include three main elements. First is the ‘physical accessibility’ whereby, the good or service must be within the safe physical reach of majority of the population. Second is the ‘economic accessibility’ whereby the good or service must be affordable to a majority of the population and third, ‘informational accessibility’ whereby the right to seek, receive and impart information concerning health issues is safeguarded.

Economic accessibility to essential medicines is hampered by the fact that majority of Kenya’s population cannot afford to buy these essential drugs. This is largely due to the fact that, protection of intellectual property rights, specifically patents[3], leads to an increase in the price of these drugs. This is because, a patent is an exclusive right that enables the right holder to prevent others from making, using, selling or importing the invention for the duration of the patent right; usually 20 years as provided for by section 60 of the Industrial Property Act (2001) of Kenya that states, ‘A patent shall expire at the end of twenty years from the filing date of the application’.[4] As a result, a monopoly of sorts is created by the right holder who is able to control not only the output as per the demand but also control the price of the patented product. Thus, translated to pharmaceuticals, the price of essential medicines is dependent on the price offered by the patent holder and as such a higher price is often quoted than that which is within the range of those most in need.

It is because of this that the World Trade Organization (WTO) came up with compulsory licensing in an international agreement referred to as the Trade Related Aspects of Intellectual Property Rights (TRIPS)[5]. This agreement neither defines compulsory licensing nor specifies when exactly a compulsory license can be granted. It does however; stipulate under Article 31 that any WTO Member such as Kenya can issue a compulsory license after certain procedures have been met. This was further embodied in our Industrial Property Act of 2001 that attempts to give a concrete definition of compulsory licensing. It describes compulsory licensing as the means by which a government can license to a company, government agency or other party the right to use a patent without the consent of the patent holder. Part XI of the Industrial Property Act (2001) provides for the exploitation of patented inventions by the government or by third persons authorized by the government. Section 80(1) (a) of the aforementioned Act, provides that such exploitation may only be carried out on the basis of public interest, in particular, national security, nutrition, health, environmental conservation or the development of any other vital sector of the national economy so required. Section 80 (1) (b), further provides that the Managing Director of Kenya Industrial Property Institute (KIPI), can on application to the licensee, in the prescribed form and after consultation with the Institute and the owner of the patent, order that the protected invention shall be exploited by the government ministry, department, agency or other person as the Minister may designate in the order, subject to the payment of adequate compensation[6] to the owner of the patent in accordance with this section.

It is important to note, however, that compulsory licensing cannot be awarded arbitrarily. In addition to the above mentioned requirements, Section 74 (1) provides that a compulsory licence shall not be granted unless the person requesting the licence satisfies the Tribunal that he has asked the owner of the patent for a contractual licence but has been unable to obtain the licence on reasonable commercial terms and within a reasonable time; and offers guarantees satisfactory to the Tribunal to work the relevant invention sufficiently to remedy the deficiencies or to satisfy the requirements which gave rise to his request. This prerequisite shall be waived in the case of a national emergency or other circumstances of extreme urgency, provided the owner of the patent shall be so notified as soon as is reasonably practicable. Section 75 (1), also states that in considering a request for a compulsory licence, the Tribunal shall decide whether a compulsory licence may be granted and shall then, if it decides in favour of the grant taking into account any terms agreed by the parties, proceed to fix the terms which shall be deemed to constitute a valid contract between the parties and shall be governed by the provisions of contractual licences. In fixing the terms, the Tribunal shall ensure that the compulsory licence is limited in scope and duration for the purpose for which it was authorized; is limited predominantly for the supply of the domestic market;[7] does not entitle the licensee to grant further licences without the consent of the owner of the patent; is non-exclusive and provides for the payment to the owner of the patent of remuneration which is equitable with due regard to all the circumstances of the case, including the economic value of the licence.

Furthermore, Section 77 (1) states that a compulsory licence may be cancelled by the Tribunal if the licensee fails to comply with the terms of the licence; or the conditions which justified the grant of the licence have ceased to exist and are unlikely to recur, provided that the legitimate interests of the licensee are adequately protected.

This dissertation thus aims at examining how a human rights approach might inform the use of compulsory licensing particularly in the area of pharmaceutical patents. It does this by looking into the provisions of the Industrial Property Act (Number 3 of 2001) that provides for compulsory licensing as a mechanism to enhance access to essential medicines and how these provisions in turn help to promote the fundamental right to health in Kenya. Moreover, this dissertation tries to pose the feasibility of casting a delicate balance between the rights of members of the society vis-a-vis the rights of patent holders.

1.2 Statement of the problem

The Constitution of the Republic of Kenya provides for the protection of property. Section 40 (1) clearly states that every person has the right, either individually or in association with others, to acquire and own property of any description and in any part of Kenya.[8]

Section 40 (2) further states that:

Parliament shall not enact a law that permits the State or any person to arbitrarily deprive a person of property of any description or of any interest in or right over any property of any description or to limit, or in any way restrict the enjoyment of any right under this article on the basis of any grounds specified or contemplated in article 27 (4).[9]

Moreover, section 40 (5) goes on to categorically provide that the State shall support, promote and protect the intellectual property rights of the people of Kenya. The word ‘shall’ in my opinion has been used to bolster the obligatory and compulsory nature of fulfilling the promotion and protection of this right. It must be noted that human rights ideally should not be in competition with each other, but rather complement each other. In as much as intellectual property rights, specifically patents, are protected in the Industrial Property Act of 2001 and indeed in the Constitution of Kenya[10] as a fundamental human right, these intellectual property rights cannot override or supersede the fundamental human right to health[11] and in particular, the right of access to essential medicines as provided by section 43 of the Constitution of the Republic of Kenya. In fact, section 40 (3) provides a qualifying factor to the support, promotion and protection of intellectual property rights. It states that the state shall not deprive any person of any property of any description, or of any interest in, or right over property of any description, unless the deprivation is for a public purpose or in the public interest and is carried out in accordance with the Constitution and any Act of Parliament[12]that requires prompt payment in full, of just compensation to the person and allows such person who has an interest in or right over that property a right of access to a court of law.

There are those who, on one hand champion, the idea that only under extraordinary circumstances should compulsory licensing be granted upon patented pharmaceutical products; otherwise detrimental effects on global health as well as on the global economy will transpire.[13] There are those, on the other hand who claim that the right to health is more important than those of the patent holder. Given that both the right to health and intellectual property rights are fundamental human rights safeguarded in the constitution, the problem thus arises as to which right has primacy over the other and whether there is a need to strike a balance between the two competing interests.

1.3 Research Questions

The following research questions guided the proposal:

1)Does compulsory licensing under the Industrial Property Act Number 3 of 2001 promote the right to health as provided for under the Constitution of Kenya?

What is the justification if any, for compulsory licensing
What is the legal impact of compulsory licensing in India as compared to Kenya
To what extent has the national legislation achieved a balance between the right to access to essential medicines on one hand and the right to protection of intellectual property rights on the other

1.4 Basic Theory behind the research

It is argued on one extreme that ‘patent protection should end where saving lives or alleviating suffering begins; that is, patent law should be subordinate to certain social interests.’[14] At the opposite end of the spectrum, it is argued that pharmaceuticals should be treated like all other commodities, thus the price should be determined by the basic principles of supply and demand and thus promote innovation.[15] There are various justifications for protection of intellectual property rights. However, two main justifications are discussed; the utilitarian theory and the dignitarian theory.

1.4.1 Utilitarian Theory:

This is referred to by Michael Spence as a community centred justification.[16] It endorses the creation of intellectual property rights as an appropriate means to foster innovation.[17] The utilitarian theory, as propounded by Jeremy Bentham and Stewart Mill, basically emphasizes that it is important to have intellectual property rights in order to encourage the production, dissemination and exploitation of various intellectual information. A pharmaceutical company may be unwilling to invest the vast sums necessary to develop, test and obtain regulatory approval for a drug that it knows can be cheaply reproduced by its competitors.[18] In order to sustain an industry in which the fruits of research are so expensive to obtain and so comparatively cheap to imitate, some type of intervention in the normal operation of the market is needed and a patent regime is an important form of that intervention.[19] However, there has been a reconsideration and reconceptualization of this theory granting protection to patent holders particularly in the international arena. Using the same term ‘Utilitarianism’, governments have come up and issued compulsory licenses so as to promote better health for citizens of the world and thus protect this fundamental human right. Social welfare has often overridden the rights of individual patent holders. It is because of this that some scholars[20] call for more stringent laws to avoid ambiguous issuing of compulsory licenses. Furthermore, they state that compulsory licensing should not be encouraged as pharmaceutical companies will not be able to recover their costs for research and development projects.

1.4.2 Dignitarian Theory:

Intellectual property rights are also justified on the dignitarian theory. This theory states that intellectual property rights should be protected as they reflect and affect the personhood of the intellectual property rights holder. Scholars such as John Locke[21] and Robert Norzick claim that every man has property in his own person.[22]It explains that the labour of man and the work of his hands are his and nobody else’s. This may also be called the labour theory. If pharmaceutical companies lose their exclusive right to control their products, they will essentially be robbed of the fruits of their labour.[23] While there are strong theories supporting why medicines ought to be given patent protection, the controversy arises due to the grave health problems currently been felt globally. This apparent fact enhances the argument that patents should be suspended when they come into conflict with serious health issues.[24]

According to Immanuel Kant[25] and Hegel, there is a natural obligation to respect the rights of the intellectual property right holder. They advocated for the personhood justification for protection of intellectual property rights. They claimed that for one to achieve proper development – to be a person- an individual needs some control over resources in the external environment and the necessary assurances of control take the form of property rights.[26]

1.7 Definition of Operational Key terms

Intellectual Property Rights– these are exclusive rights given to the holder of the intellectual property.
IPR– Intellectual Property Rights.
TRIPS– Trade Related Aspects of Intellectual Property Rights.
Doha Declaration– Declaration signed in DohaQatar on Public Health standards and TRIPS.
Compulsory Licensing– One of the Flexibilities accorded under TRIPS whereby a government can license to a company, government agency or other party the right to use a patent without the consent of the patent holder.
Voluntary Licensing– An intellectual property right holder may opt to voluntarily give up his exclusive right to another or to the government usually for the betterment of society.
Patent and patent duration– Patent is an intellectual property right that enables the right holder to prevent others from making, using, selling or importing the invention for the duration of the patent right; usually 20 years.
IPA– Industrial Property Act of Kenya.
ARVs– Antiretroviral drugs given to patients with HIV/AIDS.
ICESCR– The International Covenant on Economic, Social and Cultural Rights
UDHR– The Universal Declaration of Human Rights of 1948
KIPI– Kenya Industrial Property Institute
WTO– World Trade Organization
WHO– World Health Organization

1.8 Methodology

Following the Doha Declaration, high, middle and low income nations have all issued health related compulsory licenses.[27] I intend to carry out a comparative case study of Kenya and India to see how each country has managed to adopt compulsory licensing into its laws and how this in turn has affected the country’s right to health and particularly access to essential medicines by each country’s population.

I chose to do a comparative case study of India as it is one of the examples of countries that have incorporated compulsory licensing of pharmaceutical drug patents which has proved to be an effective tool in promoting the right to health in India.[28] Moreover, this impact can best be seen from their Indian Patent Act of 1970 that was amended and thus became TRIPS compliant in 2005. The Indian Patent Act is also unique in that it provides for pre-grant and post-grant of compulsory license opposition procedures. This, as shall be seen later in the dissertation, is a mechanism to deal with the pressure from Europe and United States of America to uphold protection of intellectual property rights at all costs; a problem that countries such as Thailand (who have liberally and frequently granted compulsory licenses) continue to experience. Thus, through the comparative study, I’ll be able to highlight what Kenya’s national legislation (particularly on intellectual property rights and the human right to health) can borrow so as to promote the fundamental right to health by increasing access to essential medicines in Kenya.

I have also critically examined some decisions of the courts in India[29] which are of a persuasive nature, in discussing compulsory licensing of pharmaceutical patents in order to promote the right to health. These cases demonstrate the instances when India has issued compulsory licenses of pharmaceutical drugs, or when the court have entertained and upheld applications for opposition to these compulsory licenses and the procedures they have used to either issue the compulsory licenses or reject them.

1.9 Literature review

The Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement is one of the fundamental sources of literature for this proposal. The TRIPS agreement is an international instrument that provides for protection of intellectual property rights. However, the TRIPS Agreement does not adequately reflect the fundamental nature of human rights particularly the right to health. It tilts the balance away from public interests and in favour of intellectual property rights. Moreover, the TRIPS Agreement fails to give a definite and conclusive definition of ‘compulsory licensing’ and as such, one is left to fill in this gap from other sources.

Another important source of literature for this proposal is the Doha Declaration. Paragraphs 17 to 19 of this instrument emphasize the importance of interpreting the TRIPS Agreement in a way that supports and encourages public health especially through the availability of access to essential medicines. It expounds on the flexibilities accorded under the TRIPS Agreement and more so on compulsory licensing. It however remains a declaration and hence lacks the force of a legally binding international document.

Some of the books and articles I reviewed while writing this proposal include; ‘Willingness and ability to use TRIPS Flexibilities: Kenya Case Study.’[30] This article acknowledges the fact that there are great challenges in the delivery of essential medicines as a result of the international property rights regime. It goes on further to give statistical data of how this regime has affected the right to health of many Kenyans. It also explains how the Industrial Property Act, 2001 was brought into compliance with the TRIPS agreement. It especially expounds and gives the general application of the provisions concerned with compulsory licensing. Nonetheless, it fails to critically examine which of the laws provide for greater protection of intellectual property rights and dwells mostly on the misconception of ARVs as being the only or most important essential medicine.

Having extensively perused Jackline Nyaga’s, ‘Implementing Parallel Importation and Licensing Mechanisms to increase access to medicines in Kenya,’[31]I observed that the authoress focuses mainly on Kenya’s experience so far in implementing the flexibilities of parallel importation and compulsory licensing and to a large extent fails to look at it critically from a legal perspective and as such lacks case law (possibly due to lack of development in this area) and other essential legal persuasions for the use of compulsory licenses for pharmaceutical patents.

Collen Chien also attempts to analyze the compulsory licensing of patents relating to essential medicines.[32]In her article, she explicates that through the empirical analysis that she and others have carried out; she is lead to a strong conclusion that there is no decline in innovation in pharmaceutical companies as a result of issuance of compulsory licensing of patented pharmaceuticals. While she presents persuasive and logical evidence in support of the above, she fails to uphold her arguments through cogent legal authorities such as case laws and other legislations and concentrates subjectively on the compulsory licensing of AIDs drugs as an essential medicine.

Kevin Kelly’s article[33] was helpful in giving statistical data on access to essential medicines by a certain demographic (HIV/AIDS infected mothers), but it ignores to answer the important question as to whether or not compulsory licensing of patents of essential drugs was a contributory factor to the data.

Whereas Jamie Feldman[34]aptly analyses compulsory licensing and even gives examples of countries where this flexibility has successfully been used, he looks at compulsory licensing wholly from the point of view of the holder of intellectual property rights and dismisses the perspective from the protection of the fundamental human right to health. He does not give an in depth nor profound justification for compulsory licensing of pharmaceutical licenses.

While Marks’ article[35] was vital in analysing the connection between the human right to health and the right to protection of intellectual property rights, it is general in its approach and thus lacks the critical analysis of national laws.

The ‘Implications of the Doha Declaration on the TRIPs Agreement and Public Health’[36] was integral in highlighting the major paragraphs of the Doha Declaration that affects the TRIPS Agreement and how each can be read together in order to give a wholesome interpretation of the TRIPS Agreement. It however does not delve critically into the debate about compulsory licensing and how it can be used as a mechanism by states to promote the right to health by increasing access to essential medicines.

Michael Spence’, Intellectual Property[37] helped me form the basic theories behind my research for my proposal. However, it had a dearth of deliberations on compulsory licensing and how it affects the intellectual property law theories.

Finally, I reviewed Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’.[38] This thesis was one of the materials I used when coming up with my comparative case study of India’s compulsory licensing under its Patent Act. It nonetheless, neglects to give a conclusive impact of compulsory licensing in India and ignored to give case laws to buoy its assertion that compulsory licenses should be issued as an effective tool in promoting access to drugs in India. Furthermore, it is not all rounded as it alludes to the fact that the only essential medicines are ARVs.

1.10 Framework of the Thesis.

This dissertation shall have four main chapters. Each chapter’s breakdown is summarised as follows;

Chapter one highlights the background to the notion of the fundamental human right to health as well as compulsory licensing under national and international law. It also introduces the reader to the concept of intellectual property rights and the justification for them, particularly patent protection. It proposes to the reader the need to bring a balance between the two warring interests and finally discusses the literature reviewed in coming up with the proposal.

Chapter two deliberates on the justification for the notion of compulsory licensing of pharmaceutical patents. It commences by discussing the major paragraphs in the Doha Declaration that affirms that compulsory licensing should be granted so as to preserve public health. It then continues to discuss the main justification for compulsory licensing, that is, to promote the fundamental right to health. It concludes by encouraging the reconciliation and balancing of both interests (the interests of the patent holder and the interests of society).

Chapter three contains a comparative analysis of the legal impact of compulsory licensing on access to essential drugs in Kenya vis-a-vis India. It begins with a brief historical perspective of India’s Patent regime and then offers an analysis of India’s Patent Act which provides for compulsory licensing. It then moves on to discuss the Kenyan situation under the Industrial Property Act Number 3 of 2001. Finally, it showcases the major similarities and differences between the two jurisdictions.

A detailed explanation and analysis as to the extent to which our national legislation has achieved a balance between the right to access to essential medicines on one hand and the right to protection of intellectual property rights on the other is discussed in chapter four. It concludes by offering recommendations as to how this delicate balance can be achieved in Kenya.

CHAPTER TWO
THE JUSTIFICATION FOR COMPULSORY LICENSING

2.1 Introduction

This chapter deliberates on the justification for the notion of compulsory licensing of pharmaceutical patents. It commences by discussing the major paragraphs in the Doha Declaration that affirms that compulsory licensing should be granted so as to preserve public health. Through this it explains why the preservation of public health is a justifiable reason for the granting of compulsory licenses for pharmaceutical patents; a clarification which the TRIPS Agreement deliberately fails to provide for and leaves this for the determination of member states.

It concludes by encouraging the reconciliation and balancing of both interests (the interests of the patent holder and the interests of society).

2.2 The Doha Declaration

Having looked at the legal basis for compulsory licensing, this chapter now attempts to delve into the legal justifications for it, especially as a means to promoting the right to health. The starting point shall be the Doha Declaration.[39]

The Doha Declaration was adopted by various countries as a demonstration of their concern for public health. This was especially so for developing countries such as Kenya. They fundamentally were seeking a declaration that recognized their right to implement certain pro-competitive measures, such as compulsory licensing as needed to enhance access to essential medicines.[40]As much as the declaration lacks the binding thrust that an international convention would have, it is still a substantive source of law justifying compulsory licensing.[41] This is because as per the Vienna Convention on the Law of Treaties Article 26, international agreements, including those which are not of a binding character are entered into ‘pacta sunt servanda’ meaning, in good faith and this applies to the Doha Declaration.[42] Paragraph 4 of the Doha Declaration, affirms the right of Member States to implement compulsory licensing by providing;

We agree that the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health. Accordingly, while reiterating our commitment to the TRIPS Agreement, we affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO Members’ right to protect public health and, in particular, to promote access to medicines for all. In this connection, we reaffirm the right of WTO Members to use, to the full, the provisions in the TRIPS Agreement, which provide flexibility for this purpose.

Further analysis of the Doha Declaration sub-paragraph 5 (b),[43] states that article 31 of the TRIPS agreement does give a number of conditions for granting compulsory licensing but does not in any way limit the grounds on which such licenses can be granted.[44] Sub-paragraph 5 (c) provides for member states to determine what constitutes a national emergency or other circumstance of extreme urgency which is relevant for the granting of compulsory licences when provided for under national laws and pursuant to TRIPS article 31 (b), without the obligation for prior negotiation with the patent owner.[45] The confirmation that the TRIPS Agreement has left room for flexibility at the national level has important legal implications in that panels, tribunals and the appellate bodies must interpret the Agreement and the laws and regulations adopted to implement it in light of the public health needs of individual member states.[46]

It has been suggested[47] that article 7 and 8 of the TRIPS Agreement does also highlight one of the main objectives of the agreement which is the exploitation of intellectual property to the mutual advantage of producers as well as users in a manner that is conducive to social and economic welfare and to a balance of rights and obligations. Moreover, that in amending the laws and regulations regarding intellectual property rights, measures necessary to the protection of public health and nutrition be adopted. However, this was interpreted by the WTO dispute settlement panel, in the Canada-Patent protection of pharmaceutical products case,[48] that the goals and limitations stated in Articles 7 and 8 as well as those of other provisions of the TRIP agreement must be borne in mind and that they are not the only provisions establishing the agreement’s objectives. Thus, the main objective is the protection of intellectual property rights.

It is thus evident that the Doha Declaration, when read in tandem with the TRIPS agreement supports and encourages the use of compulsory licensing for pharmaceutical patents.[49] The only potential obstacle lies in Article 31(f) of the TRIPS agreement that provides that compulsory licensing shall be authorized predominantly for the supply of the domestic market of the member authorizing such use. This limitation may create a problem where Kenya or any developing country can no longer manufacture drugs or medicines or has no capacity to do so both for the domestic market and international market and therefore relies on importation of compulsory licensed drugs from another country. However, Kenya has thus far not experienced such a situation.

2.2 The Human rights ‘paradox’.

It must be fathomed from the beginning that both the individual rights to intellectual property protection as well as the fundamental right to health care are provided for under international conventions and indeed our very own constitution. In this same vein, it would thus lead one to deduce that no right is superior to the other and indeed both work concurrently to ensure that the general welfare of the public is protected and indeed promoted. From the foregoing, there would appear to be a human rights ‘paradox’. However, as earlier mentioned, human rights ought to complement each other as oppose to compete with each other. Having fully underscored and understood this concept, one can thus easily identify why compulsory licensing of pharmaceutical patents should be encouraged so as to promote access to essential drugs and as a result promote the right to health.

2.2.1 The human right to intellectual property protection

The right to intellectual property protection has been acknowledged and indeed recognized by both national and international legal regimes over the years. Nationally, before the enactment of the Industrial Property Act of 2001, Kenya had adopted an Act of Parliament from the English colonial government.[50] It recognized intellectual property rights such as trademarks, copyrights and indeed patents to name a few. Internationally, article 27 of the Universal Declaration of Human Rights (UDHR), 1948 provides for the right of everyone to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is writer.Since the UDHR is of non-binding nature (except for some provisions that have attained international customary law status), the same provisions were subsequently incorporated in article 15 of the International Covenant on Economic Social and Cultural Rights (ICESCR) in 1966. It states;

The States Parties to the present Covenant recognize the right of everyone to take part in cultural life; to enjoy the benefits of scientific progress and its applications and to benefit from the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author.[51]

Article 15(3) goes on further to provide that the State Parties to the Covenant shall undertake to respect the freedom indispensable for scientific and creative activity. There is thus cause for inquiry as to whether compulsory licensing of patents in fact violates this human right of protection of intellectual property rights; in this case, pharmaceutical patents.

There has been much debate as to whether intellectual property rights can be termed as human rights.[52] However, such debate is better left for another forum. For now, what concerns us, is the fact that since it has been incorporated in the major international covenants guaranteeing human right protection,[53]it is thus accepted legally as a human right whose violation does indeed give right to legal recourse such as judicial remedies.

In addition to the aforementioned, it is argued that there are some countries that have a science-based pharmaceutical industry and indeed the pharmaceutical industry does aid in the employment of the country’s chemists, physiologists, toxicologists, pharmacologists, pharmacists, doctors and the like.[54]This pharmaceutical industry could be a significant contributor to the national economy of that country. Also, a home-based industry might be ina better position to produce medication compatible with the average local income,because the cost of labor would be commensurate with the average income.[55] Additionally, maintaining a domestic industry in the area of medication production is important for reasons of national defense.[56]

2.2.2 The human right to health.

Perhaps the most obvious threat to human rights has come from the inability of people to achieve access to expensive medicine…’[57]

The human right to health, as explained earlier includes the financial access to essential medicines by the majority of the population that needs them. ‘Essential medicines’, according to the World Health Organization (WHO), are those that ‘satisfy the priority health care needs of the population and 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.’[58] The United Nations Development Group defines ‘access’ in this context as ‘having medicines continuously available and affordable at public or private health facilities or medicine outlets that are within one hour’s walk from the homes of the population.’[59]

The Constitution of the Republic of Kenya provides for the right to health care. According to Chaskalson P. in Soobramoney v Minister of Health (Kwazulu-Natal),[60] the purposive approach to constitutional interpretation will often be one which calls for a generous interpretation to be given to a right to ensure that individuals secure the full protection of the bill of rights but this is not always the context and may indicate that in order to give effect to the purpose of a particular provision, a narrower or specific meaning should be given to it.

Furthermore, access to essential medicines can be affirmed as a human right on the basis, not only of the right to health but also on two other rights set out in the ICESCR, namely, the rights to the protection of the moral and material interests resulting from any scientific, literary or artistic production[61] and to share in its scientific advancement and its benefits.[62] When contrasted, the former seems to protect the ‘right’ of pharmaceutical companies to earn a profit from the drugs they develop, by setting prices that render medicines inaccessible to the destitute sick, while the latter seems to protect the ‘right’ of those destitute sick to benefit from the development of new drugs.[63] The way out of this dilemma is to distinguish intellectual property rights from human rights and consider them a temporary monopoly established for the valid social purpose of encouraging scientific invention and artistic creation. In other words, an IPR is a legally protected interest of a lower order than a human right, which implies a superior moral and legal claim.

Moreover, the danger in giving greater protection to intellectual property right holders is that such monopoly control can be given higher priority than ensuring the progressive realization of human rights such as the right to health. This can be seen by the fact that patent protection increases the likelihood that prices for a patented product will be higher and indeed price is an important determinant to access to essential medicines.[64] Thus whenever patents allow companies to price any drug out of the reach of those who need it, public health suffers. It is for this reason that the government steps in to ensure that the right to health is achieved by all and thus grants a compulsory license to pharmaceutical patent holder so that the price inevitably depreciates, thus increasing access to essential medicines and thus promoting the right to health.

2.2.3 The need to reconcile both interests

After the expiration of the term of protection, protected works and inventions fall into the public domain and anyone is free to use them without prior authorization by the right holder.[65] Once in the public domain, the intellectual property rights holder is deemed to have paid his societal dues. However, this term of protection, 20 years for patents, is too longer a time for society to wait while it loses its battle to diseases which could have easily been treated had it had access to essential medicines.[66]

The Committee on Economic, Social and Cultural rights came up with a ‘Statement on Human Rights and Intellectual property’ in which it considered that intellectual property rights must be balanced with the right to enjoy the benefits of scientific research, progress as well as its applications.[67]The Committee concluded by calling for a mechanism for a human rights review of intellectual property systems.[68] It also made a further clarification to General Comment No. 14 and thus to Article 12 of the ICESCR, by providing that the human right to essential medicines includes the creation of conditions[69] which would assure to all medical services and attention in the event of sickness. As part of their obligation to protect, states parties havea duty to control the marketing of medical equipment and medicines bythird parties,[70] which strongly suggests that the states should intervenewhere marketing of drugs by pharmaceutical companies is detrimental tothe right to health.[71]Nevertheless, it was in General Comment No. 17, adopted in 2006, that the Committeechallenged head-on the assumption of the international trade regimethat the rights of companies holding patents over essential drugs wereof the same order as the rights of those who need the drugs, by treating theformer as a temporary, revocable monopoly, and the latter as human rights which of course were timeless expressions of fundamental entitlements of a human being.[72]Indeed, the Committee affirmed,

In contrast with human rights, intellectual property rights are generally ofa temporary nature, and can be revoked, licensed or assigned to someoneelse.

The Committee further confirmed that States should ensure that their intellectual property regimes constitute no impediment of their ability to comply with their core obligations in relation to the right to health.[73]The right to health, in theinterpretation of the Committee on Economic Social and Cultural Rights,means that States Parties have a duty to prevent unreasonably highcosts for access to essential medicines.[74]

2.3 Conclusion

In conclusion, it is evident that a delicate balance needs to be drawn between the human right to health through access to affordable essential medicines and the right to protection of Intellectual property rights. If we truly wish to factor the promotion and protection of human right to health into the objectives of intellectual property right protection, different ways and strategies of promoting and protecting scientific progress and its results should be explored in particular cases. In the context of human rights and particularly the right to have an access to essential drugs, compulsory licensing is therefore a very crucial element as such licenses may constitute an important tool to ensure affordable drugs through competition without denying the patent owner compensation for his invention thereby promoting the realisation of the right to health.[75]

CHAPTER THREE
THE LEGAL IMPACT OF COMPULSORY LICENSING IN INDIA AS COMPARED TO KENYA

3.1 Introduction

This chapter attempts to elucidate the legal impact of compulsory licensing in India as compared to Kenya. It does this through exploration of the current system of compulsory licensing in India under the Indian Patent Act[76] and a comparison with the Kenyan Industrial Property Act (2001) provisions on the same. It commences by giving a brief historical background and rationale for the current compulsory licensing system in India which as shall be seen, before 2005, provided issuance of compulsory licenses without much procedural and legal technicalities. This in turn led to quite a number of compulsory licenses for pharmaceutical patents being awarded in India between 1970 and 2004. This made India one of the largest producers and manufacturers of generic drugs which in turn had a positive effect on its economy.

This chapter also gives the current grounds upon which compulsory licenses may be awarded and the procedure for such awards both in India and in Kenya. It further delves into examining some of the case laws that have helped develop compulsory licensing in India thus expounding the legal impact compulsory licensing has had in India and the future direction of the regime.

3.2 History and rationale of the Indian patent system.

In order to fully grasp the milestones India has gone through in trying to achieve the balance between the rights of its population to access to essential medicines, it is important to give a brief synopsis of its patent regime.

India’s first Patent Act[77]was instituted in 1856 and included patents for both process and product and lasted 14 years, with extensions allowed by the Governor General.[78] It was amended in 1859 so as to be in accordance with the British Patent Act of 1852 and underwent various other amendments until it was replaced by the 1911, Indian Patent and Design Act.[79] This Act established for the first time a system of patent administration under the management of the Controller of Patents. Furthermore, it provided for the grant of compulsory licensing mainly in the case of misuse or abuse of patent rights.

After independence, the government of India appointed two committees in order to restructure the patent regime, and to identify the resulting rise in the cost of medicines.[80] These committees were the Bakshi Tek Chand Committee[81] and the Ayyangar Committee.[82] They recommended that the patent law be so designed as to enable the country to achieve rapid industrialization to attain, as quickly as possible, a fairly advanced level of technology giving inventors and investors sufficient inducement and protection by patent grants and at the same time safeguarding its national economic and social interest.[83] The Bakshi Tek Chand Committee thus went beyond the 1911 Patent Act and recommended a provision enabling the government to request a compulsory license on behalf of private parties that seemed to suggest an inclusion on the ‘public interest’ ground which was incorporated in the 1952 Act, section 23CC[84] that provided for automatic endorsement of licenses of right in respect of inventions pertaining to food, medicines or drugs.[85]However, this amendment did not prove very effective as its provisions were fairly cumbersome when it came to their actual application.[86]Thus the Ayyangar committee was appointed. It established that due to the fact that 80-90 percent of India’s patents were held by foreigners and that these patents mostly dealt with food, chemicals and pharmaceuticals, many of the patented commodities such as medicines were arguably unaffordable to the general public and the drug-price index was rising rapidly.[87] It concluded that the patent regime was ‘wholly inadequate to prevent misuse or abuse of patent rights, particularly by foreigners.’[88]The suggestions of this committee went into amending the Act and forming the Patent Act of 1970.

This resulted in amendments to the Indian Patent Act in 1970 with such amendments including a further time limitation of a patent right from fourteen years to seven years, the curtailing of product patents on medicine and the establishment of automatic licensing.[89] With the passing of the 1970 IPA, it was clear that the policy of the Indian government was geared towards the protection of public health and the expansion of the Indian generic manufacturing industry.[90]

However, it must be noted that the Patent Act of 1970 provided only for process patent and not product patent.[91] The Act also had a strong compulsory license regime. It also prohibited patent protection on pharmaceuticals and introduced automatic licensing. As a result of this new patent regime, India became one of the cheapest drug producing countries after 1970.[92]

In 1995, India joined the World Trade Organization (WTO) and automatically became a signatory to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).[93]India was thus forced to become fully TRIPS compliant by its last amendment to the 1970 Act in 2005.[94]

3.3 Compulsory Licensing under the Indian Patent Act of 2005.

Chapter XVI of the Indian Patents Act deals with compulsory licenses. Section 84 of the Indian Patent Act provides for compulsory licensing in the domestic arena while section 92A looks at exporting of drugs.[95] Section 84 provides for a compulsory license to prevent the abuse of patent as a monopoly and to make way for commercial exploitation of invention by an interested person. Section 84 (1) provides

At any time after the expiration of three years[96] from the date of the grant of a patent, any person interested may make an application to the Controller for a grant of compulsory licence on patent on any of the following grounds, namely:—

(a) that the reasonable requirements of the public with respect to the patented invention have not been satisfied, or

(b)that the patented invention is not available to the public at a reasonably affordable price, or

(c) that the patented invention is not worked in the territory of India.

The use of the terms ‘reasonable requirements of the public’ and ‘reasonable affordable price’ are ambiguous in my opinion. This is because the determination of what might amount to a reasonable requirement or a reasonable affordable price changes from one person to the next based on the social as well as financial caliber that that person inhabits. In my contemplation, this section should have highlighted the circumstances that make it reasonable for a compulsory license to be granted,[97] such as is the case in Section 80 of the Industrial Property Act of Kenya which underscores some of these circumstances to include cases of national security, nutrition, health and environmental conservation or the development of any other vital sector of Kenya’s national economy.

It must however be noted that in as much as the aforementioned section does not explicate what a ‘reasonable requirements of the public’ is, it does provide instances when a reasonable requirement of the public is not satisfied under section 84 (7). It provides;

The reasonable requirements of the public shall be deemed not to have been satisfied;

(a) if, by reason of the refusal of the patentee to grant a licence or licences on reasonable terms,

(i) an existing trade or industry or the development thereof or the establishment of any new trade or industry in India or the trade or industry in India or the trade or industry of any person or class of persons trading or manufacturing in India is prejudiced; or

(ii) the demand for the patented article has not been met to an adequate extent or on reasonable terms; or

(iii) a market for export of the patented article manufactured in India is not being supplied or developed; or

(iv) the establishment or development of commercial activities in India is prejudiced or

(b) if, by reason of conditions imposed by the patentee upon the grant of licences under the patent or upon the purchase, hire or use of the patented article or process, the manufacture, use or sale of materials not protected by the patent, or the establishment or development of any trade or industry in India, is prejudiced; or

(C) if the patentee imposes a condition upon the grant of licences under the patent to provide exclusive grant back, prevention to challenges to the validity of patent or coercive package licensing; or

(d) if the patented invention is not being worked in the territory of India on a commercial scale to an adequate extent or is not being so worked to the fullest extent that is reasonably practicable; or

(e) if the working of the patented invention in the territory of India on a commercial scale is being prevented or hindered by the importation from abroad of the patented article by

(i) the patentee or persons claiming under him; or

(ii) persons directly or indirectly purchasing from him; or

(iii) other persons against whom the patentee is not taking or has not taken proceedings for infringement.

Section 84 (2) further states that an application under this section may be made by any person notwithstanding that he is already the holder of a licence under the patent and no person shall be estopped from alleging that the reasonable requirements of the public with respect to the patented invention are not satisfied or that the patented invention is not worked in the territory of India or that the patented invention is not available to the public at a reasonably affordable price by reason of any admission made by him, whether in such a licence or otherwise or by reason of his having accepted such a licence.

Section 89 further provides the general purposes of granting a compulsory license as:

(i) That the patented inventions are worked on a commercial scale in the territory of India without undue delay and to the fullest extent that is reasonably practicable.

(ii) That the interests of any person for the time being working or developing an invention in the territory of India under the protection of a patent are not unfairly prejudiced.

Section 84 (6) states that the Controller shall take into account the following factors when considering the application for a compulsory license:

(1) The nature of the invention, the time which has elapsed since the sealing of the patent and the measures already taken by the patent or licensee to make full use of the invention.

(2) The ability of the applicant to work the invention to the public advantage.

(3) The capacity of the applicant to undertake the risk in providing capital and working the invention, if the application were granted.

(4) As to whether the applicant has made efforts to obtain a license from the patentee on reasonable terms and conditions and such efforts have not been successful within a reasonable period as the Controller may deem fit.

Section 90 further empowers the controller to settle the terms and conditions for compulsory licenses.

Section 92 provides for a special provision for compulsory licenses on notifications by central government. It attempts to narrow down the instances in which the government may by way of notification Official Gazette, declare that compulsory licenses should be granted in respect of any patent. These include instances of national emergency, extreme urgency or public non-commercial use. Section 92 (1) (i) thus states that the Controller shall, on application made at any time after the notification by any person interested, grant to the applicant a licence under the patent on such terms and conditions as he thinks fit and that in settling the terms and conditions of a licence granted under this section, the Controller shall endeavor to secure that the articles manufactured under the patent shall be available to the public at the lowest prices consistent with the patentees deriving a reasonable advantage from their patent rights.[98]The Act also goes a step further by providing in section 92 (3) that such circumstances of national emergency and urgency include cases of public health crises relating to Acquired Immuno Deficiency Syndrome, human immune deficiency virus, tuberculosis, malaria or other epidemics and states that the Controller shall not apply any procedure specified in section 87 in relation to that application for grant of licence under this section provided that he shall, as soon as may be practicable,[99] inform the patentee of the patent relating to the application for such non-application of section 87.

It must also be appreciated that this Act does provide a definition for the term ‘pharmaceutical products’ to mean any patented product, or product manufactured through a patented process, of the pharmaceutical sector needed to address public health problems and shall be inclusive of ingredients necessary for their manufacture and diagnostic kits required for their use.[100]It must also be noted that the main difference between section 92 and section 84 is that under section 92 (1) discussed above, an applicant need not wait for a period of three years to lapse before making an application for grant of compulsory licensing.[101] Moreover, section 92 (3) states that the Controller has discretionary powers to decide whether or not to follow the cumbersome procedure under section 87 when faced with an application for grant of compulsory license under section 92.[102]

3.3.1 The unique case of compulsory licensing of mailbox application related patents.

In 1999, India added section 11A in its Patent Act pursuant to a TRIPS obligation, that provided that applications claiming pharmaceutical inventions would be accepted and put away in a mailbox to be examined in 2005.[103] These applications are referred to as ‘mailbox applications’.[104]Section 11A states that in cases of ‘mailbox applications’ that result in the grant of a patent, an automatic compulsory license would issue to the generic companies that made a ‘significant investment’ and were producing and marketing a drug covered by the ‘mailbox application’ prior to 2005. Such licence is however subject to the payment of reasonable royalty.[105] The Act does not provide a yardstick to determine the reasonableness of a royalty rate and there is no case law to set a precedent as to what could be deemed as reasonable. However, section 90 sheds some light when trying to compute the royalty rate payable by stating that one must take into account the nature of the invention, the expenditure incurred by the patentee in making the invention or in developing it and obtaining a patent and keeping it in force and other relevant factors.[106]

3.4 Limitations of the Indian Patent Act of 2005

The period after which one can apply for a compulsory license according to Section 84 of the Indian Patent Act is three years after the issuance of a patent on the drug. This three year period is not justified as most of the time essential medicines are required immediately by the population and this period provides a monopoly timeframe in which access to affordable essential medicines are limited and thus leads to an increase in loss of lives. In my opinion, this section fails to acknowledge the need to promote the right to health and indeed the right to life as fundamental human rights.

Moreover, the same section 84 requires the person applying for compulsory licensing to set out the nature of their interest and it provides an opportunity for the patent holder to oppose the application. Therefore, there are chances that any application filed for compulsory licensing can result in inordinate delays, thereby defeating the entire purpose of the provision.[107] Also, the controller has to take into account the nature of invention, time elapsed, his efforts for obtaining a license and the rate of royalty which may further complicate and delay the process. [108]

Section 92A also restricts the grant of compulsory licenses for purposes of manufacture and export to a country with insufficient or no manufacturing capacity and that the terms and conditions determining the grant of the compulsory license under Section 92A shall be as decided by the controller.[109]

However, as much as there are all these legal misgivings on the matter of compulsory licensing under the Indian Patent Act, it provides for a unique scenario by providing for pre-grant and post grant opposition provisions.[110]Under the Act, there are 11 grounds on which a patent can be opposed (post-grant),[111] but this can only be done within one year after the patent has already been granted.[112] India’s pre-grant opposition procedure is restricted on just two grounds. That is, non-compliance with patentability requirements and non-disclosure or wrongful disclosure of genetic resources or traditional knowledge.[113] The nevirapine syrup opposition case set an important precedent for all future ARV patent oppositions in India.[114] The Indian Network for People Living with HIV/AIDS (INP+) and the Positive Women’s Network (PWN) filed a pre-grant opposition for the patenting of nevirapine syrup, a pediatric drug used in the treatment of HIV positive children who are unable to swallow conventional ARV drugs. On June 11, 2008, the Indian Patent Office rejected the patent application of German pharmaceutical company Boehringer Ingelheim based on both technical and public health grounds. Specifically, the patent office found that the syrup formulation of nevirapine was merely a new form of a known drug that was first invented in 1989, well before the TRIPS/2005 IPA patent cut-off date of 1995.[115]

This decision affirmed the interpretation that India’s current patent law does not consider improvements or new forms of known medicines to be patentable.[116] More importantly, the ruling called into question the practice of ‘ever-greening,’ where pharmaceutical companies make minor variations to existing medicines in order to extend their patent monopolies for as long as possible.

3.5 Kenya’s Industrial Property Act Number 3 of 2001

One is first introduced to compulsory licensing under Section 72 (1) of the Act which states that;

At any time after four years from the filing date of an application or three years[117] from the grant of a patent, whichever period last expires, any person may apply to the Tribunal for a licence to exploit the patented invention on the grounds that a market for the patented invention is not being supplied on reasonable terms in Kenya

Section 72 goes on to state that a compulsory license shall not be granted if the owner of the patent satisfies the Tribunal that circumstances exist which justify the fact that the market for the patented invention is not being supplied, or is not being supplied on reasonable terms, in Kenya. Therefore, if for example it can be proven that a patented pharmaceutical drug is not being supplied in Kenya as it has been banned by the Kenya Bureau of Standards for a particular reason, no compulsory licence shall be granted for it. This is unlike the Indian Patent Act of 2005 that makes compulsory licensing wholly on the discretion of the Controller.[118]

Section 74 (1) further provides that a compulsory licence shall not be granted unless the person requesting the licence satisfies the Tribunal that he has asked the owner of the patent for a contractual licence but has been unable to obtain the licence on reasonable commercial terms and within a reasonable time; and offers guarantees satisfactory to the Tribunal to work the relevant invention sufficiently to remedy the deficiencies or to satisfy the requirements which gave rise to his request. This prerequisite shall be waived in the case of a national emergency or other circumstances of extreme urgency, provided the owner of the patent shall be so notified as soon as is reasonably practicable. Section 75 (1), also states that in considering a request for a compulsory licence, the Tribunal shall decide whether a compulsory licence may be granted and shall then, if it decides in favour of the grant taking into account any terms agreed by the parties, proceed to fix the terms which shall be deemed to constitute a valid contract between the parties and shall be governed by the provisions of contractual licences. In fixing the terms, the Tribunal shall ensure that the compulsory licence is limited in scope and duration for the purpose for which it was authorized; is limited predominantly for the supply of the domestic market; does not entitle the licensee to grant further licences without the consent of the owner of the patent; is non-exclusive and provides for the payment to the owner of the patent of remuneration which is equitable with due regard to all the circumstances of the case, including the economic value of the licence.

Furthermore, Section 77 (1) states that a compulsory licence may be cancelled by the Tribunal if the licensee fails to comply with the terms of the licence; or the conditions which justified the grant of the licence have ceased to exist and are unlikely to recur, provided that the legitimate interests of the licensee are adequately protected.

Section 80 (1) (a) of the aforementioned Act, provides that such exploitation may only be carried out on the basis of public interest, in particular, national security, nutrition, health, environmental conservation or the development of any other vital sector of the national economy so required. Section 80 (1) (b), further provides that the Managing Director of Kenya Industrial Property Institute (KIPI), can on application to the licensee, in the prescribed form and after consultation with the Institute and the owner of the patent, order that the protected invention shall be exploited by the Government Ministry, Department, agency or other person as the Minister may designate in the order, subject to the payment of adequate compensation[119] to the owner of the patent in accordance with this section.

3.6 Decided cases from India’s National Courts and Patent Tribunal.

The legal impact compulsory licensing has had in India can also be seen from its courts decisions. For instance the case of Neo-Pharma Industries (P) Ltd v Parke Davis & Co (Application under section 23CC of the Patent and Design Act of 1911; Order dated 23 November 1965, the applicant (Neo-Pharma) wanted a license of the patent (relating to the manufacture of Chloramphenicol and its esters) filed an application under section 23 CC of the Indian Patent and Design Act of 1911. The patentee opposed the application on various grounds, one of which was that the applicants did not have the necessary expertise to manufacture the said patented drug and the grant of compulsory license would therefore be contrary to public interest and public safety. Moreover, the grant of a compulsory license was unwarranted because the patentee’s existing licenses were adequately meeting the demands of the public and the grant of a compulsory license would only prejudice their working of the invention. Despite all these allegations, the Controller found it appropriate to give the applicant ‘a chance’ to work the invention, in public good and if the applicant failed to produce goods to the requisite standards then the market forces would ensure that they don’t not remain in business.[120]

Another case of interest is the Raptakos, Brett & Co (P) Ltd v Benger Laboratories Ltd (Application under section 23CC of the Indian Patents and Design Act (1911); Order dated 28th July 1959. The facts of this case are that the applicant, Raptakos, desiring to manufacture a Saccharated Iron Oxide (a chemical product useful in the treatment of iron deficiency anaemia) sought a license from the licensee without success. The patent related to ‘Improved Therapeutic Preparations of Iron’. The license was awarded to the respondent and the applicant under section 23 CC thus made an application for the grant of compulsory licensing of the said patent. The applicant argued that the grant of a compulsory license would be in public interest as iron deficiency anaemia was widely prevalent in India and the patented invention would become available to the public at an affordable price.[121]

The application was opposed on various grounds, some of which were that the applicant did not have the ability to work the patent and if the compulsory license were awarded, it would be detrimental to public health.[122] Moreover, it was submitted that even without the grant of a compulsory license, the price of the patented medicine had reduced considerably over time and was likely to reduce even further.[123]

It was held by the Controller that the applicant did in fact have sufficient skill and ability to work the patented invention.[124] Also, there was no need to refuse the grant of compulsory license on the grounds of ‘public health’ as the Drugs and Cosmetics Act would test the safety of the drug. Furthermore, he said that the anticipated reduction of the price of a drug was not a sufficient ground for rejecting an application for compulsory licensing and as such I was awarded.[125]

3.7 Conclusion

From the foregoing, it is evident that the controller is more inclined to give a compulsory license of a patented pharmaceutical so as to promote public health. It is apparent that there is a dearth of case law concerning the awarding or rejection of a compulsory license for a pharmaceutical patent in Kenya. Nonetheless, should a dispute arise, Kenyan courts should follow in the footsteps of the Indian tribunal and award compulsory licenses for pharmaceutical patents where the benefit to the public far outweighs the cost to the patent holder.

CHAPTER FOUR

THE EXTENT TO WHICH NATIONAL LEGISLATION HAS ACHIEVED A BALANCE BETWEEN THE RIGHT TO ACCESS TO ESSENTIAL MEDICINES AND THE RIGHT TO PROTECTION OF INTELLECTUAL PROPERTY RIGHTS.

4.1 Introduction.

This chapter attempts to advance an analysis as to the extent to which our national legislation has achieved a balance between the right to access to essential medicines on one hand and the right to protection of intellectual property rights on the other. It commences by looking at the Constitution[126] that offers both rights in its content and then looks at the Industrial Property Act (2001) and how this Act has attempted to achieve this balancing act. It then concludes by offering recommendations as to how this equilibrium can be realized.

4.2 The Constitution and its efforts towards achieving equilibrium of rights.

The Constitution of the Republic of Kenya, in its Bill of Rights Chapter four part two provides for both the right to intellectual property protection as well as the right to health. It is modelled upon the Universal Declaration of Human Rights[127] as well as the International Covenant on Economic, Social and Cultural Rights[128] that provide for the same.

In my opinion, the fact that our Constitution provides for the right to intellectual property protection[129] as well as the right to the highest attainable standard of health[130] in the bill of rights proves that our laws try to cast a balance between both rights. The constitution, being the supreme law of Kenya, recognizes that both rights should exist without categorization of either being subordinate to the other. However, to say that both rights exist in harmony with each other would be naive and utopian. The reality is that both rights are in competition with each other for primacy.

Section 40 (5) says that the State shall support, promote and protect the intellectual property rights of the people of Kenya. The state already offers these services through monitoring agencies such as Kenya Bureau of Standards[131], Kenya Pharmacy and Poisons Board,[132]as well as Kenya Industrial Property Institute (KIPI). In my opinion, the existence alone of such statutorily regulated bodies shows the government’s intention in ensuring that intellectual property rights are upheld.

Furthermore, the same constitution provides that the rights of the intellectual property right holder shall not be deprived arbitrarily nor limited in any way on the basis of discrimination.[133]This reaffirms the government’s duty in safeguarding the rights of the intellectual property right holder. However, should this right be deprived as in the case of public health, the intellectual property rights holder must be compensated by prompt and full payment.[134]

Should one’s rights to intellectual property protection be violated, they have a right to take their matter to court, the Constitutional court and where dissatisfied, they may approach the Supreme Court. This right to recourse to court is provided for in Section 40 (3) (b) (ii).

4.3 The Industrial Property Act No. 3 of 2001 and its challenge in balancing competing interests.

This Act has the main mandate of ensuring there is protection of intellectual property rights such as patents. It ensures this through various ways such as section 60 that protects the patent holder from anybody else who may want to make, use, sell or import the patented drug. This protection is however not indefinite but lasts up to 20 years. Ordinarily, this would be justifiable[135] but in the case of a patented drug that is needed by the population, 20 years may not be reasonable and as such the Act acknowledges this through the provision of compulsory licensing.

As section 80 (1) (a) so appropriately provides, compulsory licensing may be awarded on certain grounds one of which is public health. Therefore, compulsory licenses may not be issued on a whim and this in fact does also offer some kind of protection to the patent holder. In addition to this, the Managing Director of Kenya Industrial Property Institute (KIPI), can on application to the licensee, in the prescribed form and after consultation with the Institute and the owner of the patent, order that the protected invention shall be exploited subject to the payment of adequate compensation[136] to the owner of the patent in accordance with this section. Once again, the Act tries to achieve a balance of rights in the sense that first, the Managing Director can reject the application for compulsory licence if he is not satisfied that it is for public health or that the person seeking the grant of the compulsory license did not ask the patent owner for a contractual license or that he was able to obtain it on reasonable commercial terms and within a reasonable time. Second, even before he orders the grant of the compulsory license, he must have had prior consultation with the patent owner and adequate compensation be made to him.[137]Third, the grant of a compulsory license will be taken to be like a contractual agreement so that where any of the terms are breached by the one granted the compulsory license for a pharmaceutical patent it may be withdrawn by the Managing Director of KIPI once it is brought to his attention.[138] Fourth, the grant of the compulsory license is limited in terms of scope as well as duration for the purpose for which it was authorized. Therefore, once the health of the population begins to improve and there is not much demand or need for the essential medicine then the compulsory license may be withdrawn and the patent holder reclaim his patent for the remainder of the duration left of the 20 year protection period. Fifth, the compulsory license is only awarded for the supply in the domestic market. Should the person granted the license export the drug, then he will be in breach of the terms and the license may be revoked.[139]

4.4 Possible Recommendations

Possible recommendations in the international arena include the formation of a convention or treaty that acknowledges the suffering that the people in the developing world endure due to access to affordable essential medicines; and persuaded by such, formally recognize the right to use compulsory licensing in the case of public health. Once acceded or ratified, it would have a binding force and countries from the west would not be able to legitimately criticize developing countries for issuing compulsory licenses in such matters.

Nationally, I would suggest that parliament implement legislation that allows a price regulation scheme of essential drugs such as the ARVs or consider allocating more from the budget towards subsidizing the price of these drugs. Moreover, when it comes to patent protection, parliament should consider reducing the patent duration from 20 years to 10 years only for pharmaceutical patents of essential drugs (so as not to make it non-compliable with the TRIPS Agreement). For all other inventions the patent holder would be protected for 20 years. At the very least this is a debate that should be started at the international arena with a possible amendment to Article 31 of the TRIPS Agreement.

The final article of the Montreal Statementsuggests, as examples, ‘international commitments to funding health research as a global public good, and schemes that reward innovation based on health outcomes.’[140] For instance, there could be a second kind of pharmaceutical patent that entitles an inventor not to monopoly pricing powers, but rather to rewards proportioned to the invention’s actual health impact over time. Such rewards, funded by a consortium of willing governments, would incentivize pharmaceutical companies to develop, first and foremost, the most cost-effective remedies for the world’s diseases.[141]

In addition, this reform would reorient the incentives of such firms in highly desirable ways: any inventor firm would have incentives to sell its innovative medicines cheaply, often even below their marginal cost of production, in order to help even very poor people who need them.[142]

4.5 Conclusion

When people’s lives are on the line, the practice of granting compulsory licenses for pharmaceutical drugs so that these people have access to the medicines they need seems to be common sense and ethical. The main aim of granting a compulsory license for pharmaceutical patents is not to punish the patent holder but to improve global health but this goal will not be achieved until more stringent laws govern this practice.[143]Moreover, Jamie Feldman[144] postulates that if only essential compulsory licenses were issued, citizens who were truly in need would be treated and the pharmaceutical companies’ fears of not recouping their investment would be placed at ease.[145]

In my humble opinion, the balance of these two rights is very difficult to achieve and the endeavour to achieve a balance may remain a Utopian endeavour!

Reference

[1] Constitution of the Republic of Kenya (2010) , Section 43 (1) (a)

[2] This is further affirmed by the Universal Declaration of Human Rights (1948) Article 25 (1) that states everyone has the right to a standard of living adequate for the health of himself and of his family, including food, clothing, housing and medical care and necessary social services.

[3]In exchange for this exclusive right, the patent holder pays his dues to society by disclosing the technical information behind how the invention was created, and at the end of the 20-year period the protection expires and the creation enters the public domain. (World Trade Organization, Understanding the WTO: The Agreements (2007), http://www.wto.org ) [27th May, 2010.]

[4] Article 33 of the TRIPS Agreement also provides for this.

[5] This multilateral treaty came into being in 1995 and its main aim was to ensure a comprehensive homogenous set of principles for the protection of Intellectual Property Rights. It established a set of minimum standards for all countries in relation to patents, copyrights, trademarks, geographical indications, topographies of integrated circuits among others. Kenya became compliant in 2001 with our Copyright Act and the Industrial Property Act.

[6] TRIPS Agreement Article 31 (h)

[7] TRIPS Agreement Article 31 (f)

[8] Constitution of the Republic of Kenya (2010)

[9] This section states that the State shall not discriminate directly or indirectly against any person on any ground, including race, sex, pregnancy, marital status, health status, ethnic or social origin, colour, age, disability, religion, conscience, belief, culture, dress, language or birth.

[10] Constitution of the Republic of Kenya (2010).

[11] Treatment Action Campaign (TAC) v Minister of Health 2002 10 BCLR 1033

[12] In this case the Industrial Property Act Number 3 of 2001

[13] Jamie Feldman ‘Compulsory Licenses: The Dangers behind the Current Practice.’ The Journal of International Business and Law 137 (2009).

[14] Amir H. Khoury, The “Public Health” of the Conventional International Patent Regime & the Ethics of “Ethicals:” Access to Patented Medicines, 26 CARDOZO ARTS & ENT. L.J. 25, 32 (2008).

[15] Peter S Menell, Intellectual Property: General Theories. (1999) page 133.

[16]Michael Spence, Intellectual Property (Oxford University Press) 2007 page 63.

[17] Peter S Menell, Intellectual Property: General Theories. (1999) page 133.

[18] D. Schwartzmann, Innovation in the Pharmaceutical Industry ( JohnsHopkinsUniversity Press) 1976

[19] Ibid

[20] Such as Jamie Feldman ‘Compulsory Licenses: The Dangers behind the Current Practice.’ The Journal of International Business and Law at 157 (2009). See also, Amir Attaran, ‘How Do Patents and Economic Policies Affect Access To Essential Medicines In Developing Countries?’ 23(3) Health Affairs (2004), 155–156, at 157 who expresses doubt that compulsory licensing can be made practicable.

[21] Simmons, A. John ‘The Lockean Theory of Rights’ Princeton, PrincetonUniversity Press (1992)

[22] Garima Gupta and Avih Rastogi ‘Intellectual Property Rights: Theory & Indian Practice’ Centre for Civil Society (2002) at 4.

[23] Ibid

[24] Ibid

[25] Kant, Immanuel (1798), ‘Of the Injustice of Counterfeiting Books’, Essays and Treatises on Moral, Political and Various Philosophical Subjects at 229-230.

[26] Peter S Menell, Intellectual Property: General Theories. (1999) 158

[27]Jamie Feldman ‘Compulsory Licenses: The Dangers behind the Current Practice.’ The Journal of International Business and Law 149 (2009).

[28] Dipika Jain, ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at 2.

[29] It must be noted that there is not much case law that has been reported to develop this area of intellectual property law but these few cases sheds some light on what precedent our very own courts should follow where the grant of a compulsory license for a pharmaceutical license is challenged in our courts.

[30] Robert Lewis Lettington and Peter Munyi ‘Willingness and ability to use TRIPS Flexibilities: Kenya Case Study.’DFID Health Systems Resource Centre, September 2004.

[31] Jackline Nyaga’s, ‘Implementing Parallel Importation and Licensing Mechanisms to increase access to medicines in Kenya’ StanfordUniversity, 2009

[32] Collen Chien, ‘Cheap drugs at what price to innovation: does the compulsory licensing of pharmaceuticals hurt innovation?’ http://www.ssrn.com [23rd October, 2010.]

[33] Kevin J Kelly “Maternal Deaths Drop in Kenya” Daily Nation 15 April, 2010 pg 10.

[34] Jamie Feldman ‘Compulsory Licensing: The Dangers behind the current practice’. The Journal of International Business and Law (2009) 138- 167

[35] Stephen P. Marks ‘Access to essential medicines as a right to health’ Health a human rights perspective

[36] Carlos M. Correa, ‘Implications of the Doha Declaration on the TRIPs Agreement and Public Health.’ University of Buenos Aires, World Health Organization Publication (2002).

[37] Michael Spence’, Intellectual Property (OxfordUniversity Press) 2007.

[38] Dipika Jain ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009).

[39] WTO, Declaration on the TRIPs Agreement and Public Health (November 14, 2001) hereafter the ‘Doha Declaration’

[40] Carlos M. Correa, ‘Implications of the Doha Declaration on the TRIPs Agreement and Public Health.’ University of Buenos Aires, World Health Organization Publication (2002)

[41] In my opinion, should countries across the globe continue to grant compulsory licenses of pharmaceutical patents on the basis of the need to promote and protect public health as indicated in the Doha Declaration, it may attain the international status of customary international law in the next few years which would thus make it obligatory and binding.

[42] This provision is also supported Article 31 of The Vienna Convention on the Law of Treaties, 1969 that: ‘a treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose.’

[43] Each Member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted.

[44] Carlos M. Correa, ‘Implications of the Doha Declaration on the TRIPs Agreement and Public Health.’ University of Buenos Aires, World Health Organization Publication (2002) at 29.

[45] Ibid, at 30

[46] Ibid

[47] Ibid

[48] WT/DS114/R, 17 March 2000

[49] Paragraph 4

[50]Kenya Patent Registration Ordinance (1933). This later led to the enactment of the 1989 Industrial Property Act.

[51] Article 15 (1) of the UDHR (1948)

[52] Robert Ostergard, Jr., (1999): Intellectual Property: Universal Human RightsHuman Rights Quarterly,Vol. 21 p156-178 at 158. See also Peter Prove, who maintains that Intellectual Property do not possess the character of fundamental human rights but rather of subordinate or instrumental rights, Peter Drahos ‘ International Network on Disarmament and Globalisation’ at www.indp.org/trips.html (20th March, 2010)

[53] That is the UDHR and The ICESCR

[54] Giunna Julian-Arnold, International Compulsory Licensing: The rational and the reality. IDEA The journal of Law and Technology (1993) pg 352

[55] Ibid

[56] Ibid.

[57] Andrew Clapham, Human Rights Obligation of Non-State Actors(Oxford: OxfordUniversity Press, 2006), at 175.

[58] World Health Organization, ‘Essential Medicines: Definition’, available at http://www.who. int/medicines/services/essmedicines_def/en/. (7th August, 2010)

[59] MDG Gap Task Force, Millennium Development Goal 8: Delivering on the Global Partnership for Achieving the Millennium Development Goals: MDG Gap Task Force Report 2008(New York: United Nations, 2008) at 35.

[60] Constitutional Court of South Africa, Case CCT 32/97, 27 November 1997.

[61] (Article 15(1)(c) ICESCR

[62] (Article 15(1)(b) ICESCR

[63] Stephen P. Marks ‘Access to essential medicines as a right to health’ Health a human rights perspective

[64] Ibid

[65] Jamie Feldman ‘Compulsory Licenses: The Dangers behind the Current Practice.’ The Journal of International Business and Law (2009) at 139.

[66] Compulsory licensing is one of the main means for reducing the adverse effects of patents on price and availability of essential drugs.

[67]Human Rights and Intellectual Property: Statement by the Committee on Economic Social and Cultural Rights, UN Doc. E/C.12/2001/15, 14 December 2001, para. 4.

[68] Ibid., para. 18

[69] In my opinion, this includes compulsory licensing of pharmaceutical patents.

[70] Ibid., para. 35.

[71] Stephen P. Marks ‘Access to essential medicines as a right to health’ Health a human rights perspective.

[72] Ibid

[73] Committee on Economic, Social and Cultural Rights (CESCR), General Comment No. 14 on the right to the highest attainable standard of health, August 2000, UN Doc. E/C.12/2000/4, at para. 35.

[74] Stephen P. Marks ‘Access to essential medicines as a right to health’ Health a human rights perspective.

[75] Ibid.

[76] Patent Act (2005)

[77]India’s first patent legislation came into force as a result of the recommendations of the Lord Macaulay LawCommission.

[78]Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at 5.

[79] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future

[80] Ibid at 3

[81] This committee tried to defend ‘public interest’ in availability of food and medicine by examining inter alia, an effective system of compulsory licensing for food and medicine related inventions. They suggested that an application for compulsory licenses could be made to the comptroller general on grounds that India’s commerce or industry was being substantially affected and that export in the patented item was absent. (Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future)

[82] Ibid

[83] Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at10

[84] This section was very similar to section 41 of the English Act of 1949.

[85]Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 4.

[86] Ibid.

[87] MJ Adelman and S Baldia, ‘Propspects and Limits of the Patent provision in the TRIPS Agreement : The case of India ‘ Vanderbuilt Journal of Transnational Law Vol 29 1996 p 507

[88] R Ayyangar, ‘Report on the Revision of the Patent Law’ 1959, New Delhi.

[89] Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at10

[90] Ibid at 11

[91] Ibid at 12

[92] Ibid at 13

[93] Ibid.

[94] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 4.

[95] Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at 16

[96] This provision provides for a cumbersome and onerous application process that may discourage others from applying for a compulsory license grant.

[97] Section 92 of the Indian Patent Act of 2005 attempts to list the situations that encompass ‘reasonable requirement of the public’ but it still falls short of being precise and thus remains nebulous.

[98] This particular provision in my view, tries to cast that delicate balance that is needed between the rights of the society to access essential medicines and the right of the patent holder to still derive benefits from the invention.

[99] In compliance with Article 31 of TRIPS Agreement.

[100] Section 92A of the Indian Patent Act of 2005

[101] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 12

[102] Ibid

[103] Ibid at 15

[104] Ibid.

[105] Section 11A (7)

[106] Section 90 (1) (i)

[107] Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at 18

[108] Ibid

[109] Ibid at 19

[110] Ibid at 21

[111] These can be found in Chapter V of the Indian Patent Act (2005) Section 25 (1) (a) to (k).

[112] Chapter V of the Indian Patent Act (2005) Section 25 (2).

[113] Dipika Jain’s ‘Access to Drugs in India: Exploration of Compulsory Licensing as an Effective Tool’ HarvardLawSchool (2009) at 23.

[114] Ibid.

[115] Ibid.

[116] Ibid.

[117] This is similar to Section 84 of the Indian Patent Act of 2005

[118] Indian Patent Act (2005) Section 92 (3)

[119] TRIPS Agreement Article 31 (h)

[120] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 41.

[121] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 39.

[122] Ibid

[123] Ibid

[124] Shamnad Basheer and Mrinalini Kochupillai The ‘Compulsory License’ regime in India: Past, Present and Future at 40.

[125] Ibid.

[126] Constitution of the Republic of Kenya (2010)

[127] Universal Declaration of Human Rights (1948) Article 25 (1) that states everyone has the right to a standard of living adequate for the health of himself and of his family, including food, clothing, housing and medical care and necessary social services. Article 27 also provides for the right of everyone to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is writer.

[128] The International Covenant on Economic Social and Cultural Rights (1966), Article 12, states that the steps taken by the state parties to the present covenant (such as Kenya) to achieve the full realization of the right to health shall include those necessary for the prevention, treatment and control of epidemic, endemic, occupational and other diseases and the creation of conditions which would assure to all, medical services and medical attention in the event of sickness. Article 15 states that the States Parties to the present Covenant recognize the right of everyone to take part in cultural life; to enjoy the benefits of scientific progress and its applications and to benefit from the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author.

[129] Section 40 (5)

[130] Section 43 (1) (a)

[131] That monitors counterfeiting of products in the market.

[132] That ensures that the drugs that are sold are genuine and are tested and safe for consumption

[133] Section 40 (2)

[134] Section 40 (3) (b) (i).

[135] In my opinion, if the sick person were to wait for 20 years, they may die waiting and as such, their right to health adversely affects their right to life; a consequence which could have been prevented or contained had compulsory license been issued.

[136] Section 80 (1) (b)

[137] Section 74

[138] Section 75

[139] Section 77 (1)

[140] Thomas pogge, Montreal statement on the human right to essential medicines Cambridge quarterly of healthcare ethics (2006) pg 5

[141] Ibid

[142] Thomas pogge, Montreal statement on the human right to essential medicines Cambridge quarterly of healthcare ethics (2006) pg 5

[143] Jamie Feldman ‘Compulsory Licenses: The Dangers behind the Current Practice.’ The Journal of International Business and Law 167 (2009).

[144] Ibid

[145] Ibid.

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