Tuesday, December 19, 2006

Pfizer threatens another philippine generic company with litigation to stop legal competition

Pfizer is striking the Philippines generic industry again.

Orient Euro Pharma (OEP) Philippines, a subsidiary of OEP Taiwan recently launched a generic version of olmesartan medoxomil a product for the treatment of hypertension developed by Sankyo but marketed by Pfizer in the Philippines.

There is currently no patent for Olmesartan Medoxomil in the Philippines (Sankyo does have a patent application pending that OEP argues does not cover Olmesartan Medoxomil, but Olmesartan Medoxomil in combination with Hydrochlorothiazide).

However, this has not stopped Pfizer from threatening OEP and the manufacturer of the product (Hizon Laboratories, Inc.) with legal actions to prevent commercialization of the generic products that have considerably lowered the prices of Olmesartan Medoxomil in the Philippines.

Pfizer prices (under brandname Olmetec):
10mg strength PHP 38.94 per tablet
20mg strength PHP 47.20 per tablet
40mg strength PHP 70.72 per tablet

OEP Prices (under brandname Olmezar):
20mg strength PHP 18.53 per tablet
40mg strength PHP 24.75 per tablet
Note: 1 USD = 49.5 PHP, all prices are ex-retail prices inclusive of 12% VAT.

Pfizer seems to be claiming that:
1. They have 5 years of data exclusivity since Olmetec was launched in the Philippines (January 2005) under article 39.3 of the TRIPS Agreement and the Intellectual Property Code of the Philippines (Republic Act No. 8293).
2. OEP relied on Pfizer’s undisclosed test data to register its generic version.


OEP filed for a DECLARATORY RELIEF on November 2006 with the Philippine courts and the following are their main arguments, along with my analysis:

a) Article 39.3 of the TRIPS Agreement is not a self-executing provision upon which Pfizer could sue OEP and Hizon.

The correct answer to this question is that it depends. Although Intellectual Property regimes are nation based, international agreements, like the TRIPS Agreement, can have direct effects on nations that have signed them. TRIPS direct applicability depends on the method that the Philippines chose to implement its international obligations and also on the rank given to them.

It depends on which legal tradition Philippine’s constitutional law and judicial practice follows: monist or dualist. In brief, for countries following a monist tradition, international law and national law are part of a single legal order; international treaties automatically become integral part of the national law and are self-executing. Monism requires national courts to give effect to international law, notwithstanding inconsistent domestic law, even constitutional law of a constitutional character. Dualists, however, contend that international law and domestic law are distinct and that the status of international law in the domestic system is determined by domestic law.

Although there seems to be some controversy, according to Filipino lawyers that I have consulted, the Philippines is a dualist country were international treaties do NOT automatically become integral part of the national law. The legislative and judicial practice is that an enabling law has to be enacted after the Philippines ratify a treaty, because in general treaty provisions are not self-executing.

Therefore, OEP claim is correct. Article 39.3 of the TRIPS Agreement only mandates a minimal standard of protection (that does not include data exclusivity as I will explain) and there exists a need for a national legislative enactment on Article 39.3 to give it effect in the Philippines.

b) When implementing its obligations under Article 39.3 of the TRIPS Agreements, the Philippines do not have to grant “data/marketing exclusivity” over pharmaceutical test data.

This is correct. Article 39.3 only requires WTO Members States to protect from unfair commercial use and sometimes disclosure the pharmaceutical undisclosed test data that originated from new chemical entities, which required considerable effort to generate, and which is required to be submitted to national regulatory authorities to obtain marketing approval.

When implementing its TRIPS obligations WTO’s members have broad discretion and as Article 1.1 of the TRIPS Agreement provides “members shall not be obliged to, implement in their law more extensive protection than is required by this Agreement… Members shall be free to determine the appropriate method of implementing the provisions of this Agreement within their own legal system and practice.“

On 8 September 2006 (Annex “I” here and here), Pfizer’s counsel, Siguion Reyna Montecillo and Ongsiako, wrote TO OEP’s counsel answering a previous communication (Annex “H” here and here). It stated as follows: “…Your interpretation of TRIPS 39.3 – that it does not relate to data or market exclusivity – is a version promoted by interested sectors of the pharmaceutical industry seeking to influence contemporary interpretations of the provision, to their benefit. The literature on the matter does not bear out this interpretation, however. State parties respecting the TRIPS 39.3 protections recognize that a period of data protection is needed, providing innovator companies with incentive to make the necessary investment in pharmaceutical test and trial data…

Pfizer is wrong here. Article 39.3 of the TRIPS Agreement does not mandate a data or market exclusivity regime. In fact, only a few countries, the U.S. and the E.U. where brand-name/ originators pharmaceutical companies have an important presence, have traditionally implement its Article 39.3 obligations granting a period of exclusivity to the originator of test data.

It is not only academics, civil society and generics companies that defend this interpretation of the TRIPS Agreement. TRIPS negotiating history also does.

And the WHO’s Commission on Intellectual Property Rights, Innovation and Public Health (CIPIH) 2006 Report is also clear:
“Article 39.3, unlike the case of patents, does not require the provision of specific forms of rights. But it does oblige Members to protect undisclosed test or other data against unfair commercial use. It does not create property rights, nor a right to prevent others from relying on the data for the marketing approval of the same product by a third party, or from using the data except where unfair (dishonest) commercial practices are involved.
Thus, the TRIPS agreement does not refer to any period of data protection, nor does it refer to data exclusivity. In some countries, however, such as the United States, a sui generis regime was adopted prior to the TRIPS agreement under which, for a period of five years from marketing approval, no other company may seek regulatory approval of an equivalent product based on that data without the approval of the originator company...... If the patent period has expired, or there is no patent on the product, this sui generis data exclusivity may act independently of patent status to delay the entry of any generic companies wishing to enter the market. This is because the regulators cannot use the data in the period of protection to approve a product, even if the product is demonstrated to be bio-equivalent, where required. The only alternative for a generic company would be to repeat clinical trials, which would be costly and wasteful, and would raise ethical issues since it would involve replicating tests in humans to demonstrate what is already known to be effective. These sui generis regimes, which provide for data exclusivity need to be clearly differentiated from the TRIPS agreement's requirement for data protection.”


To learn more about pharmaceutical data exclusivity visit CPTech website on the topic.

c) OEP also claims that at present, Article 39.3 of the TRIPS Agreement does not have a mirror or counterpart provision under any Philippine law or statute.

As explained, the Philippines has to implement the TRIPS Agreement with national regulations to give it effect. My understanding is that the Philippine has implemented its article 39.3 TRIPS obligations with a test data protection regime that does not provide any marketing or data exclusivity, but that provides protection to marketing approval data against unfair commercial use under certain conditions.

As the Government of the Philippines reported during 2005 WTO Trade Policy Review, the implementation has been done mainly though the Food, Drug and Cosmetic Act (Republic Act No. 3720) and general business confidentiality regulations.

As one Philippino lawyer reported to me, Test Data Protection is enforced in the Philippines through BFAD issuances requiring strict confidentiality of drug applications to prevent unauthorized disclosure and unfair commercial use.

The relevant laws and regulations are:
“a) Republic Act No. 3720: Prohibits the using by any person to his own advantage, or revealing, other than to the Secretary or officers and employees of the Department or to the courts when relevant in any judicial proceeding under the Act, any information concerning any method or process which as a trade secret is entitled to protection.
b) BFAD Order No. 27-A s. 2001 (Confidentiality of Documents): This directs BFAD employees to observe strictly the confidentiality of documents submitted for evaluation and/or registration.
c) Revised Penal Code: which penalizes the revelation of secrets by a public officer known to him by reason of his official capacity as well as revelation of industrial secret by private person.
d) Republic Act No. 6713 (Code of Conduct and Ethical Standards for Public Officials and Employees): This prohibits the disclosure and/or misuse of confidential information to further their private interest or to the prejudice of the public interest.
Republic Act No. 8293 (Intellectual Property Code of the Philippines) includes "protection of undisclosed information" as one of the intellectual property rights”.
(Source: 2005 WTO Trade Policy Review, WT/TPR/M/149/Add.1)

d) Finally, OEP claims that in obtaining registration for the product they did not have access to any undisclosed test data submitted and they only used information publicly available as well as test data that they generated themselves.

For instance, OEP argues that the website of the Center for Drug Evaluation Research and the U.S. Food and Drug Administration contains a wealth of information on olmesartan medoxomil, and that a comprehensive paper entitled “Olmesartan Medoxomil, a Novel Potent Angiotensin II blocker” is downloadable from the internet.


In conclusion, there is no regime of test data/marketing exclusivity in the Philippines. The obligation of Article 39.3 of the TRIPS agreement was implemented into the Philippines with a pure test data protection regime that is in compliance with the TRIPS Agreement. Therefore Pfizer claims that they have 5 years of data exclusivity since Olmetec was launched in the Philippines is a misinterpretation of the current legal regime as mandated by the TRIPS Agreement and implemented in the Philippines and in most of the countries of the world.

In 2001 the Philippines government (with other developing countries) was already publically interpreting their legal regime as not providing data exclusivity.

Now, the Philippine’s courts should protect the Philippine’s governments efforts to provide access to more affordable medicines and to support a national industry of generic manufacturers and should issue a clear judgment establishing that:
- When implementing its obligations under Article 39.3 of the TRIPS Agreements, the Philippines law does not have to grant “data/marketing exclusivity” over pharmaceutical test data and its implementation is with a pure test data protection regime.
- If, as OEP claims, in obtaining registration for their products they only used information publicly available as well as test data that they generated themselves, OEP did not violate any of Pfizer’s trade secrets.

1 Comments:

Anonymous Angeli Adriano said...

Hi, I'm a 20-year old filipina and a college student from De La Salle University-Manila, taking up Legal Management Degree. I'm doing a thesis on this subject about Pfizer and the Philippines' conflicts and it's really helping me and my thesis-mate gather information and reliable ideas regarding the matter.

12:40 PM  

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