On 4 September 2013, the South African Department of Trade and Industry published the Draft National Policy on Intellectual Property (Draft IP Policy).[1]  South Africa does not currently have a general IP policy and, therefore, its approach to IP matters is fragmented. The purpose of the Draft IP Policy is to co-ordinate South Africa's approach to IP matters on both a national and international basis. The Draft IP Policy pays particular attention to access to public health and methods to improve same.

Chapter 2 of the Draft IP Policy, which is entitled 'IP And Public Health' states that:

  • the IP system is one of the factors that directly and negatively/positively impacts on access to healthcare;
  • a developing country like South Africa can access medicines at lower prices via 'compulsory licensing', particularly when Government considers the price of medicines to be too high;
  • other means of improving access to medicines is to facilitate generic competition and parallel importation.

To address the above concerns, the Draft IP Policy makes the following recommendations:

  • compulsory licensing should be introduced in South Africa in line with international treaties,  such as Doha Decision 6 of the WTO negotiations on Trade and Public Health;
  • IP and health policies need to be reconciled as there is a need to address the pricing of drugs to improve access to public health;
  • South Africa should facilitate in its legislation the parallel importation of cheaper drugs and in that regard, also seek regional arrangements and integration;
  • other economic policies such as IP, competition and trade policies must be in harmony with health policy objectives;
  • where indigenous knowledge is used in developing patents, there should be benefit-sharing agreements or co-ownership of the patents, where applicable;
  • public funding for research on health problems in South Africa should be increased and the IP derived therefrom must be controlled, eg. through licensing for the benefit of the country;
  • IP protection regimes must not contradict public health policies and the two should be balanced;
  • provision should be made in the laws to facilitate the quick entry of generic competitors as soon as the patent has expired on a particular medicine.
  • South African legislation should allow strict rules to apply to patenting as competition principles may be undermined. This should exclude diagnostic, therapeutic and surgical methods from patentability, including new uses of known products, as is the case under the TRIPS Agreement.

In relation to the patenting of drugs, the Draft IP Policy recognises that the granting of "weak" patents can stifle access to public health. To overcome that risk, it is stated that South Africa may need to create a substantive search and examination system since its current depository system results in "weak" patents being granted. In relation to patents, the Draft IP Policy furthermore recommends that:

  • technology transfer contracts should be standardised to regulate restricted/prohibited technologies subjected to export controls and maximum percentages;
  • the patent legislation must be changed to incorporate flexibilities as contained in the TRIPS Agreement after the Dona decisions;
  • the patent legislation must be amended to be amenable to issues related to access to public health;
  • bilateral agreements should not be entered into that may negate the gains attained by multilateral agreements such as the TRIPS Agreement on patent flexibilities. South Africa should encourage other developing countries to do likewise;
  • patent legislation should be amended to allow both pre- and post-grant opposition, as this will result in stronger patents being granted;
  • South Africa should remain committed to the protection of data in terms of Article 39 of the TRIPS Agreement, but not to the extent that multinationals are demanding as per their Governments as this could compromise access to health;
  • government departments should integrate their databases for the purposes of sharing information so as not to grant patents on medicines that may be expiring as this may undermine access to public health;
  • South Africa should develop incentive schemes in the area of IP to achieve its developmental goals, particularly poverty alleviation and health;
  • regulations/guidelines on licensing should be developed and encourage the utilisation of patents in the country;
  • upon expiry, patent information must be disclosed for use by the public. However, generics can use the Bolar provision before patent expiry;
  • generic pharmaceutical companies should optimally use the Bolar provision without resorting to stockpiling and competing with the owner of the patent before expiry;
  • education and awareness must be intensified amoung law enforcement agencies that generics are not counterfeited medicines;
  • South Africa should amend its legislation to address issues of parallel importation and compulsory licensing in line with the Dona Decision of the WTO on IP and public health.

Although not legally binding as yet, the Draft IP Policy will inform future legislative changes in South Africa. In the meantime, the Draft IP Policy has been hailed by activists in South Africa as a step in the right direction. However, it remains to be seen what final shape these legislative changes will take, and the exact effect of such policies on the healthcare industry in South Africa.