The Australian Federal Government has released an exposure draft of the Intellectual Property Laws Amendment Bill 2012.  The Bill is intended to implement Australia's obligations pursuant to the TRIPS protocol, introducing a regime for the grant of compulsory licences of patents related to pharmaceutical products on public health grounds, where resulting goods will be exported to least-developed or developing countries.

The proposed compulsory license can only be granted under strict conditions intended to balance the interests of patent owners, generic manufacturers and importing countries. 

The proposed process is as follows:

  • Identify relevant patents.
  • Attempt to obtain authorisation (generic manufacturer makes reasonable attempts to obtain authorisation from the innovator company).
  • If authorisation is not forthcoming, the generic company must notify the innovator company (and the TRIPS Council) of its intention to use the licence regime.
  • Generic manufacturer makes an application to the Australian Federal Court for a compulsory licence.
  • If the Federal Court grants the licence, the TRIPS Council and Commissioner of Patents are notified.
  • The generic manufacturer may manufacture and export the pharmaceutical product in accordance with the licence.
  • The generic manufacturer licensee and innovator company may negotiate remuneration - if they cannot agree, remuneration will be determined by the Federal Court.

In determining whether to grant a compulsory licence, the Federal Court must be satisfied that the application is made in good faith; that the pharmaceutical product is to be imported by a qualifying country; that the proposed use of the pharmaceutical product is to address  a public health problem (national emergency or for public non-commercial use); and the generic manufacturer and importing country will take reasonable measures to prevent re-importation or use of the pharmaceutical product for any other purpose.

Submission in relation to the exposure draft may be lodged until 1 October 2012