The Trans Pacific Partnership (TPP) negotiations continue to struggle on with the inclusion of Mexico, Canada and, more recently, Japan, adding further complexity, particularly in relation to agricultural market access. One of the main sticking points in the TPP negotiations is Intellectual Property (IP) rights. While this may be overly simplistic, New Zealand may need to look at its IP regime, particularly in the pharmaceutical and veterinary medicine sectors, in a trade-off for agricultural market access.
Over recent years, Canada and the European Union have also been negotiating an economic and trade agreement (the Comprehensive Economic and Trade Agreement “CETA”). Agreement in principle on CETA was reached on October 18, 2013 and it has now been announced that the CETA text has been finalised. However, in a manner reflective of the TPP negotiations, the final text of CETA has not yet been released.
There have been a number of press releases about the content of CETA, including a Canadian Government report from October 2013 entitled: “Technical Summary of Final Negotiated Outcomes”. As Canada is part of the TPP negotiations it could be instructive to see what Canada is reported to have agreed to under CETA in the pharmaceutical IP area.
Extension of Patent Term
Like New Zealand, Canada does not currently provide an opportunity to extend the term of a granted patent, currently 20 years. However, in the EU, a patentee may apply for a supplementary protection certificate (SPC) of up to 5 years to compensate for regulatory delays.
Under CETA, Canada has agreed to provide a patent term extension of up to 2 years to pharmaceutical patents, with no retroactive effect for pharmaceuticals which have already received marketing authorisation. There is therefore the potential to extend the term of pharmaceutical patents from 20 to 22 years from the date of filing. This could mean the delayed entry of cheaper generic equivalents onto the market. However, by ensuring that there is no retroactive effect, the financial impact of this will also be delayed.
It is also expected that exemptions similar to those included in the New Zealand Patents Act 2013, to enable the production of pharmaceuticals for exporting to specified eligible developing countries, will be included.
New Zealand will come under pressure in the TPP negotiations to provide the opportunity to extend pharmaceutical patent term based on regulatory delay. The Canadian model under CETA may be an option worth considering as it is likely to be the position that Canada will attempt to maintain.
Canada’s Food and Drug Regulations currently provide a 6 year data protection period during which the data used to support an innovator’s product registration cannot be used to support registration of a later application for registration for a substantially equivalent (i.e. generic) product. There is also a further 2 years of market exclusivity provided to the innovator, resulting in an effective 8 year period of market protection. The EU requested an extension of the data protection period to 10 years. While Canada rejected this EU request, it has apparently agreed to “lock in” the effective term of 8 years of market protection by specifying this period in the Food and Drugs Act.
New Zealand is currently resisting a proposal under the TPP that would extend its data protection period from 5 to 10 years for innovative products. It may need to consider the middle ground of 8 years.