Productivity Commission reviews compulsory licensing in the patents system

The Commission has invited comment on its discussion paper by 28 September 2012 and will review a range of leading international practices, including the processes under which the current provisions can be used, before making a draft report to Government in December and a final report by the end of March 2013.

AusBiotech will be making a submission on behalf of members and is interested in your comments, which can be directed to Communications Manager, Lorraine Chiroiu or via phone on (03) 9828 1400.

The Government said in announcing the review that it was prompted by concern about a perception that patents over genetic technologies, or a perceived lack of licences to use these patents in Australia, unreasonably restricts or delays patient access to medical advice based on the latest diagnostic tests.

The Commission has been requested to review the operation of the compulsory licensing provisions in the Patents Act 1990, in particular in conducting the inquiry, the Commission should have regard to:

• The importance of incentives for industry and researchers to invest in research and development, and innovation; access to and transfer of technology, including climate change mitigation, food security, healthcare and alternative energy technologies, and standard essential patents in telecommunication technologies, particularly where multiple patentees are involved;
• Affordable and equitable access to healthcare, including medical treatments and diagnostic tests in Australia;
• Recent changes to the intellectual property system reflected in the Intellectual Property Laws Amendment (Raising the Bar) Act 2012, including the research exemption;
• Other relevant parts of the intellectual property system, such as crown use provisions; and the range of international approaches.
• Assess whether the current Australian provisions can be invoked efficiently and effectively to deal with circumstances where reasonable requirements of the public are not being met or where the patentee engages in anti-competitive conduct. This includes, but is not limited to, consideration of concerns that gene patents may hinder access to affordable healthcare, including access to medical advice that relies on the identification and use of gene sequences related to human health and disease.
• Advise on the frequency, and impact, of the issue of compulsory licences in comparable markets and the common features in such compulsory licenses.
• Recommend any measures that may be required to efficiently and effectively exercise these safeguard provisions and invoke their use in a manner consistent with Australia's international obligations, without limiting access to overseas technologies, technology transfer, research and development investments or substantially reducing the patent incentive for innovation.
• Recommend any alternative mechanisms deemed necessary to ensure that the balance between incentives to innovate and access to technology best reflect objectives of ensuring reasonable access to health care solutions, maximising economic growth and growing the Australian manufacturing industry.
• Recommend measures to raise awareness of these provisions and their purpose, including the specific challenges of raising awareness among small businesses and the healthcare sector.

The discussion paper, which can be found here, poses 51 questions respondents may like to address, or invites other comment. Of particular note to the biotechnology sector include, but are not limited to, the following questions in the discussion paper:

• How effective are the compulsory licensing provisions as a safeguard to deal with cases where the reasonable requirements of the public are not being met or a patentee engages in anti-competitive conduct? What aspects of the provisions, if any, cause them to be less effective than they could be?
• How prevalent is the behaviour that the compulsory licensing provisions target? In what circumstances would a patent holder deny a licence?
• How might compulsory licensing be utilised to address the specific concerns related to genes, food security, climate change mitigation and alternative energy technologies, and standard essential patents? Is compulsory licensing the most effective means to address these concerns?
• Should the compulsory licensing provisions be altered to specifically address issues related to genes, food security, climate change mitigation and alternative energy technologies, and standard essential patents? What are the advantages/disadvantages of altering the provisions in such a way? Would maintaining a more general (technology neutral) approach be preferable?