Canada-based drug companies research and manufacture a large number of antiretroviral drugs for children, a market that is untouched by many others. The need for these medicines in developing countries set the stage for the recent passage of an amendment to Canada’s Access to Medicine Regime (CAMR), making patents available to generic drug companies for production and sale to qualifying countries.

In 2005, Canada passed the original version of CAMR, which included a time-consuming provision for requesting patents from pharmaceutical companies. The process required several specific steps before a generic-producing pharmaceutical company could acquire a license compelling the government to relinquish the patent-holding pharmaceutical’s patent. As a result, in the six years that the old regime existed, only one company was able to send one drug to one country. That process took four years.

The delay was a result of a series of bureaucratic steps seemingly meant to encourage the release of patents on the patent-holding companies’ terms. First, a qualifying developing country requested a specific drug and quantity. A generic pharmaceutical company then had to request a voluntary license to use the patent from the patent-holding pharmaceutical company. In the one successful case, in which Canadian generic manufacturing company Apotex sent Rwanda an antiretroviral that required three patented materials to create, the voluntary licenses came with tight restrictions and ultimately resulted in the withdrawal of the licenses when it was clear that Apotex could not comply. If a patent could not be released under a voluntary license, a company could solicit a compulsory license that would allow them to acquire the patent from the government. The generic pharmaceutical company pays a royalty to the patent-holding company and then sells the product to the requesting country.

CAMR now alleviates some of the hurdles by allowing generic manufacturers to acquire one license that will compel the release of the necessary patent for the benefit of all qualifying countries.

Legacy CAMR was supported by pharmaceutical companies, and the implication is that they will not be so kind to the amended version. Canadian pharmaceuticals companies insist that the old regime was working. Rx&D, the Canadian association of research-based pharmaceuticals, wrote an op-ed opposing changes to the legacy regime and insisting that the most effective way to get needed drugs to developing countries is through medicine donation programs and non-profit pricing (thus maintaining the integrity of their patent).

Rx&D and other supporters of the legacy regime note that the ninety percent to ninety five percent of the essential medicines for developing countries as listed by the World Health Organization are not protected by a patent. This would imply that a regime to release patents may not be as crucial to the health of developing countries. Relying on that statistic is misleading, however. The essential medicines list is an application-based list that takes cost effectiveness into account, thereby skewing the list in favor of generic-priced drugs. Drug resistance also plays a pivotal role in the persistent need for new antiretroviral treatments, making acquisition of new, patented drugs increasingly necessary despite their current absence from the essential medicines list.

The World Trade Organization has attempted to address the increasing need for patented medicines by promoting the flexibilities built into the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement. TRIPS established the basic standards for both the protection and the enforcement of intellectual property rights, but it also allowed for exceptions, one of which being compulsory licenses for patents. This flexibility was first narrowed by the requirement that the acquired patent be used predominantly in domestic markets and then expanded in an amendment to allow for the mass-exportation provided it is to countries with little or no pharmaceutical manufacturing capabilities. Rx&D expressed support for TRIPS implementation in 2003 (prior to the 2005 TRIPS amendment), but other policy groups such as International Federation of Pharmaceutical Manufacturers & Associations have reiterated that compulsory licenses should be a last resort following the failure of more patent-friendly solutions.

Canada’s regime seems to go further than TRIPS by opening the exportation of compulsory license-acquired medicines to any country listed as “developing” on the schedule of the CAMR legislation. That includes countries like India and Brazil. India is the largest producer of generic medicines in the world and their recent patent legislation makes obtaining a patent more difficult than in the US or Europe. While still a developing country, and still battling an HIV/AIDS epidemic, they are likely the type of country that the TRIPS amendment wanted to maintain eclipsed.

This story is as old as pharmaceutical intellectual property itself. Where is the balance between property rights and the right to health? Can they coexist in a mutually beneficial capacity? The volume of use and the ultimate effectiveness of revised CAMR have yet to be seen. One can be assured, though, that drug resistance and targeted prevention programs will fuel the need for new medicines and that pharmaceutical companies will continue to require incentives for the innovation of those products. Where there is true harmony has yet to be seen.

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