Intellectual Property And The TPPA. Does It Affect Us?

Pheh Hoon Lim

When New Zealand joined the World Trade Organization (WTO) it had to align its intellectual property protection with the minimum standards stipulated under the provisions of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). This was achieved under the Copyright Act 1994 together with amendments under the Copyright (New Technologies) Amendment Act 2008 updating the legislation for the digital environment.

The Trans-Pacific Partnership Agreement (TPPA) is the free trade agreement between New Zealand and eleven Asian and Pacific-rim countries (Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, Singapore, United States and Vietnam) concluded in October 2015, and signed in Auckland this week. It contains a chapter on the controversial area of intellectual property aimed at establishing a common regional framework among parties for harmonisation in the areas of copyright, patents, trademark and other areas such as designs, parallel importing, geographical indications and plant varieties.

The TPPA has been the subject of great controversy fuelled no less by the fact that negotiations remained shrouded in secrecy for the past seven years. Copyright issues such as technological protection measures covered by the TPPA are provided under existing provisions that allow us to break a technological protection measure for legitimate purposes such as playing a DVD purchased from overseas. There are changes proposed for performers’ rights while the parallel importing regime will remain unaffected. Under trademarks there is no requirement for a sign to be perceptible (i.e a sound can be trademarked) and best efforts are to be made to register scents.

A major change is that New Zealand will have to extend the term of copyright protection from 50 to 70 years. The current period of protection for the life of the author plus 50 years is shorter than that in the United States and Australia, where protection continues for 70 years after the life of the author. The question is how protecting books, songs or artistic works for a longer period after the writer, songwriter or artist is deceased provides an incentive for innovation. Take singer songwriter Michael Jackson, for example, whose copyright royalties are controlled by Sony/ATV Music Publishing and his estate that own the copyright in his works. Extending protection for 20 years more deprives the public domain of access to information and materials which they can build upon to create other works for a longer time. It would be the big corporations lobbying for such extended terms of protection that benefit the most.

More controversy lies in the patent area. While free trade agreements are intended to facilitate trade within the region and not to raise barriers to trade, such agreements potentially undermine access to affordable life-saving medicines. A patent gives the inventor a 20-year monopoly over the invention to exclude others from the market for the product. In the case of pharmaceuticals, the 20 year monopoly provides an incentive for drug companies to invest in much needed research and development and search for new cures for AIDS and other diseases. Thus in the initial 20 years of marketing a new drug, the pharmaceutical industry relies on patent protection to prevent others from competing in the market with the same product. This allows them to market the drugs at higher prices to recoup their large investment outlays.

Besides patent protection for the invention of new drugs, regulations also provide for protection of pharmaceutical test and other data. Before a new drug is put onto the market for sale it must have been subjected to tests to ensure the efficacy and safety of the drugs. If other parties could obtain the test data it would save a lot of time and costs for cheaper medicines to be available. However, such tests are time-consuming and expensive and the data submitted to each national authority for approval are protected from disclosure to third parties, such as manufacturers of generic drugs. Being able to manufacture cheaper medicines is important as patented AIDS medicines, for example, at one time cost US$10,000-US$12,000 compared to US$300 for equivalent generics per patient a year. The World Health Organization reported that there were still 34 million people living with AIDS globally in 2011.

New Zealand currently has in place a five-year protection period for such data of innovative medicines (containing an active ingredient that includes a chemical or biological entity), which means manufacturers of generic drugs will need to wait another five years (after the 20 years of patent protection) before they can use the test data. The new obligation for data protection under the TPPA means New Zealand will have to provide for 10 years of data protection for new agricultural chemicals and review the current 5-year protection period for biologics after 10 years. Together with the obligation to extend the patent term in cases of unreasonable delay from the date of filing there are concerns regarding access to essential lifesaving medicines, and essentially higher costs for Pharmac and consequently less public benefits in the long term.

It may appear strange that intellectual property protection is under the control of a trade umbrella such as the WTO and further free trade agreements between countries. Before intellectual property was included under trade instruments for harmonising standards of protection, developing countries such as India and Thailand were able to produce generic medicines under their national laws and supply the world with cheaper medicines. India cannot continue to do so under its obligations to bring intellectual property protection in line with WTO member countries. In addition, the United States was blatantly negotiating with Thailand and indirectly applying pressure in the form of favourable trading deals in exchange for their agreement not to produce cheap generics. The United States had also negotiated data protection with their trading partners in Central America and Vietnam as well as under the Dominican Republic–Central America Free Trade Agreement (CAFTA). Data protection can thus appear under the guise of free trade rules and intellectual property protection to prolong protection of pharmaceutical data and compound the public health dilemma.

Should you and I care about intellectual property protection under the TPPA? Does it matter that it is the music industry that controls whether we would be able to access works for another 70 instead of 50 years to mix and mash and create different versions? Should we not care that cheaper medicines should be available earlier rather than later so that more people can afford it? It is worrying if we recall the Severe Acute Respiratory Syndrome (SARS) outbreak in China and South East Asia not too long ago highlighting the need for swift access to lifesaving medicines rather than prolonging the time for generic drug manufacturers to be able to access test data and produce the same drugs at cheaper prices. The winners in this are multinational corporations owning copyright and the major pharmaceutical players, mainly in the United States. Countries should not be left standing up to intense pressure from the United States pharmaceutical industry when free trade should benefit consumers rather than corporate and political interests.

However, the TPPA does incorporate the major objectives under the TRIPS Agreement in recognising the serious public health problems faced by poorer and developing countries. We do hope that a human rights element will prevail in terms of options to remove any obstacle for access by poorer countries who are unable to manufacture their own medicines under the world trade rules when there is such a need or public health emergency.

About the author

Pheh Hoon Lim

Senior Lecturer - Auckland University of Technology
Pheh Hoon Lim is a Senior Lecturer in the Law School, AUT University. Her research interests are mainly in the areas of copyright law and digital technology as well as patents. She has presented at conferences in New Zealand, Australia, the United Kingdom and Europe and published articles in internationally peer-reviewed journals as well as the New Zealand Business Law Quarterly. Earlier publications in the International Review of Intellectual Property and Competition Law and the European Intellectual Property Review deal with a controversial and much traversed issue on the idea-expression dichotomy in copyright law and peer-to-peer file sharing, comparing the legislative initiatives across jurisdictions. She has also written on the topic of inexhaustible distribution rights and regulation in downstream markets for copyrighted software. More recently, she co-authored an article in the Intellectual Property Quarterly journal on patent law and access to medicines.