The IP Debate – Let’s not be fooled…

By Professor Yousuf Vawda, School of Law, University of KwaZulu-Natal

Those opposed to the introduction of substantive patent examination in South Africa (and increased IP protection over medicines and other innovations) base their arguments on flawed assumptions:

 

1. ‘It is highly unlikely that patent applications which have been granted in developed countries would be refused here.’

TRUE: that this is the current situation.

FALSE: that we have to continue this practice. SA has the option to fashion its own rules on patentability, what qualifies as an innovation, and what should be granted a patent.

FALSE: that this practice is widespread or without challenge. India and other countries, for example, scrutinise all applications and apply their own standards and rules.

FALSE: that developing countries have to adopt the low patentability standards of the US (even TRIPS does not require that) where even a peanut butter and jelly sandwich may be patented (US Patent No 6,004,596).

FALSE: because it can never be in the interests of developing countries to permit evergreening that delays cheaper generic medicines coming on stream.

2. ‘South Africa lacks the specialist skills to conduct substantive examinations of patents.’

PARTLY TRUE: patent examiners may not have all the requisite skills.

FALSE: that we need to hold on to a flawed system that allows trivial patents because the skills to examine are not presently available.

FALSE: that we cannot, over time, train sufficient examiners to conduct the examination.

 

3. ‘Examining patents will tie down applications in red tape, slow the rate of grants, and incur unnecessary costs.’

FALSE: conducting proper search and examination in terms of the Patents Act is not red tape, but a necessary regulatory exercise.

FALSE: that the only costs that matter are those incurred by patent applicants – what about the adverse effects of undeserving patents on consumers, public health, and access to essential technologies?

 

4. ‘Invalid patents can always be challenged in the courts.’

FALSE: this is another lie inflicted by those with vested interests in the maintenance of a broken, anti-public system. It is well-nigh impossible, as the lawyers will know, to challenge undeserving patents in court because of the time, cost, expertise, burden of proof and other constraints. In 6 years, a mere 7 cases were litigated in our courts (Vawda, 2011).

 

5. ‘Strong IP protection stimulates the economy.’

FALSE: there is no conclusive evidence to this effect, particularly in the developing country context; the evidence suggests that domestic innovation accelerates in countries with higher levels of economic development, educational attainment, and economic freedom (Maskus 2000; Qian, 2007).

 

6. ‘Strong IP protection results in foreign direct investment.’

FALSE: there are no available studies of the impact of the IP system on investment inflows. On the contrary, SA has attracted far less FDI than other countries with weaker IP protection (Kaplan, 2009).

 

7. ‘Strong IP protection promotes local innovation and development.’

FALSE: recent studies found no evidence that a strong patenting environment necessarily supported local innovators, but rather that it facilitates exploitation by foreign interests and incurs substantial social costs (Correa, 2011; Vawda, 2011; Pouris & Pouris, 2011).

 

References:

Correa CM ‘Pharmaceutical Innovation, Incremental Patenting and Compulsory Licensing’ (2011) South Centre.

Kaplan D ‘Intellectual Property Rights and Innovation in South Africa: A Framework’ The Economics of Intellectual Property in South Africa (2009) WIPO.

Maskus EK ‘Intellectual property rights in the global economy’ Institute for International Economics (2000).

Pouris A and Pouris A ‘Patents and economic development in South Africa: Managing intellectual property rights’ S African Journal of Science (2011) 107

Qian Y ‘Do National Patent Laws Stimulate Domestic Innovation in a Global Patenting Environment?:  A Cross-Country Analysis of Pharmaceutical Patent Protection 1978-2002 ’ Review of Economics and Statistics, (2007) 89.

Vawda YA ‘Pharmaceutical Innovation, Incremental Patenting and Compulsory Licensing Country Case Study: South Africa (2011) http://www.tac.org.za/userfiles/file/Vawda%20SA%20patenting.pdf

Wall Street Journal ‘Patent No. 6,004,596: Peanut Butter and Jelly Sandwich’

http://online.wsj.com/article/0,,SB111266108673297874,00.html

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