News and Analysis • Volume 11 • Number 6 • October 2007
Rwanda Tests Public Health Waiver
Rwanda is set to become the first nation to use a WTO procedure designed to allow developing countries without manufacturing capacity of their own to import of patented medicines produced under compulsory licence in another country.
The WTO Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) allows members to issue compulsory licences in specific circumstances, including public health emergencies, effectively suspending patent rights on products to clear the way for the production of cheap generics. However, the agreement also stipulates that such generics should be ‘predominantly’ produced for the domestic market, thus limiting the amount that can be exported to countries with an insufficient domestic pharmaceutical base.
To address this, WTO Members agreed in August 2003 to waive the domestic consumption requirement under certain conditions to allow poor countries to import drugs produced under compulsory licence elsewhere. This provisional waiver was made into a formal amendment to the TRIPS Agreement in December 2005, despite criticism from health activists that its administrative requirements were so complex that no country had tried to use it. The amendment will enter into force once 100 WTO Members have ratified it; meanwhile the 30 August waiver applies.
Nearly four years after the adoption of the waiver, Rwanda became the first WTO Member to test the mechanism when it notified the WTO on 17 July 2007 of its intention to import 260,000 packs of Apo-Triavir, a generic version of a patented HIV/AIDS drug from Canada. According to the waiver, a country seeking to import generic copies manufactured under compulsory license must notify the TRIPS Council of its intention to use the system, including the name and expected quantity of the product needed. It must also confirm (unless it is a least-developed country like Rwanda) that it lacks the domestic capacity to manufacture the product, and has granted or intends to grant a compulsory licence for it. The exporting country may only manufacture the specific quantity of the product notified to the WTO, and must export the total production to the importing country, which must in turn take ‘reasonable measures’ to prevent re-exportation.
On the potential supplier side, Canada was one of the first countries to respond to the decision through the adoption of the Canadian Access to Medicine Regime (CAMR) in May 2005. The legislation was put into practice on 19 September 2007, when the Canadian Intellectual Property Office granted generics manufacturer Apotex a compulsory licence to produce and export to Rwanda 260,000 packs of Apo-Triavir, a copy of the fixed-dose combination of three drugs under patents held by Glaxo Smith Kline, Shire and Boehringer Ingelheim. Apotex says its product will cost US$0.405 a unit compared to US$20 for the brandname equivalent in the United States. Moreover, it predicted that the price would drop once production of the active pharmaceutical ingredients was ramped up. The licence is valid for two years and restricted to Rwanda exclusively.
Canada has notified to the TRIPS Council that its has granted a compulsory licence under the system created by the waiver. Such notifications must include the name and address of the licensee, the product and quantity for which the licence has been granted, the country to which the product will be supplied and the duration of the licence. Before shipment, Apotex needs to create a website providing information about the quantity and destination of the medicine. The company must also provide details on the features that make the batch of Apo- Triavir destined to Rwanda readily identifiable – through characteristics such as packaging and/or distinctive shaping or colouring of the drug itself – in order to ensure that the generics are not illegally diverted into other markets. All WTO Members must ensure that legal means are available to prevent the importation into, and sale in, their territories of products produced under the system and diverted to their markets inconsistently with its provisions.