Brook K. Baker, Boston, Massachusetts, United States – The next round of negotiations on an Indonesia-European Union (EU) Comprehensive Economic Partnership Agreement (CEPA) is scheduled for today, May 8, in Brussels.
The 2016 textual proposal from the EU contains multiple provisions that threaten access to affordable medicines in Indonesia and would impose intellectual property (IP) protections far in excess of those required under the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) in effect since 1995.
The EU must withdraw all of its demands for TRIPS-plus IP protections on medicines, and Indonesia must hold steadfast in opposing measures that would needlessly interfere with its human rights duty to secure access to affordable medicines for its population.
Assured access to adequate and affordable supplies of life-saving medicines has achieved new urgency in the wake of the COVID-19 pandemic Indonesia, like most of its Global South counterparts, suffered the ravages of delayed access to covid vaccines, medicines (especially outpatient antiviral medicines like Paxlovid), and diagnostic tests.
Even after biopharmaceutical companies received massive infusions of public tax dollars to support research and development, clinical trials, and expanded manufacturing capacity, companies secured exclusive IP protections that safeguarded them against competition. Thereafter, they preferentially supplied huge stockpiles of vaccines, tests, and medicines to high income countries, sold at supra-competitive price earning nearly US$90 billion in profits, and put low- and middle-income countries like Indonesia at the end of the line. Millions of lives were needlessly lost on account of this appalling pharmaceutical apartheid.
The specifics of the EU's current trade negotiation demands are unclear because many details were left open for negotiation in its original textual proposal. However, the broad strokes of its TRIPS-plus, pro-monopoly demands are clear.
First, instead of allowing Indonesia to adopt an international patent exhaustion rule and to import a medicine lawfully put in the market anywhere in the world, Article X.3 of the EU proposal would only allow national or regional exhaustion of rights.
However, Article 167 of the Indonesia Patents Law of 2016 currently allows imports of any patented pharmaceuticals that have been lawfully marketed outside Indonesia. This right of international exhaustion, otherwise known as parallel importation, would allow Indonesia to comparison shop for cheaper versions of a patent owner's medicines when it has been lawfully sold anywhere with economic returns already earned by the patent holder. International exhaustion/parallel importation is clearly authorized by Article 6 of the TRIPS Agreement.
Second, the EU is attempting, via Article X.41.2, to force Indonesia to extend patent term protections beyond the 20 years required by the TRIPS Agreement whenever the regulatory processes for authorizing use of a medicines results in an effective term of market protection less than 15 years.
Both the United States and EU routinely attempt to force such patent term extension rules (known as supplementary protection certificates in the EU) on trading partners to give pharmaceutical patent owners a longer time to exclude competitors and charge monopoly prices. At present, Indonesia wisely limits patents to the TRIPS requirement – 20 years – that is already more than enough.
Third, the EU seeks to impose a whole new monopoly regime on Indonesia in the form of data exclusivity. Currently, Indonesia has no data exclusivity, which is not required by the TRIPS Agreement. This means that a generic producer can rely on or reference the originator's regulatory data to establish that its bioequivalent medicine is safe and effective.
This avoids any duty to conduct costly, protracted, and ultimately unethical and duplicate clinical trials. In contrast, the EU has a data/market exclusivity period of 10 years during which competing companies cannot receive authorization to market a generic equivalent by relying on the originator's data or prior registration.
The EU also grants an extra year's protection for a new use with significant clinical benefit. Although the time period for exclusivity in Article X.44 of the EU's textual proposal is now undefined, multi-year data exclusivity poses a huge threat to access to cheaper generic products in Indonesia and could conceivably restrict registration of generic medicines lawfully produced under a compulsory or government use license.
This impact on compulsory licenses is particularly concerning given that Indonesia has previously issued compulsory licenses three times to secure more affordable access to antiretroviral medicines to treat HIV and Hepatitis B. More recently in 2021, Indonesia issued a government use license on Remdesivir to treat COVID-19. EU-style data exclusivity has no exception for medicines produced via a compulsory license, which would greatly reduce Indonesia's ability to respond to pandemics and other urgent health needs.
Fourth, the EU seeks new IP enforcement measures, including border measures, that could deter generic entry and thus reduce access to expanded and cheaper sources of supply.
The EU should publicly renounce its effort to impose TRIPS-plus demands on Indonesia, a country with 1/10 the per capital GNI as the EU.
Indonesia has a high burden of infectious and chronic diseases and suffered significant waves of COVID-19 infections. The European Parliament has repeatedly chastised the European Commission not to pursue TRIPS-plus provisions in its trade negotiations with low- and middle-income countries like Indonesia. Even the EC itself has recently acknowledge that some of its existing IP protections for pharmaceuticals have gone too far and that it needs to shorten presumptive data exclusivity periods and adopt a regional compulsory licensing regime to address future health emergencies.
The status quo of rich countries imposing ever increasing monopoly protections to benefit the market control and profiteering of their transnational pharmaceutical giants must end. The right to health is too precious to the welfare of Indonesia for it to accede to unconscionable demands for longer, stronger, and broader monopolies on medicines.
[The writer is a law professor at Northeastern University School of Law and senior policy analyst for Health Global Access Project. The views expressed are his own.]