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Friday November 23, 2012 |
Canada's International Trade Minister Ed Fast traveled to Brussels
this week hoping to secure a deal on the Canada - EU Trade
Agreement. It looks like he'll be coming home empty handed as
the EU has issued a release
indicating that there are still gaps on key issues. The EU's take on
the talks:
Commissioner De Gucht and Minister Fast had in-depth discussions
on the trade deal and made substantial progress. Both sides will
now instruct their negotiators to narrow the gaps on the
outstanding issues, aiming for a deal in the coming weeks. "I am
pleased that our meeting at a political level has provided the
momentum needed to spur on the negotiations into the home strait.
It's clear that there has been significant progress but some
important work remains to be done", stated Commissioner De Gucht.
Both Commissioner De Gucht and Minister Fast decided to meet
again very shortly and to continue discussions until an agreement
is reached.
That is a far cry from a done deal with more "work to be done" and
the agreement going back to the negotiators for more talks.
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Thursday June 09, 2011 |
Yesterday I posted
on how the Canadian IP Council, the Canadian Chamber of Commerce's IP
lobby arm, floated false claims about the scope of counterfeiting in
Canada in an attempt to bolster claims for increased border measures.
The Chamber placed Canadian countefeiting costs at $30 billion per
year, a figure that has no basis in fact and that even RCMP no longer
supports.
The Chamber's false claims on counterfeiting are not the only
intellectual property issue where their arguments have been debunked as
inaccurate. My weekly technology law column (Toronto
Star version, homepage
version) focuses on the proposed trade agreement between Canada and
the European Union, which
could have big implications for the costs of pharmaceutical drugs, on
which Canadians spend $22 billion annually.
The E.U. is home to many of the world's big brand name pharmaceutical
companies and one of their chief goals is to extend Canada's
intellectual property rules to delay the availability of lower cost
generic alternatives. Earlier this year, the Chamber's IP Council
released a report
claiming that Canada lags behind other countries and
encouraging the Canadian government to follow the European example by
extending the term of pharmaceutical patents and "data exclusivity."
The CIPC (which counts several brand name pharmaceutical companies as
members) claims the reforms would lead to increased pharmaceutical
research and development in Canada. But last month University of
Toronto
law professor Edward Iacobucci released
a study that thoroughly debunks
the CIPC claims, predicting increased consumer costs and noting that
there is little evidence the changes would increase employment or
research spending.
Iacobucci's blunt assessment of the report:
The CIPC Report does not offer
objectivity in its assessment of Canada’s patent regime. It
rather is
a straightforward piece of advocacy on behalf of the branded
pharmaceutical sector. The Report makes no effort to place Canada’s
patent law in an international context or address international
relations, but instead simply asserts without justification that Canada
would suffer if it fails to grant the same concessions to the
pharmaceutical industry that the EU and US have made. The flaws in this
basic approach undermine each of the CIPC Report’s
recommendations.
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Thursday June 09, 2011 |
Appeared
in the Toronto Star on June 5, 2011 as EU/Big Pharma Deal Would Raise
Health Care Costs
Ed Fast, Canada’s new Minister of International Trade, may not be
household name, yet the B.C. Minister is set to play a key role in one
of Canada's top domestic priorities - health care costs. The link
between international trade and health care is not immediately obvious,
but a proposed trade agreement between Canada and the European Union
could have big implications for the costs of pharmaceutical drugs, on
which Canadians spend $22 billion annually.
The E.U. is home to many of the world's big brand name pharmaceutical
companies and one of their chief goals is to extend Canada's
intellectual property rules to delay the availability of lower cost
generic alternatives. Earlier this year, the Canadian Intellectual
Property Council, an advocacy group within the Chamber of Commerce,
released a report claiming that Canada lags behind other countries and
encouraging the Canadian government to follow the European example by
extending the term of pharmaceutical patents and "data exclusivity."
The CIPC (which counts several brand name pharmaceutical companies as
members) claims the reforms would lead to increased pharmaceutical
research and development in Canada. But last week University of Toronto
law professor Edward Iacobucci released a study that thoroughly debunks
the CIPC claims, predicting increased consumer costs and noting that
there is little evidence the changes would increase employment or
research spending.
The Iacobucci study, which received support from the Canadian Generic
Pharmaceutical Association, is a must-read for Fast, trade negotiators
and policy makers since it clarifies the likely costs associated with
the EU demands.
Iacobucci points out that competition from generic pharmaceuticals can
have an enormous impact on consumer costs. For example, when generic
alternatives to the cholesterol medication Lipitor appeared on the
market in 2010, annual revenues for the drug dropped by $350 million.
Given the billions spent on pharmaceuticals each year, rules that delay
generic competitors can lead to huge additional costs.
Iacobucci also questions the premise that increased intellectual
property protection for pharmaceuticals will invariably lead to job
growth and increased research and development spending. On the
employment front, he notes that the brand name and generic
pharmaceutical companies are both big employers in Canada - 15,000
employees for brand name and 10,000 for generics - and policy changes
might not yield any net new jobs.
Iacobucci challenges the notion that because intellectual protection is
good, more protection must be better. The report notes that this is
particularly true in the Canadian context, which is a small player in
the global pharmaceutical market. Canada represents only 2.5
percent of the world market, meaning that Canadian laws have little
impact on international incentives to innovate.
In fact, Iacobucci reveals that previous Canadian attempts to use
policy levers to generate increased pharmaceutical research have
largely failed. In 1987, Canada began enacting a series of reforms with
the promise from brand name pharmaceutical companies that their
research and development budgets would equal at least ten percent of
domestic sales. The government kept its end of the bargain with changes
that delayed the entry of generic drugs by up to two years and granting
eight years of data exclusivity. Yet despite the reforms, Canadian
research and development spending has regularly failed to meet the ten
percent target.
Moreover, while the percentage of research and development spending may
not have increased, Canada's pharmaceutical trade deficit certainly
has. In 2000, the Canadian pharmaceutical trade deficit - the amount
that imports exceeded exports - stood at $3.7 billion. By 2009, the
trade deficit had grown to a record $6.4 billion.
Those numbers help explain why Canada will face great pressure to
favour brand name, predominantly foreign-based pharmaceutical
companies. As Fast tallies the costs and benefits of further
pharmaceutical reforms, the Iacobucci study confirms that there is
little in it for Canada.
Michael Geist holds the Canada
Research Chair in Internet and E-commerce Law at the University of
Ottawa, Faculty of Law. He can reached at mgeist@uottawa.ca or online
at www.michaelgeist.ca.
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