EGA Press Release

Tuesday, 02 November 2004

NEW EU REGULATION ON COMPULSORY LICENSING AIMS TO HELP COUNTRIES WITH IMPORTANT HEALTH NEEDS

The European Generic medicines Association (EGA) welcomes the European Commission’s proposed Regulation on Compulsory Licensing which will allow the manufacture and export of generic versions of patented medicines to developing countries facing important health needs.

The proposed “Regulation on compulsory licensing of patents for export of pharmaceutical products to certain countries with public health problems” has been drawn up to transpose the WTO Decision of 30 August 2003 on the Implementation of Paragraph 6 of the Declaration on the TRIPs Agreement and Public Health into the patent laws of EU Members States. As such, it forms part of wider European and international efforts to address public health concerns faced by the world’s least developed countries and other developing nations.

It should be noted that all EU Member States and every sector of the pharmaceutical industry originally welcomed the WTO decision of 2003

The new EU Regulation will provide the necessary legal and regulatory framework for European companies to manufacture and export medicines to third countries which have issued a compulsory licence for specific medicines patented in their territory.

The license can only be issued by a least developed country or a country with no manufacturing capacity and only in accordance with the 30 August Decision. A compulsory licence imposes clear conditions upon the licensee defining which medicines are to be manufactured and in what amounts. The products manufactured can only be sold in the country for which the licence was granted and safeguards are provided to ensure they are not diverted to other markets.

Once the new legal framework is in place in the EU, it will still be necessary to establish the practical terms of how to meet the medicinal requirements of developing countries.

Greg Perry, Director General of the EGA, stresses that:

“Under the proposed Regulation, European companies will only be able to supply these medicines to least developed countries or countries with non-existent or insufficient manufacturing capacities. These are often countries with limited ability to pay for even the lowest cost medicines available. Generic companies making these versions of patented medicines will not be able to finance development and production by means of sales on European or US markets as is the case for the patented medicines. In this context it will be important to see what incentives or guaranteed purchase funding can be provided to help companies produce and sell these specially required medicines.”

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