Global trade in generic medicines

In the Philips Electronics & Nokia cases, the European Court of Justice recently affirmed that patents and trademarks are not enforced against goods in-transit through Europe (C-466/09).  European IP owners are unhappy with the ruling and some academics are unhappy as well (IPKat, for example). The EC has been working on a new tougher Regulation for some time (see Vrins’ article in JIPL&P 2011). But for global health, this is the right ruling.

In 2009, generic drugs were shipped from India to Africa and Brazil.  Sometimes the most direct route isn’t the cheapest, so these drugs ended up “in-transit” in the Netherlands on their way to Africa and Brazil.  The drugs fully complied with all intellectual property laws in India and Brazil, but the patents had not yet expired in Europe.  The Dutch authorities seized the drugs and triggered a firestorm.  (MSF letter here; my related academic paper here).  If these drugs had been destined for sale in Europe, they would have infringed the patents and trademarks.  But they were just moving through a port in the global stream of commerce.

Global IP law recognizes that IP rights are territorial, and that each country will apply patent, trademark and copyright rules somewhat differently.  Law can protect the companies’ legitimate expectations of profits in wealthy countries without blocking global trade in fully legal generic medicines.

The ECJ got it right.


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