Today took place a meeting of the Dispute Settlement Committee within the Korea Patent Office to hear opinions of parties involved in a case of compulsory license of Fuzeon patent. I did not attend the meeting but obtained the material presented by Duke University and Trimeris through their Korean attorney, Kim & Chang.
Duke University and Trimeris, resting on four grounds, insisted the CL request to be dismissed. First they argued that IPLeft and KANOS who initiated this case lack the standing to request a CL because they have neither ability to manufacture nor import a pharmaceutical product covered by the Fuzeon patents. The Patent Act does not allow a licensee under the CL to be assigned to a third party. Therefore IPLeft and KANOS are not "person who intends to work the patented invention" within the meaning of Article 107.
Second, Duke University and Trimeris argued that the statutory condition of a prior negotiation was not met. Under Article 107, the condition of a prior negotiation is exempted only when the intended working of a patented invention is of non-commercial use. IPLeft and KANOS failed to establish the non-commercial working as they indicated to sell a product under the CL at a price set by government (25,746
Third ground relates to the statutory requirement of "the particular necessity for the public interest". Duke University and Trimeris took a position that granting a compulsory license is exceptional and should be subject to a strict interpretation of the statutory requirement as it imposes a restriction on property right protected under the Constitution and the Patent Act. They argued the requirement of particular necessity for the public interest can be met when there is no substitutional measure in an emergent situation. Further, the determination of the particular necessity for the public interest should be made by balance striking between "the interests of the
general public and a patentee" through the protection of a patent right and "the interests of the general public" through the exceptional limitation of patent protection.
Duke University and Trimeris went further to argue that the authorization of a CL should be considered on its individual merits according to Article 31(a) of TRIPS: individual situation of relevant state. Such factors as economic status of Korea (OECD member state, world top 14th in GDP, world top 4th in R&D investment per GDP) and technology strength of Korea (world top 4th in PCT patent applications, world top 3rd in the number of US patent applications, and R&D activities in 488 items by 45 domestic pharmaceutical companies) should be taken into account for the "individual merits" of TRIPS Art. 31(a).
According to Duke University and Trimeris, very small group of patients who needs Fuzeon indicates no emergency. IPLeft and KANOS estimated the patients being approximately 150. In contrast, Roche Korea approximated 68 patients and only two patients have called for Fuzeon which has been provided free of charge through the Korea Orphan Drug Center.
Concerning the substitutional measure and access to medicine, Duke University and Trimeris maintained that the patients can be treated by other product such as Prezista sold by Jansen and Fuzeon has been provided free of charge by Korea Orphan Drug Center since February 25, 2009.
Fourth, Duke University and Trimeris insisted that the CL is ineffective because there is no generic and manufacturing Fuzeon is technologically too difficult. Further, granting a CL on the Fuzeon patent would only produce a harmful impact: reducing incentive to develop new pharmaceutical products and in turn hampering innovation and industrial progress.
* Relevant provisions of Patent Act:
Article 107 Adjudication for the Grant of a Nonexclusive License (1) Where a patented invention falls under any of the following subparagraphs, a person who intends to work the patented invention may request the Commissioner of the Korean Intellectual Property Office to make an adjudication (referred to as "an adjudication") for the establishment of a nonexclusive license, provided no agreement is reached despite having a consultation (referred to as "a consultation" in this Article) under reasonable conditions with the patentee or exclusive licensee on the grant of a nonexclusive license for the patented invention or a consultation is impossible to arrange; however, the person may request an adjudication even in the absence of a consultation if the patented invention is to be worked noncommercially for the public interest or in any case that falls under subparagraph (iv):
(i) where the patented invention has not been worked for more than three consecutive years in the Republic of Korea, except for natural disasters, unavoidable circumstances or other justifiable reasons prescribed by Presidential Decree;
(ii) where the patented invention has not continuously been worked commercially or industrially in the Republic of Korea on a substantial scale during a period of three years or more without justification, or where the domestic demand for the patented invention has not been satisfied to an appropriate extent and under reasonable conditions;
(iii) where working the patented invention noncommercially is necessary for the interests of the public; or
(iv) where working the patented invention is necessary to remedy a practice determined to be unfair after the judicial or administrative process
(v) where working the patented invention is necessary for the export of medicine to a country (referred to as "an importing country") that intends to import the medicine (including effective ingredients that are necessary for the production of the medicine and diagnostic kits necessary for the use of the medicine) in order to treat diseases that threaten the health of the majority of its citizens.
(2) Paragraph (1)(i) and (ii) of this Article does not apply unless a period of four years has elapsed after the filing date of the application for the patented invention.
(3) In adjudicating the authorization of a nonexclusive license, the Commissioner of the Korean Intellectual Property Office shall consider the necessity of each request.
(4) When the Commissioner of the Korean Intellectual Property Office makes an adjudication under subparagraphs (i) to (iii) or (v) of paragraph (1), the following conditions apply to the person for whom the adjudication was made:
(i) where the adjudication is made under subparagraphs (i) to (iii) of paragraph (1), the nonexclusive license must be implemented for the primary purpose of meeting domestic demand; and
(ii) where the adjudication is made under subparagraph (v) of paragraph (1), all the medicine produced under the terms of the adjudication must be exported to importing countries.
(5) The Commissioner of the Korean Intellectual Property Office shall ensure that reasonable consideration is given to every adjudication. When making an adjudication under subparagraph (iv) or (v) of paragraph (1), the Commissioner of the Korean Intellectual Property Office may consider the factors in each of the following subparagraphs:
(i) where an adjudication is made under subparagraph (iv) of paragraph (1), the need to rectify unfair transactions; and
(ii) where an adjudication is made under subparagraph (v) of paragraph (1), the economic value generated in importing countries by the working of the patented invention.
(6) For semiconductor technology, a request for adjudication may be made only in the
cases set forth in subparagraph (1)(iii) (where the noncommercial working of the patented invention is permitted in a limited way for the interests of the public) and (1)(iv).
Article 109 Solicitation of Opinion from the Intellectual Property Rights Dispute
Committee and the Heads of Relevant Authorities Before adjudicating, the Commissioner of the Korean Intellectual Property Office may solicit an opinion from the Intellectual Property Rights Dispute Committee established under Article 41 of the Invention Promotion Act and the heads of relevant authorities and seek assistance from relevant administrative authorities or interested parties.