May 3, 2012 – In today’s Windsor Star, MLI author Kristina Lybecker recommends changes to Canadian legislation that would help strengthen pharmaceutical intellectual property protection. Lybecker says, “By adopting global legislative best practices, specifically those that characterize innovation-intensive nations, Canada could attract additional pharmaceutical research and development investment and gain the research jobs that would follow.” The full op-ed is copied below. It is based on “Intellectual Property Law and the Pharmaceutical Industry: An Analysis of the Canadian Framework,” Lybecker’s contribution to The Economics of Intellectual Property Protection in the Pharmaceutical Sector, the second instalment in MLI’s Pharmaceutical Series.
By Kristina Lybecker, Windsor Star, March 3, 2012
Canada enjoys great benefits from the pharmaceutical industry, including jobs and investment. However, the pharmaceutical industry is characterized by a research and development process that is lengthy, expensive, uncertain and risky.
Canada’s complacency in intellectual property is threatening its relative position in the global pharmaceutical industry and changes are needed in IP protection to re-establish Canada as a global competitor.
Adjustments need to be made to patent term extensions, price regulation of patented drugs and basic patent linkage with automatic injunction. Updating our IP laws would open up trade relationships worth billions.
The proposed reforms offer the opportunity to increase investment and employment in this thriving sector as well as reduce trade frictions to get more access to foreign markets.
Compared to Canada, the European Union can approve new drugs faster and provide earlier access to innovative medical therapies. The future of Canadian IP architecture is critical to the potential of our pharmaceutical industry.
In the current negotiations toward a Comprehensive Economic and Trade Agreement with the 27 nations of the European Union, Canada is being urged to strengthen its intellectual property framework.
Specifically, Canada ought to implement patent term restoration, which would provide innovative pharmaceutical firms up to five years of additional product exclusivity to compensate for the lengthy regulatory approval process as well as extended data protection for the data from the clinical trials of brand name pharmaceutical companies.
With these changes, Canada could attract more life science research investment, create additional research jobs and speed the development of new medicines. The agreement could significantly increase bilateral trade with Europe and provide a boost of billions of dollars to the Canadian economy.
Putting aside the trade con-troversy, Canada would still benefit from strengthening pharmaceutical intellectual property protection. By adopting global legislative best practices, specifically those that characterize innovation-intensive nations, Canada could attract additional pharmaceutical research and development investment and gain the research jobs that would follow. Three changes in Canadian legislation are recommended.
First, Canada should facilitate more expansive data exclusivity protection. Currently, innovative drugs are protected from generic competition for eight years. Strengthening data exclusivity laws will give innovative firms the incentives to produce the data required for regulatory approval, facilitating the research process and encouraging additional investment.
Second, in stark contrast to the United States and the European Union, Canada fails to provide an extra period of patent protection as compensation for time lost during regulatory approval delays. The restoration of a patent term extension of zero to five years, as in other countries, would lengthen the effective patent life of innovative therapies, increasing the incentives to invest in the research and development costs that these treatments require.
Finally, Canada should strengthen its anti-counterfeiting legislation. Criminal sanctions in concert with regulatory provisions will protect Canada from the threat of fraudulent medicines, safeguarding the health of patients and defending the innovative pharmaceutical industry from the theft of intellectual property.
Protection of the industry’s research and development investments would encourage additional investments and innovation.
While not without opposition, these proposed changes generate discussions critical to improving health in Canada and to sustaining the excellence of the Canadian health care system.
Kristina Lybecker is a professor of economics at Colorado College and author of the recent Macdonald-Laurier Institute paper on intellectual property protection, which can be downloaded at macdonaldlaurier. ca
