[Ip-health] Patent Linkage in KORUS FTA and Its Comparison with AUS FTA This is a preliminary analysis on "approval-patent linkage" provision
in the KORUS FTA, text of which was released today. Welcome comments
to hurips@gmail.com.

Text of KORUS FTA and AUS FTA

Article 18.9:4 of KORUS FTA

Where a Party permits, as a condition of approving the marketing of a
pharmaceutical product, persons, other than the person originally
submitting safety or efficacy information, to rely on that information
or on evidence of safety or efficacy information of a product that was
previously approved, such as evidence of prior marketing approval in
the territory of the Party or in another territory, that Party shall:
(a)	provide that the patent owner shall be notified of the identity of
any such other person that requests marketing approval to enter the
market during the term of a patent notified to the approving authority
as covering that product or its approved method of use; and
(b)	implement measures in its marketing approval process to prevent
such other persons from marketing a product without the consent or
acquiescence of the patent owner during the term of a patent notified
to the approving authority as covering that product or its approved
method of use.

Article 17.10:4 of AUSFTA

Where a Party permits, as a condition of approving the marketing of a
pharmaceutical product, persons, other than the person originally
submitting the safety or efficacy information, to rely on evidence or
information concerning the safety or efficacy of a product that was
previously approved, such as evidence of prior marketing approval by
the Party or in another territory:
(a) that Party shall provide measures in its marketing approval
process to prevent those other persons from:
(i) marketing a product, where that product is claimed in a patent; or
(ii) marketing a product for an approved use, where that approved use
is claimed in a patent, during the term of that patent, unless by
consent or acquiescence of the patent owner; and
(b) if the Party permits a third person to request marketing approval
to enter the market with:
(i) a product during the term of a patent identified as claiming the product; or
(ii) a product for an approved use, during the term of a patent
identified as claiming that approved use, the Party shall provide for
the patent owner to be notified of such request and the identity of
any such other person.

Differences between KORUS FTA and AUS FTA and Analysis

1. "Implement measures" vs. "provide measures"

KORUS FTA requires that the Party shall "implement" measures, while
AUS FTA requires that the Party shall "provide" measures. KORUS FTA
seems to require higher obligation than AUS FTA.

In this regard, Korean government explains that during the negotiation
her negotiating team denied accepting the demand of US to include
"automatic stay (30 months)" when a patent holder files a patent
infringement action. Instead it is said to have "agreed to devise an
appropriate way to implement" according to detailed explanations
released by Korean government on May 25, 2007.

2. "patent notified to the approving authority"

This is a new phrase, which is not found in any other FTAs involving
US. Every patent can benefit the approval-patent linkage provision
simply by notifying the drug-approval authority of a patent
information. Further, this phrase eliminates any possible policy
measures, which may be taken by Korea without such a phrase, to
evaluate if a patent is valid or generic drug actually infringes the
patent before applying the linkage benefit to the patent.

3. "patent notified â¦ as covering that product or its approved method
of use" vs. "product/approved use is claimed in a patent"

Patent that covers a pharmaceutical product is much broader than a
patent that claims a pharmaceutical product. For instance, a process
claimed in a patent can cover a product produced by the process. See
Article 28(b) of TRIPS Agreement saying "a party shall confer on its
owner the following exclusive rights â¦ where the subject matter of a
patent is a process, to prevent third parties not having the owner's
consent from the act of using the process, and from the acts of:
using, offering for sale, selling, or importing for these purposes at
least the product obtained directly by that process".

Korean government argues that, with this phrase, only a product patent
and a new use patent are applicable to the linkage provision and any
patents directed to a manufacturing process or packaging are excluded
from the linkage provision. However, it seems that this argument goes
far beyond the actual meaning of the text.

4. "Automatic stay of 30-month"

Neither the KORUS FTA nor the AUS FTA offers means for early
resolution of patent disputes.  The "automatic stay" is a mechanism to
balance the patent linkage system by facilitating the
elimination of weak patents and encouraging timely resolution of
patent disputes under the US law (see GPhA's letter to USTR on March
2, 2006).

I believe that the Korean negotiating team denied the US demand to
insert the "automatic stay" in the linkage provision simply because
they misunderstood the linkage system in FTA and in the US law.

--
HeeSeob Nam
IPLeft (www.ipleft.or.kr)
Mobile: +82 11 470 1180
hurips@gmail.com
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