KUALA LUMPUR, March 2 — A powerful American pharmaceutical lobby group has again called for Malaysia to be “blacklisted” for denying sufficient protection of US intellectual property rights and fair market access.
The Pharmaceutical Research and Manufacturers of America (PhRMA), a trade group representing companies in the US pharmaceutical industry, wants Malaysia to be designated a “Priority Foreign Country” in the United States Trade Representative’s (USTR) 2020 Special 301 Report, the same call it made last year. The USTR’s Special 301 Report is an annual review for the agency to identify trade barriers to US companies and products due to intellectual property laws.
The Priority Foreign Country listing is considered the worst classification given to foreign countries. The other listings are Priority Watch List, Watch list, and Monitoring. Malaysia has been classified as a Watch List country — meaning it has been recognised as having “serious intellectual property rights deficiencies” — since 2005.
The USTR is a federal agency responsible for developing and recommending US trade policy to the president. It is a high-ranking office, with its head holding a Cabinet-level position, though it is not technically in the US Cabinet.
In a February 6 statement attached with its submission for the USTR’s annual review, PhRMA said urgent action is required to address serious market access and intellectual property barriers in 24 overseas markets, including Malaysia.
“Biopharmaceutical innovators in the United States face a wide array of damaging pricing policies abroad that free ride on American innovation, threaten billions of dollars in lost sales, and put American jobs and exports at risk,” it said in its review.
“Medicines discovered and manufactured by PhRMA member companies are the constant target of compulsory licensing and other harmful practices that deny the most basic intellectual property protections necessary to drive discovery and bring new treatments and cures to patients around the world.”
PhRMA singled out Malaysia for purportedly undermining intellectual property (IP) protection, adding if the government’s actions go unaddressed, it could inspire similar “damaging” actions in other countries.
Making the same call as it did last year, PhRMA also urged USTR to take steps to reverse compulsory licensing in Malaysia.
The umbrella group made note of Malaysia’s “non-transparent” move to issue a compulsory license (CL) for a breakthrough innovation US-developed medicine that cures hepatitis C, sofosbuvir.
Malaysia’s compulsory license to obtain generics of sofosbuvir without the drug maker’s consent reportedly only treated 1,501 patients over a 12-month period in 2018. However, cooperative discussions and collaborative access policies like voluntary licensing treated over 15,000 patients over the same period in neighboring Vietnam, said PhRMA.
Voluntary licences are an agreement between originator and generic manufacturers that allows the production and sale of patented drugs in certain countries, subject to licensing terms.
As such, PhRMA said the CL sent a “devastating signal” to American bio-pharmaceutical innovators that their patents are not safe in Malaysia, also noting that the US manufacturer for the drug had decided to include Malaysia in its voluntary licensing program.
Apart from that, it claimed that the Malaysian Ministry of Health or any government agency or ministry did not offer to meet with relevant industry stakeholders to consider their concerns prior to the “sudden” announcement of the CL in 2017 under the Barisan Nasional administration.
“If not met with a forceful US government response, this action carries significant risks of contagion to other markets, which would significantly undermine the current R&D (research and development) model for innovative medicines on which the US pharmaceutical industry and patients around the world rely,” it said.
PhRMA also claimed that Malaysia does not have an effective patent enforcement system that provides for the early resolution of patent disputes before marketing approval is granted to infringing follow-on products during the patent term.
“In addition, its regulatory data protection (RDP) system fails to provide (1) any protection for biologics; and (2) effective protection for a sufficient period of time for chemically synthesized drugs from the date of marketing approval in Malaysia.”
Malaysia requires the marketing authorisation application of the new medicine to be filed within 18 months from the first worldwide regulatory approval in order to be considered as a “new chemical entity” and, thus, eligible for RDP in Malaysia.
But PhrMA said it was “challenging, if not impossible” to meet the 18-month application requirement if the first worldwide registration was not in the EU or the US. If the 18-month deadline is not met, a follow-on molecule can be approved based on the originator’s regulatory data during what PhrMA said should have been the RDP period.
The actual term of the protection in Malaysia is measured from the date of first global approval. So, if a new drug is registered in Malaysia one year after first approval in the world, Malaysia only provides four years of RDP.
“Indeed, the only instance in which an innovator can receive the full five years of RDP in Malaysia is if they seek marketing approval in Malaysia first,” said PhrMA.
“As in other markets that seek to promote research and development into innovative medicines, Malaysia should measure the term of the RDP protection from the time that the new molecule is approved in Malaysia.”
PhrMA added that Malaysia should provide RDP for biologics, medicines made from living organisms.
PhRMA’s member companies strongly encouraged the improvement and adoption of mechanisms in Malaysia that strengthen patent enforcement and the ability to resolve outstanding patent concerns prior to marketing approval and launch of follow-on products.