All we are saying is give IP a chance...
Sustaining Pharmaceutical Innovation Through a Balance
IP System
Paul Fehlner, Head of Intellectual Property, Novartis Pharma AG
Beijing, China
12 June 2014
Greater than 10 years and 1.5 billion USD to
develop one drug*
Timeline and cost for pharmaceutical innovation
~ 10 years
*Source: The Pharmaceutical Research and Manufacturers of America (PhRMA)
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China calls for more innovations in the “12th FiveYear Plan for the Pharmaceutical Industry”
 Key tasks listed in the five-year plan
1. Increase capability for creating new drugs
2. Improve the quality and safety of drugs
3. Increase capability for producing and supplying essential drugs
4. Facilitate technology transformation of enterprises
5. Optimize the organizational structure
6. Optimize the regional distribution of the industry
7. Accelerate internationalization
8. Promote green development of the industry
9. Improve the informatisation level of the industry
10. Improve drug reserve and emergency response system
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How could a robust IP system promote
pharmaceutical innovations?
 Consistent, unambiguous IP laws
• IP laws are evolving fast in China with active legislative activities.
• Ambiguity and inconsistency should be avoided since legal
uncertainty deters drug development.
 Transparency of administrative and judicial systems
• Sufficient public accessibility to administrative and judicial decisions
is not only important for justice but also for increasing the IP
awareness of the society.
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How could a robust IP system promote
pharmaceutical innovations? – Cont’d
 IP laws through which public benefit is well balanced with
patent rights
• Patentability standards
- Sufficient disclosure requirements:
o enable a person skilled in the art to carry out the invention; or
o experimental data showing technical advantages of the solution
- Retroactive implementation of examination guideline, esp. invalidations
• Fair inventor remuneration
- Pharmaceutical product is a fruit of team effort
- A patent is not sufficient to create a product
- Inventor remuneration may also motivate negative behavior
• Some specifics of pharmaceutical patents
- Bolar exemption vs. patent term extension
- Parallel import
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How could a robust IP system promote
innovations? – Cont’d
 An effective system for enforcing and challenging patents
that allows resolution of disputes before one party is
irreparably damaged
• Patent linkage in the regulatory process (no surprises)
• Revocation action available independently of infringement (‘clearing
the way’)
• Preliminary injunction (avoid irreparable harm)
• Evidence disclosure
• Statutory damages
- Indemnity calculation in the patent law: 1) profit gained by infringement, 2)
patentee’s loss, or 3) reasonable royalty
- Statutory indemnity not exceeding RMB 100 million Yuan – applies to
invention, utility model and design patents
• Unified judicial standard throughout the nation
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Secure today for tomorrow’s world
 Predictable and transparent IP
system
 Balanced IP (especially patent)
requirements
 Effective enforcement and
challenge mechanisms
 We, as innovative industry
leaders, have the obligation to
ensure adequate and fair
protection for innovators and
their innovations
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Acknowledgements
 Zheng Wei
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