Last Tuesday the UK’s Supreme Court delivered their verdict in the “prorogation of Parliament” case and found that the advice provided to the Queen was unlawful with the effect that prorogation had never happened. Parliament was duly recalled on Wednesday where the Speaker directed that the item in the Journal of the House of Commons relating to Prorogation was to be expunged and replaced with a reference to the House being adjourned instead.
The Commons session last Wednesday went ahead with a series of Urgent Questions and the atmosphere in the chamber steadily deteriorated as things went on. Last week also marked the return to UK TV of the show The Good Place, and in honour of that show and its main character Eleanor Shellstrop, the session in Parliament last Wednesday could probably fairly be summed up as a forking shirtshow.
Lost a little in the noise generated by the Supreme Court decision and the subsequent recall of Parliament however was an announcement from Labour in Jeremy Corbyn’s conference speech (and associated policy paper) regarding medicines and the use of the patent system.
Labour’s Policy Paper & Corbyn’s Conference Speech
The conference speech can be found here and the relevant part comes just over halfway through when Corbyn turns to the drug Orkambi and the failure of the manufacturer recently to agree a price with the NHS for the supply of that drug. The policy paper can be found here.
[Side note: IPcopy would like to give a special mention to the cruel son of a bench who thought listing 172 footnotes using Roman numerals1 would be a reader friendly way to go with structuring the paper (“is that clxxi or cixxi?“).]
Nice Patent Monopoly you’ve got there….be a shame if something were to happen to it….
Part of Labour’s solution to the drug pricing issue is to invoke the prospect of compulsory or Crown Use licences to enable “a government to issue a license to another manufacturer to produce a generic version of a patented drug at a lower price”. When the Orkambi issue cropped up a few months ago the possibility of compulsory licensing was floated and presumably this suggestion has mutated into the policy paper that Labour has published.
Speaking as someone who doesn’t normally find their professional area reflected in political publications to such a degree, the policy paper is something of a frustrating read and IPcopy’s copy of the paper is littered with comments like “this is the point of the patent system!”, “that’s not what reference lix says” or simply “!!!”. There’s also the odd outbreak of conjecture and speculation within the paper and a persistent tendency, in IPcopy’s opinion, to reference a third party source without quite ever managing to reflect the actual meaning or conclusions of the source in question.
The parts of most interest to IPcopy however are the sections which reference Crown Use (see sections 55-59 of the UK Patents Act 1977). These sections provide the Crown with the ability to use patented inventions without the consent of the patent proprietor but require the proprietor to be compensated (section 55(4) PA1977). Compensation is meant to be on the basis of a willing licensee/licensor arrangement. It is also noted that section 57A, which was added by the Copyright, Designs and Patents Act 1988, provides for compensation for loss of profit. Section 57A is in addition to the compensation due under s55(4).
The Labour paper explicitly references (see Chapter 3, Box 62 of the paper) the case for Crown Use and Orkambi. Cases of Crown Use are very rare3. As a result the provisions of s57A have not, as far as we (or indeed the paper) are aware, been tested in court. The Labour paper spins this lack of legal precedent in an “interesting” way by suggesting that this section of the Patents Act could be construed such that there is “no responsibility to pay such compensation in such cases”. Given that the effect of section 57A could noticeably increase the compensation payable for Crown use IPcopy is not so certain that a court would agree with the Labour policy paper position. Perhaps acknowledging this possibility however, the paper suggests that the “there may be a need to revise the law”. The paper is apparently silent on (overlooks?) the provisions of section 55(4).
Careful, you don’t TRIP(S)
Revising the law to make it more financially attractive to use the Crown Use provisions might be what the paper suggests but IPcopy would think this would run into difficulties as it would presumably be in conflict with the provisions of TRIPS (in particular Article 31 TRIPS) which state that “the right holder shall be paid adequate remuneration in the circumstances of each case, taking into account the economic value of the authorization”.
A Golden Age for Patent Litigators?
Both the provisions in the UK Patents Act and also the provisions of TRIPS would seem to provide patent rights holders with ample opportunity to challenge any government that embarked on either a policy of repeated use of the Crown Use provisions or an attempt to change the law in this area. In fact the paper in its current form seems to be a blueprint for patent litigators having a lot of work to do in the future. Probably not the desired result that Labour are aiming for.
Labour has a traditionally strong message on the NHS so the publication of this report, with this level of change to the current system, seems a little unnecessary. The report even suggests the creation of a state owned generics company which might be a job creator as the report suggests but which would also cost a huge amount of money to build and staff and so would appear to reduce the cost effectiveness of the whole “Medicines for the Many” proposal. There’s also the issue of requiring regulatory approval for any generic drugs this company would produce which for biosimilar cases may not be a simple process.
The issue of high drug prices is, in cases like Orkambi, a difficult situation to observe. Perhaps there are other options that might yield generally lower drug prices such as greater incentives to UK based companies and possibly a change in the regulatory environment?
In any case it will be interesting to see how much of either the conference speech or the policy paper actually make it into the next Labour party manifesto.
A General Election in the UK at some point in the near future is almost guaranteed. Before the election however Boris Johnson will, assuming he doesn’t manage to agree a deal with the EU or convince Parliament to vote for a No Deal Brexit, be required by the Benn Act to request a further extension to the EU departure date to extend it from 31 October 2019 to some point next year.
It is also noted that some of the parties involved in the recent Supreme court case have filed a new action in the Scottish Courts inviting Boris to “Nob Off”. Courts in Scotland have a remedy available to them, which courts in England and Wales do not, to take action if someone refuses to do something they are legally obliged to do. This authority, which formally is known as nobile officium (and also referred to as “nob off”!), means that the court will be asked to use those powers to write to the EU seeking the extension the Benn Act provides for in the event that the Prime Minister refuses.
So, further action for the UK Supreme Court seems likely and October in general looks to be crunch time for politics in the UK which continues to be deeply deeply depressing. That’s without considering that, even once there’s a Brexit deal, we probably still have years of Brexit related shenanigans ahead of us. As another fictional character, Captain Raymond Holt, might sum up the UK political situation, “Everything…is garbage.”
Mark Richardson 3 October 2019
1 Look, a footnote and not a Roman numeral in sight….
2 Technically this is actually the second “box 6” in the paper as the boxes are mislabelled!
3 And to IPcopy’s knowledge there is no centralised resource in government that records when it has been used.