ࡱ>  @ 'bjbjqq -Tu1 ~ ~ ~  77787tF8L ?xn8R:h:h:h:_A]CCLwwwwwww$zR|w~ ]WM@_A]W]Ww h:h:wi[i[i[]W "h:~ h:wi[]Wwi[i[n r~ juh:8 O37EXt6Zwdx0?xt~}YT}lju }~ ju=DBJxi[NR=D=D=Dww (M[ ( FACT SHEET September 2006 TRIPS and pharmaceutical patents CONTENTS  TOC \t "Heading 3,1,Heading 4,2" Philosophy: TRIPS attempts to strike a balance  PAGEREF _Toc168798748 \h 1 What is the basic patent right?  PAGEREF _Toc168798749 \h 2 A patent is not a permit to put a product on the market  PAGEREF _Toc168798750 \h 2 Under TRIPS, what are member governments obligations on pharmaceutical patents?  PAGEREF _Toc168798751 \h 2 IN GENERAL (see also exceptions)  PAGEREF _Toc168798752 \h 2 ELIGIBILITY FOR PATENTING  PAGEREF _Toc168798753 \h 3 RESEARCH EXCEPTION AND BOLAR PROVISION  PAGEREF _Toc168798754 \h 3 ANTI-COMPETITIVE PRACTICES, ETC  PAGEREF _Toc168798755 \h 4 COMPULSORY LICENSING  PAGEREF _Toc168798756 \h 4 WHAT ARE THE GROUNDS FOR USING COMPULSORY LICENSING?  PAGEREF _Toc168798757 \h 4 PARALLEL IMPORTS, GREY IMPORTS AND EXHAUSTION OF RIGHTS  PAGEREF _Toc168798758 \h 5 THE DOHA DECLARATION ON TRIPS AND PUBLIC HEALTH  PAGEREF _Toc168798759 \h 5 IMPORTING UNDER COMPULSORY LICENSING (PAR.6)  PAGEREF _Toc168798760 \h 6 What does generic mean?  PAGEREF _Toc168798761 \h 7 Developing countries transition periods  PAGEREF _Toc168798762 \h 7 GENERAL  PAGEREF _Toc168798763 \h 7 PHARMACEUTICALS AND AGRICULTURAL CHEMICALS  PAGEREF _Toc168798764 \h 7 For more information  PAGEREF _Toc168798765 \h 8  Philosophy: TRIPS attempts to strike a balance The ϲʹϒs Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) attempts to strike a balance between the long term social objective of providing incentives for future inventions and creation, and the short term objective of allowing people to use existing inventions and creations. The agreement covers a wide range of subjects, from copyright and trademarks, to integrated circuit designs and trade secrets. Patents for pharmaceuticals and other products are only part of the agreement. The balance works in three ways: Invention and creativity in themselves should provide social and technological benefits. Intellectual property protection encourages inventors and creators because they can expect to earn some future benefits from their creativity. This encourages new inventions, such as new drugs, whose development costs can sometimes be extremely high, so private rights also bring social benefits. The way intellectual property is protected can also serve social goals. For example, patented inventions have to be disclosed, allowing others to study the invention even while its patent is being protected. This helps technological progress and technology dissemination and transfer. After a period, the protection expires, which means that the invention becomes available for others to use. All of this avoids re-inventing the wheel. The TRIPS Agreement provides flexibility for governments to fine tune the protection granted in order to meet social goals. For patents, it allows governments to make exceptions to patent holders rights such as in national emergencies, anti-competitive practices, or if the right-holder does not supply the invention, provided certain conditions are fulfilled. For pharmaceutical patents, the flexibility has been clarified and enhanced by the 2001 Doha Declaration on TRIPS and Public Health. The enhancement was put into practice in 2003 with a decision enabling countries that cannot make medicines themselves, to import pharmaceuticals made under compulsory licence. In 2005, members agreed to make this decision a permanent amendment to the TRIPS Agreement, which will take effect when two thirds of members accept it. What is the basic patent right? Patents provide the patent owner with the legal means to prevent others from making, using, or selling the new invention for a limited period of time, subject to a number of exceptions. A patent is not a permit to put a product on the market A patent only gives an inventor the right to prevent others from using the patented invention. It says nothing about whether the product is safe for consumers and whether it can be supplied. Patented pharmaceuticals still have to go through rigorous testing and approval before they can be put on the market. Under TRIPS, what are member governments obligations on pharmaceutical patents? IN GENERAL (see also exceptions) Patenting: ϲʹ members have to provide patent protection for any invention, whether a product (such as a medicine) or a process (such as a method of producing the chemical ingredients for a medicine), while allowing certain exceptions. Article27.1. Patent protection has to last at least 20 years from the date the patent application was filed. Article33 Non-discrimination: Members cannot discriminate between different fields of technology in their patent regimes. Nor can they discriminate between the place of invention and whether products are imported or locally produced. Article27.1 Three criteria: To qualify for a patent, an invention has to be new (novelty), it must be an inventive step (i.e. it must not be obvious) and it must have industrial applicability (it must be useful). Article27.1 Disclosure: Details of the invention have to be described in the application and therefore have to be made public. Member governments have to require the patent applicant to disclose details of the invention and they may also require the applicant to reveal the best method for carrying it out. Article29.1 ELIGIBILITY FOR PATENTING Governments can refuse to grant patents for three reasons that may relate to public health: inventions whose commercial exploitation needs to be prevented to protect human, animal or plant life or health Article27.2 diagnostic, therapeutic and surgical methods for treating humans or animals Article27.3a certain plant and animal inventions Article27.3b. Under the TRIPS Agreement, governments can make limited exceptions to patent rights, provided certain conditions are met. For example, the exceptions must not unreasonably conflict with the normal exploitation of the patent. Article30. RESEARCH EXCEPTION AND BOLAR PROVISION Many countries use this provision to advance science and technology. They allow researchers to use a patented invention for research, in order to understand the invention more fully. In addition, some countries allow manufacturers of generic drugs to use the patented invention to obtain marketing approval for example from public health authorities without the patent owners permission and before the patent protection expires. The generic producers can then market their versions as soon as the patent expires. This provision is sometimes called the regulatory exception or Bolar provision. Article30 This has been upheld as conforming with the TRIPS Agreement in a ϲʹ dispute ruling. In its report adopted on 7April2000, a ϲʹ dispute settlement panel said Canadian law conforms with the TRIPS Agreement in allowing manufacturers to do this. (The case was titled Canada Patent Protection for Pharmaceutical Products) ANTI-COMPETITIVE PRACTICES, ETC The TRIPS Agreement says governments can also act to prevent patent owners and other holders of intellectual property rights from abusing intellectual property rights, unreasonably restraining trade, or hampering the international transfer of technology. Articles8 and40 COMPULSORY LICENSING Compulsory licensing is when a government allows someone else to produce the patented product or process without the consent of the patent owner. In current public discussion, this is usually associated with pharmaceuticals, but it could also apply to patents in any field. The agreement allows compulsory licensing as part of the agreements overall attempt to strike a balance between promoting access to existing drugs and promoting research and development into new drugs. But the term compulsory licensing does not appear in the TRIPS Agreement. Instead, the phrase other use without authorization of the right holder appears in the title of Article31. Compulsory licensing is only part of this since other use includes use by governments for their own purposes. Compulsory licensing and government use of a patent without the authorization of its owner can only be done under a number of conditions aimed at protecting the legitimate interests of the patent holder. For example: Normally, the person or company applying for a licence must have first attempted, unsuccessfully, to obtain a voluntary licence from the right holder on reasonable commercial terms Article31b. If a compulsory licence is issued, adequate remuneration must still be paid to the patent holder Article31h. However, for national emergencies, other circumstances of extreme urgency or public non-commercial use (or government use) or anti-competitive practices, there is no need to try for a voluntary licence Article31b. Compulsory licensing must meet certain additional requirements. In particular, it cannot be given exclusively to licensees (e.g. the patent-holder can continue to produce), and usually it must be granted mainly to supply the domestic market. WHAT ARE THE GROUNDS FOR USING COMPULSORY LICENSING? The TRIPS Agreement does not specifically list the reasons that might be used to justify compulsory licensing. In Article31, it does mention national emergencies, other circumstances of extreme urgency and anti-competitive practices but only as grounds when some of the normal requirements for compulsory licensing do not apply, such as the need to try for a voluntary licence first. Doha declaration 5(b) and (c) PARALLEL IMPORTS, GREY IMPORTS AND EXHAUSTION OF RIGHTS Parallel or grey-market imports are not imports of counterfeit products or illegal copies. These are products marketed by the patent owner (or trademark- or copyright-owner, etc) or with the patent owners permission in one country and imported into another country without the approval of the patent owner. For example, suppose company A has a drug patented in the Republic of Belladonna and the Kingdom of Calamine, which it sells at a lower price in Calamine. If a second company buys the drug in Calamine and imports it into Belladonna at a price that is lower than company As price, that would be a parallel or grey import. The legal principle here is exhaustion, the idea that once company A has sold a batch of its product (in this case, in Calamine), its patent rights are exhausted on that batch and it no longer has any rights over what happens to that batch. The TRIPS Agreement simply says that none of its provisions, except those dealing with non-discrimination (national treatment and most-favoured-nation treatment), can be used to address the issue of exhaustion of intellectual property rights in a ϲʹ dispute. In other words, even if a country allows parallel imports in a way that another country might think violates the TRIPS Agreement, this cannot be raised as a dispute in the ϲʹ unless fundamental principles of non-discrimination are involved. The Doha Declaration clarifies that this means that members can choose how to deal with exhaustion in a way that best fits their domestic policy objectives. Article6 and Doha declaration5(d) THE DOHA DECLARATION ON TRIPS AND PUBLIC HEALTH Some governments were unsure of how these TRIPS flexibilities would be interpreted, and how far their right to use them would be respected. The African Group (all the African members of the ϲʹ) were among the members pushing for clarification. A large part of this was settled at the Doha Ministerial Conference in November 2001. In the main Doha Ministerial Declaration of 14 November 2001, ϲʹ member governments stressed that it is important to implement and interpret the TRIPS Agreement in a way that supports public health by promoting both access to existing medicines and the creation of new medicines. They therefore adopted a separate declaration on TRIPS and Public Health. They agreed that the TRIPS Agreement does not and should not prevent members from taking measures to protect public health. They underscored countries ability to use the flexibilities that are built into the TRIPS Agreement, including compulsory licensing and parallel importing. And they agreed to extend exemptions on pharmaceutical patent protection for least-developed countries until 2016. On one remaining question, they assigned further work to the TRIPS Council to sort out how to provide extra flexibility, so that countries unable to produce pharmaceuticals domestically can obtain supplies of copies of patented drugs from other countries. (This is sometimes called the Paragraph 6 issue, because it comes under that paragraph in the separate Doha declaration on TRIPS and public health.) IMPORTING UNDER COMPULSORY LICENSING (PAR.6) Article 31(f) of the TRIPS Agreement says products made under compulsory licensing must be predominantly for the supply of the domestic market. This applies to countries that can manufacture drugs it limits the amount they can export when the drug is made under compulsory licence. And it has an impact on countries unable to make medicines and therefore wanting to import generics. They would find it difficult to find countries that can supply them with drugs made under compulsory licensing. The legal problem for exporting countries was resolved on 30August2003 when ϲʹ members agreed on legal changes to make it easier for countries to import cheaper generics made under compulsory licensing if they are unable to manufacture the medicines themselves. When members agreed on the decision, the General Council chairperson also read out a statement setting out members shared understandings on how the decision would be interpreted and implemented. This was designed to assure governments that the decision will not be abused. The decision actually contains three waivers: Exporting countries obligations under Article 31(f) are waived any member country can export generic pharmaceutical products made under compulsory licences to meet the needs of importing countries. Importing countries obligations on remuneration to the patent holder under compulsory licensing are waived to avoid double payment. Remuneration is only required on the export side. Exporting constraints are waived for developing and least-developed countries so that they can export within a regional trade agreement, when at least half of the members were categorized as least-developed countries at the time of the decision. That way, developing countries can make use of economies of scale. Carefully negotiated conditions apply to pharmaceutical products imported under the system. These conditions aim to ensure that beneficiary countries can import the generics without undermining patent systems, particularly in rich countries. They include measures to prevent the medicines from being diverted to the wrong markets. And they require governments using the system to keep all other members informed, although ϲʹ approval is not required. At the same time phrases such as reasonable measures within their means and proportionate to their administrative capacities are included to prevent the conditions becoming burdensome and impractical for the importing countries. All ϲʹ member countries are eligible to import under this decision. But 23 developed countries have announced voluntarily that they will not use the system to import: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Japan, Luxembourg, Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom and the US. After they joined the EU in 2004, another10 countries have been added to the list: Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic and Slovenia. And 11 more said they would only use the system to import in national emergencies or other circumstances of extreme urgency: Hong Kong China, Israel, Korea, Kuwait, Macao China, Mexico, Qatar, Singapore, Chinese Taipei, Turkey, United Arab Emirates. After that, several potential exporting countries changed their laws and regulations in order to implement the waivers and to allow production exclusively for export under compulsory licence. At the time of writing (September 2006) Norway, Canada, India and the EU have formally informed the TRIPS Council that they have done so. The 2003 waivers are interim; the ultimate goal is to amend the TRIPS Agreement itself, and a decision to do this was reached in December2005, accompanied again by a chairpersons statement. The amendment a direct translation of the waivers enters into force when two thirds of members accept it. What does generic mean? Dictionaries tend to define a generic as a product particularly a drug that does not have a trademark. For example, paracetamol is a chemical ingredient that is found in many brandname painkillers and is often sold as a (generic) medicine in its own right, without a brandname. This is generic from a trademark point of view. Sometimes generic is also used to mean copies of patented drugs or drugs whose patents have expired generic from a patent point of view. This is not necessarily different since patented drugs are almost always sold under a brandname or trademark. When copies of patent drugs are made by other manufactures, they are either sold under the name of the chemical ingredient (making them clearly generic), or under another brandname (which means they are still generics from the point of view of patents). Whether a drug is generic is one question. Whether it infringes intellectual property rights and is pirated or counterfeit is a separate question. Generic copies are legal from the patent point of view when they are made after the patent has expired or under voluntary or compulsory licence but pirated and counterfeit products are by definition illegal. Developing countries transition periods GENERAL Developing countries and economies in transition from central planning did not have to apply most provisions of the TRIPS Agreement until 1January 2000. The provisions they did have to apply deal with non-discrimination. Article65.2 and 65.3 Least-developed countries were given until 1January 2006. Article66.1. On 30November2005, members agreed to extend the deadline to 1July2013, or to the date a country is no longer least-developed, if that is earlier. For pharmaceutical patents this is extended to 2016 under the Doha Declaration on TRIPS and Public Health. Most new members who joined after the ϲʹ was created in 1995 have agreed to apply the TRIPS Agreement as soon as they joined. Determined by each new members terms of accession PHARMACEUTICALS AND AGRICULTURAL CHEMICALS Some developing countries delayed patent protection for pharmaceutical products (and agricultural chemicals) until 1January 2005. This was allowed under provisions that say a developing country that did not provide product patent protection in a particular area of technology when the TRIPS Agreement came into force (on 1January1995), has up to 10 years to introduce the protection. Article65.4 However, for pharmaceuticals and agricultural chemicals, countries eligible to use this provision (i.e. countries that did not provide protection on 1January1995) had two obligations. They had to allow inventors to file patent applications from 1January 1995, even though the decision on whether or not to grant any patent itself need not be taken until the end of this period Article70.8. This is sometimes called the mailbox provision (a metaphorical mailbox is created to receive and store the applications). The date of filing is significant, which is why the mailbox provisions were set up. It is used for assessing whether the application meets the criteria for patenting, including novelty (newness). And if the government allowed the relevant pharmaceutical or agricultural chemical product to be marketed during the transition period, it had to subject to certain conditions provide the patent applicant an exclusive marketing right for the product for five years, or until a decision on a product patent was taken, whichever was shorter. Article70.9 Which countries used the extra transition period under Article65.4, wholly or partially? The answer is not entirely straightforward. Thirteen ϲʹ members Argentina, Brazil, Cuba, Egypt, India, Kuwait, Morocco, Pakistan, Paraguay, Tunisia, Turkey, United Arab Emirates and Uruguay notified mailbox systems to the TRIPS Council, indicating that at the time they did not grant patent protection to pharmaceutical products. It is possible that a few other members should have notified the ϲʹ but did not do so.  SHAPE \* MERGEFORMAT  For more information The ϲʹ websites gateway to TRIPS:  HYPERLINK http://www.wto.org/english/tratop_e/trips_e/trips_e.htm http://www.wto.org/english/tratop_e/trips_e/trips_e.htm TRIPS, pharmaceuticals and public health:  HYPERLINK "http://www.wto.org/english/tratop_e/trips_e/pharmpatent_e.htm" http://www.wto.org/english/tratop_e/trips_e/pharmpatent_e.htm The Doha Declaration on TRIPS and Public Health:  HYPERLINK "http://www.wto.org/english/tratop_e/trips_e/healthdeclexpln_e.htm" http://www.wto.org/english/tratop_e/trips_e/healthdeclexpln_e.htm The 30August2003 decision on importing and exporting under compulsory licence:  HYPERLINK "http://www.wto.org/english/news_e/pres03_e/pr350_e.htm" http://www.wto.org/english/news_e/pres03_e/pr350_e.htm  PAGE 2 This fact sheet has been prepared by the Information and Media Relations Division of the ϲʹ Secretariat to help public understanding. It is not an official interpretation of the ϲʹ agreements or members positions The TRIPS Agreement Article 7 Objectives The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations. Article 8 Principles 1.Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement. 2.Appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology. The TRIPS Agreement Article 31 Other Use Without Authorization of the Right Holder Where the law of a Member allows for other use of the subject matter of a patent without the authorization of the right holder, including use by the government or third parties authorized by the government, the following provisions shall be respected: [] (b)such use may only be permitted if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder on reasonable commercial terms and conditions and that such efforts have not been successful within a reasonable period of time. This requirement may be waived by a Member in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. In situations of national emergency or other circumstances of extreme urgency, the right holder shall, nevertheless, be notified as soon as reasonably practicable. In the case of public non-commercial use, where the government or contractor, without making a patent search, knows or has demonstrable grounds to know that a valid patent is or will be used by or for the government, the right holder shall be informed promptly; (c) the scope and duration of such use shall be limited to the purpose for which it was authorized, and in the case of semi-conductor technology shall only be for public non-commercial use or to remedy a practice determined after judicial or administrative process to be anti-competitive; [] (f) any such use shall be authorized predominantly for the supply of the domestic market of the Member authorizing such use; [] (h) the right holder shall be paid adequate remuneration in the circumstances of each case, taking into account the economic value of the authorization; [] (k) Members are not obliged to apply the conditions set forth in subparagraphs (b) and (f) where such use is permitted to remedy a practice determined after judicial or administrative process to be anti-competitive. The need to correct anti-competitive practices may be taken into account in determining the amount of remuneration in such cases. Competent authorities shall have the authority to refuse termination of authorization if and when the conditions which led to such authorization are likely to recur; [] The TRIPS Agreement Article 27 Patentable Subject Matter 1. Subject to the provisions of paragraphs2 and 3, patents shall be available for any inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application(5). Subject to paragraph4 of Article65, paragraph8 of Article70 and paragraph3 of this Article, patents shall be available and patent rights enjoyable without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced. 2. Members may exclude from patentability inventions, the prevention within their territory of the commercial exploitation of which is necessary to protect ordrepublic or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment, provided that such exclusion is not made merely because the exploitation is prohibited by their law. 3. Members may also exclude from patentability: (a) diagnostic, therapeutic and surgical methods for the treatment of humans or animals; (b) plants and animals other than micro-organisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes. However, Members shall provide for the protection of plant varieties either by patents or by an effective suigeneris system or by any combination thereof. The provisions of this subparagraph shall be reviewed four years after the date of entry into force of the ϲʹ Agreement. Article 29 Conditions on Patent Applicants 1. Members shall require that an applicant for a patent shall disclose the invention in a manner sufficiently clear and complete for the invention to be carried out by a person skilled in the art and may require the applicant to indicate the best mode for carrying out the invention known to the inventor at the filing date or, where priority is claimed, at the priority date of the application. 2. Members may require an applicant for a patent to provide information concerning the applicants corresponding foreign applications and grants. ________________ (5) For the purposes of this Article, the terms inventive step and capable of industrial application may be deemed by a Member to be synonymous with the terms non-obvious and useful respectively. The TRIPS Agreement Article 70 Protection of Existing Subject Matter [] 8. Where a Member does not make available as of the date of entry into force of the ϲʹ Agreement patent protection for pharmaceutical and agricultural chemical products commensurate with its obligations under Article27, that Member shall: (a) notwithstanding the provisions of PartVI, provide as from the date of entry into force of the ϲʹ Agreement a means by which applications for patents for such inventions can be filed; (b) apply to these applications, as of the date of application of this Agreement, the criteria for patentability as laid down in this Agreement as if those criteria were being applied on the date of filing in that Member or, where priority is available and claimed, the priority date of the application; and (c) provide patent protection in accordance with this Agreement as from the grant of the patent and for the remainder of the patent term, counted from the filing date in accordance with Article33 of this Agreement, for those of these applications that meet the criteria for protection referred to in subparagraph(b). 9. Where a product is the subject of a patent application in a Member in accordance with paragraph8(a), exclusive marketing rights shall be granted, notwithstanding the provisions of PartVI, for a period of five years after obtaining marketing approval in that Member or until a product patent is granted or rejected in that Member, whichever period is shorter, provided that, subsequent to the entry into force of the ϲʹ Agreement, a patent application has been filed and a patent granted for that product in another Member and marketing approval obtained in such other Member. The TRIPS Agreement Article 65 Transitional Arrangements 1. Subject to the provisions of paragraphs 2, 3 and 4, no Member shall be obliged to apply the provisions of this Agreement before the expiry of a general period of one year following the date of entry into force of the ϲʹ Agreement. 2. A developing country Member is entitled to delay for a further period of four years the date of application, as defined in paragraph1, of the provisions of this Agreement other than Articles3, 4 and 5. 3. Any other Member which is in the process of transformation from a centrally-planned into a market, free-enterprise economy and which is undertaking structural reform of its intellectual property system and facing special problems in the preparation and implementation of intellectual property laws and regulations, may also benefit from a period of delay as foreseen in paragraph 2. 4. To the extent that a developing country Member is obliged by this Agreement to extend product patent protection to areas of technology not so protectable in its territory on the general date of application of this Agreement for that Member, as defined in paragraph2, it may delay the application of the provisions on product patents of Section5 of PartII to such areas of technology for an additional period of five years. 5. A Member availing itself of a transitional period under paragraphs 1, 2, 3 or 4 shall ensure that any changes in its laws, regulations and practice made during that period do not result in a lesser degree of consistency with the provisions of this Agreement. Article 66 Least-Developed Country Members 1. In view of the special needs and requirements of least-developed country Members, their economic, financial and administrative constraints, and their need for flexibility to create a viable technological base, such Members shall not be required to apply the provisions of this Agreement, other than Articles3, 4 and5, for a period of 10 years from the date of application as defined under paragraph 1 of Article65. The Council for TRIPS shall, upon duly motivated request by a least-developed country Member, accord extensions of this period. [] The TRIPS Agreement Article 6 Exhaustion For the purposes of dispute settlement under this Agreement, subject to the provisions of Articles3 and 4 nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights. The TRIPS Agreement Article 8 Principles [] 2.Appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology. SECTION 8: CONTROL OF ANTI-COMPETITIVE PRACTICES IN CONTRACTUAL LICENCES Article 40 1. Members agree that some licensing practices or conditions pertaining to intellectual property rights which restrain competition may have adverse effects on trade and may impede the transfer and dissemination of technology. 2. Nothing in this Agreement shall prevent Members from specifying in their legislation licensing practices or conditions that may in particular cases constitute an abuse of intellectual property rights having an adverse effect on competition in the relevant market. As provided above, a Member may adopt, consistently with the other provisions of this Agreement, appropriate measures to prevent or control such practices, which may include for example exclusive grantback conditions, conditions preventing challenges to validity and coercive package licensing, in the light of the relevant laws and regulations of that Member. [] The TRIPS Agreement Article 30 Exceptions to Rights Conferred Members may provide limited exceptions to the exclusive rights conferred by a patent, provided that such exceptions do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties. The Doha declaration 5.Accordingly and in the light of paragraph 4 above, while maintaining our commitments in the TRIPS Agreement, we recognize that these flexibilities include: [] (b)Each Member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted. (c)Each Member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crises, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a national emergency or other circumstances of extreme urgency. (d)The effect of the provisions in the TRIPS Agreement that are relevant to the exhaustion of intellectual property rights is to leave each Member free to establish its own regime for such exhaustion without challenge, subject to the MFN and national treatment provisions of Articles 3 and 4. 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