412. South Africa wishes to continue the discussion on the linkage between intellectual property and competition law and policy based on the documents which are contained in the circulated document IP/C/651, which includes inter alia IP/C/643; IP/C/W/649 and Addenda.
413. We wish to continue this debate with specific reference to exploitative excessive pricing and restrictive practices such as reverse payment agreements, strategic patenting and more lately, the evolution of niche pricing of off-patent pharmaceuticals.
414. The discussion has gone through various phases of debate, based on underlying guiding questions. During the TRIPS Council meeting of 5 and 6 June 2018, co-sponsors endeavoured to enhance the understanding of Members of the various approaches to competition law and policy and how competition norms are used to prevent or deter practices such as collusive pricing or the use of abusive clauses in licensing agreement that unreasonably restrict access to new technology and prevent the entry of generic companies and may result in higher prices for medicine.
415. We specifically pointed out that while the TRIPS Agreement sets "minimum norms" for standards of IP protection that significantly limit Members' discretion on a large number of IP rights issues, it is however not the case with competition law.
416. During the TRIPS Council meeting of 8 and 9 November 2018, we intensified the debate by pointing out that over the course of time clearer competition policy treatment of IPRs has evolved through either iterative processes or the evolving practice of competition authorities. This development, as we argued, underscored the need for further debate and analysis since competition law and policy is no longer the preoccupation of only a few jurisdictions.
417. A recent publication of the European Commission entitled "Competition Enforcement in the Pharmaceutical Sector (2009 – 2017)" sheds light on the efforts of European competition authorities to ensure affordable and innovative medicine. It should be noted that not all jurisdictions prohibit exploitative excessive pricing, however excessive pricing models may often be indicators of underlying competition problems. Unlike the binding minimum standards of intellectual property protection and enforcement contained in the TRIPS Agreement, there is no equivalent international legal instrument for competition law that would provide such minimum standards of protection.
418. Competition policy has an important role to play in ensuring fair access to medical technology and fostering innovation in the pharmaceutical sector. WTO Members have absolute policy space under international law to design their national competition laws in accordance with their domestic interests and needs and the level of their development.
419. We want once again to urge Members to share their national experiences and examples of how competition law is used to achieve public health and related national objectives. Debate and information exchange could serve to enhance the understanding of Members of various approaches to the use of competition law and policy to prevent or deter practices such as: collusive pricing or the use of abusive clauses in licensing agreements that unreasonably restrict access to new technology, the use of measures that prevent the entry of generic companies and result in higher prices for medicines, reverse payment agreements and strategic patenting, patent thickets and product switching.
420. We also focus on capacity building and technical assistance which remains an important means to enable WTO Members to increase their capacity to administer and implement policies that ensure access to medicines within the TRIPS flexibilities framework.
421. We also have a list of questions circulated in document IP/C/W/651. I will focus in questions 4 and 5 only:
(4) Have any Members recently conducted market inquiries into the pharmaceutical sector to assess its impact on access to medicine or more generally the impact of the pharmaceutical sector on competition in particular market segments? If so, what were the findings and what remedial actions were recommended or taken?
(5) To what extent can technical assistance and capacity building contribute to the delivery of more effective policies by WTO Members in the field of competition law to address the abuse of intellectual property rights? What role can international organisations play in this regard, including the WTO?