291. I would like to take the opportunity to update Members on a new element of UNCTAD's activities related to IP. Building on the results of UNCTAD's capacity building and policy advice for developing countries related to the implementation of the TRIPS Agreement, we now consider it important to assist developing countries in the support of technology-based industries and job creation, in areas such as pharmaceuticals, biotechnology, information and communication technology, and agricultural technologies. With a view to improving living conditions in beneficiary countries, avoiding brain drain and large-scale migration, it is essential to help developing countries move away from their dependence on natural resources and cheap labor. The fast-growing percentage of young people in developing country societies and the expected impact of artificial intelligence and robotics on currently existing employment in the processing industry call for a shift toward more knowledge-based economies. Technology plays a key role in this respect, and technology transfer for developing countries is crucial.
292. This is where our future activities in IP are intended to take place. In our work, we have seen that voluntary, contractual licenses may provide a key avenue for technology transfer in developing countries and may at the same time open new markets for foreign investors. Well negotiated contracts can create win-win situations for both the foreign investor and the domestic partner in a developing country. This has been demonstrated in a series of case studies on "Local Production of Pharmaceuticals and Related Technology Transfer in Developing Countries" that UNCTAD published in 2011. In that context we found that contractual agreements between a foreign investor – which could be a patent holding pharmaceutical company or a generic company – and a local producer were important sources of technological know-how that assisted local producers in meeting WHO Good Manufacturing Practices (GMP). For example, we analysed a case where a foreign investor authorized a local manufacturer to use the investor's trademark to sell locally produced products in the host country, in exchange for the right to benefit from the domestic producer's distribution network. The licensor of the trademark agreed to provide GMP training to the licensee to ensure the good reputation of the trademark. We found beneficial effects in terms of contractual know-how transfer in countries at very different stages of development, for example Argentina, Bangladesh, Colombia, Ethiopia, Indonesia, Jordan, and Uganda.
293. All of this being said, we have also seen in our work that the private sector in many least-developed countries and developing countries has very little capacity in understanding and negotiating a contractual license. This lack of capacity not only concerns IP licenses, but likewise contracts on research collaboration, technology transfer, joint ventures, and other transactions involving technology. To our knowledge this problem has not been sufficiently addressed by the providers of technical cooperation.
294. In our view, this represents a missed opportunity for technology transfer and foreign investment that we intend to address. We wish to promote mutually beneficial contractual arrangements. We intend to cooperate with the Medicines Patent Pool (MPP), which in informal consultations confirmed the need to build capacities in developing countries to better understand patent licenses. UNCTAD could complement the work of the MPP in that respect. In addition, we would seek to build capacities of pharmaceutical producers based in countries that are usually excluded from MPP licenses, considering that some of these countries are seriously affected by certain diseases and at the same time provide interesting markets for foreign investors. Finally, we intend to go beyond the area of pharmaceuticals and will seek to build capacities in contracts related to other areas of technology that are important to help developing countries become less dependent on commodities, such as biotechnology, agricultural technologies, and information and communication technologies.
295. Importantly, we will not address contractual licenses in isolation. Foreign investors will only engage with local producers where the latter have acquired a certain degree of technological capacity. We therefore intend to advise developing country governments on the design of appropriate IP and investment frameworks that are conducive to the acquisition of domestic technological capacity and an improved R&D framework. One example is the promotion of linkages between public universities and R&D institutions on the one hand and the domestic industry on the other. Other examples relate to the adaptation of domestic IP frameworks to recent technological developments in big data solutions and artificial intelligence, and the design of incentives to more effectively address technology solutions for antimicrobial resistance.
296. We would like to invite development cooperation partners to approach us for further discussion.
