Changing Landscape for Multinationals in the Philippine Pharmaceutical Market
In October 2007, the Philippine Senate approved the Quality Affordable Medicine Act. More commonly known as the “Cheap Medicines Bill,” this Act contains many initiatives aimed at lowering drug prices in the Philippines and giving more support to the country's generic drug manufacturers. The Act also includes a number of new regulations regarding intellectual property and drug development.
An important change the Act makes to the patent process is a new restriction of patentable inventions. It explicitly states that the discovery of a new form or new property of a known substance will not merit a patent unless it results in greater efficacy of that substance. This parallels Section 3(d) of India's patent law, which Novartis recently failed to overturn in the Indian courts. Overall, the patent law changes may make “new use” patents harder to obtain and allow generic versions of off-patent medicines to enter the market sooner.
The Act also introduces "parallel importation" to allow generic drugs to enter the Philippine market more quickly. This process allows for importation of patented products from abroad, without the consent of the patent-holder. In other words, a company could import a patented drug marketed in another country and undercut the patent-holder's price on the Philippine market.
Other plans to help generics include “Early Working,” which allows generic companies to develop and test generic versions of a drug in expectation of its patent expiring. In addition, third parties would be able to access data on patented drugs to facilitate the future registration of generic versions. Early Working would make it easier for generic producers to start production and sale of a generic drug immediately after the patent expires.
To increase the use of generics, the Act also requires doctors to only write generic names of drugs on medical prescriptions. In addition, drug outlets would be required to inform all buyers of all other drug products with the same generic name.
The Act also discusses recent Department of Health recommendations on strengthening the Bureau of Food and Drugs (BFAD). These recommendations include expanding the BFAD's research and regulatory capacity, making its administrative structure more flexible, and imposing mandatory disclosure of drug prices sold in foreign markets.
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