Better protection of patents and R&D, in Canada, will boost the business relations with the U.S.

In Washington, D.C. there is growing debate regarding the state of intellectual property rights protection. A strong supporter of intellectual property rights, the Property Rights Alliance understands the threat that the pharmaceutical industry faces in their efforts to protect their ability to obtain patents. Furthermore, given recent events, the state of IPR in Canada is deeply concerning. According to the U.S. Chamber of Commerce’s Global Intellectual Property Center’s International IP Index, Canada ranks significantly behind other developed countries, with an influencing factor (among others) being the country’s low grade in its pharmaceutical and enforcement environment.
Canada has instituted higher standards for what is referred to as “patent utility,” which essentially requires innovators (in this case pharmaceutical companies) to provide significantly more evidence and effectiveness of a pharmaceutical product. Despite the numerous years and millions of dollars that companies invest in such goods, if an innovator is unable to meet the new heightened standards of the Canadian government, it opens the doorway for others to copy the work of said businesses and cash in. Furthermore, Canada’s heightened standard for patent utility runs contrary to international norms and the country’s own obligations under the North American Free Trade Agreement (NAFTA) and Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS).
In just three years Canada’s new patent utility requirements have hurt the pharmaceutical industry tremendously, leading to 18 patents to be invalidated in Canada despite the fact that hundreds of thousands of Canadian patients were using said medications and proven to be incredibly safe and effective according to the U.S. Chamber of Commerce. The fact of the matter is that Canada’s new utility requirement is reducing the incentive for companies to invest in potentially lifesaving drugs due to the increased risk of not receiving patent protection.
One of the primary arguments in support of the heightened patent utility is centered around the cost of prescription medication, claiming that patent protection is preventing the access to quality generic medicine. However, such medicines are costly to create and their arguably high cost is reflective of such cost. In a statement, John Castellani, the President and CEO of The Pharmaceutical Research and Manufacturers of America demonstrates the value of new medicine produced by the pharmaceutical industry by highlighting that, the development of a drug to cure Hepatitis C will not only cure people of a debilitating condition, but will also help save the U.S. healthcare system up to $9 billion annually by preventing the need for hospitalizations and liver transplants.
Pharmaceutical companies undoubtedly create lifesaving medication and should be rewarded for it. With the diminishing IP environment in Canada companies are seeing less incentive to create life changing medication and without proper incentives that allow companies to make back the billions of dollars lost in failed and successful medications companies will take less risks, create less and therefore be less able to fund future medications. Instead of constricting the healthcare and pharmaceutical industry governments should look to address the accessibility to such drugs.