IP Regulations in Latin America
February 28th, 2023
The pharmaceutical industry is heavily dependent on Intellectual Property (IP) laws to protect its innovations and drive economic growth. In Q3 2021, a total of 45,048 patents were granted worldwide, with China, the US and Japan being the top countries. This number is expected to rise in the future.
To foster research and development, it is important to secure IP rights, particularly in the pharmaceutical sector. Existing laws need to be strengthened to allow for harsher penalties to safeguard patent owners, creating a more ethical environment for innovation.
The Role of Patent Rights in the Pharmaceutical Industry
Protecting IP is crucial for both a nation's economy and public health. One of the most important IP laws to be established by countries around the world is the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). This agreement was implemented in 1995, however, many developing nations did not fully adopt it until 2000. Even then, it took a further five years for systems for registering and protecting patents for pharmaceuticals to be established. The development of drugs is a costly, lengthy and time-consuming process. Patents protect pharmaceutical companies from competition for a certain period of time, as it prevents others from producing cheaper copies of their products.
The State of IP Rights in Latin America
While Latin American countries are party to the World Trade Organization Agreement on TRIPS, they also have agreements with the United States and European Union through Free Trade Agreements and Economic Partnership Agreements, respectively. These agreements have provisions that further protect IP rights, particularly for originator pharmaceuticals in the region.
In the last year, there have been changes in IP regulations on trademarks, patents, industrial designs, and copyrights in the Latin American region. These changes have been towards stricter measures in securing IP rights. For example, Chile joined the Madrid Protocol, which is a unified database for trademark registration through an application. Additionally, Brazil's court amended its laws on patent terms, extending the validity of patents to 20 years from the date of filing.
One country that is predicted to experience significant changes in IP protection is Mexico. Mexico already has specific laws in place for identifying and protecting patents, trade secrets, and trademarks. These laws are more comprehensive than in other Latin American countries and are expected to evolve further in the future.
Recent Amendments to Mexico’s IP Rights
In 2003, Mexico established a patent linkage system that connects the regulations of two governing bodies: the Mexican Institute of Industrial Property (IMPI) and the Federal Commission for the Protection against Sanitary Risks (COFEPRIS). This system aims to ensure that Sanitary Regulations (SR) filed to commercialize products do not infringe on patent rights.
While the system has been valuable in protecting pharmaceutical IP rights, the process of determining infringement needed further improvement. Both generic and originator companies found some disadvantages to the system due to the complex procedures that took up time and effort for both parties involved.
The recent upgrade of the Free Trade Agreement resulted in the US-Mexico-Canada Agreement (USMCA). Following this international agreement, Mexico abolished its Industrial Property Law (LPI) and enacted the Federal Protection of Industrial Property Law (LFPPI). This restructuring of the laws provided greater security for patent owners, particularly for the pharmaceutical industry. The new Law ensured a more streamlined patent application process and offered more advantages for patent owners, as they are notified of a generic application and can therefore find more avenues ahead of time to resolve potential disputes.
Furthermore, the LFPPI also granted longer validity periods for patents of inventions. The Law also extended terms for patents in case of delay during the filing process. Additionally, the LFPPI allowed changes in the validity period of trademarks, slogans, and trade names with the 10-year term commencing on its approval date rather than on application. It also permitted the partial cancellation of trademarks.
The LFPPI also gave the IMPI the authority to impose and collect fines for infringement, allowing IP owners to claim damages incurred from infringing parties. Overall, these recent amendments to Mexico's IP rights have aimed to increase the protection of IP rights, particularly for the pharmaceutical industry, by streamlining the patent application process and increasing the length of validity periods for patents of inventions, as well as by allowing IP owners to claim damages incurred from infringing parties.
The Future of IP Rights
The Pacific Alliance is a trade bloc of Latin American countries including Chile, Colombia, Mexico, and Peru, where Micro, Small and Medium Enterprises (MSMEs) comprise 95% of employment rates. Through collaboration with the World Intellectual Property Organization (WIPO), small companies in this alliance are provided with tools and strategies to protect their IP rights and increase their competitive advantage.
Brazil has also taken steps to protect IP rights by creating the National Intellectual Property Strategy (ENPI) to run until 2030. Other countries such as Costa Rica and Colombia have also implemented similar strategies.
The pandemic has had an impact on the IP industry, with patent filing levels dropping in the early stages of the pandemic as IP services transitioned to remote operations. However, this trend has since reversed, with patent filing levels reaching a peak in 2021. The IP industry is expecting this trend to continue in the coming years.
In summary, the protection of intellectual property rights is crucial for economic growth and public health. Latin American countries, such as Mexico, have implemented stricter measures to ensure IP rights are upheld, particularly in the pharmaceutical industry.
The recent amendments to Mexico's IP laws, such as the Federal Protection of Industrial Property Law, have streamlined the patent application process and granted longer validity periods for patents. These changes can lead to increased innovation and economic benefits for the country, setting an example for other Latin American nations to follow.
Categories: Avoiding IP Litigation