Parke, Melissa, MP

Ms PARKE (Fremantle) (19:49): Last year, I spoke in broad support of the Intellectual Property Laws Amendment Bill as introduced by the former Labor government. That bill did not pass through the parliament before it was furloughed for the 2013 election. The bill before us is substantially the same in respect of one of the main objectives of the Labor bill; that is, the implementation of the TRIPS protocol in order to assist developing countries to access vital medicines. The TRIPS protocol—that is, the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights, which was agreed by the general council for TRIPS in 2005 and accepted by Australia in 2007—enables pharmaceuticals to be exported under a compulsory license. The aim of the protocol is to encourage patent owners either to practice price differentiation and provide medicines at affordable prices to the least developed and developing countries in need or to issue voluntary licences to generic manufacturers to provide medicines at affordable prices. If the patent owner is unwilling to do this, then the protocol provides a mechanism to force the patent owner to issue a compulsory licence. Much of the world's poor are suffering from treatable diseases including HIV/AIDS, tuberculosis and malaria; yet developing countries are often unable to make essential medicines themselves and cannot afford to buy them at normal market prices. A 2010 study commissioned by the World Health Organization and Health Action International shows that the continuing high price of medicines is having catastrophic effects on the world's poorest people. The WHO has stated that the availability of generic products is a major contributor to reducing the cost of medicines to the poor. We have seen that here in Australia with costs to the PBS being dramatically reduced whenever drugs come off patent and are able to be produced generically. The bill will amend the Patents Act to enable the Federal Court to grant compulsory licences to generic pharmaceutical manufacturers to make and export a patented pharmaceutical product. Patent holders would receive adequate compensation for the use of the patent. While strongly supporting the intent and objective of the legislation, I am concerned that the mechanism being put in place—an application to the Federal Court—is cumbersome and expensive and that this will undermine the very objective of the policy behind this legislation. It is already evident that the generic pharmaceutical industry's capacity to fund expensive court based applications is much reduced by reforms regarding drug pricing introduced by Mr Abbott when he was the health minister in 2005 and the signing of the Australia-United States Free Trade Agreement in which, according to the recently released Pharmaceutical Patents Review: Australia agreed that it would preserve a further extension to patents for pharmaceuticals beyond the twenty years that it had already legislated, without careful regard to whether thus binding ourselves to this policy for the future was in our own economic interest. The Pharmaceutical Patents Review went on to caution: In negotiating such agreements in the future, Australia needs a more active strategic engagement with the issues. While the patent system must be strong to be effective, it should also be parsimonious, avoiding restrictions on trade and innovation that are not necessary for it to deliver incentives to innovate. Beyond this, international negotiations should address critical issues arising from the limitations of patents in providing incentives to innovate, including the need to develop drugs with high social value which are not well rewarded in markets. There are signs that these past failures are being replicated in the current Tran-Pacific Partnership (TPP) negotiations because small, net importers of intellectual property, including Australia, have not developed a reform agenda for the patent system that reflects their own economic interests—and those of the world. Indeed, it must be said that the generics industry is in crisis in Australia due to the continued consolidation of market power by the branded pharmaceutical industry through such practices as evergreening, which are strategies employed to extend the effective period during which a product is covered by patents after initial patent protection has expired—for instance, making very minor changes to drugs and getting extensions on their 20-year patents. An example could be changing a tablet from one that is taken every day to one that is taken every two days. The ability of pharmaceutical companies to evergreen, thereby shutting out generic medicine manufacturers for a longer period at great expense to the PBS, makes a mockery of the patents system, which is supposed to be about offering a limited period of patent protection as a reward for invention that is disclosed to the public. It is not intended to provide a semi-permanent monopoly that can milk the taxpayer indefinitely. The government should, as a matter of urgency, implement the recommendations of the Pharmaceutical Patents Review, which include reducing the maximum effective patent life provided, using part of the associated savings to fund R&D directly, and establishing an external patent oversight committee that is tasked with reviewing grants issued by IP Australia and auditing the decisions involved in making such grants. In the absence of such reforms, longer-term prospects for patent challenges are doubtful and if this is the case the costs to the PBS will rise dramatically going forward, resulting in reduced access to newer and much needed drugs, such as Solvadi hepatitis C treatment. With regard to the implementation of the TRIPS protocol, instead of the court based applications set out in this bill I would support another process such as that in Thailand, where an application for a compulsory licence could be made to the government through the relevant minister. Indeed, any state or federal minister has already available 'crown use' powers that would enable the policy behind the TRIPS protocol to be implemented without further amendment to the Patents Act. As I noted in my speech last year on the bill, crown use is an important safeguard in the Patents Act that allows governments to access patented inventions without the consent of the patent owner. However, despite the fact that crown use provisions have been in the Patents Act since 1903, they have been used only once in this country—in 1916 when Mr Billy Hughes was the Prime Minister, to ensure access to aspirin during WW1. I note the Productivity Commission's recommendations to the effect that the scope of crown use is uncertain and needs to be clarified. In my view, there is no lack of clarity. What is really needed is the political will on the part of state and federal governments to use the existing and available powers. I am, therefore, not unhappy that the crown use provisions in the previous version of the bill, which sought to implement the Productivity Commission's recommendations, have been deleted, since they may actually have reduced the crown's capacity to use its powers. The crown use provisions are in the Patents Act to overcome the kind of despicable behaviour that has been engaged in by corporations like Genetic Technologies and Myriad Genetics, in relation to their patents over human genes and which has led to considerable community concern in recent years. At present in Australia, companies can patent human genes and have monopoly control over those genes for commercial benefit. In my view, and the view of many others, this is wrong on a number of levels. Firstly, it is wrong as a matter of legal principle to allow the patenting of human genes. It is a fundamental principle of patent law—indeed it is the principle upon which the whole patent system is based—that there must be an invention. Clearly, no-one invented our genes—not even the defective cancer-causing ones. Last year, the US Supreme Court in a nine-zero unanimous decision in the Myriad Genetics case found that human genes, whether removed from the human body or not, are products of nature and as such are not patentable subject matter, in the same way that coal extracted from the earth and cotton fibres extracted from cotton seeds are not patentable. Secondly, it is wrong as a matter of public policy to allow patenting of human genes. The grant of a patent is the grant of a monopoly. Gene patents give companies monopolies over genes and prevent others from accessing those genes. The purpose of the patent system is to take something produced in the private domain and, through a period of protection, bring it into the public domain for the benefit of society. But the patenting of nature involves taking something from the public domain and locking it up in the private domain for the benefit of a single commercial entity, which is, in fact, a perversion of the intent of patent law and its protection of the rights of an inventive individual for the benefit of society. This has very real consequences for health researchers and clinicians who need access to genes for their work in diagnosing disease and developing treatments and cures. We are only at the beginning of what we know about human genes, and genes are going to play an even greater role in diagnostics, treatments and personalised medicine. Scientists are finding that diseases like cancers are often caused by multiple genes acting in concert. The more patents we grant over genes the more complex we are making the legal landscape for researchers and those that want to produce new diagnostic treatments and medicines. Thirdly, the patenting of human genes is wrong because genetic information belongs to all of us and it should not be the subject of private property. James Watson, the co-discoverer of the molecular structure of DNA, said: It is as precious a body of knowledge as humankind will ever acquire, with a potential to speak to our most basic philosophical questions about human nature. This is why, when the human genome was decoded 14 years ago, US President Clinton and UK Prime Minister Blair issued a joint statement which said: Raw fundamental data on the human genome, including the human DNA sequence and its variations, should be made freely available to scientists everywhere ... unencumbered access to this information will promote discoveries that will reduce the burden of disease, improve health around the world and enhance the quality of life for all humankind. It is instructive to recount some practical examples of how patents over naturally occurring biological materials are impacting on health research and treatment in Australia. The Chiron Corporation held the patent over the hepatitis C virus. This meant that no-one else could develop alternative and better tests for hepatitis C for 10 years, despite Chiron's own antibody test being largely ineffective. Chiron aggressively protected its patent through lawsuits. This is an example of the chilling effect on research of such patents. What researcher will dare to take on a corporation with deep pockets? Professor Baruch Blumberg of the Fox Chase Cancer Center in Pennsylvania was awarded the Nobel Prize in Medicine and Physiology in 1976 for his work on the hepatitis B virus. During the course of patent litigation between Chiron Corporation and Murex Diagnostics Australia Pty Ltd, Professor Blumberg gave testimony about the impact of Chiron's Australian patent: Based on the unusually broad nature of the patent, if I were a research director for anti-virals and had the option of working on several viruses, the existence of this patent would weigh against my deciding to undertake HCV research. A company, or even an academic laboratory, might well be deterred from conducting research on HCV because the patent is, in effect, intimidating. With the patent as it stands, any investigator, particularly in commercial laboratories (where much of the work on hepatitis has been done) would have to seriously consider that Chiron would bring an action against them if they attempted any commercialization of anything related to HCV. Another example was that highlighted on Four Corners in 2010 of Westmead Hospital in New South Wales, which documented the fact that doctors were sending children's samples to Scotland for epilepsy testing rather than pay the exorbitant fees demanded by Genetic Technologies, which holds the licence to the epilepsy gene patent in Australia. The US corporation Myriad holds the patents over the breast and ovarian cancer genes. The Australian licence holder of the patent is Genetic Technologies. In 2008 Genetic Technologies sent lawyer's letters to all Australian public laboratories ordering them to stop testing for breast cancer, claiming it had the sole right to do so under the patent. In 2010 the Peter MacCallum Cancer Centre gave evidence to a senate committee inquiry that its research into breast and ovarian cancer had been delayed by two years and had ended up costing three times as much because Myriad and Genetic Technologies refused it permission to use the breast and ovarian cancer genes in its research into those cancers. This is appalling behaviour, and yet in Australia it is completely legal. Unfortunately, the US Supreme Court decision that genes are not patentable was not followed by the Australian Federal Court, which on 5 September this year held that Myriad's isolation of the human genes linked to breast and ovarian cancer is an invention under Australian patent law. This has gone on appeal to the High Court, but it could be years before it is finalised. In any event, as the High Court has noted in a previous case, this is the kind of matter that is best left to the legislature, which is why, in my view, amendments are needed to the Patents Act. Such amendments would still allow patents over real inventions such as new diagnostic processes, treatments, medicines and vaccines that use genetic materials in them—for example, Professor Ian Frazer's Gardasil vaccine. The prohibition would only be on the patenting of the underlying genetic material itself, because (a) no-one invented it and (b) because others need to retain access to that basic material to develop alternative treatments and medicines. The biotechnology industry has claimed that without the economic incentives created by gene patents there will be no investment in genetic research—but in fact the opposite is true. Nobel laureates for economics and medicine Professors Joseph Stiglitz and John Sulston, writing in the Wall Street Journal, said: [Gene] patents ... not only prevent the use of knowledge in ways that would most benefit society, they may even impede scientific progress. Every scientific advance is built on those that came before it. There is still a great deal to learn about our genes, particularly how they contribute to disease. Gene patents inhibit access to the most basic information. Further, much of the research that has gone into identifying the genes that have led to gene patents is actually publicly funded. Myriad was only able to discover the genetic mutation for breast cancer by piggybacking on 16 years of publicly-funded research by Professor Mary-Claire King at the University of California, who discovered that the BRCA gene was located on human chromosome 17q. Professor King did not seek to patent her discovery, unlike the gene hunters at Myriad. Finally, I note that most of the voices resisting reform in this area, primarily the biotech industry and patent attorneys, have vested interests. On the other side of the argument, you have those arguing for the community interest: the Cancer Council of Australia, the National Breast Cancer Foundation, the Royal College of Pathologists of Australasia, the Royal Australasian College of Surgeons, the Clinical Oncological Society of Australia, Civil Liberties Australia, many academics, scientists and economists, including numerous Nobel Prize winners, all saying there is something seriously wrong here. I think we should be listening to that community voice and acting accordingly.