Labour’s ‘Medicines for the Many’ Policy – implications for intellectual property

Jeremy Corbyn, Leader of the Labour Party, recently announced a report entitled “Medicines For the Many: Public Health before Private Profit”, which sets out a proposed set of policies on access to medicines in the UK, which are reflected in the Labour Party’s manifesto launched last week. An accompanying press release described the report as “a radical programme of reforms to make life-changing drugs available at affordable prices and create a health innovation system that will put public health before private profit”. In this article, we summarise key aspects of the proposed policies, consider the relevant legal background and analyse potential implications for companies operating in the life sciences sector, with a particular focus on issues relating to intellectual property. We also touch on the potential for companies which may be affected by the Labour Party’s proposed changes to the sector, to look to public law and human rights related avenues of challenge, as well as to investment treaties, to mitigate risk.

Key points

The Medicines for the Many report (the “Report”) envisages a potential future Labour government “actively [using] voluntary and compulsory licenses to secure affordable generic versions of patented medicines where the patented product cannot be accessed”. The Report proposes doing this either via claiming the use of patented inventions for services of the Crown (“Crown Use”), or via applications for compulsory licenses. The powers to access patented medicines in these ways are already provided for in the Patents Act 1977, which also includes provisions for compensation for affected patent owners, but there is little case law on their use in practice.

We envisage that any exercise of the Crown Use or compulsory licence provisions is likely to give rise to litigation over the nature and extent of these powers and associated provisions (such as compensation), particularly given the lack of guidance available from the Courts to date. Decisions by the Government and other public bodies (such as NICE) in connection with the assertion of Crown Use or as part of an application for a compulsory licence must be taken in accordance with public law principles (such as acting within their powers and in a procedurally fair manner), otherwise it may be possible to challenge them by way of judicial review. It is also possible that a compulsory licence or Crown Use might amount to a de facto expropriation or a control on use of property within the meaning of human rights legislation and also as generally protected against in the numerous bilateral investment treaties to which the UK is a party.

Further, since the UK is party to the international Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPS”), any amendments to UK law proposed by a future Labour government in this regard will have to be compliant with the terms of that Agreement. Since TRIPS provides that “unauthorised use”, which includes compulsory licensing and Crown Use, should only be permitted where, amongst other things, a proposed user has first made an effort to obtain a licence on reasonable commercial terms and that a patent owner will be entitled to adequate remuneration, any proposed amendments to the relevant compensation provisions provided for in the Patents Act will have to be considered carefully in this light.

The Report also states that a Labour government intends to review “non-patent monopoly protections on medicines” such as data/marketing exclusivity, SPCs and patentability criteria. However, as regards patentability requirements, since the UK is a signatory to the European Patent Convention, an international agreement that is entirely separate from the European Union and its institutions and as such, not affected by Brexit. Consequently, a UK government’s ability to alter unilaterally the patentability requirements applying to patents in the UK is limited. The UK’s scope to amend provisions on data/marketing exclusivity and SPCs may be similarly limited, subject to the terms of the UK’s exit from the European Union.

It may therefore be difficult for a Labour government to achieve a number of the aims set out in the Medicines for the Many Report without international cooperation.

Read the full briefing here.