New Report Urges ASEAN Markets to Strengthen Intellectual Property Rights

Across Southeast Asia, governments are working to build knowledge economies. Their success will depend on a variety of factors, such as tax, regulatory efficiency and skills policies. It will also require certainty for both local and foreign investors in intellectual property (IP) rights. If this protection is weak or enforcement of it is poor, local companies will be unlikely to invest in developing new technologies. And international companies will be less likely to enter into partnerships with local companies for R&D or manufacturing.

A new report by the global think tank Geneva Network urges the ASEAN region to strengthen IP protections as a way to support a shift toward innovation and higher-value knowledge-based goods and services. The report, entitled “The importance of Intellectual Property Rights for progress; A reform agenda for ASEAN countries,” recommends aligning IP systems with the highest global standards to attract foreign investors, integrate into global supply chains and support local businesses and entrepreneurs.

The report cited Singapore as the regional leader in the “frontier” phase of innovation, due to its strong local R&D capabilities. Malaysia and Thailand are in the “catch-up” phase according to the report, but both have significant potential to grow their already high innovation capabilities as their economies grow. While the Philippines, Indonesia and Vietnam have made significant progress, these countries are still in the “learning” phase of innovation.

To be effective, the report said an IP system should have three key elements:

• It must provide fair and effective incentives for innovation,
• It must provide innovators certainty regarding their rights, and
• It must offer strong enforcement tools for defending intellectual property rights.

While ASEAN countries have the IP basics in place – in line with their commitments under the WTO TRIPS Agreement – they vary greatly in the scope of IP rights provided, the ease with which innovations can be registered and overall enforcement.

The report cites compulsory licensing – where a government breaks a patent on an innovative product – as an example that could harm investor confidence in the biopharmaceutical industry. In recent years, this tool has been used in Malaysia and Indonesia to lower drug costs. However, in reality, the threat and use of compulsory licenses is more likely to reduce choice in the medicines that are available and restrict patient access to them.

“Undermining intellectual property rights in this way deters private sector investment in the healthcare ecosystem, which undermines choices for patients,” the report concluded.

In addition, regulatory data protection was cited in the report as an increasingly important form of IP for biological medicines. Innovators of new medicines need time to recoup the costs of compiling clinical trials data before that data is made available to generic or biosimilar manufacturers to use in their own approval applications. In the case of biologic medicines, the protection of clinical trial data is important because patents alone may not provide sufficient protection. Indonesia, the Philippines and Thailand do not yet provide this form of IP protection. Malaysia offers no protection for biologic medicines.

The Geneva Network, a UK-based public policy think tank, worked with ASEAN think tanks based in Malaysia, Indonesia, Philippines, Vietnam and Thailand to produce the report.

The full text can be found at: https://geneva-network.com/wp-content/uploads/2019/09/IPR-ASEAN.pdf