Distrito Federal – Brasilia to the World

An Open Invitation to President Lula...


Patents are social contracts between the public and inventors. In exchange for sharing enabling disclosures on inventions with the public, the inventor may receive a limited-time market restriction around third party commercial exploitation of the invention. For two decades, a fundamental misunderstanding has been promoted by industrialized countries – most robustly supported by the WTO and its TRIPS agreement – focusing on the rights of patent holders. Galvanized around the treatments for HIV/AIDS, marginalized countries have been coerced into debating these presumed rights while offering no attention or voice to the other half of the social contract – namely, the public interest. Every patent is required to contain the disclosure – the recipe if you will – for how a skilled person can replicate the invention. If it does not provide such clarity, it is not a legal patent and any untaught claim is unenforceable. Pharmaceutical companies have extorted vast sums from marginalized countries under the “compulsory license” concessions derived from costly battles around patent estates. In most instances, the combatants in the battles waged on drugs, technology, communications, and defense, have overlooked two glaring omissions.


First, with few exceptions, the platform compounds for most key pharmaceuticals are NOT patented in worldwide patent filings. In the most notorious cases of HIV/AIDS drugs, the core compounds were protected in the U.S. and parts of Europe alone. While pharmaceutical companies did file patents on production methods after the fact (and often with complicit patent offices turning a blind eye towards rules of patentability), the core compounds (together with its original production processes) were entirely unrestricted in the majority of the world. The patent thickets constructed by pharmaceutical companies DO NOT limit the use of the compound. They simply restrict the distinct processes of manufacturing in the countries with protection. While the Doha Declaration and other uses of Article 31 of the TRIPS Agreement have co-opted the debate around patents into the nefarious faux concessions for public health interest, all of this sound and fury obscures the real point. In most instances, the countries impacted by patent allegations have an open source alternative to create domestic solutions. These open source alternatives are derived from: 1) failure to file original patents in countries thereby rendering them public access from the first year after filing; and, 2) expired, abandoned or otherwise public domain alternatives which provide freedom to operate alternatives to branded product claims of proprietary positions. Countries from Brazil, to India, to Thailand, have been seduced into debating an untested presumption of rights which must immediately be informed.


Second, as evidenced in the recently-released Global Innovation Commons (debuted in Florianopolis, Brazil in October 2009), hundreds of thousands of patented technologies are described in patents which do NOT enjoy international enforcement rights. If a patent has not been filed in a country, that country is free to use the information for its own market use and can enter into international commerce around the patented invention provided that no commercial activity whatsoever is done in countries of enforcement. Companies selling patented technologies to countries in which the patents enjoy no protection are not capable, under patent law, to defend any unprotected element of technology. [Note: There are instances where companies, realizing their patent filing failures, impose patent-like restrictions by contract.] When resolving Trade Credit Offset obligations, hundreds of multi-national companies seek to receive offset credits from technology transfer however, in most reviewed cases, the patents transferred to countries like China, Brazil, India, Korea, Taiwan, etc. DO NOT EXIST. There is a common misunderstanding around patents. Just because someone has a patent in Europe, for example, does not give them any market restriction rights outside of Europe. A patent is only enforceable in jurisdictions where it is filed. A user of patented technology in other markets is not “stealing intellectual property” (an allegation frequently made by the U.S. Commerce Department on behalf of companies who forgot to protect their assets in emerging markets); rather, it is salvaging an abandoned property option. A patent holder cannot, by virtue of a transfer of a patent, create an asset around something that was not first filed and enforced in the recipient country. A U.S. patent – not filed and in good standing in Brazil – cannot be transferred to Brazil for any value other than value for the Brazilian recipient to limit use in the U.S. market. The patent has NO effect in Brazil and has no restriction on third party use in Brazil.


Brazil’s President Lula has been seen, by many, as an advocate for the world’s marginalized states in the area of WTO’s TRIPS matters. Coming out of the Doha round of WTO negotiations (and I use that term loosely), he was willing to stand up and use the tools that the incumbency had provided him – namely ethical use exemptions for public health under Article 31. However, as he is now coming to the close of his dynamic presidency, I would strongly recommend that he take a game-changing approach. I would suggest that Brazil make an explicit statement that FULLY honors the TRIPS agreement in a way that the industrialized authors of WTO never anticipated. Practically, I would recommend that President Lula:


1. Immediately lay Commons Claim for the public benefit to ALL intellectual property records of patents filed by EVERY patent holder in the world which did not seek Brazilian jurisdiction status;

2. Immediately distribute these Global Innovation Commons patents to academic institutions, state-sponsored research laboratories, small and medium sized enterprises, and nationally domiciled corporations for immediate use in:

a. Domestic research, development, deployment, and commercial use;

b. International commerce between countries in which the same protections were equally ignored;

c. Resolution of Trade Credit Offset obligations (over $13 billion in current obligations associated with foreign technology procurement at present) by inviting foreign patent holders to receive partial offset credit if they teach Brazilian companies how to use their technology and agree to subcontract with the same for production, assembly, or advanced research and development; and,

3. Extend the logic of the Article 31 concession to ALL technologies under the argument that NO right should restrict the use of technologies if the holder is not actively operating in the market. In short, no patent holder should be free to block technologies to clean energy, health care, water, or infrastructure if they are not actively offering the same in the market.


It is time for credible voices like President Lula to frame a global standard that is not merely the best that can be done with the flimsy arguments offered by incumbents – like the compulsory licensing façade built on the untested presumption of validity of patents – but to raise the standard to say that the world now stands to take seriously the public interest in the patent contract. We the people, in exchange for true disclosures of technologies that advance our well-being, will offer limited market protections to those who disclose true advances and make those disclosures to all humanity. If the patent holder ignores any country or its people, the social contract not only is not enforceable there, but the ignored places must unite to use the open source created by arrogance and ignorance and create the Generic Innovation Industry – a new force for economic transformation in a new global economy. And if Merck, and its monopolistic allies, fear that this will provide a “chilling effect on research” (http://news.bbc.co.uk/2/hi/americas/6626073.stm), then they are clearly not the right company to address the world’s greatest challenges. I trust that President Lula uses his final months in the Presidency to fully unleash Brazil’s creative engine for global transformation. By this summer, we should see Open Source cellulosic ethanol production, Open Source desalination; Open Source agro-industry; Open Source bio-technology; Open Source high speed transportation; Open Source everything.

The World needs this leadership at a time when the industrial incumbents are now alleging hollow patent estates blocking climate, food, water, communications, power, and health technology deployments. If we're going to be serious as a human race about our intractable challenges, we must have accountability for the fact that most of what we're looking for is already here - just buried out of sight by those who profit from the perpetuation of the status quo.