Patents Amendment Act 2002
With effect from 19 December 2002, the New Zealand Parliament has passed a small but significant amendment to the Patents Act. The new provision (section 68B) provides that:"It is not an infringement of a patent for a person to make, use, exercise or vend the invention concerned solely for uses reasonably related to the development and submission of information required under New Zealand law or the law of any other country that regulates the manufacture, construction, use, or sale of any product".
The effect of the provision that it is no longer an infringement for a party to apply for regulatory approval for, say, a generic equivalent pharmaceutical or animal remedy prior to the expiry in New Zealand of patents governing the original product. Similarly it will not be an infringement to manufacture samples and conduct testing if required to meet regulatory requirements for registration either in New Zealand or under the law of any other country.
The New Zealand provision was taken from section 55.2(1) of the Canadian Patents Act. The Canadian provision was itself the subject of challenge before the WTO by the EU. In a lengthy decision issued on 17 March 2000, a WTO Panel upheld the Canadian provision, ruling that it was not inconsistent with Articles 27.1, 28.1, and 30 of the TRIPs Agreement.
The WTO Panel accepted arguments that the Canadian provision did nothing to impair the patentee's rights to exploit its patent for the full term of protection. Nothing in the TRIPs Agreement was intended to give a patent owner an extension to the prescribed period of a patent. In view of the time required for registration of pharmaceuticals, failure to allow pre-expiry testing would lead to a delay in competition after the expiry of the patent, and a de facto extension of a patent - thus allowing the patent owner to gain a "windfall monopoly". The WTO Panel held that this was not a consequence intended by the TRIPs Agreement.