Brand new IP-Watch analysis by Frederick Abbott specifically addresses the gray market import of drugs into the US:
Paving the way for parallel imports to exert downward pressure on domestic pharmaceutical prices
Frederick Abbott is Edward Ball Eminent Scholar and Professor of International Law at Florida State University College of Law.
Evidently this had been on the radar concerning pharma for quite a while, according to ipwatch in this 2015 story
It’s genesis was the AIDS epidemic in South Africa, in which S.A. instituted a policy of patent exhaustion in order to make anti aids medicine more affordable for their population. Pharma fought this tooth and nail, but did not prevail.
How there is not more rx related coverage of this story is truly mystifying.
Especially since the decision was written in plan english so no expert translation was needed.
How lawyers are saying manufacturers will deal with this ruling:
Case Collard, partner at Dorsey and Whytney, believes that drug manufacturers will attempt to enforce the contracts they have with their distributors. Since drug companies deal with limited numbers of distributors, going after them is easier [than Lexmark going after many more retail customers]
Isaac Ashkenazi, partner at Paul Hastings, suggests that new distribution contracts may include clauses that require specific steps from the distributor to ensure clients will not export drugs back [into the US or other higher-tiered-pricing markets]
Nick Williamson, partner with Bryant Cave, believes that drug manufacturers may take over distribution where the danger of re-export is too high
Kevin Nelson, partner with Schiff Hardin, expects existing FDA regulations to be a significant barrier to import into the US. He explains that different versions of a drug [from overseas] may be treated differently by the FDA and require new approval.
Finally, the Biotechnology Innovation Organization (BIO), an industry trade group, had filed a friend-of-the-court brief favoring Lexmark, and its deputy general counsel, Hans Sauer, warns that some low-priced countries may see their access to critical drugs jeopardized by re-export into high-price markets.
In 1989 when South Africa changed their patent exhaustion law, big pharma filed a lawsuit against their new regulations. But by 2001 it had turned into a public relations disaster for pharma and they dropped the suit.
And what is more troubling, the US patent and US trade agencies have traditionally sided with pharma.
This is going to be a real war. And it seems the only way we’re going to win is a full court press in the court of public opinion.
A new article on this topic, By Sarah R. Wasserman Rajec, Assistant Professor of Law, William & Mary Marshall-Wythe School of Law.:
There is a long section that focuses on pharmaceuticals. Some of her conclusions:
… while generally there are good reasons to apply patent law equally to different technology areas, the drug industry may be appropriate for special treatment because it is subject to price controls in so many countries. […] Under these circumstances, the free trade concerns that drive some of the arguments for international exhaustion simply do not apply in that industry. Combined with the highly-regulated nature of drug sales in the United States, this provides a strong argument for treating drugs differently in order to maintain access for foreign patient populations.
In other words, she feels that it would be appropriate for the present SCOTUS decision not to apply to the pharmaceuticals market.
There is another major article in preparation by a lawyer who specializes in FDA law, that I understand will clarify many of our questions.