Viagra and Intellectual Property Rights in China - Free Essay Example

The company of Pfizer was founded by two German cousins, Charles Pfizer and Charles Erhart in 1849. These two men were based in Brooklyn at the time, selling chemicals from their offices. The first product that these cousins created was an anti-parasitic for treating intestinal worms. While there were other options for this medication on the market, considering the popularity of this affliction in the time period, Pfizer made theirs more appetizing in terms of taste, and therefore more appealing than others. In 1941, their attention shifted to soldiers fighting in the war, leading them to refocus their resources to the production of penicillin (Abrami). This company’s claim to fame, the drug Viagra, was a lucky accident that Pfizer scientists stumbled upon during their research. Pfizer scientists wanted to develop a drug to lower blood pressure and open arteries. They applied for a UK patent, since the scientists were Britain-based, for a class of compounds for the treatment of cardiovascular conditions. When this drug went to volunteer clinical trials, participants discovered that the compound also acted as a treatment for Erectile Dysfunction (ED). However, when tested on monkeys, the drug did not have the same result. Scientists later found that nitric oxide (NO) was unavailable to the anesthetized monkeys, which is why they did not experience the same results, but was crucial to sexual arousal. The scientific outcome of this realization was the new idea that PDE-5 inhibitors were a treatment for ED in otherwise healthy males. After discovering the added benefits of the drug that they had created as a treatment for cardiov ascular conditions, Pfizer filed a secondary use patent application titled â€Å"Pyrazolopyrimidinones for the Treatment of Impotence† (Abrami). After the discovery and development of their unique drug, Pfizer took measures to protect their intellectual property rights in the matter. By 1998, Pfizer held a patent on sindenafil citrate itself, the specific compound that worked as treatment for Erectile Dysfunction. They also obtained US and EU patent rights on PDE-5 inhibitors and the drug became available with a doctor’s prescription by 1998. Their business immediately took off, filling 2.9 million prescriptions for the drug within three months of their launch (Abrami, 7). However, after Viagra’s worldwide launch in 1998, a Chinese firm known as Welman Company (unbeknownst to Pfizer) filed a trademark application for the name â€Å"Wei Ge.† While Viagra’s official Chinese brand name was â€Å"Wan Ai Ke,† much more popular was their Mandarin Chinese street name of â€Å"Wei Ge.† The problem at hand was that, while Pfizer had a patent for the drug and compound itself, they had never filed a trademark application for the name. They did hold a 3D trademark for their ocean blue, rhombic pill, which had been granted in 2001. In 2003. Welman Company launched an Erectile Dysfunction drug using the â€Å"Wei Ge† name, which they had received a trademark for in 2002, and a similar look of pills (Abrami). Welman’s launch of such a similar drug launched a momentous dispute between the two. In 2005, Pfizer filed a lawsuit against Welman Company. They claimed that while they did not hold a specific trademark for the name, they had the rights to the unregistered, famous trademark. The Paris Convention, which Pfizer cited in their argument, mandated that member countries, including China, â€Å"agreed to ‘refuse or to cancel the registration, and to prohibit the use, of a trademark which constitutes a reproduction, an imitation or a translation, liable to create confusion, of a mark considered . . . as already being the mark of a person entitled to the benefits of this convention’† (Abrami, 9). While Pfizer had a patent on the drug itself and a trademark on the appearance of the drug, they did not have a trademark on the â€Å"Wei Ge† name. Welman Company capitalized on this loophole and attempted to make their own drug, so similar to that of Pfizer that they would profit of it themselves. As a response, Pfizer filed a lawsuit against the Chinese firm and cited the Paris Convention, claiming that the trademark belong to them and they should be the only ones to reap the benefits of it (Abrami). However, before the Paris Convention, intellectual property rights (IPR) were a foreign idea to much of the population of China. China did not develop their first Patent Law until 1984, nor their first Trademark Law until 1982 (Abrami, 2). The majority of their IPR improvements were not prompted until 2001, caused by China’s pending membership in the World Trade Organization, after which they had to comply with the TRIPS Agreement, or Trade-Related Aspects of Intellectual Property Rights. The State Intellectual Property Rights Office then declared that a firm could apply for three different types of patents: an invention patent, a utility model patent, or a design patent. After becoming a player in the global market, China’s trademark and patent laws became more inclusive. When Welman Company released their version of Pfizer’s ED drug, Pfizer had the grounds to argue that â€Å"Welman’s pills intentionally looked similar to Viagra, and in direct violation of existing Pfizer trademark rights held in China† (Abrami, 8). A back-and-forth legal battle between the two firms ensued, the results of which we have yet to see (Abrami). Similar to the dispute between Pfizer and Welman Company regarding Viagra, Cipla also got caught in the midst of a patent war. After AIDS was identified in 1982, British pharmaceutical company Burroughs Wellcome introduced the first drug that had been shown to slow the progression of AIDS in 1987. Although this was a groundbreaking treatment, the price was so expensive that nobody who needed it could afford it. Dr. Yusuf Hamied, chairman of Cipla, worked to develop an affordable alternative. In 1992, Cipla announced that it had reserve-engineered AZT and was able to produce and sell their serving for a fraction of the price of large MNCs. After this revelation, MNCs faced backlash, but cited high RD costs as the reason why they could not make their drugs more affordable. Many invested entities demanded that they drop the suit they had filed against the South African government (where the need for this drug was astronomical), including AIDS activists and humanitarian organizations. Ev entually, they dropped their suit and Cipla was allowed to continue production of affordable alternatives to their expensive drugs (Deshpandà ©). Legally, when Hamied began his work on the AIDS drug alternative, the 1970 India Patents Act was in effect. This act only recognized patents on the process of creating a drug, not on the drug itself. By reserve-engineering the drug and therefore using a different process of creation, Hamied was not in violation of the India Patents Act. While Cipla’s production of AZT would be a violation of Intellectual Property Rights since they did not develop the drug themselves, they did not legally violate the patent laws in play. Additionally, when Welman Company began producing their own version of Viagra, it was an underhanded attempt to make profits and gain business for themselves. They intentionally used a trademark that was associated with a different firm so that they would gain business from the confusion as well. Dr. Yusuf Hamied of Cipla argued that, while his methods may be questionable, his intentions were of a humanitarian nature, as well as being ethically and legally soun d. Additionally, as opposed to Welman Company, Cipla was selling their drugs for as cheap as possible, not increasing the price in an attempt to make profits. Their man concern was ensuring that those who needed access to their medication could have it. While both of these cases could be considered violations of intellectual property rights, their motives were very different: while Welman Company was concerned primarily with business and profits, Cipla had humanitarian intentions (Deshpandà ©). After the legal battle between Pfizer and Welman Company, it was determined that Welman Company would be allowed to keep the trademark on the Chinese name for Viagra, â€Å"Wei Ge.† The root of this issue was that, after Viagra’s launch, the name commonly used for this medication in China was â€Å"Wei Ge,† even though Pfizer only held a trademark for â€Å"Wai Aike,† a direct translation that never gained popularity (Chow, 83). Pfizer did not file a trademark application until May 1997, at which point it already belong to Guangzhou Viamen Pharmaceutical Company (Chow, 88). Because the media will coin a name in their language instead of using the English name, â€Å"a Chinese entity might obtain a registration for the Chinese transliteration of the English brand name before the U.S. brand owner can do so in China† (Chow, 88-89). One serious implication of this â€Å"is that the brand owner loses control over the Chinese-language name for its brandà ¢â‚¬  (Chow, 88). Because Wei Ge was already associated with the Viagra brand, when Guangzhou Viamen Pharmaceutical gained ownership of the name, it resulted in a huge loss of business for Pfizer (Chow). A solution that Chow presents in his article â€Å"Lessons from Pfizers Disputes Over its Viagra Trademark in China† is that Pfizer should have sought out the trademark for the Wei Ge name sooner. He claims that, in order to â€Å"maintain Chinese brand control, MNCs should develop and maintain a Chinese-language trademark in China prior or simultaneous to the time that an English-language trademark is obtained in the United States† (Chow, 104). At this point, Pfizer had gotten a patent for the drug itself and a trademark for the English name Viagra. However, when the Wei Ge name was coined in China, Pfizer should have immediately submit an application for the trademark to ensure that they received the business for their brand. If they had obtained the trademark to the Wei Ge trademark sooner, they would have the rights to the name instead of Guangzhou Viamen Pharmaceutical, and would have gained much more business in the global market (Chow).