Russia to Expand Grounds for Granting Compulsory Licenses

On December 15, 2020, the amendments to the Russian Civil Code expanding the list of grounds for granting compulsory licenses were approved by the Russian State Duma, the lower house of the Russian Federal Assembly, in the first reading. While the Civil Code already allows the Russian government to grant permissions to use patented inventions in the interests of defense and national security, the amendments also allow the government to issue compulsory licenses in the interest of protecting the life and health of citizens.

The amendments were submitted to the State Duma in 2019, attracting much criticism. The opponents argued that compulsory licensing may unjustifiably interfere with the functioning of the market and potentially cause a shortage of both generic and brand-name drugs in Russia. However, due to the COVID-19 pandemic, this step taken by the Russian government may have come at an opportune time. After all, the ability of a country to issue compulsory licenses for medicines and other urgently needed items to respond to a health crisis is not a novel approach and is not prevented by international trade agreements. Under the pressure of responding to the COVID-19 crisis, countries such as Germany, Canada, France, Brasil, Ecuador and Chile are also preparing to facilitate the issuing of compulsory licenses. Israel has already issued a compulsory license allowing the country to import the Lopinavir and Ritonavir medications used in COVID-19 treatment.

In order to be implemented in practice, the Russian Civil Code amendments must still go through the second and third readings in the State Duma before being finally approved. However, in November 2020, one of the leading pharmaceutical companies in Russia, Pharmasyntez, asked the Russian government for permission to produce a generic version of Remdesivir (Veklury®), a medication produced by American pharmaceutical company Gilead which has been approved for temporary use in COVID-19 treatment in about 50 countries worldwide. It is protected in Russia by Eurasian patents until 2035. On January 5, 2021, referring to the interests of defense and national security, the Russian government issued a compulsory license for the Remdesivir patent, allowing Pharmasyntez to produce a generic version called Remdeform.

Taking into account the pending amendments to the Russian Civil Code and the current health situation, it appears that patent disputes arising from compulsory licenses may increase in Russia in the near future.

By: Natalia Osipenko

For more information, please contact Natalia Osipenko at our Russia office.