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15 January 2018Americas

US identifies shortcomings in China’s IP pharma sector

The US Department of Commerce (DOC) has said that there are “shortcomings” in China’s IP rights when it comes to the country’s pharmaceutical sector.

This comes after the DOC announced that pharmaceutical preparations are the US’s second-largest consumer goods export to China.

In its Economics and Trade Bulletin for January 8, the DOC highlighted that, under Chinese law, companies are unable to bring patent infringement cases against a patent violator until the product has been launched to the market by the alleged violator.

“As a result, a US drug company must allow a patent violator to enter the market before it can take action,” said the report.

While injunctions to prevent patent abuse during litigation are allowed, they are “rarely, if ever, granted in pharmaceutical cases”.

Furthermore, the DOC claimed that damages awarded by Chinese patent courts are insufficient in recovering lost revenue or stopping infringement in the pharmaceutical sector.

Last year, US President Donald Trump asked the US trade representative Robert Lighthizer to assess whether an investigation into Chinese IP theft is necessary, as reported on LSIPR’s sister site WIPR.

Talking at a press gathering on August 14, 2017, Trump said it’s his “responsibility to protect the American workers’ technology and industry from unfair and abusive actions”.

He added: “We will safeguard the patents, copyright, trademarks, trade secrets and all the IP that is so vital to our security and prosperity, we will uphold our values, defend our workers and protect the innovations and creations that power our magnificent country,” he said.

Responding to this, the Chinese Ministry of Commerce said that the US ignored rules of the World Trade Organization by initiating the investigation.

Pharmaceutical preparations make up 31% of the US’s consumer goods exports to China, trailing mobile phones and other household goods, at 35%. Toiletries and cosmetics make up 5% and jewellery 3%, while other goods make up 26%.

Between 2007 and 2016, pharmaceutical preparations from the US to China have consistently increased in value, from $402 million in 2007 to $2.2 billion in 2016.

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8 December 2016   President-elect Donald Trump’s announcement that he will withdraw the US from the Trans-Pacific Partnership is a “detriment” to US companies in terms of enforcing their patent rights in other jurisdictions.

More on this story

Americas
17 August 2017   US President Donald Trump has put an end to his manufacturing council after a series of resignations.
Americas
8 December 2016   President-elect Donald Trump’s announcement that he will withdraw the US from the Trans-Pacific Partnership is a “detriment” to US companies in terms of enforcing their patent rights in other jurisdictions.