FOURTEENTH CONGRESS OF THE 
1 
Firsf Regular Session 
) 1 
7 .iLL a: iii ; .; 7 
REPUBLIC OF THE PHILIPPINES 
S E N A T E  
Introduced by SENATOR COMPANERA PIA S. CAYETANO 
EXPLANATORY NOTE 
In the Philippines, the problem of access to medicines has become very 
alarming through the years. Drugs and medicines used for the treatment of just 
about any ailment cost more in the Philippines than elsewhere. 
Without legislation, the pharmaceutical industry has shown that on its own, 
it does not have sufficient mechanisms for ensuring their affordability. It will 
simply charge as much as it can, and it has done so. 
The multinational companies justify their dominance of the Philippine 
pharmaceutical market on the ground that the medicines that they produce are of 
good quality with their efficacy and safety assured. In relation to the alleged high 
prices that they impose, they justify such because of the quality and the need to 
recoup their research and development costs in relation to each successful 
patent which is given exclusive rights by the intellectual property law of the 
Philippines. In other words, the strength of the multinationals lies in the patents of 
the drugs or medicines. 
On the other hand, the smaller Filipino pharmaceutical companies contend 
that there are a lot of barriers to a level playing field in the local pharmaceutical 
market. As much as they acknowledge that they do not have that much capital, 
they especially note that, unlike in other countries, local intellectual property laws 
are designed in favor of heavily protecting the patents of the multinationals, thus 
granting more marketing monopoly in favor of the multinationals. 
Not surprisingly then, multinationals have gained a monopoly in 
pharmaceutical patents. Based on data from the Intellectual Property Office, of 
the 191 pharmaceutical patents filed from 2001 to 2004, at least 89% were 
foreign patents while only 11% were local. Of the number of pharmaceutical 
patents issued from 2002 to 2005, only one local patent was issued compared to 
448 foreign patents issued in 2001, 363 in 2002, 351 in 2003, 531 in 2004 and 
404 in 2005. The country now has a total of 3,113 foreign patents on medicines 
but only 5 local patents due to expire from 2006 to 201 5. 
Surely, the arguments that the cost of manufacturing and local taxes result 
in higher prices cannot justify the exorbitant high prices of medicines here as 
compared to our Asian neighbors. Thus, this bill seeks to address this problem. It 
posits that things should not be so - that access to medicines is a question of life 
or death, and medicines cannot be treated as mere commodities. 
In this regard, this bill lays down four cornerstones that will make quality 
medicines cheaper and more accessible to our people. Specifically, it shall make 
patents and trademark laws more responsive to the health care needs of our 
people by amending the Intellectual Property Code of the Philippines to allow the 


2 
following - 
9 One, the parallel importation of medicines; 
9 Two, the early development of patented medicines; 
9 Three, exemption of government importation, manufacture, sale 
or distribution of medicines from the standard compulsory 
licensing requirements; and 
9 Four, disallowing new uses or derivatives of patented drugs to 
be covered by a separate or new patent. 
It should be emphasized that all these proposed amendments comply with 
the basic covenants under the Agreement on Trade-Related Aspects of 
Intellectual Properly Rights or TRIPS and the Doha Declaration on the TRIPS 
Agreement and Public Health of the World Trade Organization (WTO). 
Furthermore, these amendments are within the allowable flexibilities given to 
developing countries under the TRIPS Agreement and the Doha Declaration. 
The TRIPS flexibilities were envisioned “to balance the protection of 
intellectual property owners with economic and social welfare, as well as with 
technological development.” The Doha Declaration recognized “the gravity of the 
public health problems affecting many developing and least-developed 
countries.” It also emphasized “the need for the TRIPS Agreement to be part of 
the wider action to address these problems,” and included an acknowledgment 
that intellectual property protection has an effect on the price of medicines, even 
as it is important for pharmaceutical research and development. 
Everywhere around the world, governments are exercising the function to 
define the proper role of intellectual property protection in relation to balancing 
the private rights of innovators against the broader interest of the public. 
The need to help our citizens gain access to affordable and quality 
medicines is surely a great move to solve the problem of expensive drugs and 
medicines in the country. The passage of this bill will somehow, unburden or, at 
least, lessen this heavy load on our people, especially to those living in poverty. 
Thus, approval of this Bill is urgently sought. 
COMP hJ* 
ERA (+p 
P S. CAYETANO 


S E N A T E  
S. B. No. 1484 
Introduced by SENATOR COMPANERA PIA S. CAYETANO 
AN ACT 
TO MAKE THE LAWS ON PATENTS, TRADENAMES AND TRADEMARKS 
MORE RESPONSIVE TO THE HEALTH CARE NEEDS OF THE FILIPINO 
THE 
IMPORTATION AND 
EARLY 
DEVELOPMENT OF 
PATENTED 
MEDICINES, AND MODIFYING GOVERNMENT USE PROVISIONS FOR 
DRUGS OR MEDICINES, TO LOWER PRICES AND INCREASE ACCESS TO 
AND SUPPLY OF QUALITY DRUGS OR MEDICINES, AMENDING FOR THIS 
PURPOSE CERTAIN PROVISIONS OF 
REPUBLIC ACT 
NO. 
8293 
OTHERWISE KNOWN AS THE INTELLECTUAL PROPERTY CODE OF THE 
PHILIPPINES. 
Be if enacted by fhe Senafe and House of Representatives of the Philippines in 
PEOPLE BY CLARIFYING NON-PATENTABLE INVENTIONS, ALLOWING 
Congress assembled: 
SEC. 1. Section 26 of Republic Act No. 8293 is hereby amended to read as 
follows: 
"SEC. 26. Inventive Step. - 26.1. An invention involves an 
inventive step if, having regard to prior art, it is not obvious to a 
person skilled in the art at the time of the filing date or priority date 
of the application claiming the invention. 
"26.2. THERE IS NO INVENTIVE STEP IF THE INVENTION 
RESULTS FROM THE MERE DISCOVERY OF A NEW FORM OR 
NEW PROPERTY OF A KNOWN SUBSTANCE WHICH DOES 
NOT RESULT IN THE ENHANCEMENT OF THE KNOWN 
EFFICACY OF THAT SUBSTANCE, OR, THE MERE DISCOVERY 
OF ANY NEW USE FOR A KNOWN SUBSTANCE OR A KNOWN 
PROCESS UNLESS SUCH KNOWN PROCESS RESULTS IN A 


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NEW PRODUCT THAT EMPLOYS AT LEAST ONE NEW 
REACTANT.” 
SEC. 2. Section 72 of Republic Act No. 8293 is hereby amended to read as 
follows: 
“SEC. 72. Limitations of Patent Rights. - The owner of a 
patent has no right to prevent third parties from performing, without 
his authorization, the acts referred to in Section 71 hereof in the 
following circumstances: 
“72.1. Using a patented product which has been put on the 
market in the Philippines by the owner of the product, or with his 
express consent, insofar as such use is performed after that 
product has been so put on the said market: PROVIDED, THAT, 
WITH REGARD TO DRUGS OR MEDICINES, THE LIMITATION 
ON PATENT RIGHTS TO THE USE, SALE, OFFERING FOR 
SALE OR IMPORTATION OF THE PRODUCT SHALL APPLY 
AFTER A DRUG OR MEDICINE HAS BEEN INTRODUCED 
ANYWHERE IN THE WORLD BY THE PATENT OWNER, OR BY 
ANY PARTY AUTHORIZED TO USE THE INVENTION. 
“72.2. Where the act is done privately and on a non- 
commercial scale or for a non-commercial purpose: Provided, That 
it does not significantly prejudice the economic interests of the 
owner of the patent; 
“72.3. Where the act consists of making or using exclusively 
for [the purpose of experiments that relate to the subject matter of 
the 
patented 
invention;] EXPERIMENTAL USE 
OF 
THE 
INVENTION FOR SCIENTIFIC PURPOSES OR EDUCATIONAL 
PURPOSES AND 
SUCH OTHER ACTIVITIES 
DIRECTLY 
RELATED 
TO 
SUCH 
SCIENTIFIC 
OR 
EDUCATIONAL 
EXPERIMENTAL USE. 


5 
“72.4 WHERE THE ACT INCLUDES TESTING, USING, 
MAKING OR SELLING THE INVENTION INCLUDING ANY DATA 
RELATED THERETO, SOLELY FOR PURPOSES REASONABLY 
RELATED TO THE DEVELOPMENT AND SUBMISSION OF 
INFORMATION 
AND 
ISSUANCE 
OF 
APPROVALS 
BY 
GOVERNMENT REGULATORY AGENCIES REQUIRED UNDER 
ANY LAW OF THE PHILIPPINES 
THAT REGULATES THE 
MANUFACTURE, CONSTRUCTION, USE OR SALE OF ANY 
PRODUCT: PROVIDED, THAT IN ORDER TO PROTECT THE 
DATA SUBMITTED BY THE ORIGINAL PATENT HOLDER FROM 
UNFAIR COMMERCIAL USE PROVIDED IN ARTICLE 39.3 OF 
THE TRIPS AGREEMENT, THE INTELLECTUAL PROPERTY 
OFFICE (IPO), IN CONSULTATION WITH THE APPROPRIATE 
GOVERNMENT AGENCIES, SHALL ISSUE THE APPROPRIATE 
RULES AND REGULATIONS NECESSARY THEREIN NOT 
LATER THAN ONE HUNDRED TWENTY (120) DAYS AFTER 
ENACTMENT OF THIS LAW. 
“[72.4] 72.5. Where the act consists of the preparation for 
individual cases, in a pharmacy or by a medical professional, of a 
medicine in accordance with a medical prescription or acts 
concerning the medicine so prepared; 
“[72.5] 72.6. Where the invention is used in any ship, vessel, 
aircraft, or land vehicle of any other country entering the territory of 
the Philippines temporarily or accidentally: Provided, That such 
invention is used exclusively for the needs of the ship, vessel, 
aircraft, or land vehicle and not used for the manufacturing of 
anything to be sold within the Philippines. (Secs. 38 and 39, R.A. 
No. 165a)” 


6 
SEC. 3. Section 74 of Republic Act No. 8293 is hereby amended to read 
as follows: 
“SEC. 74. Use of lnvenfion by Government. - 74.1. A 
Government agency or third person authorized by the Government 
may exploit the invention even without agreement of the patent 
owner where: 
(a) The public interest, in particular, national security, 
nutrition, health or the development of other sectors, as 
determined 
by 
the 
appropriate 
agency 
of 
the 
government, so requires; or 
(b) A judicial or administrative body has determined that the 
manner of exploitation, by the owner of the patent or his 
license, is anti-competitive; OR 
(C) THERE IS PUBLIC NON-COMMERCIAL USE OF THE 
PATENT 
BY 
THE 
PATENTEE, 
WITHOUT 
SATISFACTORY REASON. 
“74.2. UNLESS OTHERWISE PROVIDED HEREIN, [TJthe 
use by the Government, or third person authorized by the 
Government shall be subject, [mufafis mutandis, to the conditions 
set forth in Sections 95 to 97 and 100 to 102. (Sec. 41, R.A. No. 
165a)l TO THE FOLLOWING PROVISIONS: 
(A) IN SITUATIONS OF NATIONAL EMERGENCY OR 
OTHER 
CIRCUMSTANCES 
OF 
EXTREME 
URGENCY, THE 
RIGHT HOLDER SHALL 
BE 
NOTIFIED 
AS 
SOON 
AS 
REASONABLY 
PRACTICABLE; 
(B) IN THE CASE OF PUBLIC NON-COMMERCIAL USE, 
WHERE THE GOVERNMENT OR CONTRACTOR, 
WITHOUT MAKING A PATENT SEARCH. KNOWS OR 


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HAS DEMONSTRABLE GROUNDS TO KNOW THAT 
A VALID PATENT IS OR WILL BE USED BY OR FOR 
THE GOVERNMENT, THE RIGHT HOLDER SHALL 
BE INFORMED PROMPTLY; 
THE SCOPE AND DURATION OF SUCH USE SHALL 
BE LIMITED TO THE PURPOSE FOR WHICH IT WAS 
(C) 
AUTHORIZED, AND IN THE CASE OF SEMI- 
CONDUCTOR TECHNOLOGY, SHALL ONLY BE FOR 
PUBLIC NON-COMMERCIAL USE OR TO REMEDY A 
PRACTICE DETERMIYED AFTER JUDICIAL OR 
ADMINISTRATIVE 
PROCESS 
TO 
BE 
ANTI- 
COMPETITIVE; 
(D) SUCH USE SHALL BE NON-EXCLUSIVE; 
(E) THE RIGHT HOLDER SHALL BE PAID ADEQUATE 
REMUNERATION IN THE CIRCUMSTANCES OF 
EACH CASE, 
TAKING 
INTO ACCOUNT 
THE 
ECONOMIC VALUE OF THE AUTHORIZATION; 
(F) THE LEGAL VALIDITY OF ANY DECISION RELATING 
TO THE AUTHORIZATION OF SUCH USE SHALL BE 
SUBJECT TO JUDICIAL REVIEW; AND 
(G) THE USE OR OTHER EXPLOITATION BY THE 
GOVERNMENT OR THIRD PERSON AUTHORIZED 
BY THE GOVERNMENT OF DRUGS OR MEDICINES 
UNDER THIS SECTION SHALL BE SUBJECT TO THE 
EXCLUSIVE DETERMINATION OF THE PRESIDENT 
OF THE REPUBLIC OF THE PHILIPPINES AND 
SHALL BE IMMEDIATELY EXECUTORY: PROVIDED, 
THAT NO COURT, EXCEPT THE SUPREME COURT 
OF 
THE 
PHILIPPINES, 
SHALL 
ISSUE 
ANY 


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TEMPORARY 
RESTRAINING 
ORDER 
OR 
PRELIMINARY 
INJUNCTION OR 
PRELIMINARY 
MANDATORY INJUNCTION THAT WILL PREVENT 
ITS IMMEDIATE EXECUTION. THE OFFICE OF THE 
PRESIDENT, 
IN 
CONSULTATION 
WITH 
THE 
APPROPRIATE GOVERNMENT AGENCIES, SHALL 
ISSUE THE APPROPRIATE IMPLEMENTING RULES 
AND REGULATIONS FOR THE EXERCISE OF THIS 
AUTHORITY WITHIN ONE HUNDRED TWENTY (120) 
DAYS AFTER ENACTMENT OF THIS LAW. 
ALL 
CASES ARISING FROM THE IMPLEMENTATION OF 
THIS PROVISION SHALL BE COGNIZABLE BY 
COURTS 
WITH 
APPROPRIATE 
JURISDICTION 
PROVIDED BY LAW.” 
SEC. 4. Section 159 of Republic Act No. 8293 is hereby amended to read 
as follows: 
“x x x 
“x x x 
‘IX x x 
I‘X x x 
“159.4 THERE SHALL BE NO INFRINGEMENT OF 
TRADEMARKS OR TRADENAMES OF IMPORTED OR SOLD 
DRUGS OR MEDICINES ALLOWED UNDER SECTION 72.1: 
PROVIDED, THAT SAID DRUGS OR MEDICINES BEAR THE 
REGISTERED MARKS THAT HAVE NOT BEEN TAMPERED, 
MODIFIED, OR INFRINGED UPON AS DEFINED UNDER 
SECTION 155 OF THIS CODE.” 
SEC. 
5. lmplemenfing Rules and Regulations. - Unless otherwise provided 
herein, the Intellectual Property Office shall issue the necessary implementing 


9 
rules and regulations within one hundred twenty (120) days after enactment of 
this law. 
SEC. 6. Separability Clause. - Any portion or provisions of this Act that 
may be declared unconstitutional or invalid shall not have the effect of nullifying 
other portions and provisions hereof as long as such remaining portion or 
provision can still subsist and be given effect in their entirety. 
SEC. 7. Repealing Clause. - All laws, decrees, executive orders, 
proclamations and administrative regulations, or parts thereof inconsistent 
herewith are hereby repealed or modified accordingly. 
SEC. 8. Effectivity Clause. - This Act shall take effect fifteen (15) days 
after its publication in at least two national papers of general circulation. 
Approved,