George Nathanael is a JD candidate at Osgoode Hall Law School.

In an article on Intellectual Property Watch, Javier Fernandez, a lawyer for CropLife Latin America, argues that better protection of regulatory data is necessary in order to foster innovation in the agricultural industry. In consideration of projections of an exploding global population, a decreasing amount of natural resources, and the greater reliance of farmers (especially in developing countries) on efficient technologies to remain profitable so that they can continue to produce, proper stimulation of the agricultural industry may be vital. Intellectual property law has historically been used as a means of shaping a variety of industries, but the standard protection of the final invention is sometimes not enough of an economic incentive for companies to continue productive research. By protecting the large amounts of useful data that innovative companies have discovered while developing a new product, and which they must release to regulatory bodies to judge safety and efficacy, these companies are more likely to continue investing in such costly research.

Mr. Fernandez believes that there are two main ‘prongs’ of regulatory data protection, which he calls ‘data protection’ and ‘data confidentiality’. The first prong has to do with implementing an exclusivity period in which “third parties are precluded from relying on the originator’s proprietary test data to obtain their crop protection product marketing approvals”. The second prong requires regulatory bodies to maintain high standards with the information that they collect. Despite legitimate reasons for release to the public of this data (such as for public safety, non-commercial research, education, etc.) the release of this information should be strictly controlled, keeping in mind the interests of the company that originally produced it.

This additional layer of protection on top of standard patent protection can be said to be needed because the data must be released in order to get approval for the originator’s product from a regulatory agency and so it can be used by another company to get approval for a similar product that may not infringe on the originator’s patent.  Article 39 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement provides that member states “shall protect [test and other] data against unfair commercial use ... [and] against disclosure”. As an example of the rationale underlying such a provision, the Pest Management Regulatory Agency of Health Canada uses the following as one of its objectives in its policy dealing with the protection of proprietary interests in pesticide data:

A policy that provides fair protection of the proprietary interests in data to encourage the introduction of new and reduced-risk pest control products while providing a predictable, timely process for the introduction of competing generic pesticide products to the Canadian market.

A separate argument for greater protection of regulatory data that is made in the article is that “[i]mproper reliance on originators’ proprietary data increases the possibility of substandard, copycat products reaching the marketplace that can pose unacceptable risks to health and the environment”. This seems quite sensible, but if safety is an actual concern, then it should follow that such an exclusivity period ought to be infinite, meaning that third parties should never be allowed to use another company’s regulatory data to get approval for a separate product. Understandably, this argument can be viewed outside of the sphere of intellectual property, but one of the ideas simultaneously brought up by Mr. Fernandez is that third parties can obtain licences to use the originator’s information, and this does not seem to mesh with the idea of maintaining high safety standards.

The substance of this topic is very applicable to other industries as well. This past summer, for example, there were many debates in the U.S. over legislation that touched on the exclusivity period for biologics companies. The economic bases that underlie these sorts of debates obviously vary by sector, and so research is always necessary to determine the likely market consequences that would follow with any amendment to the law. Within the agricultural industry specifically, given the wide social implications mentioned earlier, it is crucial that a correct balance is struck in order to benefit all interests at stake.