Patent Protection of the Traditional Chinese Medicine and. Its Impact on the ..... 16 Hong Wei, Happiness and worries on the internation- alization of TCM.
Patent Protection of the Traditional Chinese Medicine
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Qiao Yongzhong* / Zhu Xuezhong**
Patent Protection of the Traditional Chinese Medicine and Its Impact on the Related Industries in China
Abstract Traditional Chinese Medicine (TCM) IP strategy is an integral part of China’s national IP strategy. It is of great value for the implementation of the Strategy to study the status quo of the patent protection of TCM and its impact on the related industries. This paper gives a multidimensional illustration of the current of the patent protection of TCM in China in view of the following aspects: patent applications, patent grants, PCT and the object of the patent protection of TCM. It demonstrates the impact of patent protection on the TCM industry after a detailed analysis of the R&D expense, social effects, human resources in TCM institutions and their output of scientific/technical papers. Finally, it analyzes the challenges facing the patent protection of TCM and discusses some tentative solutions.
Introduction Traditional medicine is a general term comprised of Traditional Chinese Medicine (TCM), Indian medicine, Arab medicine and other traditional medicine systems. In 2005, a global survey done by the WHO showed 54 nations had formulated laws and regulations regarding traditional medicine, and another 42 were in the process. Some Asian nations, for instance, Sri Lanka (1941), Burma (1953), India (1970), Bengal (1972), Cambodia (1976), have already enacted relevant laws and regulations to protect traditional medicine. Sixteen nations in Africa have finished TCM framework laws. Nearly every state in
* Qiao Yongzhong, Ph.D. Candidate, Institute Intellectual Property Strategy, Huazhong University of Science & Technology, Wuhan, China; Associate professor, School of Political Science and Public affairs, Southwest University of Political Science and law, Chongqing, China. His area of interest and expertise includes intellectual property law, the management of Intellectual Property. ** Zhu Xuezhong, Prof.Dr., Director of the Institute Intellectual Property Strategy, Huazhong University of Science & Technology, Wuhan, China. His area of interest and expertise includes intellectual property law, the strategy and international protection of Intellectual Property.
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the USA has enacted laws and regulations regarding protections for acupuncture, moxibustion, and TCM treatments. Additionally, the UK has enacted the Faculty of Homeopathy Act (1950), the Osteopaths Act (1993) and the Chiropractors Act (1994); Victoria, Australia, The Chinese Medicine Registration Act; and British Columbia, Canada, Traditional Chinese Medicine Practitioners and Acupuncturists Regulation (2000).1 Consequently, it can be concluded that the traditional medicine is being protected in many nations. Traditional Chinese Medicine (TCM)2, the unique form of traditional medicine in China, passed down over two thousand years, is an ancient and still very vital holistic system of health and healing, based on the notion of harmony and balance, and employing the ideas of moderation and prevention. It is also the most influential traditional medicine system with the largest population and the most complete historical and cultural preservation. The TCM industry plays an important role in the strategic framework of the sustainable development of China’s pharmaceutical industry. According to statistics, there are some 20.000 TCM cultural relics and 12.124 kinds of ancient Traditional Chinese Medicine books.3 The Prescription Dictionary of Traditional Chinese Medicine,4 for example, includes 96.592 descriptions. The national TCM survey conducted in 1983 indicated that China had 12.807 kinds of TCM resources comprised out of 11.146 kinds of plants, 1.581 kinds of animals and 80 kinds of minerals. Among them, the overall reserves of 320 kinds of most-used medical plants amounted to 8.5
1 Sang Bingsheng, Guo Zihua, Wen li, The legal status of traditional medicine has become an increasing concern to all countries. The International Reference to Traditional Medicine. 11, 4-6 (2005). 2 In this paper, traditional Chinese medicine (TCM) is used in the broad sense. 3 Referring to the National Union Catalog of TCM Books in China. 4
Peng Huairen, The Prescription Dictionary of Traditional Chinese Medicine. People’s Medical Publishing House (2007).
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million tons. In recent years, especially, since the People’s Republic of China Ministry of Science & Technology together with six related Departments and Commissions worked out The Outline of the Development of Chinese Medicine Modernization in 2002, China’s TCM industry has made great progress. So far, 448 bases of Chinese traditional medicinal crops have been established all over the country, with the planting area reaching 14.244 million acres. 17 provinces (autonomous regions and municipalities) have regulated The Measures for Administration of the Good Agricultural Practice for Chinese Crude Drugs Inspection (GAP) and The Production Technology Standard Operating Procedures (SOP), and established 122 Chinese traditional medicinal crops quality control methods. China has 47 forms of Chinese patent medicines, comprising about 9.000 varieties, and 1.400 Chinese medicine enterprises. A system, consisting of international treaties, domestic laws and regulations and related industry policies, has been formulated for the overall protection of the TCM industry in China. The system mainly includes international treaties China has approved and joined: The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), The Paris Convention for the Protection of Industrial Property, The Madrid Agreement for the Repression of False or Deceptive Indications of Source on Goods, The Berne Convention for the Protection of Literary and Artistic Works, The Universal Copyright Convention, The Convention on Biological Diversity, The Patent Cooperation Treaty (PCT), and The International Convention on the Protection of New Plants Varieties and Trips. Domestic laws and regulations include: The Constitution, The Patent Law, The Trademark Law, The Copyright Law, The Law against Unfair Competition, The Regulations on the Protection of the Wild Medicinal Resource, The Regulation on the Protection of Chinese Medicines, The Regulations on the Protection of New Varieties of Plant, and The Provisions for Drug Registration. Related industry policies include: The Regulations on Chinese Medicine Scientific/Technical Progress Award (for trial implementation), The Regulations on Chinese Medicine Scientific and Technological Achievements Registration (for trial implementation), The Regulations on Major Scientific and Technological Development Project and Implementation Details (for tentative implementation), With Regard to Further Strengthening the Inheritance and Development of Chinese Medicine, The Policies on Technology in Medicine Science, The Medicine Science and Technology Policy, The Outline for the Development in Modernization of Traditional Chinese Medicine and With Regard to the Management of Chinese Medicine Massage and Other Activities. With respect to the great impact of patent systems on the development of TCM industry, this paper focuses on the
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status quo and object of patent protection of TCM, the influence of patent protection on R&D of the TCM industry and the challenges and solutions.
The Status Quo of Patent Protection of TCM In China, before the enforcement of the Patent Law of the People’s Republic of China (hereinafter referred as the Patent Law), the enterprises preferred the measures of internal confidential methods and implementation of various security procedures to protect TCM. The patent protection of TCM has experienced three periods after the enforcement of the Patent Law. Phase One (1985-1992) is from the implementation of patent law to the first revision. During this period, the Patent Law implemented in 1985 provided a very low level of patent protection for TCM, covering only the pharmaceutical manufacturing methods and medical apparatus and instruments, but excluding the use of drugs and substances obtained by chemical methods. Phase two (19932000) is from the first revision of Patent Law to China’s WTO entry. After the first revision, the Patent Law began to protect drugs (including TCM), which substantially increased the level of patent protection of TCM and promoted the development of China’s TCM industry. Phase three is from 2001 until now. Since China’s accession to the WTO in 2001, the TCM industry has progressed substantially because the invigorating drug patent protections have greatly stimulated increased TCM patent applications. However, some problems still remain due to the intrinsic characteristics of TCM. An Overview of TCM Patent Applications The following statistics are taken from the patent database of China Intellectual Property Net (CNIPR), A61K355 (Medicinal preparations containing raw materials or reaction products with undetermined constitution) and A61K33 (Medicinal preparations containing mineral active ingredient) as the search portal. The result shows: the amount of patent applications accepted by State Intellectual Property Office (SIPO) during 1985-2007 was 2.972.262 and 382.052 of them were granted. Among
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Classification A61K35/78 (materials from plants) in Edition Seven of IPC is combined into A61K36/00 (including Algae, lichen, fungi, plants and their derivatives, such as undetermined structures pharmaceutical preparation from traditional herbs) in Edition Eight (put into use on January 1, 2006). So, A61K 36/00 is covered when we were retrieving data in 2006-2007.
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them, the number of patent applications for TCM was 41.482, which accounted for 1.4% of the total; and the number granted was 12.690, which accounted for 3.3% in total. According to a statistic on patent applications of TCM from 1992 to 2002, the applicants were mainly domestic, while international applications only accounted for 1.2%. Therefore, the data in the paper illustrates the situation of Chinese medicine applications and grants.
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An Overview of TCM Patent Grants As shown in Figure 2, compared with patent applications of TCM, the periodic time demarcations of the number of TCM patents granted by SIPO is sporadic. The period of 1985-1992 indicated steady growth with an increase from 21 to 147. The number of TCM patent grants substantially increased from 147 in 1992 to 521 in 1993, because the first revision of the patent law protected TCM products, while the
Figure 1: Statistics of patent applications of TCM accepted by SIPO during 1985-2007 Date Source£∫Patent Database Service Platform of China Intellectual Property Net, http://search.cnipr. com/cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0 (last visited on 12 June 2008)
As shown in Figure 1, the situation of TCM patent applications accepted by SIPO in 1985-2007 corresponds with the three periods of patent protection of TCM. The amount of TCM applications from 19851992, though rising steadily, was very small, ranging from 43 in 1985 to 629 in 1992. In comparison with the first period, the amount of patent applications of TCM significantly increased from 19932000. However, the growth rate in this period was as low, with a decrease of 171 from 1993 to 1995, to an increase up to 2166 applications in 2000. The trend of TCM patent applications from 2001-2007 experienced parabolic (rising and falling) processes. In the third period, the amount of patent applications rose significantly in comparison with the second period. In 2003, the number of patent applications peaked (4358), while in 2007 it dropped to 2282. Therefore, patent applications of TCM experienced three periods: steady growth, stable development and significant drops.
Patent Law in 1985 did not.6 The number of TCM patent grants steadily increased from 1993 (521) to 2002(1508). However, since 2002, the number has dropped significantly. Therefore, the TCM patent grants experienced three phases: slow, steady rising; rapid rising with a plateau effect; and rapid increase and decline (see Figure 2.). An Overview of the Granted Rate of TCM Patent The patent grant rate (the number of applications/grants in the same period) reflects the quality of patent applications to some extent. Figure 3 illustrates the TCM patent grant ratio by SIPO during 1985-2006. The data suggests that the ratio in 1985-1992 declined in a non-linear manner, steadily increase from 1992-2000 and again declined in a non-linear manner since 2000. Therefore, the
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Because of the lag of patent granting, the increase of the granted patents resulting from the first revision of patent law could not be retrieved from the data.
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Figure 2: Statistics of Patent of TCM Granted by SIPO during 1985-2006. Date Source£∫China Intellectual Property Net Patent Database Service Platform, http://search.cnipr.com/ cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0 (last visited on 12 June 2008) patent applications quality of TCM experienced three periods: declining in a non-linear manner, steady growth, and again declining in non-linear manner. The decline of the granted rates probably results from blind pursuit of application numbers and the deterioration of application quality.
TCM International Patent Applications In 1998, there were only two TCM PCT applications, which accounted for 2.4% of China’s total of PCT applications. However, the proportion kept increasing with the number of patent applications rising each year, and reached 4.4% in 2000, and 4.5% in
Figure 3: The ratio of TCM patents granted by SIPO during 1985-2006. Date Source£∫China Intellectual Property Net Patent Database Service Platform, http://search.cnipr.com/ cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0 (last visited on 12 June 2008)
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2001. This change reflected the gradual participation of TCM enterprises in the world market competition. But the proportion of TCM PCT applications among all Chinese medicine applications was very low. In 2002, the proportion was only 0.6%, which means 99.4% of domestic TCM was not internationally patented, thus losing the international market share.7 Besides the Patent Law various methods are used to protect TCM. Until December 2005, China had registered 62.531 trademarks of TCM with 84 wellknown trademarks among them. In 1999-2005, the General Administration of Quality Supervision, Inspection and Quarantine of P.R.C. (SIQSAQ) gave geographical indications protection to over 600 TCM products. Additionally, some TCM software and databases were developed. Furthermore, trade secrets also play an important role in the protection of TCM. For example, Yunnan white drug-powder, anti-inflammatory and analgesic bolus, cow-bezoar bolus for resurrection, and pill of six ingredients with magical effects were listed as national secrecy prescriptions. The data from China’s State Drug Administration Web site shows that there are 1668 varieties of TCM under the protection of the Regulations on the Protection of Traditional Chinese Medicine Varieties, with 12 national First Grade varieties and 1656 national Second Grade varieties among them.
The Protection Object of TCM Patent TCM has two forms of prescriptions: simple and compound. A simple prescription is a new preparation containing the active ingredients extracted from TCM. A compound prescription is a hybrid of new compatibility of drugs developed under the guidance of TCM theory, aiming at certain pathological symptoms or with regard to pharmacology and pharmacodynamics. Judging by the active ingredients, TCM is divided into chemical compounds and effective parts. An extracted compound has a molecular formula, so its protection method is quite similar with that of western medicines. In contrast, an effective part is not a compound, but a mixture of all extractions without a known structure; therefore it cannot receive a high level of patent protection. Consequently, compared with the patent protection of the compound, components TCM and extraction effective parts of TCM
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Song Jiangxiu, The patent protection of TCM: the conditions, the problems and possible solutions. Chinese Journal of Information on TCM, 3, 91 (2005).
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have low level patent protection. TCM in this paper mainly refers to components (compound prescription) and effective parts extracted from TCM, due to the extremely small proportion of compounds extracted of TCM. In the following part, this paper mainly introduces the protection methods of products, process and use of TCM patents. Product Inventions of TCM According to different characteristics of the TCM components, TCM product inventions could be divided into extraction inventions, components inventions and combined preparation inventions of TCM.8 Extraction inventions of TCM include: (1) individual compounds extracted from TCM which have an explicit composition and a chemical structural formula; (2) extraction from single Chinese medicine raw materials-effective parts;9 (3) extraction from various Chinese medicine materials.10 Components inventions of TCM include: (1) components of TCM containing single active ingredients and characterized by the active ingredients, including the ones containing the active ingredients from primary source animals, plants, minerals and the extract and the ones containing the active ingredients from the primary source, e.g. medicinally used animals, plants, minerals and the extract; (2) components of TCM containing various active ingredients, including mixed powder of more than two kinds of traditional Chinese medicinal crops; mixtures of traditional Chinese medicinal crops and Chinese medicine extracts, and more than two kinds of Chinese medicine extract; (3) components invention of TCM characterized by the additive; (4) components invention of TCM characterized by the dosage form, namely those of new dosage form and ameliorative dosage form. Chinese medicine combined preparation inventions refer to the ones of Chinese medicine packaged medicinal preparations containing various products of TCM.
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Zhang Xiaoying, The research on patent protection of TCM. A master’s degree thesis of China University of Political Science and Law(2006).
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They have no compatibility features among raw materials, so they can be defined by the extracting methods, namely, methods of preparation: raw materials, process, and dissolvent used in extraction and processing conditions.
10 Because it is the extraction from various TCM and the ingredients are mixed in certain proportions, it can be defined by ”the characteristics of raw materials plus method of preparation” in the claims.
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Process Inventions of TCM Process inventions of TCM include the methods of extracting, sequestration and purification of the active ingredients, methods of preparation of Chinese medicine pharmaceutics and its processing sequence, the processing technologies of Chinese traditional medicinal crops and the producing methods of related products. They include: (1) the processing methods of Chinese traditional medicinal crops; (2) the cultivation methods of Chinese traditional medicinal crops; (3) producing methods of artifacts from Chinese traditional medicinal crops; (4) preparing methods of Chinese medicine extraction; (5) preparing methods of new Chinese medicine products; (6) ameliorative preparing methods of the known Chinese medicine products; (7) determination and evaluation methods of Chinese medicine products; (8) storage methods of Chinese medicine products. 11 Application Inventions of TCM The new medical application of a medicine is eligible for patenting if a known Chinese medicine can be used in a new medical treatment. The common application inventions in Chinese medicine include: (1) new medical function of animals, plants, minerals and their extraction; (2) second medical function of known Chinese traditional medicinal crops and their extraction. Moreover, industrial designs in TCM industry are patentable, mainly including the drug package, the physical shape of the medicine and its overall design characteristics.
The Impact of Patent Protection on the TCM Industry R&D Though TCM industry’s great achievements cannot be totally attributed to the patent system, the patent system has indeed greatly promoted the development of the TCM industry. The Patent Law has played an important role in the development of the TCM industry ever since the implementation of the law, especially, since the first revision in 1992. Since 1997, the TCM industry has achieved an annual output growth rate of over 20%, with the net profit ratio, ratio of income to sales and cost utilization rate above the average level of medicine industry. In recent years, the TCM industry has maintained a
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rapid development. The sales of Chinese patent drugs and TCM prepared in ready-to-use forms account for over 40% of the domestic medicine market. According to a statistics by Shanghai Pharmaceutical Industry Research Institute Information Centre, in 2005, the gross value of the industrial output (current value) of TCM achieved ¥116.97 billion, which accounted for 26.4% of the national medicine industry; products sales revenue ¥108.63 billion, 25.8%; and total profits of ¥10.21 billion, 29%. In 2002-2005, China’s TCM industry (including Chinese patent drugs industry and TCM prepared in ready-to-use forms industry) developed with a 20% annual increase rate of gross value of industrial output, an 18.5% annual increase rate of products sales revenue and 11.6% total profits.12 From January to May, 2007, the gross value of industrial output of Chinese patent drugs was ¥9.34 billion, and TCM prepared in ready-to-use forms¥47.66 billion, which rose by 32.91% and 19.7% respectively, compared with the same period last year. The whole industry maintained a rapid growth rate.13 From January to August, 2007, cumulative gross value of industrial output of China’s Chinese patent medicines industry achieved ¥90.51 billion with an increase of 20.1% compared with the same period last year; cumulative products sales revenue ¥80.56 billion with an increase of 19.4%; and cumulative total amount of profits ¥8.79 billion with an increase of 52.7%. From January to August, 2007, cumulative gross value of industrial output of China’s TCM prepared in readyto-use forms industry achieved ¥18.28 billion with an increase of 35.0% compared with the same period last year; cumulative products sales revenue ¥16.24 billion with an increase of 34.8%; and cumulative total amount of profits ¥8.6 billion with an increase of 34.6%.14 The Impact of Patent Protection of TCM on the Expense and Social Benefits of TCM Institutions’ R&D Figure 4 compares the numbers of TCM patent applications and grants, TCM R&D expenditures and the TCM hospital revenues and expenditures
12 Yao Zhengyu, The status quo of development and trends analysis of TCM industry. Chinese Journal of Pharmaceuticals, 10,127-132 (2007). 13 ”Money China” thematic editing group. The analysis of the status quo and the prediction of its developing trend of TCM. Money China, 10, 56-57 (2007).
11 Xiao Shiying, The technical guidelines of intellectual property protection and report. China Medical Science and Technology Publishing House, 38 (2005).
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14 2008 market analysis and investment consulting report of TCM. China Investment Advisory Network. http://www.ocn.com.cn/reports/2006087zhongyao.h tm (last visited on 8 October 2008).
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from 1998-2006.15 It shows that the number of TCM patent applications and grants increased at the beginning then later declined. The number of TCM patent applications peaked in 2003 (4358), and the number of the grants peaked in 2002 (1508). TCM intuition R&D expenditures distinctly climbed with the largest increase from 2002-2003. The changes of the total revenues and expenses of TCM hospitals were basically in the same condition - significant increases with the largest increase from 2002-2003. It can be concluded that the change of the number of patent applications and grants of TCM exerts no distinct influence on the R&D expenditures of TCM institutions and the social benefits of TCM. This paper holds that the reasons for the phenomenon
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are: (1) the TCM patent protection has improved considerably and TCM industry has developed greatly in recent years; therefore, the R&D expenditure of TCM institutions and the revenues and expenditures of TCM hospitals are rising significantly; (2) because of the particularity of the patent protection object of TCM, it is normal that the number of TCM patent applications and grants will drop when it increases to a certain point. The reason is that the TCM patent protection has its certain object and content so the protection coverage is limited. The level of TCM patent protection is continually rising, while the number of TCM patent applications and grants will stabilize or even decline at a certain point .
Figure 4: An overview of the number of TCM patent applications and grants, TCM R&D Expenditures and TCM Hospital payments from 1998£≠2006 Date Source£∫China Intellectual Property Net Patent Database Service Platform, http://search.cnipr. com/cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0£ªStatistical Data Column, State Administration of TCM of P.R.C. Net, The Statistics Excerpts of Traditional Chinese Medicine, http://www.satcm.gov.cn/96/ the National Statistics Excerpts of Traditional Chinese Medicine/main.htm (last visited on 3 June 2008 ).
15 Although accessible authoritative data is limited, we can just study the number of TCM patent applications and grants, TCM R&D expenditures, and the TCM hospital balance of payments from 1998-2006. The following data are in the same condition.
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The Impact of TCM Patent Protection on the TCM Institution Human Resources In recent years, TCM human resources have greatly developed. Statistics shows that the R&D staff in Chinese medicine manufacturing enterprises accounted for 25.4% of the entire medicine manufacturing industry in 2005. In 2006, the number of the R&D staff in business circles was 5748, and institutions 4578.16 In Chart 5, a comparison is made between the number of patent applications and grants, the R&D staffs in TCM institutions, and college students majoring in TCM.17 The number of patent applications and grants of TCM will not be repeated here since it has been mentioned previously. As shown in Figure 5, the number of the R&D staff in TCM institutions, and college students
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majoring in TCM increased except in 2000. Both components increased from 2000-2002, and the number of TCM institution R&D staff had a relatively larger margin of increase. From 2002-2006, the number of the R&D staff in TCM institutions had no significant changes, while the number of college students majoring in TCM continued to increase, especially from 2003-2005. It can be concluded that there is no direct relationship between the number of patent applications and grants and the number of the R&D staff in TCM institutions according to the changes of the number of patent applications and grants and the number of the R&D staff in TCM institutions and college students majoring in TCM (see Figure 5.).
Figure 5: An overview of the number of TCM patent applications and grants, the TCM R&D staff and the number of Students in TCM Colleges and Universities from 1999£≠2006 Date Source£∫China Intellectual Property Net Patent Database Service Platform, http://search.cnipr. com/cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0£ªStatistical Data Column, State Administration of Traditional Chinese Medicine of P.R.C. Net, The Statistics Excerpts of Traditional Chinese Medicine, http://www.satcm.gov.cn/96/ the National Statistics Excerpts of Traditional Chinese Medicine/main.htm (last visited on 3 June 2008 ).
16 Hong Wei, Happiness and worries on the internationalization of TCM. Technology Times, 2008-01-18.
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17 ”College students majoring in Chinese medicine” refers to the sum of the postgraduates, the undergraduates and the junior college students who passed the national unified entrance exam that year.
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The Impact of TCM Patent Protection on the Scientific/Technical Output of TCM Institutions Figure 6 compares the number of TCM applications and grants, the amount of scientific papers of institutions, and the number of papers delivered overseas. The number of TCM applications and grants will not be repeated here since it has been mentioned previously. In this period, the amount of scientific papers of institutions first declined by a small margin and then increased gradually with no significant rise, except for the rapid increase from 2005-2006. The number of papers delivered overseas changed in a non-linear manner, with no significant fluctuation. It dropped to the bottom in 2001 (66) and peaked in 2004 (130). It can be concluded that there is no direct relationship between the number of Chinese medicine patents applied and granted and the numbers of the scientific/technical output of Chinese medicine research institutions.
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The Challenges Confronting TCM Patent Protection and the Solutions Currently, the TCM industry is facing great opportunities. Until 2005, the government of China had signed agreements concerning TCM with 70 nations; TCM is accepted and protected by the law in Australia, South Africa and some other nations; acupuncture and moxibustion have legal permissions in most nations. The annual trade volume of Chinese herbal medicine and Chinese patent medicines has exceeded US°Á15 billion. Thirty percent of the population in Europe has used Chinese medicine, and 10% of the doctors in Germany have received preliminary training of acupuncture and moxibustion. A TCM cooperative research project has been set under FP7 of the EU.18 However, the TCM patent protection is also confronted with severe challenges. These challenges
Figure 6 Comparison of the amount of TCM patent applications and grants and the amount of scientific/technical papers of institutions from 1998-2006 Date Source£∫China Intellectual Property Net Patent Database Service Platform, http://search.cnipr. com/cnipr/zljs/indexGuest.jsp?ret=0&channelid=14%2C15%2C16&searchType=0£ªStatistical Data Column, State Administration of Traditional Chinese Medicine of P.R.C. Net, The Statistics Excerpts of Traditional Chinese Medicine, http://www.satcm.gov.cn/96/ the National Statistics Excerpts of TCM /main.htm (last visited on 3 June 2008 ).
18 Zheng Tianhong, Bai Jiechun, Wang Pan, To break the „barriers to trade mark“ of TCM. http://www.gd.xinhuanet.com/2005-04-21 (last visited on 10 June 2008).
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stem from two aspects: (1) the intrinsic characteristics of TCM; (2) the loss of TCM resources. These two factors together lead to inefficient TCM patent protection. Firstly, the open requirement of the claims of patent application undermines the patent protection of TCM. A formula is the essence of a TCM patent. It must be publicized in a patent application according to the Patent Law. But it will be fairly difficult to determine the infringements when the formula is separated and recombined into a new one. In those cases, an improper solution would result in insufficient TCM patent protection. Secondly, the patentability examination could be challenging for TCM patent applications to pass because of the characteristics of TCM compound prescriptions. On the one hand, the traditional feature of TCM is not compatible with the novelty requirements of patentability. Simple prescriptions of TCM, especially compounds extracted from TCM, probably can fulfill the novelty requirements, but because of the traditional features and the resources of new TCM - ancient books, the requirements could be a barrier to TCM patent protection for the TCM compound prescriptions. On the other hand, it is difficult to determine creativity because of the flexible components of TCM formulas. Using reverse engineering techniques, competitors could produce the same kinds of TCM after separating and recombining the core formula of a TCM or changing the proportion of each medicine to form a new formula. The ”revised” formula’s creativity is hard to determine in a patent application. Thirdly, the uncertainty of the active ingredients in a TCM formula also leads to the difficulty of determining patent infringements. The patented western medicine generally has fixed chemical structural formulas, so it is easy to determine infringement. Compared with western medicine, many TCM formulas are compounded from over two medical substances, with no fixed chemical structural formula. Since the active components of a formula are often difficult to define, it is difficult to determine the infringement if the components or the proportion of the formula are changed to form some ”new” one. Therefore, it is difficult to determine if violations occur that would meet a court challenge. All these factors undermine the TCM patent protection. Lastly, because of the defects of the TCM protection system, especially the TCM patent protection system, China’s TCM resources have been drained in recent years, which has challenged the development of the TCM industry. Firstly, overseas enterprises import cheap Chinese traditional medical
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crops and develop new medicine to encroach on the international market of TCM. According to a statistics by the SIPO, Japan and South Korean hold 80%90% of the international TCM market, while 70%80% of their raw materials are from China. China’s 4.000 preparations only account for 3%-5% of the international market. Japan has invested heavily on TCM R&D and its annual total output value has exceeded 100 billion yen, although it has only obtained 210 formulas from Treatise on Febrile Disease and Synopsis of Prescriptions. South Korea has achieved US°Á70 million annual output in only one TCM: ”cow-bezoar sedative bolus”. Secondly, overseas enterprises develop new drugs from TCM and apply for patents to stifle China’s TCM industry. Taking Teikoku Seiyaku Co., Ltd. in Japan as an example, it applied for and received USA patents on four compound prescriptions mainly treating ulcerative colitis ”modified ease powder”, ”Chinese angelica root and lactiflora peony root soup”, ”cinnamon twig and Tuckahoe pills” and ”paeonia lactiflora and hay soup”.19 In another example, the USA have owned 8 patents on peppermint originated from Jiangsu in China. Among the 68 patents on precious TCM herd gingko in China, four are owned by foreigners, but the four cover almost all the extraction processes of gingko. To further facilitate the development of TCM industry, this paper offers the following suggestions besides improving the patentability examination and infringement determination rules of TCM. Firstly, taking advantage of the coming third revision of the Patent Law, an inheritance resource disclosure mechanism should be introduced to enhance TCM patent protection. The revised draft of the Patent Law provides that the invention cannot be patented if the acquisition and utilization of inheritance resources from which the invention derives, violates the related laws in China; if the invention comes from inheritance resource, the applicants should disclose this in the patent description. If the provisions are to be enforced, the loss of TCM resources could be reduced to some extent. Secondly, the relationship between the Patent Law and other systems of TCM protection should be coordinated, so as to increase the effi-
19 ”Modified ease powder” is from Peace Huimin Mixture, ”Chinese angelica root and lactiflora peony root soup”, ”cinnamon twig and tuckahoe pills” from Synopsis of Prescriptions of Golden Chamber, ”Paeonia lactiflora and hay soup” from Treatise on Febrile Diseases.
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ciency of laws and regulations and industry policies, and thus promote the development of the Chinese TCM industry. Besides the Patent Law, other laws, regulations and industry policies also play important roles in the development of TCM, such as The Trademark Law, the Regulation on the Protection of Chinese Medicines and The Regulations on the Protection of New Varieties of Plant. They provide a multi-level protection for TCM. But their compatibility is low, and there even exist some conflicts. Some voids remain in the TCM protection. Lastly, the legislative body should initiate special TCM protections aimed at the unique features of the TCM industry to promote its modernization.
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Acknowledgements Preparation of this paper was financially supported by the National Natural Science Foundation of China (batchnumber: 70633003) and National Social Science Foundation of China (batchnumber: 07&ZD006).
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