Governments can override patent rights when necessary. In such instances, the government authorizes a third party to use the patented invention without the patent holder's permission. This authorization comes in the form of a compulsory licence.
The World Trade Organization's (WTO) Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) describes the conditions in which a WTO member may issue a compulsory licence. Prior to the August 2003 decision of the WTO, members could only issue a compulsory licence if it was predominantly for the supply of the domestic market. Developed countries could issue compulsory licences to supply their domestic markets but they could not do so to supply developing countries.
The August 2003 decision of the WTO waived the domestic supply requirement thereby enabling WTO members with pharmaceutical manufacturing capacity to authorize a third party to manufacture and export lower cost versions of patented pharmaceutical products to countries with insufficient or no capacity to manufacture those products. Canada's Access to Medicines Regime implements the August 2003 Decision of the WTO and provides the legislative and regulatory framework authorizing the Commissioner of Patents to grant export-only compulsory licences.
A compulsory licence under Canada's Access to Medicines Regime authorizes the manufacture and export of an eligible drug or medical device to an eligible country. However, if the product is patented in the importing country, a compulsory licence must be granted by the importing country's government to authorize its import.