Israel: Revised Patent Law Passes First Reading

The Israeli Knesset (parliament) has passed the first of three readingsof the revised patent law, which is part of a batch of government-approved structural reforms appended to the annual budgetary proposals sent to the Knesset. If the revised law is ratified, it would allow Israeli companies to work on a patent before expiry, in order to commence marketing of generic alternatives as soon as the patent expires.

The USA and the European Union have long campaigned against this proposal. The USA has placed Israel on a list of countries being monitored for breach of intellectual property rights, while the EU prefers at this stage to focus on negotiation to settle the dispute, but both say the proposal contradicts free trade agreements with Israel. Israel's Ministry of Industry, Commerce and Trade disagrees, saying the dispute results from pressure exerted by foreign drug companies on their governments for fear of increased competitiveness from Israeli companies.

Representatives of US and European drug companies, meeting with Israeli Treasury Minister Yaakov Neeman, have told him that the law would make foreign companies hold back from establishing R&D in Israel. The delegation, which reportedly includes Merck & Co, Glaxo Wellcome and Neopharm, one of Israel's largest importers, was also due to meet with ICT Minister Nathan Sharansky and the Minister of Justice, Moshe Negbi.