Brand owners suffer the side effects of new generic drugs law

Argentina

With the effect of weakening the trademarks of large pharmaceutical companies, Parliament has approved a new law which requires that all prescriptions for medicine must be made using the medicine's international non-proprietary name. In addition, pharmacists must substitute trademarked medicine with a cheaper alternative (ie, a generic), unless the patient specifically requests otherwise. The legislation is part of a government plan to facilitate access to medicine (eg, HIV-related drugs).

The requirement to replace trademarks with international non-proprietary names in prescriptions will particularly weaken the marks of medicines manufactured by the companies that invented and developed the products. Many of these marks are well known and have become associated with particular types of medicine.

Another issue is that a pharmacist, faced with a prescription containing the trademark of a leading medicine, will use that trademark to identify and substitute a generic drug manufactured by a third party. The leading brands will therefore function as a basic indicator of quality before being replaced by another product of a different source and perhaps different quality.

It remains to be seen whether the courts will find that using a trademarked good to induce substitution amounts to trademark infringement (as has been found in certain European jurisdictions).

Fernando Noetinger, Noetinger & Armando, Buenos Aires

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