Israeli Experts Warn of New Patent Law's Consequences

Israeli intellectual property specialists have claimed that the country's new patent law is set to have a counter-productive effect, and could lead to "aggressive" US retaliation on patent violations. Last week, the Office of the US Trade Representative put the country back on its "Priority Watch" list of countries that are in violation of internationally accepted patent practices.

This year's amendment to Israel's 1967 Patents Act, as well as the country's recently-introduced data exclusivity bill, have created widespread concern among multinational pharmaceutical firms. In this regard, a 1988 reform to patent laws, known as the "Teva amendment," has also proved especially controversial. The measure effectively allows generic drugmakers to conduct clinical trials on new products in Israel before expiry of the ethical equivalent's patent, thus allowing Israeli generics makers a competitive edge over rivals in other countries.

The latest amendment retains these provisions, which are aimed at protecting Israel's sizeable domestic generics export industry. Although authorities have proposed five-year patent extensions for ethical drugs, experts allege that this period will in fact amount to no more than 30 months.

Assuming it is approved, the latest patent amendment is expected to have consequences for Israel beyond the pharmaceutical sector. Hi-tech industries account for a significant proportion of the country's more valuable exports, prompting fears that a failure to comprehensively enforce patent laws threatens international patent recognition in some of Israel's other strategic industries.