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Trade secrets and the public interest

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Yesterday, I attended the GRUR-AIPPI Joint Brussels Workshop, on behalf of EFPIA together with about 100 people. This impressive number clearly signals both how hot and timely the topic chosen was, i.e. the proposed EU framework for protection of undisclosed know-how and business information. Its nickname: trade secrets.

By harmonising the protection against unlawful acquisition, use or disclosure, the Proposal enables trust between companies. Trust lies at the very heart of every fruitful research and development collaboration between companies.

A second misunderstanding about the legislation is that it is about defining what can and cannot be a trade secret. In reality trade secrets are very diverse. It was rightly hammered home today: this Proposal is not about trade secrets – it is about the misappropriation and misuse of trade secrets!

It is about having an idea, an asset – and a good one – investing time and resources into realising its potential and having protection to prevent this from being stolen. It is about doing better than them and retaining your competitive advantage. As was rightly pointed out today, all companies on the market have secrets. Were this not the case, they would simply cease to exist.

As vital assets for innovative companies, harmonising the legal framework for protecting trade secrets is key to their competitiveness. This Directive will not prevent you from having the same idea and using it. But it will prevent you from using illegitimate means to get hold of and exploit my idea.

Theft Prevention

It was rightly underscored today: this Proposal is not about trade secrets – because secrecy is not something you can regulate – it is about the misappropriation and misuse of trade secrets! By harmonising the protection against unlawful acquisition, use or disclosure, the Proposal promotes trust between companies. Trust lies at the very heart of every fruitful research and development collaboration between companies.

EFPIA therefore welcomed the Commission Proposal. A number of provisions could be clarified and improved, but this is not an easy task, given the diversity of trade secrets as a subject matter. The majority of discussions around the Proposal have so far focused on where to draw the line between the companies’ interest in preserving their competitiveness and the public interest. The public interest comes into play in relation to press freedoms, employee mobility and environmental policy, among other issues.

Speakers yesterday illustrated this actual – or potential – conflict between over- and under-protection with many creative and impressive metaphors. Of course, trying to define the public interest is at the very least tricky and most probably a dead-end. So it all comes down to careful calibration and recognising the interests to be balanced.

One area that is off-limits in this discussion (or should be) is how EU Institutions disclose data. This is governed by other legislation and the requirements tend to be very thoroughly documented, so that all stakeholders can understand what will be disclosed and on what grounds. While such disclosures can and do affect competition between companies, they are not instances of misappropriation or misuse.

Zooming in to what is of particular interest to our industry, one of these conflicts opposes the protection of trade secrets and the disclosure of information to and by EU or national regulatory authorities. EFPIA, however, doesn’t believe there is an actual conflict here.

Transparency Remains Important

Contrary to what has been argued, EFPIA understands and agrees that the way in which these institutions deal with the data that is submitted to them, in particular for the purposes of marketing authorisation, is outside the scope of the proposed Directive (cf. Recital 9).

This Directive will not be a basis for obstructing disclosure and transparency obligations. Moreover, it is clear and agreed that this Directive will have absolutely no bearing on existing legislation on public access to information, on pharmaceutical companies’ obligations under the new Clinical Trials Regulation, or on the European Medicines Agency’s policy on publication of clinical data.

The question of whether, within the data submitted or disclosed, there are some commercially confidential elements, and how public authorities deal with these elements is, of course, of critical importance. It is however distinct from the Trade Secrets Directive and subject to its own calibration within the relevant regulations. It is not for the Trade Secrets Directive to legislate on that matter.

There is also no obligation to keep undisclosed data secret. Our industry has made commitments to data sharing to enhance research and scientific knowledge, advance patient care and improve public health. Under these EFPIA-PhRMA Joint Principles for Responsible Clinical Trial Data Sharing to Benefit Patients, biopharmaceutical companies will dramatically increase the amount of information available to researchers, patients, and members of the public. The Trade Secrets Directive will not be a pretext to step back on these.

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