[e-drug] Prescription for pain (Le Monde Diplomatique, March 2003)

[Richard Laing <richardl@bu.edu>]

E-drug: Prescription for pain (Le Monde Diplomatique, March 2003)
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Here is an interesting article by James Love on the Doha dispute. It
was published recently in Le Monde Diplomatique (long message!)

Richard Laing
richardl@bu.edu

---
March 2003
WTO RENEGES ON DRUG PATENTS: Prescription for pain
By James Love

Despite the promise made by the World Trade Organisation in
2001, Northern pharmaceutical companies and wealthy Western
nations are still preventing Southern countries from getting
desperately needed drugs cheaply.
_______________________________________________________

Was it a policy change or a slip of the tongue? One phrase in
President George Bush's State of the Union address in January left
observers bewildered. After announcing a major increase in US
funding for the worldwide battle against Aids, he noted that the
cost of retroviral treatments had fallen from $12,000 to $300 a
year, even though only manufacturers of generic copies charge
$300. Bush, like President Bill Clinton before him, has noisily
combatted generic drugs in international forums, even though, to
quote Bush, their lower cost "places an immense possibility within
our grasp".

For the past two years the World Trade Organisation has been in
bitter dispute over patents on medicinal drugs. Powerhouses such
as the US, the European Union, Japan and Canada want to
backtrack on the Doha agreement of November 2001. And US
intransigence scuttled last-minute WTO talks in Geneva last
December.

The argument is about the right of countries to provide health care
by overriding drug patents. Wealthy countries, which have a virtual
monopoly on drug patents, compiled a list of suitable diseases:
Aids, tuberculosis, malaria and a few mainly tropical ailments of
little commercial interest. Wealthy countries have been trying to
apply the Doha agreement only to these diseases; no provision for
cancer, diabetes or asthma.

Those wealthy countries also raised technical questions in order to
further restrict the scope of the agreement. These pertained to
limiting the number of countries authorised to override patents;
restricting qualifying technologies; and creating complicated, costly
and restrictive legal requirements that threaten supplies of generic
equivalents of patented drugs. Wealthy countries have conspired
against the poor, undermining and breaking the promises made in
2001.

How did this happen? The events leading to the WTO meeting in
Doha were dramatic: large pharmaceutical companies filed a lawsuit
to force South Africa to drop an amendment to its patent laws.
What ensued was a public-relations nightmare: HIV-positive South
Africans protested in 2001 and broadcasts of the courtroom
proceedings were devastating for the plaintiffs; people in wealthy
countries were ashamed. The US also asked the WTO to overturn a
Brazilian law on overriding patents, although it eventually dropped
the case amid widespread public criticism.

After the 11 September 2001 attacks the US faced a bioterrorism
threat. Public officials and news organisations received anthrax
spores in the mail, leading to five deaths and widespread panic over
access to Cipro, a drug used to treat strains of the disease. To
ensure adequate low-cost supplies, Canada and the US threatened
to override Bayer's patents on Cipro. Even though this action was
justifiable, it defied the vigorous attempts to prevent Brazil and
South Africa from taking similar steps to fight Aids.

The WTO then met in November 2001. Forced on to the defensive,
wealthy countries approved a statement affirming the right of all
countries to protect public health. Hailed as the beginning of a new
era in international trade, the arrangement was seen as fairer for
poor countries. But in the 14 months after the WTO meeting,
negotiations on implementing the Doha agreement went out of
control as the US and the EU consolidated their support for big
pharmaceutical exporters. The progress in Doha was a setback for
public health groups and developing countries.

The battle centres on the WTO's agreement on trade-related
aspects of intellectual property (Trips), one of the organisation's
three pillars (1). In theory the Trips agreement is flexible, allowing
countries to protect public-interest concerns, including health care.
One of the most important provisions concerns compulsory licences
on patents. Governments can legally force patent holders to
authorise licences enabling drugs to be produced locally; the patent
holders are entitled to modest financial compensation under the
terms of the licences.

In Doha the WTO's entire membership approved a powerful
statement on the Trips agreement and public health issues. It
stipulated that Trips "should be interpreted and implemented in a
manner supportive of WTO members' right to protect public health
and, in particular, to promote access to medicines for all". This
shocked the big pharmaceutical companies, which responded by
focusing on one of the statement's key implementation provisions.

Paragraph 6 of the Doha statement called on the WTO to resolve
restrictions on drug exports. When a country issues a compulsory
licence for a patent, any generic copies made by local companies
are assumed to be primarily for the domestic market. But if
countries manufacturing generic drugs cannot export them, how
can a country without a domestic pharmaceutical industry acquire
generic drugs? Because economies of scale are so crucial to the
pharmaceutical industry, how will domestic manufacturers in a
small country ever achieve commercial viability? One reasonable
solution fits the WTO's free-trade agenda: allowing all countries
with public health concerns to override patents and import generic
copies of patented drugs. This would be a prac tical way to make
low-cost medication available, easing suffering and saving millions
of lives. But how will the statement be implemented? To Robert
Zoellick, the US trade representative, and Pascal Lamy, the EU
trade commissioner, paragraph 6 is a pretext allowing them to turn
the Doha statement on its head, after enjoying its media benefits. In
the final days of marathon negotiations last December, the US,
under pressure from the pharmaceutical lobby, reduced the list of
diseases covered by the Doha statement.

Unsupported by any public health criteria, Washington's list was
opposed by 143 of the 144 WTO member-countries, and also by Dr
Gro Harlem Brundtland, the outgoing director- general of the World
Health Organisation and her successor, Dr Jong Wook Lee. This did
not stop the EU trade commissioner from trying to relaunch
negotiations in January by producing a similar list. Referring to
diseases not included on his list, Lamy's office implied that prior
consultation with the WHO would ensure the involvement of "a
trusted authority to smooth the progress of negotiations" (2). Trust
is a loaded term that emphasises a range of bilateral pressures.

The US and the EU are offering poor countries a cruel and difficult
choice: either accept a tainted deal with complexities, limitations
and restrictions that in the end will function, badly, in only a few
countries, or get nothing at all. As Zoellick said: "The problem on
that issue was that more and more countries wanted the ability to
import from third countries, including countries that have very
strong pharmaceutical industries. And so you expand the set of
countries that were supposed to use this special privilege to about
120. And then some countries wanted to expand the scope of
disease. So if you take what's supposed to be an exception for
special circumstance, expand it to almost every country except the
OECD [Organisation for Economic Cooperation and Development]
countries, and expand it to every disease, you've blown a hole in
the whole intellectual property regime" (3).

Overriding patents will continue to be a simple procedure in wealthy
countries, where markets are large and governments quick to issue
compulsory licences. Cipro was not an isolated case: the US
recently issued hundreds of compulsory licences on a range of
technologies, including tow trucks, corn varieties, pharmaceuticals,
gene patents, computer parts and software.

After informing developing countries that "drugs don't invent
themselves", Lamy took no action when Japan called for vaccines
to be excluded from the negotiations. His staff tell reporters that
patents should be overridden only for Aids and tropical diseases,
not for diabetes, cancer or asthma. Meanwhile the EU is in the
process of implementing compulsory licences for patents on new
plant varieties. The United Kingdom, France and Canada have all
indicated that they will override Myriad's patents on genes linked to
breast cancer (4). The Roche pharmaceutical group recently used a
compulsory licensing law in Germany to obtain a "voluntary"
licence from Chiron, a California-based biotechnology firm that
holds patents on an HIV blood-screening procedure.

The arguments are complex, but some points are clear. What Lamy
and Zoellick say about the merits of compulsory licensing is a false
debate. After all, the WTO agreement already gives every
member-country the right to override patents on any product for
any reason. The real issue is whether this right can be asserted
effect ively by countries with small domestic markets, considering
that the WTO's patent rules become binding in 2005, when generic
drug producers will no longer be able to supply low-cost exports.

Nothing indicates that developing countries will abuse their right to
issue compulsory licences; if anything, they are not using
compulsory licensing enough, since they fear intimidation and
reprisals. Last year South Africa, with 5 million HIV-positive citizens
(5), turned down a request for a compulsory licence relating to Aids
drugs from Cipla, an Indian manufacturer. Brazil negotiated lower
prices after threatening to issue compulsory licences three times:
twice for high-priced Aids treatments and once for Glivec, a
$50,000-a-year leukaemia drug.

Proclaiming that pneumonia, diabetes, asthma, heart disease and
cancer do not primarily affect the poor is either cynical or incredibly
ignorant. Most cancer deaths happen in poor countries, where 80
million cancer patients have no access to health care. Hypertension
affects 22% of the adult population in the Seychelles and 30% in
Cuba. Every year there are 180,000 deaths from asthma around the
world, mostly among the poor; in non-lethal cases patients often
suffer from lack of treatment. Asthma also affects 20-30% of
children in countries such as Brazil, Costa Rica, Kenya, Panama,
Peru and Uruguay. Two-thirds of the deaf people in the world live in
developing countries. India has more than twice as many diabetics
as the US, and Ethiopia has more cases of diabetes than
Switzerland. Aids-compromised immune systems mean that every
illness, no matter how trivial, can be fatal.

The developing countries are not investing enough in health care
because they are deep in debt. Every dollar saved on drug
treatments, vaccinations and tests could be earmarked for new
supplies, more expensive medications, improved health-care
infrastructure or higher salaries for doctors and nurses. The Doha
agreement was a good-faith effort that was supposed to remove
the main legal barriers preventing developing countries from
achieving universal access to medical care. But since November
2001 the world's wealthiest countries, best-off in living standards
and health care, have sabotaged it.
 ____________________________________________________

* James Love is a director of the Consumer Project on Technology,
Washington (www.cptech.org)

(1) The WTO's other two pillars are the general agreement on tariffs
and trade (Gatt), covering rules for international trade in goods, and
the general agreement on trade in services (Gats).

(2) Lamy's office was responding to Le Monde diplomatique, which
questioned the source of his list.

(3) Press conference, 16 January 2003: www.ustr.gov

(4) See John Sulston, "Heritage of humanity", Le Monde
diplomatique, English language edition, December 2002

(5) See Philippe Rivière, "South Africa's Aids apartheid", Le Monde
diplomatique, English language edition, August 2002.

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