[e-med] (2)UE: Audition sur les accords Adpic et l'accès aux médicaments

["Dominique Kerouedan" <d.kerouedan@skynet.be>]

Audition au Parlement européen à Bruxelles sur les accords
ADPIC et l'accès aux Médicaments


Chers amis, 
 
Je vous transmets ci-joint les présentations faites hier aux Députés
européens sur les ADPIC et l'accès au Médicament, par des représentants
de l'OMC, de MSF, de la Fédération Européenne de l'Industrie
pharmaceutique, l'Inde et le Brésil, en session organisée par la
Commission sur le Commerce International. 
 
Vous avez également le programme de cette session, 
 
L'ensemble des communications peuvent être demandées en version papier à
l'adresse suivante: 
 
Secretariat of the Committee on International Trade
European Parliament
ATR 03K080
Rue Wiertz, B-1047 Brussels
Tel. +32-2-284.36.38  Fax + 32-2-283.12.51
E-mail: lluoma@europarl.eu.int
 
amicalement
 
Dominique Kerouedan
d.kerouedan@skynet.be
*********************
552533EN.doc PE 350.279
EUROPEAN PARLIAMENT
PE 350.279
COMMITTEE ON INTERNATIONAL TRADE
HEARING ON
TRIPS AND ACCESS TO MEDICINES
on Tuesday, 18 January 2005
at 9.00 a.m. - 12.30 p.m.
Hemicycle - Brussels
PROGRAMME
9.00 - 9.15
Opening of the Hearing by Enrique Barón Crespo, Chairman of the
Committee on
International Trade
9.15-9.25
Presentation by Roger Kampf, Counsellor, Intellectual Property Division,
World Trade
Organisation
9.25-9.35
Presentation by Ellen F.M. 't Hoen LL.M., Director policy advocacy and
research, Médicins
Sans Frontières, Access to Essential Medicines Campaign
9.35 - 10.15
Questions and comments by members
PE 350.279 2/2 552533EN.doc
10.15-10.20
Presentation by Peter Bains, Senior Vice-President, Commercial
Development,
GlaxoSmithKline/European Federation of Pharmaceutical Industries and
Associations (EFPIA)
10.20-10.25
Presentation by William F. Haddad, Chairman/CEO of the Generic
Pharmaceutical Industry
Association, representing Cipla, Ltd. (India)
10.25-11.15
Questions and comments by members
11.15-11.25
Presentation by Maigari Gurama Buba, First Secretary, Nigeria Trade
Office to the WTO
11.25-11.35
Presentation by Francisco Pessanha Cannabrava, Head of Trade Sector,
Embassy of Brazil to
Mexico
11.35-12.15
Questions and comments by members
12.15-12.30
Conclusions

*******************
EUROPEAN PARLIAMENT
COMMITTEE ON INTERNATIONAL TRADE
HEARING ON TRIPS AND ACCESS TO MEDICINES
Tuesday 18 January 2005
Presentation by Ellen ?t Hoen
Médecins Sans Frontières (MSF) Access to Essential Medicines Campaign
The magnitude of the AIDS crisis has drawn attention to the fact that
millions of people in the developing world do not have access to the
medicines that are needed to treat disease or alleviate suffering. Each
day, close to eight thousand people die of AIDS in the developing world.
The reasons for the lack of access to essential medicines are manifold:
logistical supply and storage problems, substandard drug quality,
inappropriate selection of drugs, wasteful prescription and
inappropriate use, inadequate production, prohibitive prices and lack of
financing for health care.
In many cases, however, high drug prices are the main barrier to needed
treatments. Prohibitive drug prices are often the result of strong
intellectual property protection. Governments in developing countries
that attempt to bring down the price of medicines have come under
pressure from industrialised countries and the multinational
pharmaceutical industry. For instance, in 2001, 39 drug companies took
the South African government to court over its medicines act. More
recently, Guatemala has come under pressure to implement "TRIPS-plus"
data protection rules.
The 1995 World Trade Organization (WTO) Trade-Related Aspects of
Intellectual Property Rights (TRIPS) Agreement sets out minimum
standards for the protection of intellectual property, including patents
on pharmaceuticals. These standards derive from wealthy Western nations
and are not necessarily appropriate for developing countries. The TRIPS
Agreement has come under fierce criticism for this "one size fits all"
principle because of the effects of increased levels of patent
protection on drug prices.
MSF has witnessed the effects of patents on the prices and availability
of medicines, in particular newer medicines, and has documented the
patent practices in the countries where it works1. It should be no
surprise that patent protection translates into high drug prices:
patents create monopolies and monopolies lead to higher drug prices. As
soon as the monopoly ceases to exist, prices come tumbling down. Figure
1 below shows the effect of generic competition on the price of
first-line AIDS triple therapy. 1
1 Médecins Sans Frontières (MSF) "Drug patents under the spotlight -
Sharing practical knowledge about pharmaceutical patents", June 2004.
In addition to their impact on prices, patents may also hamper the
development and availability of recommended formulations. An example is
the problem of developing fixed dose combinations (e.g. the "three in
one" pill for AIDS treatment) when the patents of the individual
components are held by different companies. These fixed dose
combinations are particularly important in AIDS treatment. Some
recommended fixed dose combinations are now available from Indian
producers because until 2005 pharmaceutical product patents were not
granted in that country and therefore did not create a barrier to
formulating these products.
Why do we have patents?
The patent system is a social policy tool which aims to stimulate
innovation. The idea is that by providing limited exclusivity to the
"inventors" of products, which comes at a price, innovation will be
promoted and society as a whole will benefit from the availability of
new and improved products.
Patents and Research and Development
However, a major problem of the current patent system is the imbalance
between rights and obligations: the patent system is intended as a
stimulus for innovation, but there is no mechanism for directing that
innovation, and as a result many diseases are totally ignored. Drug
research and development, which is almost exclusively confined to the
private sector, is skewed towards areas that promise a profitable
return. This is a logical consequence of the patent-driven R&D mechanism
our societies rely on these days. Thus in the last 25 years, almost
1,400 new medicines have been developed, but only 1% of these were for
tropical diseases (see figure 2).
Figure 1. Effects of Generic Competition on ARV Prices
2
These diseases kill tens thousands of people every year, but because
they are almost entirely confined to the developing world, they do not
represent a profitable market for industry.2
Tuberculosis: 3
Tropical diseases: 13Tuberculosis: 3Tropical diseases: 13
Patent protection has increased over the last 20 years, but the mean
innovation rate has fallen, with an increase in the number of ?me-too
drugs? of little or no therapeutic gain, as shown in figure 3 below.
This global crisis in innovation has of course a disproportionately
heavy impact on the needs of people in developing countries.
Figure 2. Drug Development Outcome
1975-1999: 1393 new chemical entities marketed
Figure 3. Innovation in France 1981-2001
Adapted from Prescrire International, April 2001/Vol 10, n° 52 p 54
2 Trouiller P, Olliaro P, Torreele E, Orbinski J, Laing R, Ford N. Drug
development for neglected diseases: a deficient market and a
public-health policy failure. Lancet 22 June 2002 359;9324: 2188-2194.
3
By adopting the Doha Declaration on TRIPS and Public Health in 2001, the
WTO recognised some of the concerns raised by developing countries
regarding access to medicines. The Doha Declaration lays out the
flexibilities contained in the TRIPS agreement which countries can use
to overcome the barriers posed by patents. It also extends the
"transition period" - during which Least Developed Countries (LDCs) are
not obliged to enforce or grant patents on pharmaceuticals products -
until 2016. The EU supported the Doha Declaration as an important tool
to help increase access to medicines.
However, in recent years, we have seen a systematic dismantling of the
Doha Declaration through bilateral trade agreements with the United
States, which include so-called "TRIPS plus" provisions: these annul the
achievement of Doha and confirm the lack of political support for the
use of TRIPS flexibilities.
Post 2005
Following the full implementation of the TRIPS Agreement as of 1 January
2005 in India and the few other developing countries not yet granting
pharmaceutical patents, access to new drugs is expected to become more
difficult. For example, most of the ARVs currently available at
affordable prices come from India. Successful AIDS programmes such as
those of Brazil and Thailand were possible because key pharmaceuticals
where not patent-protected and could be produced locally at much lower
costs.
>From 2005 onwards, all new drugs may be subject to at least 20 years of
patent protection in all but the least developed countries and the
occasional non-WTO country such as Somalia, Palestine or Macedonia. A
number of developing countries that are presently scaling up AIDS
treatment have expressed their concern to the World Health Organization
about the effects of TRIPS implementation in India.3
Because TRIPS implementation will affect both producers in key
manufacturing countries and countries that are dependent on these
manufacturers for raw materials, prices will be kept high and new
medicines will be made inaccessible for the majority of the population
in developing and least developed countries. Generic producers will also
be blocked from developing fixed dose combinations until the relevant
patents on the individual components of the combinations expire. In
other words, access to essential medicines could become dramatically
more difficult in the coming years if no further action is taken.
Faced with these new challenges, the public health safeguards affirmed
in the Doha Declaration, such as compulsory licensing or government use,
will become even more important. It is imperative that producing
countries such as Brazil, Thailand and India routinely make use of
compulsory licenses or ?government use? provisions, including allowing
the export of these medicines, to enable generic competition to drive
prices down. Strong political resolve will be needed to do this.
Production and export of generic medicines
In 2003, the WTO adopted the "August 30th decision" which allows the
export of medicines produced under a compulsory license ? this is
restricted in the TRIPS agreement by the requirement that a compulsory
license be ?predominantly for the domestic market?. The August 30th
solution is needlessly complex, however, and is not likely to remove the
real threat of
3 Letter from Dr Jim Kim, Director WHO HIV/AIDS department to the
Minister of Health of India dd. 17 December 2004.
4
dwindling generic production in countries such as India4,5. The
mechanism is based on a drug by drug, country by country and case by
case decision-making process which ignores the fact that economies of
scale are needed to attract interest from producers. Without the pull of
a viable market for generic pharmaceutical products, manufacturers
cannot rationally be expected to want to take part in the production for
export system.
Certain countries, including EU member states and the European
Commission, have taken the initiative to implement the decision. Given
the complexity of the WTO solution, one would expect that the
implementation by potential exporters would at least be straightforward,
without introducing extra barriers.
Unfortunately, this is not necessarily the case. For example, in Canada,
the implementation of the August 30th decision contained limitations
that were rejected by WTO Members at the time of negotiating the
solution, such as a list of eligible countries, as well as a limited
list of approved medicines that can be produced and exported in generic
form to developing countries. But the medicines list does not include
the fixed dose AIDS drug combinations which are recommended by WHO and
are vital for scaling up AIDS treatment in developing countries.
Although it is foreseen that the list can be reviewed, the Canadian
experience shows that new medicines have been excluded from the list
following lobbying from the drug industry. For example, the company
Bayer successfully lobbied to keep its pneumonia therapy, moxifloxacin,
off the list of medicines.
The proposal put forward by the European Commission does not include
such limitations, but it is also far from ideal. For instance, the
Commission?s proposal requires prior negotiations with the
patent-holder, even though this is not required by TRIPS in public
non-commercial uses and/or emergencies (art 31 b). The proposal also
seems to restrict the license for manufacturing purposes only, which
could make the solution useless in case patented raw materials need to
be imported - a likely scenario, since for example the raw materials for
ARVs mostly come from outside the EU. The solution also does not offer
the possibility for non-governmental actors such as NGOs, churches or
the UN to make use of the system, even though they are often the prime
suppliers of medicines.
Even if these issues are resolved, in the best of worlds implementation
in good faith of a text that is basically flawed cannot possibly yield
real solutions.
Regretfully, these hollow measures are often hailed as great progress,
and the public and parliamentarians are led to believe that access
problems have been resolved and that affordable medicines will now
become available and no further action is needed. Such an approach would
be disastrous.
Once again, the AIDS crisis shows us why. First-line triple therapy is
now available for as little as US$140 per patient per year. But
resistance to first-line ARVs is as inevitable in poor countries as it
is in rich ones. When patients need to switch to second-line treatment,
they will face treatment costs as high as US$5,000 per patient per year.
4 A country in need of a certain product which is not available (for
example because it is not marketed, or because the price is too high)
will have to inform the WTO about its intention to import and indicate
the type of product and quantities needed and ? if it is not for
governmental use and / or an emergency - will have to seek a voluntary
license from the patent holder(s). A potential producer in an exporting
country needs to be identified. This producer - assuming there is one
willing to invest in production for a limited market (the quantities
need to be defined beforehand based on the request from one or several
countries) ? must then request and obtain a compulsory license from its
national authorities, adapt its production line and capacities, and pay
royalties to the patent-holder. 5 Correa, C. Access to drugs under
TRIPS: A not so expeditious solution. Bridges 8(1), p.21-22.
5
3TC/d4T/NVP
(1st line) TDF+ddI+LPV/r
(2nd line) 2nd line vs 1st line Western country6 US$8773/year
US$13151/year 1.5 times more expensive Developing countries US$154/year
Cipla Triomune7 US$3950/year
Originator products 26 times more expensive Reduction - 98 % - 70 %
This discrepancy needs to be tackled urgently. The price of first-line
drugs came down dramatically because countries that did not grant
pharmaceutical product patents were able to produce generics and
stimulate competition. The challenge will be much greater for
second-line drugs. Now that key manufacturing countries will no longer
be able to produce generic versions of new drugs, bringing down the
price of a single source product is going to be much more difficult.
Sources of affordable versions of new medicines will dry up. While the
2001 Doha Declaration on TRIPS and Public Health offers measures to
access existing generics, much more needs to be done to ensure the
production of generic second-line drugs.
The Commission has supported tiered pricing by drug companies by taking
measures to prevent trade diversion. The anti-trade diversion mechanism
put in place by the Commission proves to be of limited value in so far
as it lists only one company which has products for which affordable
versions are already available from other sources8,9.
In the post 2005 era where all drugs may be patented in most countries
in the world, a lot more action will need to be taken to ensure that
drug prices are set at a level the people who need them and their
communities can afford. Essential medicines are not a luxury whose
availability can be left to private market forces only.
While it is easy to get lost in the legal details, it is crucial not to
lose the human picture in this discussion. The fact is that effective
medicines that dramatically increase the life expectancy of people
living with AIDS became available in Europe and North America a decade
ago. Today, 40 million people in the developing world are infected with
HIV, and six million people need access to these medicines NOW. Only
400,000 do. The result is that, at the end of today, another 8,000
people will have died of AIDS.
Recommendations for the European Parliament
The way in which medicines are researched, developed and sold today
leads to grave inequities. The European Parliament should ensure that
European and global rules that affect the R&D and availability of
medicines are driven by health needs rather than industrial or
commercial considerations. Faced with the rise of infectious diseases
such as AIDS, TB, and malaria, and the increasing marginalisation of
health problems that do not affect the developed world, strong voices
are needed now more than ever to defend global public health.
Ensuring access to the fruits of innovation for even the poorest
patients and promoting health R&D as a global public good requires
global action. We ask the European Parliament to put R&D
6 Australian EXW prices: ?Schedule of Pharmaceutical Benefits for
Approved Pharmacists and Medical Practitioners, May 2004. Exchange rate
used for conversion (1Australian $=0.72213 US$, May 1, 2004) 7 Clinton
Foundation price (FOB) + 10 % due to transportation and importation
taxes. 8 Council Regulation 953/2003 to avoid Trade Diversion
http://trade-info.cec.eu.int/cgi-bin/antitradediversion/index.pl 9
Médecins Sans Frontières (2004) Untangling the web of price reductions:
a pricing guide for the purchase of ARVs for developing countries (6th
Edition), www.accessmed-msf.org.
6
for neglected diseases at the top of its agenda and ensure sufficient,
sustainable and long-term financing to address the R&D needs and work
towards a change in the way health R&D priorities are set and financed.
We urge the EP to address the dismantling of the Doha declaration, which
is advancing insidiously through US-initiated Free Trade Agreements. We
welcome former trade Commissioner Lamy?s concerns about the FTAs
expressed at the 10th anniversary of the WTO TRIPS Agreement, and we
hope that the new Commissioner shares these concerns. We regret that the
Commission has not yet taken action, for example by raising the issue at
the WTO TRIPS Council.
The EP should also ensure that the Commission provides strong political
support to countries that use the TRIPS flexibilities and offers
technical assistance. We also ask you to encourage the Commission to
engage with the Indian government to ensure that the new Indian patent
policies allow the continued production and export of generic versions
of newer medicines.
The EP should assess the effectiveness of the current EU trade diversion
mechanism in bringing drug prices down and explore more effective ways
to force prices of innovator products to a level people in developing
countries can afford.
Finally, we appeal to you to ensure that the implementation of the
August 30th decision in Europe is free from additional conditions and
restrictions.
The European Parliament should actively involve itself in these issues,
for instance by discussing with colleagues in other countries the need
to change the rules governing drug supply today. By playing an active
role in international debate, the European Parliament can have an
important role in ensuring access to essential medicines for all people.
Contact
Ellen F.M. 't Hoen LL.M.
Director of Policy, Advocacy and Research Access to Essential Medicines
Campaign Médecins Sans Frontières 8, rue Saint-Sabin 75544 Paris Cedex
11 France tel: + 33 1 4021 2836 fax: + 33 1 40212960 email:
ellen.t.hoen@paris.msf.org
Seco Gerard
EU Liaison Officer Access to Essential Medicines Campaign Médecins Sans
Frontières
Rue Dupré 94 1090 Brussels tel:+32 2 474 75 09 fax: +32 2 474 75 75
mobile: +32 479 514 900
email: seco.gerard@msf.org

*************************
Testimony of William (Bill) Haddad, Chairman 
and CEO of Biogenerics, Inc., also representing Cipla, 
Ltd., Mumbai, India, before Committee on 
International Trade, European Parliament, hearing on TRIPS and Access to
Medicines, January 18th, 2005, Brussels, Belgium

(Please refer to background document ?Generic Medicines: The Solution or
the Problem? commissioned by the Working Group on Access to Medicines of
the Millennium Project, November, 2004)

At sea ?a perfect storm? develops when uniquely three or more forces of
nature combine to create a catastrophe from which there is virtually no
escape.  I was reminded of this fear as the New Year dawned on us and ?a
perfect storm? of political intrigue, corporate greed and lack of
political will congealed into a reality that will mark the AIDS pandemic
as a harbinger of things to come. The pharmaceutical storm was ten or
fifteen years in the making in the backrooms of politics and now, as we
say in the States, the chickens have come home to roost. As a result
fully two thirds of the world?s population will systematically be denied
access to life saving medicines. If anyone tells you something else,
they are lying. 

The pharmaceutical perfect storm consists of TRIPS, TRIPS Plus,
bi-lateral and regional agreements and imposed national laws such as
India?s Exclusive Marketing Rights which  secretly accepted patents into
a ?locked box beginning in 1995, patents that will begin to be issued in
the months ahead, an unwelcome consequence of TRIPS. Similar ?locked
box? arrangements exist in other countries. In India this, in effect,
wipes out  a major portion of the country?s exemption from early
application of TRIPS.

Some poor nations, strange as it may seem to a rational person,
shortened or gave up their extension rights under TRIPS, allegedly under
pressure from the developed nations. Why would a poor nation agree to
higher pharmaceutical prices for its people when WTO granted them an
extension without economic or social consequences?

These TRIPS barriers are in addition to the manned barricades that often
block generic medicines from reaching victims. Let me cite one example
that may be familiar to you. 

The pharmaceutical  industry is moving quickly from chemically produced
medicines to medicines produced through biotechnology, the first stage
of a new generation of medicine that will culminate with medicines
designed for individuals.  All these new "biotech? medicines have
virtual perpetual patents because the west is locked in a political
battle disguised as a science with the bottom line that most of the
developed and developing world is denied these extraordinary high priced
medicines. Why? Because regulatory agencies have yet to design an
approval system for generic biotech products to reach the market. For
nations with sophisticated medical insurance coverage, the financial
burden falls on governments; in other countries, it often falls on the
individual; in the poor nations of the world most medicines are
purchased with personal funds. Even in the United States, state
governments are being forced to triage medicines including AIDS drugs.

Let me state, up front, that I am not against patents, they do encourage
innovation and reward initiative, personal and corporate. What concerns
me is that this is not an absolute right. Yesterday the United Nations
released the recommendations for the Millennium. Included in those
recommendations was access to essential medicines as a human right. 
TRIPS, while giving what we call ?lip service? to this human consequence
of its economic sweep to remove the barriers to free trade, has done
very little to insure the human rights guaranteed under this compact.

The recommendations of the UN Millennium Project released yesterday call
for access to medicines as a human right.

I must also confess to my hard-nosed businessman?s view that most of the
world?s poor nations were dragooned into WTO by promises of expanded
trade and open borders and the right to push patents to the side in a
national health emergency.

But the reality is another story.

All during the AIDS crisis, when brand name AIDS medicines cost
$12-15,000 per patient year and the generic versions cost less than a
dollar a day, not one nation exercised this right. What I am told
privately is that international and national pressures plus uncertainty
kept them from helping their people.  As a result then?and now?more than
eight thousand persons die of AIDS each day?240,000 victims each month,
when, as former President Clinton said: ?we have the medicines to
convert a certain death sentence into a chronic illness and we are not
using them.?

I am reluctant to draw comparisons to the six million who died in the
holocaust because that political and human tragedy occupies a special
place in history, nor to the current  natural and almost biblical
disaster in Southeast Asia which may claim more than 240,000 lives,  but
unless immediate changes are made, available AIDS medicines will be
denied to more than thirty million afflicted and they will die
destroying the fabric of nations and leaving behind generations of
orphans.  How many of these afflicted people are being treated in the
poor nations of the world?  At a maximum, 300,000.  That is the hard
fact that no politically correct language can deny. The European
Parliament has the God given opportunity to help change those statistics
because TRIPS has contributed dramatically and will continue to
contribute dramatically to the death toll in the poor nations of the
world.

At Doha in 2001 all of the WTO nations set about to clarify and correct
this situation but when the time came to implement these
recommendations, my government intervened and decided the developed
nations should make the decisions about what constituted a third world
national pandemic. I would be less than honest if I did not convey my
belief that many developed nations conveniently hide behind the skirts
of the United States and let my country do ?the dirty work? for them.
The opposition to these human rights is not a national force but a
coordinated, well financed, reward driven international effort that
knows no boundaries. 

Let?s look at some specific problems.

India and China by using a legal and non-infringing patent process to
manufacture and export essential drugs became the principal supplier of
these medicines to the poor nations of the world. It was this process
that enabled Dr. Yusuf Hamied, the Managing Director of Cipla of India
to challenge the multinational pharmaceutical corporations by
manufacturing generic versions of brand AIDS products and doing them one
better by combining the three effective ARVs in one tablet taken twice a
day replacing a complicated, multi-pill, multi-company regime and
reducing the price to a dollar a day.  If TRIPS had taken hold a few
years ago, the world would only be able to purchase the high priced
pharmaceutical  products, which for all practical purposes means that
very few people in the poor nations would have had these medicines. AIDS
is only the ?tip of the iceberg

As of January first, when TRIPS became virtual international law, this
lifeline was closed for all new medicines including any cure or vaccine
for AIDS. The stipulations for exemptions for the so-called ?lesser
developed nations? of the world are, at worst, a farce and at best, a
major barrier to implementation. All those at ground zero of this battle
know the truth. Our failure is that we have not been able to convince
the world?s politicians of this reality. 

On August 30, 2002, in Geneva, the United States withdrew its objections
as to who could define a medical emergency, and allowed the nation
itself to make that decision. As you may recall, this  action was taken
to prevent the forces fighting for a new agricultural policy to join
forces with those seeking fairness in the pharmaceutical process at the
WTO meeting in Cancun in September, 2003. 

But when the wrapping came off the gift, the small print requirements
makes it virtually impossible for a poor nation to obtain a compulsory
license to produce the medicines required. 

With great fanfare WTO announced that the ?lesser developed nations?
would be exempted from the WTO twenty year patent requirements until
2016. The definition of ?lesser developed nations? comes from an obscure
UN subcommittee that without logic or explanation excludes any nation
with a population over seventy-five million. Translated that means the
nations that have traditionally manufactured essential medicines for
poor nations are excluded from the process. The nations requiring the
medicines by and large, at this point in time, lack the financing and
expertise to create their own pharmaceutical industry.

In Brussels at the tenth anniversary celebration of TRIPS?I would have
labeled it a funeral?I asked the United States representative how they
could justify going beyond TRIPS to more restrictive requirements in
their bi-lateral and regional agreements? He arrogantly said this was
permitted under the flexibilities built into TRIPS?the very
flexibilities that are systematically denied the poor nations of the
world.

Ten years ago in China where I sat on a pharmaceutical committee as the
US generic delegate discussing WTO, I learned that the multinational
pharmaceutical companies were successfully pushing an absurd concept
that granted five years of protected patent life in China even if their
patents had expired.   That absurd concept is now being quietly inserted
into the TRIPS Plus agreements. 

For TRIPS, TRIPS Plus, and the bi-lateral and regional agreements the
name of the game is to extend patents and block competition. This is
really an extension of a forty years war to limit generic competition. 

The multinational technique on pharmaceuticals is to hide unseen behind
Intellectual Property rules that are used to correct real abuses and
misuses. Many of these pharmaceutical decisions are made behind closed
doors and seldom reach a media this is often more concerned with the
commercial issues such as textiles, steel and internet gambling.

I do not believe TRIPS and WTO were created to deny poor people the
right to life, but that is what is happening as we speak.

What can be done by the EU Parliament?

The abuses we are discussing need a voice, an institution to stand tall
and expose the unnecessary human consequences of this commercial law.
Ask yourself this question: why would a company charge prices its
customers could not pay and simultaneously keep out the competition that
can make these medicines affordable or subsidizeable? That?s TRIPS in
operation. The protection of the music industry or the software industry
is not the same as protection of the practices of the multinational
pharmaceutical companies.

We need to redefine who is eligible for participation in the 2016
exemptions. We need to include those nations who have traditionally
supplied essential medicines to the poor nations of the world. By 2016,
many of the smaller nations will be able to develop their own
pharmaceutical industry but in the interim the manufacturing nations
must be put back into the equation.

Forthwith we must clarify and simplify the methodology for poor nations
to use compulsory licensing. Right now the generic industry and the NGOs
believe the process is too cumbersome for most nations. I personally
believe that the compulsory licenses should be part of the WHO process
so that each nation does not have to reinvent the wheel. 

I would strongly recommend that we reconvene a mini-Doha to explore the
failures of the past attempts leading towards a WTO meeting this summer
to correct these flaws.

Several years ago in Brussels, speaking to European and African leaders,
I asked this question: ?Have We No Shame??  How can we allow this to
happen? What are we going to tell our children and grandchildren when
history records the success of the commercial interest over the human
rights?

Can we ask ourselves this question?  What if a member of your famliy was
dying in pain?as many do from AIDS?and you knew that a warehouse
contained the medicine that would save your child?s life and was blocked
because of backroom political deals? What would you do? I know what I
would do and it would not be very legal.

Thank you for listening.

********************

Hearing on TRIPS and Access to Medicines

European Parliament, Committee on International Trade
Brussels, 18 January 2005

Introductory Statement by Roger Kampf,
Intellectual Property Division, World Trade Organisation

________________________________________________________________________

1.	Introduction: From the Doha Declaration on the TRIPS Agreement
and Public Health to the August 2003 Decision

	The TRIPS Council started looking into the possible implications
of the TRIPS Agreement for access to medicines well in advance of the
Doha Ministerial Conference in 2001.  To respond to concerns expressed,
the stand-alone Doha Declaration on the TRIPS Agreement and Public
Health was adopted at the 4th Ministerial Conference in November 2001.
It confirms and clarifies the flexibility in the TRIPS Agreement
available to ensure that intellectual property rights are interpreted
and applied in a manner supportive of public health.  The Declaration
also accords least-developed WTO Members an extension of their
transitional period until 2016 in regard to the protection and
enforcement of patents and rights in undisclosed information with
respect to pharmaceutical products. At the same time, it recognises the
importance of intellectual property protection for the development of
new medicines and reaffirms all WTO Members' commitment to the TRIPS
Agreement.

	The ability of countries with insufficient or no manufacturing
capacities in the pharmaceutical sector to make effective use of
compulsory licensing arose during the work on the Declaration.  Concerns
were expressed about the availability of supply sources from generic
producers in other countries to meet the needs of those countries
wanting to import under compulsory licenses.  At the origin of those
concerns is Article 31(f) of the TRIPS Agreement, which explicitly
requires that a compulsory license granted by a Member to generic
producers shall be "predominantly for the supply of the domestic market"
of that Member.  Paragraph 6 of the Declaration recognised the problem
and instructed the TRIPS Council to find an expeditious solution.

Following intensive work in 2002, a Decision on the Implementation of
Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public
Health was adopted by the WTO's General Council on 30 August 2003.  It
waives the obligations:

?	of an exporting Member under Article 31(f) of the TRIPS
Agreement to the extent necessary for the purposes of production and
export of the needed medicines to those countries that do not have
sufficient capacity to manufacture them;

?	of the importing country under Article 31(h) of the TRIPS
Agreement in situations when remuneration is paid in the exporting
Member for the same products; and

?	under Article 31(f) of the TRIPS Agreement of any developing or
least-developed country that is party to a regional trade arrangement at
least half of the current membership of which is made up of presently
least developed countries.  

The system established under the August 2003 Decision provides for the
conditions necessary to ensure transparency and requires to have
safeguards in place to prevent trade diversion.  It takes also care of
minimising burdens.  For example: 

?	Notifications required to be made under the system by importing
and exporting countries are only for information purposes and are not
subject to approval by any WTO body.  A country wishing to use the
system for importing a pharmaceutical product only needs to conduct a
self-verification that it does not have the capacity to manufacture the
product and then notify its requirement and the methods and results of
its self-verification to the WTO.  Least developed countries are
automatically assumed not to have such capacity for any pharmaceutical
product.  Exporting countries have to notify details of the licences
granted, but these are countries which can be presumed to have greater
administrative and other capacities than the importing Members.
Notifications are not required for African countries exporting or
importing within the regional trading arrangement; 

?	As one of the principal safeguards against diversion, the
compulsory licensee in the exporting country is required to clearly
identify its product as being produced under the system through specific
labelling and marking.  Since all product have to be marked, labelled
and packaged, this cannot be construed to be greatly burdensome.   Such
procedures should not in general have a significant impact on the price
of pharmaceuticals; and

?	The requirement to take measures against diversion in the
importing countries is confined to reasonable measures within their
means, proportionate to their administrative capacities and to the risk
of trade diversion.  	Third countries are required to use the means
already available under the TRIPS Agreement to prevent the importation
and sale of products produced under the system and not meant for their
markets.

All WTO Members are eligible to be importers but some  have decided to
opt out of using the system altogether to import and others have stated
in the General Council before the adoption of the Decision that if they
use the system, it would be in no more than situations of national
emergency or other circumstances of extreme urgency .  All WTO Members
are eligible to be exporters in order to produce and export
pharmaceutical products to an eligible importing country.


The Decision further envisages an amendment to the TRIPS Agreement; the
waivers are to remain in place until such an amendment takes effect.  

The Decision was accompanied by a Chairman's statement representing key
shared understandings of Members regarding its interpretation and
implementation.  This statement was designed to provide comfort to those
who feared that the Decision was too open-ended and might be abused in a
way that would undermine the benefits of the patent system.  


2.	Use of the System Established under the August 2003 Decision

	The WTO Secretariat established a website dedicated to the
Decision to ensure transparency of the notifications made.  To date,
there have been no notifications made to the TRIPS Council of the use of
the system.

	But there has been a certain amount of activity relating to the
grant of compulsory licences.  Countries have granted compulsory
licences for the importation of anti-retrovirals, but given that the
imports were coming from countries that were not yet obliged to provide
patent protection for pharmaceutical products, there was no need to use
the system.  Some others have threatened the use of compulsory
licensing, which led to a reduction in prices from the originator
companies in certain cases, or to an agreement on voluntary licensing
for local production in the country in need of the medicines in other
cases. 
	
	Can we conclude from the lack of use of the system that it is
too complicated and impractical, or, on the contrary, that there was
never any real problem ?  Both judgements appear premature.  It is more
likely that the system has not been used so far for the following
reasons:

?	Traditionally compulsory licences have been very rare and the
main effect of the system has been to improve the bargaining power of
applicants in obtaining lower prices or voluntary licences.  This is
usually preferred by the originators and also has an advantage for the
applicant since it will generally bring with it the transfer of
technology.  Recent examples seem to indicate that the preference for
voluntary licensing is continuing;

?	Exporting countries under the system need to amend their
legislation to permit the production of patented medicines for export
under compulsory licences.  This usually involves primary legislation
and inevitably takes time.  Only Norway, a country without a significant
generic industry, has completed this task.  Canada has amended its
primary legislation;  implementing regulations were published for
comment in October and it is expected that the legislative framework is
in place in early 2005.  As you know, the EC Commission has also tabled
a proposal for a Regulation end October, which will soon be discussed in
the Council.  Finally, Switzerland is expecting to present draft
legislation as part of the revision of its patent legislation in the
near future;

?	Developing countries who had yet to introduce patent protection
for pharmaceutical products were required by the TRIPS Agreement to do
so by 1 January 2005.  Until recently, it was thus possible to import
products patented elsewhere from them without the need to use the
paragraph 6 system.  As pharmaceutical products progressively come under
patent protection in these countries, the need to use the system may
become greater.


3.	Amendment of the TRIPS Agreement to Replace the Paragraph 6
Decision

Paragraph 11 of the August 2003 Decision called on the TRIPS Council to
prepare an amendment to the TRIPS Agreement to implement the Decision
with a view to adopting it by June 2004.  This amendment is to be
"based, where appropriate" on the Decision.  

The TRIPS Council took the matter up at its last meeting in 2003, and in
all meetings in 2004.  All WTO Members continue to be committed to
replacing the Decision with an amendment to the TRIPS Agreement.
However, due to differences of view on the content, timing and legal
form of the amendment, the TRIPS Council agreed at its meeting in June
2004 to extend the timeframe for adoption of an amendment to March 2005.
Providing more time does not imply any legal vacuum since the Decision
continues to apply until the amendment comes into force.

	What are the main issues at stake ?  The key question certainly
is whether the content of the amendment should track faithfully the deal
that has already been struck or whether certain "improvements" could be
made.  Positions taken so far can be summarised as follows:    

?	the EC, supported by some others, takes the view that the
amendment should be a purely technical transposition of the waiver; the
Chairman's statement could be re-read by the Chairman of the General
Council at time of the adoption of the amendment so that it has the same
status in relation to the amendment as it presently has in relation to
the waiver;

?	the US seeks to incorporate a reference to the Chairman's
statement in the amendment of the TRIPS Agreement, which is seen by many
as enhancing the legal status of the Chairman's statement; and

?	the African Ministers at their various meetings in the summer
insisted on an expeditious permanent solution. 

In line with this position, the African Group tabled a proposal on the
implementation of paragraph 11 of the Decision at the last TRIPS Council
meeting of 1-2 December 2004.  This is the first specific proposal put
forward in this exercise.  While the initiative was welcomed by many
developing countries, the proposal was criticized by most developed
countries as re-opening the August 2003 Decision, by omitting certain
parts of it and modifying the language in some other parts.  They
reiterated their view that only a "neutral" implementation, faithfully
reflecting the deal reached in August 2003, would be acceptable.  At
this stage, it seems clear that any attempt to re-open the substance of
the August 2003 deal may further delay an agreement on the amendment.  

The Chair of the TRIPS Council has undertaken to hold intensive
consultations prior to the Council's next meeting in early March 2005.


4.	Technical Assistance
	
	From the WTO's perspective, it is important to provide technical
assistance to importing developing countries so that they feel fully
equipped to use the system established under the August 2003 Decision.
The WTO is regularly organising regional workshops on intellectual
property, of which an important part is focusing on the TRIPS Agreement
and public health, and more particularly the implementation of the
Decision on paragraph 6.  In 2004, seven such workshops were carried out
in all regions of the world.  In 2005, in addition to further regional
workshops, the WTO is organising in Geneva a workshop for IP, trade and
public health officials dedicated to the operation of the system.
However, the WTO disposes only of limited financial and human resources
and therefore attaches importance to technical assistance activities of
other organisations, such as WIPO and WHO, as well as to similar efforts
by individual countries.

5.	Concluding Remarks

	The August 2003 Decision by WTO Members signals the fulfilment
of the instructions given by Ministers under the Declaration and enables
countries without manufacturing capacity to make full and effective use
of a major flexibility in the TRIPS Agreement.  Hopefully, it will soon
be possible to conclude this work by reaching an agreement amongst WTO
Members on the amendment of the TRIPS Agreement, which would implement
the Decision on a permanent basis.

	In the meantime, it is of crucial importance to ensure that the
system established under the August 2003 Decision is fully operational
and works to the benefit of countries in need of medicines.  Major
exporting countries, such as the EU, should make all efforts to create
the basis for this to happen expeditiously. This will include putting
into place the necessary changes in their national legislation, but also
making all necessary resources available to provide adequate financial
and technical assistance to importing countries.

 
ANNEX 1


WORLD TRADE
ORGANIZATION	
	
	WT/L/540
2 September 2003
	(03-4582)
	

IMPLEMENTATION OF PARAGRAPH 6 OF THE DOHA DECLARATION ON 
THE TRIPS AGREEMENT AND PUBLIC HEALTH

Decision of 30 August 2003*


	The General Council,

	Having regard to paragraphs 1, 3 and 4 of Article IX of the
Marrakesh Agreement Establishing the World Trade Organization ("the WTO
Agreement");

	Conducting the functions of the Ministerial Conference in the
interval between meetings pursuant to paragraph 2 of Article IV of the
WTO Agreement;

	Noting the Declaration on the TRIPS Agreement and Public Health
(WT/MIN(01)/DEC/2) (the "Declaration") and, in particular, the
instruction of the Ministerial Conference to the Council for TRIPS
contained in paragraph 6 of the Declaration to find an expeditious
solution to the problem of the difficulties that WTO Members with
insufficient or no manufacturing capacities in the pharmaceutical sector
could face in making effective use of compulsory licensing under the
TRIPS Agreement and to report to the General Council before the end of
2002;

	Recognizing, where eligible importing Members seek to obtain
supplies under the system set out in this Decision, the importance of a
rapid response to those needs consistent with the provisions of this
Decision;

	Noting that, in the light of the foregoing, exceptional
circumstances exist justifying waivers from the obligations set out in
paragraphs (f) and (h) of Article 31 of the TRIPS Agreement with respect
to pharmaceutical products;

	Decides as follows:

1.	For the purposes of this Decision:
(a)	"pharmaceutical product" means any patented product, or product
manufactured through a patented process, of the pharmaceutical sector
needed to address the public health problems as recognized in paragraph
1 of the Declaration.  It is understood that active ingredients
necessary for its manufacture and diagnostic kits needed for its use
would be included ;
(b)	"eligible importing Member" means any least-developed country
Member, and any other Member that has made a notification  to the
Council for TRIPS of its intention to use the system as an importer, it
being understood that a Member may notify at any time that it will use
the system in whole or in a limited way, for example only in the case of
a national emergency or other circumstances of extreme urgency or in
cases of public non-commercial use.  It is noted that some Members will
not use the system set out in this Decision as importing Members  and
that some other Members have stated that, if they use the system, it
would be in no more than situations of national emergency or other
circumstances of extreme urgency;
(c)	"exporting Member" means a Member using the system set out in
this Decision to produce pharmaceutical products for, and export them
to, an eligible importing Member.
2.	The obligations of an exporting Member under Article 31(f) of
the TRIPS Agreement shall be waived with respect to the grant by it of a
compulsory licence to the extent necessary for the purposes of
production of a pharmaceutical product(s) and its export to an eligible
importing Member(s) in accordance with the terms set out below in this
paragraph:
(a)	the eligible importing Member(s)  has made a notification2 to
the Council for TRIPS, that:
(i)	specifies the names and expected quantities of the product(s)
needed ;
(ii)	confirms that the eligible importing Member in question, other
than a least developed country Member, has established that it has
insufficient or no manufacturing capacities in the pharmaceutical sector
for the product(s) in question in one of the ways set out in the Annex
to this Decision;  and
(iii)	confirms that, where a pharmaceutical product is patented in its
territory, it has granted or intends to grant a compulsory licence in
accordance with Article 31 of the TRIPS Agreement and the provisions of
this Decision ;
(b)	the compulsory licence issued by the exporting Member under this
Decision shall contain the following conditions:
(i)	only the amount necessary to meet the needs of the eligible
importing Member(s) may be manufactured under the licence and the
entirety of this production shall be exported to the Member(s) which has
notified its needs to the Council for TRIPS;
(ii)	products produced under the licence shall be clearly identified
as being produced under the system set out in this Decision through
specific labelling or marking.  Suppliers should distinguish such
products through special packaging and/or special colouring/shaping of
the products themselves, provided that such distinction is feasible and
does not have a significant impact on price;  and
(iii)	before shipment begins, the licensee shall post on a website
the following information:
-	the quantities being supplied to each destination as referred to
in indent (i) above;  and
-	the distinguishing features of the product(s) referred to in
indent (ii) above;
(c)	the exporting Member shall notify  the Council for TRIPS of the
grant of the licence, including the conditions attached to it.   The
information provided shall include the name and address of the licensee,
the product(s) for which the licence has been granted, the quantity(ies)
for which it has been granted, the country(ies) to which the product(s)
is (are) to be supplied and the duration of the licence.  The
notification shall also indicate the address of the website referred to
in subparagraph (b)(iii) above.
3.	Where a compulsory licence is granted by an exporting Member
under the system set out in this Decision, adequate remuneration
pursuant to Article 31(h) of the TRIPS Agreement shall be paid in that
Member taking into account the economic value to the importing Member of
the use that has been authorized in the exporting Member.  Where a
compulsory licence is granted for the same products in the eligible
importing Member, the obligation of that Member under Article 31(h)
shall be waived in respect of those products for which remuneration in
accordance with the first sentence of this paragraph is paid in the
exporting Member.
4.	In order to ensure that the products imported under the system
set out in this Decision are used for the public health purposes
underlying their importation, eligible importing Members shall take
reasonable measures within their means, proportionate to their
administrative capacities and to the risk of trade diversion to prevent
re-exportation of the products that have actually been imported into
their territories under the system.  In the event that an eligible
importing Member that is a developing country Member or a
least-developed country Member experiences difficulty in implementing
this provision, developed country Members shall provide, on request and
on mutually agreed terms and conditions, technical and financial
cooperation in order to facilitate its implementation.
5.	Members shall ensure the availability of effective legal means
to prevent the importation into, and sale in, their territories of
products produced under the system set out in this Decision and diverted
to their markets inconsistently with its provisions, using the means
already required to be available under the TRIPS Agreement.  If any
Member considers that such measures are proving insufficient for this
purpose, the matter may be reviewed in the Council for TRIPS at the
request of that Member.
6.	With a view to harnessing economies of scale for the purposes of
enhancing purchasing power for, and facilitating the local production
of, pharmaceutical products:
(i)	where a developing or least-developed country WTO Member is a
party to a regional trade agreement within the meaning of Article XXIV
of the GATT 1994 and the Decision of 28 November 1979 on Differential
and More Favourable Treatment Reciprocity and Fuller Participation of
Developing Countries (L/4903), at least half of the current membership
of which is made up of countries presently on the United Nations list of
least developed countries, the obligation of that Member under Article
31(f) of the TRIPS Agreement shall be waived to the extent necessary to
enable a pharmaceutical product produced or imported under a compulsory
licence in that Member to be exported to the markets of those other
developing or least developed country parties to the regional trade
agreement that share the health problem in question.  It is understood
that this will not prejudice the territorial nature of the patent rights
in question;
(ii)	it is recognized that the development of systems providing for
the grant of regional patents to be applicable in the above Members
should be promoted.  To this end, developed country Members undertake to
provide technical cooperation in accordance with Article 67 of the TRIPS
Agreement, including in conjunction with other relevant
intergovernmental organizations.
7.	Members recognize the desirability of promoting the transfer of
technology and capacity building in the pharmaceutical sector in order
to overcome the problem identified in paragraph 6 of the Declaration.
To this end, eligible importing Members and exporting Members are
encouraged to use the system set out in this Decision in a way which
would promote this objective.  Members undertake to cooperate in paying
special attention to the transfer of technology and capacity building in
the pharmaceutical sector in the work to be undertaken pursuant to
Article 66.2 of the TRIPS Agreement, paragraph 7 of the Declaration and
any other relevant work of the Council for TRIPS.
8.	The Council for TRIPS shall review annually the functioning of
the system set out in this Decision with a view to ensuring its
effective operation and shall annually report on its operation to the
General Council.  This review shall be deemed to fulfil the review
requirements of Article IX:4 of the WTO Agreement.
9.	This Decision is without prejudice to the rights, obligations
and flexibilities that Members have under the provisions of the TRIPS
Agreement other than paragraphs (f) and (h) of Article 31, including
those reaffirmed by the Declaration, and to their interpretation.  It is
also without prejudice to the extent to which pharmaceutical products
produced under a compulsory licence can be exported under the present
provisions of Article 31(f) of the TRIPS Agreement.
10.	Members shall not challenge any measures taken in conformity
with the provisions of the waivers contained in this Decision under
subparagraphs 1(b) and 1(c) of Article XXIII of GATT 1994.
11.	This Decision, including the waivers granted in it, shall
terminate for each Member on the date on which an amendment to the TRIPS
Agreement replacing its provisions takes effect for that Member.  The
TRIPS Council shall initiate by the end of 2003 work on the preparation
of such an amendment with a view to its adoption within six months, on
the understanding that the amendment will be based, where appropriate,
on this Decision and on the further understanding that it will not be
part of the negotiations referred to in paragraph 45 of the Doha
Ministerial Declaration (WT/MIN(01)/DEC/1).


ANNEX 2

EXCERPT FROM THE GENERAL COUNCIL MINUTES ? WT/GC/M/82 ? 
MEETING OF 25, 26 AND 30 AUGUST 2003

IMPLEMENTATION OF PARAGRAPH 6 OF THE DOHA DECLARATION ON 
THE TRIPS AGREEMENT AND PUBLIC HEALTH 

STATEMENT READ OUT THE CHAIRMAN OF THE GENERAL COUNCIL


"29.	The Chairman then read out for the record the following
statement, which had been forwarded to him by the Chairman of the
Council for TRIPS on the approval of the TRIPS Council:
	"The General Council has been presented with a draft Decision
contained in document IP/C/W/405 to implement paragraph 6 of the Doha
Declaration on the TRIPS Agreement and Public Health.  This Decision is
part of the wider national and international action to address problems
as recognized in paragraph 1 of the Declaration.  Before adopting this
Decision, I would like to place on the record this Statement which
represents several key shared understandings of Members regarding the
Decision to be taken and the way in which it will be interpreted and
implemented.  I would like to emphasize that this Statement is limited
in its implications to paragraph 6 of the Doha Declaration on the TRIPS
Agreement and Public Health.

	"First, Members recognize that the system that will be
established by the Decision should be used in good faith to protect
public health and, without prejudice to paragraph 6 of the Decision, not
be an instrument to pursue industrial or commercial policy objectives.

	"Second, Members recognize that the purpose of the Decision
would be defeated if products supplied under this Decision are diverted
from the markets for which they are intended.  Therefore, all reasonable
measures should be taken to prevent such diversion in accordance with
the relevant paragraphs of the Decision.  In this regard, the provisions
of paragraph 2(b)(ii) apply not only to formulated pharmaceuticals
produced and supplied under the system but also to active ingredients
produced and supplied under the system and to finished products produced
using such active ingredients.  It is the understanding of Members that
in general special packaging and/or special colouring or shaping should
not have a significant impact on the price of pharmaceuticals.

	"In the past, companies have developed procedures to prevent
diversion of products that are, for example, provided through donor
programmes.  "Best practices" guidelines that draw upon the experiences
of companies are attached to this statement for illustrative purposes.
Members and producers are encouraged to draw from and use these
practices, and to share information on their experiences in preventing
diversion.

	"Third, it is important that Members seek to resolve any issues
arising from the use and implementation of the Decision expeditiously
and amicably:

		-	"To promote transparency and avoid controversy,
notifications under paragraph 2(a)(ii) of the Decision would include
information on how the Member in question had established, in accordance
with the Annex, that it has insufficient or no manufacturing capacities
in the pharmaceutical sector.

		-	"In accordance with the normal practice of the
TRIPS Council, notifications made under the system shall be brought to
the attention of its next meeting.

		-	"Any Member may bring any matter related to the
interpretation or implementation of the Decision, including issues
related to diversion, to the TRIPS Council for expeditious review, with
a view to taking appropriate action.

		-	"If any Member has concerns that the terms of
the Decision have not been fully complied with, the Member may also
utilize the good offices of the Director-General or Chair of the TRIPS
Council, with a view to finding a mutually acceptable solution.

	"Fourth, all information gathered on the implementation of the
Decision shall be brought to the attention of the TRIPS Council in its
annual review as set out in paragraph 8 of the Decision.

"In addition, as stated in footnote 3 to paragraph 1(b) of the Decision,
the following Members have agreed to opt out of using the system as
importers: Australia, Austria, Belgium, Canada, Denmark, Finland,
France, Germany, Greece, Iceland, Ireland, Italy, Japan, Luxembourg, The
Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland,
the United Kingdom and the United States.

"Until their accession to the European Union, the Czech Republic,
Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak
Republic and Slovenia agree that they would only use the system as
importers in situations of national emergency or other circumstances of
extreme urgency.  These countries further agree that upon their
accession to the European Union, they will opt out of using the system
as importers.

"As we have heard today, and as the Secretariat has been informed in
certain communications, some other Members have agreed that they would
only use the system as importers in situations of national emergency or
other circumstances of extreme urgency.  These are the following:  Hong
Kong, China;  Israel;  Korea;  Kuwait;  Macao China;  Mexico;  Qatar;
Singapore;  the Separate Customs Territory of Taiwan, Penghu, Kinmen and
Matsu;  Turkey and the United Arab Emirates."

30.	The Chairman then proposed that the General Council take note of
the statements and, in the light of the Chairman's Statement he had just
read out, adopt the draft Decision contained in document IP/C/W/405 in
accordance with the Decision-Making Procedures under Articles IX and XII
of the WTO Agreement agreed in November 1995 (WT/L/93). 
31.	The General Council so agreed. "
 
ANNEX 3


WORLD TRADE
ORGANIZATION	
	
	WT/MIN(01)/DEC/2
20 November 2001
	(01-5860)
	
MINISTERIAL CONFERENCE
Fourth Session
Doha, 9 - 14 November 2001	



DECLARATION ON THE TRIPS AGREEMENT AND PUBLIC HEALTH

Adopted on 14 November 2001


1.	We recognize the gravity of the public health problems
afflicting many developing and least-developed countries, especially
those resulting from HIV/AIDS, tuberculosis, malaria and other
epidemics.

2.	We stress the need for the WTO Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPS Agreement) to be part of
the wider national and international action to address these problems.

3.	We recognize that intellectual property protection is important
for the development of new medicines.  We also recognize the concerns
about its effects on prices.

4.	We agree that the TRIPS Agreement does not and should not
prevent Members from taking measures to protect public health.
Accordingly, while reiterating our commitment to the TRIPS Agreement, we
affirm that the Agreement can and 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.

	In this connection, we reaffirm the right of WTO Members to use,
to the full, the provisions in the TRIPS Agreement, which provide
flexibility for this purpose.

5.	Accordingly and in the light of paragraph 4 above, while
maintaining our commitments in the TRIPS Agreement, we recognize that
these flexibilities include:

(a)	In applying the customary rules of interpretation of public
international law, each provision of the TRIPS Agreement shall be read
in the light of the object and purpose of the Agreement as expressed, in
particular, in its objectives and principles.
(b)	Each Member has the right to grant compulsory licences and the
freedom to determine the grounds upon which such licences are granted.
(c)	Each Member has the right to determine what constitutes a
national emergency or other circumstances of extreme urgency, it being
understood that public health crises, including those relating to
HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a
national emergency or other circumstances of extreme urgency.
(d)	The effect of the provisions in the TRIPS Agreement that are
relevant to the exhaustion of intellectual property rights is to leave
each Member free to establish its own regime for such exhaustion without
challenge, subject to the MFN and national treatment provisions of
Articles 3 and 4.

6.	We recognize that WTO Members with insufficient or no
manufacturing capacities in the pharmaceutical sector could face
difficulties in making effective use of compulsory licensing under the
TRIPS Agreement.  We instruct the Council for TRIPS to find an
expeditious solution to this problem and to report to the General
Council before the end of 2002.

7.	We reaffirm the commitment of developed-country Members to
provide incentives to their enterprises and institutions to promote and
encourage technology transfer to least-developed country Members
pursuant to Article 66.2.  We also agree that the least-developed
country Members will not be obliged, with respect to pharmaceutical
products, to implement or apply Sections 5 and 7 of Part II of the TRIPS
Agreement or to enforce rights provided for under these Sections until 1
January 2016, without prejudice to the right of least-developed country
Members to seek other extensions of the transition periods as provided
for in Article 66.1 of the TRIPS Agreement.  We instruct the Council for
TRIPS to take the necessary action to give effect to this pursuant to
Article 66.1 of the TRIPS Agreement.


_________

Statement by Peter Bains, Senior Vice President, International
Commercial Development GlaxoSmithKline
to the
European Parliament?s Committee on International Trade Hearing on TRIPS
and Access to Medicines, Brussels, 18 January 2005

Introduction
Thank you for the opportunity to address this important hearing. 
There are no easy solutions to the challenge of providing access to
sustainable healthcare in developing countries. Poverty is the single
biggest barrier to improving healthcare in the developing world. Poverty
of finance, poverty of infrastructure, poverty of healthcare capacity
and poverty of political will. In many countries people do not have
enough food or water, and very limited access to healthcare
professionals and facilities. Often the governments of these countries
simply do not have the resources needed to address the healthcare needs
of their people. 
However, lack of resources can be no excuse for lack of action. An
effective global response is needed, and needed now.
The industry?s contribution
The pharmaceutical industry has played, is playing, and remains
committed to playing a full part in addressing the healthcare challenges
of the developing world. Unfortunately, I don?t have enough time today
to provide much detail, but the industry makes a vital contribution
through action in four areas. Firstly, the most important contribution
the pharmaceutical industry can make is investing in the research and
development (R&D) that will produce the new treatments and vaccines of
tomorrow. Secondly, we are seeking to improve affordability of our
products in the poorest countries of the world through various
differential pricing offers which are often comparable to those from
generic companies. Thirdly, the pharmaceutical industry is one of the
world?s most philanthropic, as shown by its response to the Asian
tsunami. From 1998 to 2003, pharmaceutical companies contributed $4.1
billion to improve healthcare in the developing world. And fourthly, the
industry has always sought innovative partnerships. Examples abound such
as Bristol Myers Squibb?s Secure the Future programme or Merck?s work
with the Gates Foundation in Botswana. For our part, GSK has granted 6
voluntary licences to generic companies for the manufacture and sale of
our leading ARVs to the public and private sectors across all of
sub-Saharan Africa.
I?m not claiming that the industry?s response has been perfect. It
hasn?t. Like many stakeholders we were taken by surprise by the speed,
scale and scope of the AIDS epidemic. But our contribution now is
comprehensive, sustainable and responsible.
We believe that our response is not only the right thing to do but makes
good business sense. Companies that respond sensitively and with
commitment by changing their business practices to address such
challenges will be the leaders of the future.
IP is not the problem
Generic companies have an important role in addressing the AIDS crisis.
But it would be counter-productive to ignore or undermine the role of
the research-based industry. There is a fundamental truth about AIDS ?
we need new medicines and vaccines. We do not yet have a cure or a
vaccine for HIV. Existing medicines are becoming less effective as
resistance to them grows. Intellectual property protection is of
critical importance for R&D, without it there will not be any. And if
there is no R&D, there will be no new medicines and vaccines. Support
for innovation is important. 
Too many people see tearing up intellectual property rules and local
manufacturing as the panacea. This is simplistic and counter-productive.
If that were the answer, India would deal with AIDS better than any
country in the developing world. India has had no intellectual property
protection for pharmaceutical products, and has the most developed
generics industry in the world, with over 20,000 manufacturing sites.
Yet the proportion of people on ARVs who need them is similar to that
seen in Africa. 
Additionally, of the 325 medicines on the WHO?s Essential Medicines
List, around 98% are off patent and yet the WHO state that a third of
the world?s population have no reliable access to them. Clearly, lack of
healthcare infrastructure and resources are the problems, and where the
focus should be, rather than on intellectual property.
Some have claimed that now that countries like India have fully
implemented TRIPS, suddenly the world?s supplies of generics will dry
up. This is nonsense. Very little will change. TRIPS is not
retrospective, so medicines that are currently produced will continue to
be available. And for new products, TRIPS contains provisions which give
governments the flexibility to adopt national policies to safeguard
their public health interests.
Intellectual property must be respected if new medicines and vaccines
are to be researched and developed. At the same time, we fully
acknowledge the public health safeguards in TRIPs. We welcomed the
agreements struck in Doha in 2001 and in Geneva in August 2003, and we
believe it is in the best interests of all stakeholders to see the rapid
passing of legislation to implement them. In this context, the industry
broadly supports the Commission?s proposal for a Regulation on
compulsory licencing for export, which I understand this committee will
be reviewing.
The real solutions
Access to medicines in the developing world remains a complex issue. It
presents a unique challenge to the global community. 
Welcome new resources are coming through.  Nevertheless, funding remains
inadequate.  Wealthy nations must give more. Developing world countries
also have their part to play. Middle Income countries must accept their
responsibilities and not seek the lowest prices offered to the world?s
poorest countries. Others need to show genuine political commitment.
This means addressing stigma; it means removing import tariffs that
raise prices; and it means prioritising healthcare in national budgets. 
Conclusion
Only an holistic approach embracing both prevention and treatment will
work. The global community must provide political will, a significant
mobilisation of additional resources and a spirit of partnership if we
are to see an improvement in healthcare and quality of life across the
developing world. The industry will continue to play its part. We will
continue with our efforts, improving our initiatives by applying lessons
learned and looking for opportunities to do more.