TRIPS isn’t working
Trade Rules Suck
The UK government has said the TRIPS agreement is sufficient to allow access to affordable medicines. They claim it is impossible to say whether or not it works because it is yet to be tested.
We believe the argument that we should withhold judgement on the agreement until it is used is missing the point. The fact that the agreement has gone unused is itself an indictment of its failure to fulfil the purpose for which it was intended - as a quick and easy way for those in need to access affordable medicines.
What is more, evidence of the agreement´s failure is available. Since 2004 MSF has put two years of considerable effort into testing the agreement, trying to get ARVs exported for patients in its HIV/AIDS projects. But as yet “not a single drug has reached a patient under the WTO mechanism” (MSF).
In depth: The `Red Tape’
MSF’s efforts provide evidence for why the WTO’s `solution’ is ‘unworkable’. 20 Some of the problems they identified are detailed below. Imagine you´re a developing country government with limited capacity, or a generics company looking for an incentive to manufacture patented ARVs. Do you fancy your chances with this procedure?
- Before a compulsory licence can be issued the generic company must first seek a ‘voluntary licence’ from the company that holds the patent. A voluntary licence is issued where the patent holding company agrees to allow the generic company to produce the drug in exchange for an agreed payment. This means higher prices for patients than if a compulsory licence was issued.
- Only if they are unable to reach agreement “on reasonable commercial terms and conditions” and within a “reasonable period of time” can a compulsory licence be issued. As there are no clear guidelines for when negotiations can be said to have failed, this results in lengthy and complicated negotiations. The patent holder will try to drag this process out to get the best deal and avoid the issuing of a compulsory licence.
- A country must notify the WTO’s TRIPS Council if it intends to issue a compulsory licence, providing unnecessarily complicated and detailed information. Countries may fear that if they were to give notification this will result in political pressure from countries who are opposed to compulsory licences.
- This process must be followed for each order for each drug in each country. The application must specify the quantities required, even though needs on the ground change quickly and the process is slow. If the quantities needed were to increase, the process would have to start all over again with negotiations for a voluntary licence.
- This process requires enormous resources from the generic company - with no guarantee of success at any stage.
TRIPS-PLUS
Some governments, particularly the US, are pushing countries into bilateral or regional trade agreements that include `TRIPS-plus’ provisions.
These provisions include extending the length of patents, impeding the use of generic medicines and forcing countries to buy drugs from particular pharmaceutical companies.
Developing countries agree to such terms usually in return for concessions in other areas such as market access for their country’s produce. In effect countries are trading away people’s health.
Guatemala and the Central America Free Trade Agreements (CAFTA) 21 CAFTA allows American pharmaceutical companies 5 years exclusivity for supplying new drugs, preventing competition from companies that sell cheaper generic versions. This jeopardises the ability for patients to access essential medicine by keeping the price of treatment high and offering few affordable alternative treatments when patients develop resistance to the more commonly used brands.
The UK should actively oppose any conditions in bilateral trade agreements, including those of other countries, which undermine access to medicines.
Far from being a dramatic breakthrough, the agreement finally reached on TRIPS has the effect of burying developing countries in red tape and slowing down even further the urgent process of getting AIDS drugs to the people who need them.
It is likely to squeeze out generic production by making it more costly and time-consuming. Many countries are too poor and lack the specialist advice needed to make use even of the tools agreed under Doha for putting health before patents.
An agreement that is unused and unworkable is not the speedy solution for public health emergencies which is desperately needed.
“Today´s deal was designed to offer comfort to the US and the Western pharmaceutical industry. Unfortunately, it offers little comfort for poor patients. Global patent rules will continue to drive up the price of medicines.” Ellen ´t Hoen, MSF, responding to the TRIPS deal, August 2003
(20) MSF, August 2006, Neither expeditious, nor a solution: The WTO August 30th decision is unworkable
(21) Oxfam, June 2004, Undermining access to medicines: Comparison of five US FTAs
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