NGOs DENOUNCE NORTHERN PRESSURES AGAINST COMPULSORY LICENSING

Under the WTO-TRIPs agreement, developing countries can use the power of compulsory licensing to enable generic drugs to be produced and made available to their peoples at low prices. It is unacceptable for the US and other Northern governments to pursue the narrow interests of some transnational corporations in trying to force Southern governments not to exercise that power.

By Chakravarthi Raghavan

April 1999

Leading health and consumer protection non-governmental organisations (NGOs) like Medicins Sans Frontieres, Health Action International and the US-based Consumer Project on Technology denounced on 25 March pressures and threats by the US and other Northern governments against developing countries' use of their compulsory licensing rights to ensure their people's access to cheap and essential medicines.

This issue of compulsory licensing is now the subject of trade disputes involving the United States, Thailand, South Africa and other countries.

The NGO representatives were addressing a press conference on the eve of a meeting sponsored by them at which public health and consumer groups, governments of industrialised and developing countries, pharmaceutical companies and international organisations like the World Trade Organisation (WTO), World Intellectual Property Organisation (WIPO) and World Health Organisation (WHO) were to discuss the issues of compulsory licensing of patents to essential medical technologies.

James Love, Director of the Consumer Project on Technology (CPT), said developing countries had some space under the WTO-Trade-Related Aspects of Intellectual Property Rights (TRIPs) agreement to use the power of compulsory licensing to enable generic drugs to be produced and made available to their peoples at low prices.

It was unacceptable that the US government should pursue the narrow interests of some corporations in trying to force governments such as those of Thailand or South Africa not to use compulsory licensing.

Eric Sawyer, co-founder of ACT UP NY, a US-based AIDS activist coalition, himself a victim of AIDS since 1981, several years before the HIV virus was discovered, and one who has been using every new AIDS drug, said many more people in the developing world had succumbed to the disease because of lack of access to the drugs and the money to pay for them.

In most of the developing countries, access to the new Protease inhibitors that are part of any combination therapy is available only to the very rich, and often only in the capital cities. Access to essential treatment is in almost every case listed as blocked, most often by the high prices or patent limitations.

Compulsory licensing and parallel imports can go some way towards redressing the injustice of this unequal access. And he was ashamed, as an American, that even drugs developed by the US government and then turned over to the private sector, have been patented and priced so high, beyond the reach of the ordinary person in the developing world.

Love said that the major pharmaceutical transnationals keep the prices at levels that could be got in the developed countries, and prevent the drugs' availability in developing countries, through use of the patent laws and the TRIPs agreement, in order to ensure that drug prices in developed countries do not fall.

The pharmaceutical industry was one that commanded very high profits, 25% of gross sales, as compared to the 4-5% that the US Fortune 500 companies get. This was unconscionable, he said.

The representative of Medicins Sans Frontieres and Love said that the problem was not just restricted to AIDS but emerged in relation to even ordinary tropical ailments and sicknesses.

Dr Zafar Mirza of Pakistan pointed out that while the WHO had a list of 'essential drugs' which may be generic and which do not need the approval of patent-holders, newer and newer diseases were coming up and the old diseases like malaria etc develop strains resistant to existing drugs. And the newer versions or formulations needed to treat them are covered by the 'new patents', which means that at least for another 20 years, they are covered by the intellectual property right (IPR) holders' monopoly rights and are thus not available at an affordable price. And in the developing world, health care is mostly private and patients cannot afford to buy them.

Ms Saree Aongsomwang of the Thai Consumer Foundation pointed out that her country's compulsory licensing provisions had to be changed under US pressure as a price for allowing access to the US market for Thailand's exports of jewellery. Developing countries are being faced with the alternative of earning foreign exchange through exports or securing availability of cheap drugs and medicines for their peoples.

Zafar Mirza said a whole range of policies and problems are involved - including International Monetary Fund (IMF)/World Bank conditionality policies under which governments had to give priority to repayment of debt over health.

Dr Love said that compulsory licensing, which involved compensation or a licence fee being paid to the holder of the patent rights, is consistent with international law and the WTO and is a well-established practice in the patent field. But the major pharmaceutical companies oppose it and have lobbied developed countries like the US, England, Italy and the European Union to oppose the use of compulsory licensing in the developing countries.

The patent system itself involves many abuses, and the US Federal Trade Commission and National Institutes for Health, Love added, had themselves issued reports recently highlighting the specific problems caused for medical research and follow-on. There is also the problem of high prices for drugs, including those developed by the governments.

Trade policies on IPRs and health care should be designed to accomplish public health goals, Love and Mirza underlined, and not the other way round. The WTO and TRIPs provide safeguards, exceptions and mechanisms including compulsory licensing and parallel imports.

But it is appropriate to begin a dialogue on a new framework for trade discussions that address the most important issue, namely a mechanism to ensure adequate and fair sharing of the costs of funding essential medical research, and a new focus on it to shape policies by national governments and international trade regimes, Love added. - Third World Network Features

About the writer: Chakravarthi Raghavan is Chief Editor of SUNS (South-North Development Monitor), a daily bulletin, and Third World Network's representative in Geneva.

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