Blog > News Analyses > Developed Countries Agree to Increase Access to HIV/AIDS Drugs for Poor Nations |
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In an effort to launch a new trade round, developed countries lead by the EU and US, made a significant concession to the developed world on patent issues by agreeing that developing countries could bypass patent rights and obtain cheap generic drugs to treat “all public health problems ” The decision at the Doha world trade summit loosening the rules of the Trade Related Intellectual Property Rights (TRIPS) Agreement proved to be a victory for poor nations who gained authority to determine what constitutes a public health problem as well as enhancing their ability to access drugs of public health importance.
The most important issue for the developing countries is the fight against the global AIDS epidemic. Currently there are an estimated 40 million people living with HIV/AIDS and this number is growing. More than 90 percent of HIV/AIDS infections occur in developing countries, causing enormous disruptions in the social and economic foundations of these countries. Drugs have been developed to reduce HIV-related symptoms, reduce the incidence of opportunistic infections, and improve the quality of life for HIV-positive individuals.
Developing countries argue, however, that TRIPS limits availabilty of such medicines. TRIPS was designed to narrow the gaps in the way that intellectual property rights are protected around the world and bring them under common international rules. Drug manufacturers seek to uphold patent rights protected by the TRIPS agreement, while many developing country governments, public health organizations, and civic groups argue that prices on patented HIV/AIDS drugs have made them inaccessible to the majority of the world’s population.
The TRIPS agreement requires all 142 World Trade Organization (WTO) members to provide a certain minimum standard of protection and effective enforcement for patents and other intellectual property. The TRIPS agreement obliges member country governments to offer patent protection for 20 years, granting pharmaceutical companies exclusive right to the sale of drugs they develop. However, several Articles of TRIPS give WTO member governments some flexibility. WTO members can override patents to issue compulsory licenses in cases of national emergency (Article 31). More generally, Article 8 grants member governments the authority to adopt measures necessary to protect public health. Member countries can override patents by issuing compulsory licences. In essence, compulsory licensing allows generic drug manufacturers to produce a generic substitute of a patented drug. This usually reduces the cost of drugs and reduces the demand for the patented version of the drug.
Developing countries, led by Brazil, have taken measures to reduce the costs of antiretroviral HIV drugs in their effort to alleviate the morbidity and mortality caused by the HIV crises. Brazil contends that fighting the AIDS epidemic with existing drug prices is too expensive. First, under Brazilian patent law passed in 1996, foreign companies lose patent protection if they do not make the drugs in Brazil or license a local company to make the drug within three years of securing a patent. Second, Brazil’s patent law also has permitted government-run laboratories to copy any foreign drugs with patents that predate the 1996 law. These laws have enabled the Brazilian government to domestically produce and import generic HIV drugs at a much lower cost than by the patent holding producers of the drugs.
Developing countries have been unable to implement compulsory licensing in many cases. Pressure from Europe and the United States, where pharmaceutical companies are based has limited developing country requests to issue compulsory licenses. There is disagreement between developing countries and developed countries over what constitutes a national emergency or a public health threat. Developing countries propose that the current public health crises caused by the AIDS epidemic is a national emergency, but drug companies and the countries where drug companies are based have been slow to agree. Therefore, developing countries have been reluctant to issue compulsory licenses for fear of WTO trade sanctions for violation of the TRIPS agreement.
Pharmaceutical companies argue that reduction of their TRIPS rights would reduce their incentive to support research and development of drugs for which compulsory licenses are issued. Pharmaceutical companies claim that neglecting patent rights could reduce their incentive to support research and development of drugs that may potentially be seized under compulsory licensing. Patent laws provide the legal and business framework enabling companies to support the expensive research and development necessary in the process of drug discovery. Drug companies want to uphold these patent laws, which protect their rights as a sole manufacturer of the product.
Furthermore, pharmaceutical companies criticize the introduction of price controls allowing some countries to buy drugs at a cheaper price. This price differential between markets creates an incentive to buy drugs in the low cost market and resell drugs in a higher price market; this practice is referred to as parallel imports. Parallel imports can result in a loss of quality control for a drug and produce harmful affects on the consumer.
The recent terrorist activities in the United States involving anthrax have raised questions about patent rights of drug companies in a new context. Developed country governments were confronted with a situation similar to those of the developing world. As the anthrax scare has grown so has the need for the medicine Ciprofloxacin to fight the anthrax threat. Much like the actions of Brazil with HIV/AIDS drugs, Canada and the United States have both used threats of compulsory licensing to lower the price demanded by the Ciprofloxacin producer, Bayer. The public health crisis in the US involving anthrax has claimed 5 lives, while 24.5 million Africans are infected with HIV/AIDS.