Poor Nations Can Ignore Patents to Meet Public-Health Needs
Wall Street Journal | November 14, 2001 | By Geoff Winestock and Helene Cooper
DOHA, Qatar -- The pharmaceutical industry is scrambling to limit the damage that might result from a deal hammered out by World Trade Organization negotiators this week that declares that poor countries can ignore drug-company patents and buy cheap generic drugs to meet public-health needs.
The drug industry has long argued that countries, even poor ones, must honor its patent rights or else the industry won't have an incentive to develop new drugs. Under intense political and public pressure, some companies have in the past year eased their position on patents for drugs to treat AIDS in poor countries. But the WTO deal goes further: Drug companies sought narrow language to encompass only health pandemics such as AIDS, but under the pact, illnesses from cancer to diabetes to asthma could qualify.
How the deal was struck shows how the industry was outmaneuvered by activists.
Just as WTO negotiations here reached a crisis on Monday morning, a fretful Alan Holmer, president of the Pharmaceutical Research and Manufacturers of America, fired off a letter to U.S. Trade Representative Robert Zoellick to warn against any compromise that might weaken drug patents.
Too late. Within hours, elated negotiators from poor countries were passing around a draft agreement that declares that public health trumps drug patents. "We agree that the [WTO] does not and should not prevent members from taking measures to protect public health," the agreement said. "We affirm that the agreement ... be interpreted and implemented in a manner ... to ensure access to medicines for all."
Mr. Holmer didn't return phone messages seeking comment.
While U.S. trade negotiators here maintain they haven't weakened WTO legal protections for drug patents, the drug industry worries the agreement is bound to embolden poor countries to get cheap generics where they can.
AIDS activists, who showed up here in droves to battle drug-company lobbyists, were ecstatic. "It's like the WTO looked at the signs of the demonstrators on the street, and then put in a declaration and adopted it," said Jamie Love, director of Ralph Nader's Consumer Project on Technology.
Officials from Brazil -- where AIDS drugs are free and the fight for greater access to life-saving medicines is a cause celebre -- were also elated. "Our expectations were fully met," said Paulo Teixeira, Brazil's top AIDS official. "Even six months ago, this was unthinkable." Brazil is the only country that sent both its top health and AIDS officials to the meeting.
Yesterday, drug lobbyists at the meeting here were still struggling to figure out the pact's meaning. Vague language in the agreement, they fretted, could lead some countries, especially India, to continue to flout patents.
But their bosses back in the U.S. and Europe said they knew concessions were likely. "I wouldn't say that we're upset about this," said Nancy Pekarek, a spokeswoman for GlaxoSmithKline PLC. "The language [of the declaration] maintains the integrity of" WTO protections of patents.
Brian Ager, director general of the European Federation of the Pharmaceutical Industries and Associations, agreed. "It's still very much a political declaration," not a legal change to the WTO rules, he said.
Not everyone in the industry was so sanguine. "I am concerned," said Daniel Vasella, chairman and chief executive of Novartis AG. "It's important that the compromise express care for developing countries." But without patents, profits aren't possible, and research suffers, he said.
Most trade envoys here said they assume the drug-patent agreement would take effect regardless of whether the WTO conducts and concludes a new round of trade-liberalization talks, but that isn't assured. "In the WTO, nothing is agreed until everything is agreed," one WTO official said.
From the start, the drug-patents issue dominated talks here in Doha. Lobbyists from U.S., Swiss and European drug companies all descended on the meeting to protect their patents. But unlike in 1993, when intellectual-property protections were first negotiated as part of the initial WTO pact, this time the lobbyists were matched by AIDS activists who proved to be a well-coordinated group of opponents.
Even before negotiations started, AIDS activists were pressing delegates from poorer countries in Africa, Latin America and Asia to hold fast to their demands that the agreement allow them to override drug patents for a variety of ailments and not just pandemics such as AIDS. They also hounded the negotiators from the U.S., Europe and Switzerland, meeting with them again and again, to draft the agreement.
During a bus ride to one pre-conference meeting, the activists swarmed Finnish delegate Hannele Tikkanen. They demanded -- and received -- three meetings with U.S. negotiators, then passed the negotiators' cellphone numbers around.
Sometimes the battle between the drug lobbyists and the activists looked like a spy movie. "Shhh, that's Harvey Bale -- he'll hear us," one Oxfam America activist whispered after spotting the director general of the International Organization of Pharmaceutical Manufacturers on a late-night shuttle bus from the convention center. Oxfam is a charitable health organization.
At one point, the activists considered "outing" one drug lobbyist who sneaked into the WTO meeting using a press pass, but then thought better of it when they realized that about half of the activists themselves were also posing as reporters. The representative of the World Health Organization, which has close links to AIDS activists, was booted from one meeting of trade officials after the WTO complained he had no right to be there.
U.S. trade officials, once considered by activists to be allied with the devil himself on the patents issue, soon seemed almost angelic, especially when compared to the hard-line Europeans, particularly the Swiss. During a meeting Sunday at the Sheraton with the Swiss negotiators, Mr. Love of the Nader group listened for 45 minutes while the Swiss refused to move on the patents issue. The agreement should be limited to just AIDS, the Swiss envoys argued. What if African countries, they asked, used the pact to steal Novartis and other companies' patents on beauty products?
Mr. Love walked out of the meeting shaking his head.
But the Americans' traditional posture of defending patents suffered a severe blow several weeks ago, when Tommy Thompson, U.S. Secretary for Health and Human Services, threatened to seize Bayer AG's patent on Cipro, an antibiotic to fight anthrax, unless Bayer lowered its price. "We constantly reminded delegates of anthrax," said Mr. Teixeira of Brazil.
Since Brazil began producing local versions of expensive, foreign-made AIDS drugs, it has managed to bring down their prices by about 82%, according to the Brazil health ministry. As a result of widespread use of the drugs, the number of AIDS-related deaths and the infection rate in the country have both been cut in half in recent years. These statistics have made Brazil's AIDS program a model for the developing world.
Drug lobbyists did manage to win one point. The agreement fobs off to a committee the activists' demand that the WTO explicitly state that it's acceptable for countries that manufacture cheap generics -- such as Brazil and India -- to export those drugs to other countries.
Vanessa Fuhrmans in Frankfurt, Miriam Jordan in Sao Paulo and Gardiner Harris in Washington contributed to this article.
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