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Letter to Weekly Standard
In its August 9, 1999 issue, the Weekly Standard published
letters to the editor by Arianna Huffington and me about
David Tell's editorial on the South African dispute.
Mr. Tell responded to both letters, prompting me
to send a second letter. Here it is.
Jamie
-------
James Love
Consumer Project on Technology
http://www.cptech.org
love@cptech.org
202.387.8030
August 4, 1999
The Weekly Standard
Dear Editors,
I hardly expect to have the last word on the issue of US trade
pressures on South Africa and pharmaceutical drugs, but I will
respond to David Tell's August 9, 1999 comments.
I was surprised to see Mr. Tell making a number of sweeping and
untrue assertions regarding the WTO TRIPS agreement and parallel
imports and compulsory licensing. Has he ever bothered to read
the TRIPS?
Mr. Tell makes it sound as if a country that wants to authorize
free trade in pharmaceuticals (parallel imports) must first make
a national emergency declaration, and negotiate a range of issues
with patent owners, under WTO TRIPS rules. None of this is true.
Parallel imports of pharmaceuticals are legal now in most
European countries and would be legal in the US under S. 1191 or
HR 1885. The WTO places no restrictions on a country's decision
to permit parallel imports. And how long does Mr. Tell think
that any country can stop parallel imports in an era of e-
commerce and global markets?
It is true that the WTO regulates compulsory licensing. But
contrary to Mr. Tell's comment, it does not limit this to cases
of national emergency (not there is a serious dispute over the
existence of one in South Africa), and it also does not require
countries to even negotiate with patent owners for public non-
commercial use.
The WTO rules do require payment of compensation to patent
owners, a matter that is not in dispute in the South African
case. Mr. Tell says he is concerned that the South African
Medicines Act gives statutory authority for the government to
authorize the use of patents, without spelling out in detail how
the patent owner's rights will be protected. South Africa says
it will set this out in regulations. This isn't an unreasonable
position. Mr. Tell would recognize this if he ever read the US
government's statutes on compulsory licensing of patents, such as
those for clean air (42 USC 7608), atomic energy (42 USC 2183),
Bayh-Dole March-In Rights (35 USC 203) or US government use under
eminent domain (28 USC 1498). Before Mr. Tell hurls rocks at
black leaders in South African he might want to look at the legal
frameworks in the US and Europe. But in any case, the US
government could bring a WTO action against South Africa if and
when South Africa actually violated anyone's patent rights. The
US hasn't taken this path so far because it would lose - unless
the WTO decided to make Mr. Tell a judge.
Mr. Tell chides me for skipping over too quickly the issue
of drug-resistant strains of HIV/AIDS, if we permit poor blacks
to have access to drugs. He makes an interesting point, in light
of the fact that drug resistance is a common problem for HIV/AIDS
patients, including middle income white people in the US. Where
exactly is Mr. Tell going with this? Is Mr. Tell going to
endorse the famous Peter Jennings "final solution" for poor
African blacks - denial of drugs as public health measure? Do
we extend this "remedy" to American citizens who have problems
with resistance?
I will say that it is uncommon for PhRMA and its member
companies to actively promote the idea that inappropriate uses of
drugs is a major public health problem. But the solution is not
to tell 22 million black Africans that they should quietly die,
it is to fight for a better health care system in general.
Deliberately making drug prices sky high isn't the only policy
response that one might imagine.
In Mr. Tell's tart response to Ms Huffington, he says "Gore
has not 'coordinated trade policy' with South Africa." Mr. Gore
has "gone his own way--declining to endorse [the pharmaceutical]
industry's preferred solution, trade sanctions, while continuing
to pursue a serious question of trade law."
Where exactly does Mr. tell get this from? The White House
and the whole US trade bureaucracy has been putting tons of
pressure on South Africa on this issue for two years. The US
government recently cited South Africa for speaking out at World
Health Organization meetings - making dissent an official barrier
to US exports. Before this became an election issue, Mr. Gore's
own staff had boasted of its efforts to push for changes in South
African policy. Now Mr. Gore is pressuring South African
officials to say it never happened. The fact that Mr. Gore
didn't do everything PhRMA asked means what? That PhRMA asked
for more than it got from the Vice President? What industry
group doesn't ask or the moon?
What is the "serious question of trade law" regarding
parallel imports, the issue that has consumed most of Mr. Gore's
time in this dispute? Does Mr. Tell insist on claiming that
there is any doubt at all on behalf of anyone with any legal
training that parallel imports are legal under the WTO?
And what does Mr. Tell mean that Mr. Gore has not
"coordinated" policy on South Africa, and as US co-chair of the
South Africa Binational Commission, he "attempts only to resolve
bilateral impasses at the ministerial level." There must be some
deep distinction that Mr. Tell is searching for, and I'm sure
there is some clever way to avoid the "buck stops here" for Mr.
Gore, but one would be hard pressed to find anyone in the Federal
government other than the Vice President who has been in charge
of this relationship. Really Mr. Tell, who was in charge, if
not Mr. Gore?
After Mr. Tell is through trashing the South African
government, he might look at the US trade pressures on dozens of
other countries on behalf of the pharmaceutical industry. Such
as pressure on the Philippines regarding generic drug
substitution, successful efforts to get Thailand to repeal laws
on compulsory licensing and parallel imports, efforts to stop New
Zealand from using HMO style reimbursement schedules, or
complaints against Cyprus or Israel for authorizing medical
research on patented drugs. There is a bigger picture that
deserves a more serious treatment than the one offered by Mr.
Tell.
Sincere,
James Love
--
James Love, Director, Consumer Project on Technology
I can be reached at love@cptech.org, by telephone 202.387.8030,
by fax at 202.234.5176. CPT web page is http://www.cptech.org