[Ip-health] Thai Day: IPR Debate Centers on Cheap Drugs

[Mike Palmedo]

http://www.manager.co.th/IHT/ViewNews.aspx?NewsID=3D9490000001090

IPR debate centers on cheap drugs

IHT Thai Day
By Daniel Ten Kate
5 January 2006 14:23

The late Howard Aiken, who is credited with inventing one of the world=92s
first digital computers for IBM back in 1944, once said, =93Don=92t worry
about people stealing your ideas. If your ideas are any good, you=92ll
have to ram them down people=92s throats.=94

Though Aiken may be correct in some circumstances, other ideas, commonly
known as intellectual property to trade negotiators, are considered much
more valuable and worth protecting.

As technology makes information available at the touch of a keyboard,
governments have moved to devise laws that weigh the need to encourage
innovation while protecting the greater interest of the public at the
same time.

=93There must be a suitable balance between enforcing intellectual
property rights (IPR) to encourage investment and disseminating
information that can benefit the public,=94 Chanchai Likhitjitta,
president of the Supreme Court, told a recent seminar on IPR. =93The
crucial question is: where do we draw that line?=94

That heated debate is one of the sticking points in the free trade
agreement (FTA) negotiations with the United States, which are scheduled
to resume next week. And though IPR covers a wide range of goods and
services, from the entertainment industry to agricultural products to
traditional knowledge, the sector that is of most concern to both
governments is the pharmaceutical industry.

The US wants the FTA with Thailand to go beyond what the government
already signed up for in the World Trade Organization=92s Agreement on
Trade-Related Aspects of Intellectual Property Rights, commonly known as
TRIPS.

Specifically, the US wants an extension of patent protection to 25 years
from the 20 agreed to in TRIPS, as well as stronger laws to protect
=93data exclusivity,=94 the period in which drug manufacturers cannot rely
on the data of the brand-name drug to register a generic equivalent.

That has the effect of delaying when cheaper generic drugs can reach the
market. If generic drug manufacturers do not have access to data, they
must essentially reinvent the wheel, and use sick patients to do so.

US trade negotiators have argued that data exclusivity allows
pharmaceutical companies to =93more fully protect the existing life span
of a patent.=94 But critics, including some US senators, have said the
measure only prevents developing countries from quickly accessing cheap
drugs.

=93With data exclusivity, companies will have to do more and more
experiments to arrive at the data, and it has nothing to do with
patents,=94 said Lerson Tanasugarn, a Chulalongkorn University law
professor who has advised the Thai government on IP issues in the FTA
talks with the US.

=93It=92s not so much about the price of drugs going up,=94 he said of the
concerns over IPR. =93It=92s more about the price not coming down fast enou=
gh.=94

Researchers from Chulalongkorn have called on Thai negotiators to reject
the introduction of data exclusivity and extend the life of patents
beyond TRIPS requirements. They argue that an FTA should not impose any
obstacles that might threaten public health, and call on the government
to implement compulsory licenses for anti-retroviral drugs.

=93The extension of patent life to compensate for up-front administrative
or regulatory delays in granting the original patent must not be
accepted at all,=94 wrote Jiraporn Limpananont and Vithaya Kulsomboon, two
professors in Chulalongkorn=92s pharmaceutical sciences faculty, in a
recent report. =93Since the patent life of 20 years in Thai patent law
started from the application filing date, so the delays in granting the
original patent do not shorten this patent life and do not affect the
rights of the patentee.=94

The US argues that stronger IPR enforcement would help rid the market of
potentially dangerous fake drugs, and create an environment where more
research and development-based manufacturers would be willing to set up
shop in Thailand. It also argues that the FTA will lower drug prices.

=93If anything, drug prices will come down because the 10-percent tariff
on pharmaceutical products will be gone,=94 said a US government official,
speaking on condition of anonymity. =93That basically acts as a flat tax
on sick people.=94

Some doubt, however, that Thailand would see many benefits in
strengthening its IPR regime. The country=92s economy is not as
knowledge-intensive as that of Singapore, whose bilateral FTA with the
US in 2003 has become the foundation for the current negotiations
between the US and Thailand.

=93It is highly questionable that such TRIPS-plus provisions are in
Thailand=92s interest,=94 wrote Razeen Sally, a professor at the London
School of Economics, in a recent study on Thailand=92s bilateral trade
negotiations. Since Thailand is a developing economy, it has no
comparative advantage in inventions. But with a TRIPS-plus deal, the
country=92s generic pharmaceutical industry would be at risk, Sally wrote.

Furthermore, the researcher found, the long-term benefits =93such as
attracting IP-related FDI are speculative (to say the least), but
short-term losses would be real and immediate. These would include the
costs of overhauling legislation and beefing up the enforcement of laws
and regulations =96 at a time when the legal system is already overburdened=
.=94

Finally, most concerns and protests surrounding intellectual property
rights focus on the government=92s ability to issue compulsory licenses to
override patents and produce cheaper generic drugs to fight such public
health emergencies as HIV/AIDS, malaria and tuberculosis. US officials,
including Deputy Secretary of State Robert Zoellick, have repeatedly
said that access to cheap antiretroviral drugs would not be affected by
the bilateral FTA. But some are holding their applause until they see
that the fine print of the trade pact does not limit the government=92s
ability to issue compulsory licenses as the WTO agreement specifies.

=93The USA has given assurances that the Doha Declaration on TRIPS will be
respected, but the issue remains to be clarified in negotiations,=94 Sally
wrote in his report. =93Thai unease is perfectly understandable.=94