[Ip-health] WHO DG regrets her C-License statement

[martin khor]

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TWN Info Service on WTO and Trade Issues

15 February 2007

Third World Network

www.twnside.org.sg





Health: WHO DG regrets her reported remarks on Thai compulsory licenses



The WHO Director General Dr. Margaret Chan, has sent a letter to Thailand's

Health Minister expressing regret for the embarrassment caused to his

government by remarks she was reported to have made in Bangkok that were

critical of the compulsory licenses granted by the government for three medicines.



The letter follows the deep offence that Dr. Chan's comments had caused the

government and particularly the Minister of Public Health.



Dr. Chan's reported comments had also caused outrage among international

health NGOs and grassroots health movements worldwide, especially

groups representing people living with HIV-AIDS. More than 400 groups and

individuals have sent her a protest letter asking her to change her views.



In her letter, Dr. Chan assures the Health Minister that its issuance of compulsory

licenses is "entirely the prerogative of the government, and fully in line with the TRIPS

agreement", that the WHO "unequivocally supports the use by developing countries of

the flexibilities within the TRIPS agreement", including the use of compulsory licensing,

and that "there is no requirement for countries to negotiate with patent holders before

issuing a compulsory licence."



The Director General however repeats the main theme of her speeches when she was in

Bangkok recently, that the multinational drug companies are "part of the solution" and

that it would be "pragmatic" for the government have prior negotiations with them.



Below is an article on the DG's letter and on the letters to the DG from

health organisations. This article was publiched in the SUNS on 14 Feb 2007.



With best wishes

Martin Khor

TWN



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WHO DG regrets her reported remarks on Thai compulsory licenses



By Martin Khor, Penang, 13 Feb 2007



The Director General of the World Health Organisation, Dr. Margaret Chan, has sent

a letter to Thailand's Health Minister expressing regret for the embarrassment

caused to his government by remarks she was reported to have made in

\angkok that were critical of the compulsory licenses granted by the government for

three medicines.



The letter follows the deep offence that Dr. Chan's comments had caused the government

and particularly the Minister of Public Health, Dr. Mongkol Na Songkhla, who was

reported to have cancelled a dinner meeting with the Director-General.



Dr. Chan's reported comments, highlighted by a Bangkok Post article of 2 February

entitled "WHO raps compulsory licensing plan", had also caused outrage among

international health NGOs and grassroots health movements worldwide, especially

groups representing people living with HIV-AIDS. More than 400 groups and individuals

have sent her a protest letter asking her to change her views.



In her letter, Dr. Chan assures the Health Minister that its issuance of compulsory

licenses is "entirely the prerogative of the government, and fully in line with the TRIPS

agreement", that the WHO "unequivocally supports the use by developing countries of

the flexibilities within the TRIPS agreement", including the use of compulsory licensing,

and that "there is no requirement for countries to negotiate with patent holders before

issuing a compulsory licence."



The Director General however repeats the main theme of her speeches when she was in

Bangkok recently, that the multinational drug companies are "part of the solution" and

that it would be "pragmatic" for the government have prior negotiations with them.



In her speech on 1 February at a health conference in Bangkok, Dr Chan spoke on the

problem of neglected diseases, praised the role of multinational drug industry and

stressed that the solution was to rely on drug donations or discounts from the companies.



On the same day, during a visit to the National Health Security Office, Dr Chan

reportedly cautioned Thailand over its move to adopt compulsory licensing for producing

generic versions of drugs for heart disease and AIDS.



''I'd like to underline that we have to find a right balance for compulsory licensing. We

can't be naive about this. There is no perfect solution for accessing drugs in both quality

and quantity,'' the Bangkok Post quoted her as saying.



The report continued: "Dr Chan said she truly felt that the pharmaceutical industry was

part of the solution to better drug access and that the government should open

negotiations with drug firms over the issue."



The Thai government has taken the position that it need not negotiate with the patent

holder before issuing a compulsory license if this is for non-commercial public use,

which was the case for its three licenses. This position was confirmed as correct (i. e. not

in violation of the WTO's TRIPS agreement) by international legal and health experts,

including Professor Carlos Correa of Argentina, at a Bangkok press conference on 2

February.



Dr. Chan's letter to Dr. Mongkol now states the WHO's view that there is "no

requirement for countries to negotiate with patent holders before issuing a compulsory

licence."



In late January, the Health Ministry announced the compulsory licensing of two drugs -

Kaletra, an advanced anti-AIDS drug, and Plavix, a treatment for heart disease - by

invoking Article 51 of the 1992 Thai Patent Law to import or produce a generic version

of the two drugs.



Last November it also issued a compulsory license to import and produce generic

versions of the anti-AIDS drug Efavirenz. The Ministry says that it will save significantly

on the cost of medicines and would be able to treat more patients, as the generic versions

would be much cheaper than the branded patented products.



While its actions enjoy wide public support, they have also earned the ire of multinational

drug companies which warned that these measures would sour the business climate and

jeopardize foreign investment.



In her letter dated 7 February to Dr. Mongkol, the WHO Director-General said: "I deeply

regret that my comments at the close of the briefing at the National Health Security

Office were misrepresented in the media, and may have cause embarrassment to the

government of Thailand. They should not be taken as a criticism of the decision of the

Royal Thai government to issue compulsory licences, which is entirely the prerogative of

the government, and fully in line with the TRIPS agreement.



"Thailand is making good progress towards increase budget allocations for health, while

simultaneously control rising health care costs with greater efficiency. Medicines are a

substantial element of health care costs, and it is entirely appropriate and necessary for

the government of Thailand to find means of reducing these costs to ensure sustainable

financing of health care.



"As I mentioned in the recent Executive Board, I firmly believe that the pharmaceutical

industry-generic manufacturers and R&D companies are part of the solution. I am

committed to dialogue with industry to find ways of ensuring that access to high quality

essential medicines is not limited by cost considerations. I am equally committed to

dialogue with people who suffer from HIV/AIDS and other conditions, and with civil

society groups and NGOs.



"WHO unequivocally supports the use by developing countries of the flexibilities within

the TRIPS agreement that ensure access to affordable, high quality drugs. This includes

the use of compulsory licensing, as described in paragraph 6 of the Doha Declaration of

the TRIPS Agreement and Public Health.



"The decision whether to issue a compulsory license for a pharmaceutical product is a

national one. There is no requirement for countries to negotiate with patent holders before

issuing a compulsory licence.



"As a global community we need to ensure the right balance between the immediate and

urgent pressing need to provide affordable medicines to the many that need them, and the

need for provide continuous incentives for innovation. It is in this regard that I noted that

prior negotiations with industry is a pragmatic approach that may ensure countries have

access to high quality medicines at affordable prices."



"Where there are urgent needs, the bottom line is that people need access to medicines. I

trust this clarifies the position of WHO concerning compulsory licensing of medicines,

and I look forward to further opportunities to discuss these important issues with you in

the future."



Just about the same time as Dr Chan's letter was sent, 426 individuals and organizations

representing people living with HIV/AIDS and their supporters around the world sent a

letter to Dr. Margaret Chan, expressing disappointment at her comments as well as asking

her to reconsider her views regarding the Thai compulsory licenses.



In the letter, the groups told Dr. Chan: "You have been entrusted, in your position as

director general of WHO, to work for 'the attainment by all peoples of the highest

possible level of health.' We believe that your comments last week do not reflect this

mission, and in fact work against it.



"We expected that you would have congratulated Thailand for its efforts, completely

legal under WTO rules, to increase public health and access to medicines for its people.

As you know, TRIPS grants the right to countries to act in the interests of public health

and override the monopoly power that a patent grants a company if the need arises."



The letter said that the Doha Declaration reaffirmed each WTO member "has the right to

grant compulsory licences and the freedom to determine the grounds upon which such

licences are granted". Also, according to the TRIPS agreement Article 31(b), as well as

Thai law, a compulsory license for government use does not require prior negotiation

with the patent-holder.



"You mention finding a 'balance' issuing compulsory licenses. While this may sound

reasonable on the surface, surely you are aware that the pharmaceutical companies have

time and again shown that they are only committed to maximizing their own profits," said

the letter.



"In the case of Kaletra, one of the three drugs for which Thai authorities issued a

compulsory license, Abbott (which produces Kaletra) pursues a deeply cynical and

profiteering marketing strategy within the US that was recently revealed by internal

company memos.



"In July 2006, Abbott announced a new 'discounted' price for Kaletra in developing

countries such as Thailand, but the price (US$2200/year/person) still includes more than

300% profit margin and would create undue financial burdens on the Thai government's

universal treatment program, making this program financially unsustainable."



The letter added that generic medicines are today keeping millions of people alive, and

providing hope to millions more. The groups said they need the Director General as a

world leader in public health, to support all possible efforts to provide treatment to people

living with HIV/AIDS in developing countries, especially the promotion of generic

competition, which has proven over and over to be the most important factor in

decreasing the cost of medicines.



Among the groups that signed the letter were members of the International Treatment

Preparedness Coalition, People living with HIV/AIDS, ACTUP-NY, USA, AIDS Law

Project, South Africa, AIDS infoshare Russia, Zimbabwe Activists Against HIV and

AIDS, Australian AIDS Fund, International Community of Women Living with

HIV/AIDS, Positive Malaysian Treatment Access & Advocacy Group, Health GAP,

USA, Kenya Treatment Access Movement, Knowledge Ecology International, AIDS

Care China, Ghana AIDS Treatment Access Group., Action for Health Initiatives

Philippines, Manipur Network of positive people (India), and AIDS Alliance Nepal.



In another statement, the AIDS Healthcare Foundation said that the WHO chief's lack of

support for the Thai compulsory licensing action made it clear that "health of people

living with HIV in Thailand is not among her priorities." The Foundation is the US'

largest HIV/AIDS healthcare and prevention and education provider, which operates free

AIDS treatment clinics in the US, Africa, Latin America/Caribbean and Asia.



It said Dr Chan's views appear to favour pharmaceutical companies' interests over people

living with HIV/AIDS in the developing world.



Michael Weinstein, AIDS Healthcare Foundation's President said: "Thailand's move to

issue a compulsory license for Kaletra will likely lower the price of this lifesaving drug to

nearly half of its current cost and will mean the difference between life and death for

thousands of Thai citizens in need.



"The comments made by Dr. Chan serve only to undermine Thailand's efforts to protect

the health of its people and it is appalling that in her position she would choose to

advocate for multinational corporate interests over the interests of people living with

HIV/AIDS in the developing world. AHF seeks immediate clarification from the Director

General on her position regarding Thailand's efforts to protect the health of its citizens."

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