[Ip-health] Op-Ed: Drug Patent Rules Must Allow Exceptions for Public Health

[Dan Beeton]

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Drug Patent Rules Must Allow Exceptions for Public Health

By Mark Weisbrot

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This op-ed was distributed by McClatchy Tribune Information Services on
Thursday, March 20, 2008, and it was published by the Sacramento Bee[1] and
other papers.

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Some big pharmaceutical companies are up in arms about developing countries
importing less expensive generic versions of drugs for which these companies
hold a patent monopoly. But the procedure is perfectly legal, even under the
World Trade Organization's pro-pharmaceutical-monopoly rules. The only
question is whether these huge corporations - who used their political muscle
in Washington to prevent our government from lowering the price of Medicare
prescription drugs --  will intimidate other governments that are trying to
provide essential medicines to their citizens.
Thailand became the latest target of this bullying last winter when it issued
"compulsory licenses" for three drugs. Two were anti-AIDS drugs (efavirenz and
lopinavir/ritonavir) and the third is used to treat patients with
cardio-vascular disease (clopidogrel). A compulsory license allows for the
production or import of a generic version of a patented drug, without the
permission of the patent holder. It is completely legal, and in fact the
United States has used compulsory licenses many times.
But the U.S. government has sided with the big pharmaceutical companies and
put Thailand on a special "Priority Watch List," which could potentially lead
to trade sanctions against Thailand. Actual sanctions are unlikely, but
Washington and its pharmaceutical allies have made a serious threat. Now that
pressure is reportedly being used to block similar licenses for three cancer
drugs.

Thailand is a developing country of 65 million people, with income per person
of about $10,000, or less than one-fourth that of the U.S. The government
estimates that the use of generic efavirenz will enable it to provide this
anti-AIDS medicine to an additional 20,000 people, as compared to using the
pharmaceutical giant Merck's branded version (called Stocrin).
The vast majority of developing countries have not exercised their rights to
compulsory licensing, because of the pressure from PhRMA (the U.S. trade
association of the big branded pharmaceutical companies) and the many
politicians that are under its influence. This is a tragedy. Former President
Bill Clinton, speaking in support of the governments of Thailand and Brazil in
issuing compulsory licenses, noted that "no company will live or die because
of high price premiums for AIDS drugs in middle-income countries, but patients
may."
The pharmaceutical companies argue that they need to protect their patents in
order to fund the research and development that produces new drugs. This is
partly true - although the majority of pharmaceutical research goes to produce
"copycat" versions of other drugs that already exist. These copycat drugs can
generate big profits but don't necessarily provide any advantage over existing
drugs. The system is so inefficient that Americans are currently paying about
$150 billion dollars through monopoly pricing to the companies, in order to
get about $25 billion worth of research - much of which is not especially
helpful.
So big PhRMA is really making an argument for more comprehensive reform: if
the economic and social costs of funding research through private monopolies
is so high, maybe we should put more into public and non-profit research
(which already accounts for a substantial amount of the research these
companies use). In fact, if our own government were to fund the research that
the branded pharmaceutical companies now carry out, and allow the results to
be used for generic drugs, the research would more than pay for itself. The
government would save more than the cost of this research through lower prices
for the drugs it buys through Medicare and Medicaid. And the drugs would be
available immediately as generics to the rest of the world.
Such economically sensible reforms may be some years off, given the power of
the pharmaceutical lobby. But the least we can do right now is to stop this
lobby from bullying other governments that are trying to do the right thing
for their citizens.


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Mark Weisbrot[2] is Co-Director of the Center for Economic and Policy
Research, in Washington, D.C. (www.cepr.net[3]).

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Center for Economic and Policy Research, 1611 Connecticut Ave, NW, Suite 400,
Washington, DC 20009
Phone: (202) 293-5380, Fax: (202) 588-1356, Home: www.cepr.net
[4]

Dan Beeton
Center for Economic and Policy Research
1611 Connecticut Avenue, NW, Suite 400
Washington, DC 20009
Phone: 202 293 5380 x104
Fax: 202 588 1356
E-mail: beeton@cepr.net / www.cepr.net[5]

===References:===
  1. http://salsa.democracyinaction.org/dia/track.jsp?v=2&c=qZS%2BqW9hsoJW3NIBKKRql7iXwRaO0UMh
  2. http://salsa.democracyinaction.org/dia/track.jsp?v=2&c=Zxg%2FW8hrNMjPFFZdG%2FyRbriXwRaO0UMh
  3. http://www.cepr.net/
  4. http://salsa.democracyinaction.org/dia/track.jsp?v=2&c=0LlP1NdJPqwGFn%2FIKD2xW7iXwRaO0UMh
  5. http://www.cepr.net/