UN Agencies Encourage Use Of WTO Measures To Lower HIV Medicines Costs

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Three United Nations agencies have joined together to explain to their member countries the little-understood but hard-won flexibilities they have to stiff international intellectual property rules. The focus of a new policy brief issued today is on improving access to HIV treatment, and it offers a series of actions for governments and international organisations.

At issue are the “flexibilities” built into the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), the 1994 agreement that constructed a strong IP enforcement system. Negotiators at the time worked in a variety of exceptions and limitations that less-developed countries could employ to soften any negative impacts of stricter enforcement and ensure they retained the ability to take actions in their own best interest.

An example is in the public health area, where nations are given the choice to issue compulsory licences for patented drugs in order to produce cheaper generic versions of them, if they deem it necessary.

Use of flexibilities has been discouraged by developed countries – owners of the vast majority of IP rights – and pressure not to use them has been intense especially on emerging markets like Thailand or Brazil. But UN agencies emphasise the over-riding human rights principles embodied in UN declarations. They also highlight in the brief the increasing and treatable number of people afflicted with HIV in developing regions.

The 12-page policy brief [pdf] entitled, Using TRIPS Flexibilities to Improve Access to HIV Treatment, was released on 15 March by the World Health Organization, UN Development Programme, and UNAIDS. In a press briefing, the three organisations emphasised that their aim is to encourage the sustainability and scale-up of HIV treatment. They particularly cited the economic climate as undermining the affordability of needed drugs.

The brief gives key cases of national experiences with the flexibilities, such as in South Africa, Rwanda, Brazil, Thailand and India. It also cites the ever-rising level of commitments developing countries are drawn into through bilateral and regional trade agreements, which can undermine these flexibilities.

India, the biggest producer of affordable generic medicines, has seen a rapid rise in patenting of medicines with its 2005 implementation of TRIPS. There is global concern that the supply of affordable drugs it provides to the developing world will dry up as a result.

Sunjay Sudhir, the Indian representative to the WTO on TRIPS issues, praised the brief, as it is “simple enough for a layperson to understand but at the same time has references which could be utilised by IP experts,” he said. “While the context is AIDS treatment, the policy brief has a general relevance. The brief gives real life examples of use of flexibilities drawn from developing countries and LDCs [least-developed countries].”

The real test, he told Intellectual Property Watch, will be “to give it a life beyond the 12-page brochure by taking it across to countries through the technical assistance activities of the WHO, WTO, WIPO [World Intellectual Property Organization] and UNDP. Civil society organisations also need to contribute to spreading such awareness.” The report notes that civil society has “catalysed the process by challenging specific patents.”

“It is not yet late because LDCs have a transition period till 2013 (which could get extended),” said Sudhir. “Moreover, the brief is timely because of the spate of TRIPS-plus initiatives like ACTA [the Anti-Counterfeiting Trade Agreement recently concluded by mostly developed countries] and IP commitments in RTAs [regional trade agreements] which are actually constraining the flexibilities rather than promoting the use of flexibilities.”

Many African countries are said to have limited their ability to use the flexibilities through commitments built into the two regional IP agreements in Africa to which they were counselled by WIPO to sign up.

[Updated] Andrew Jenner, director of innovation, intellectual property and trade at the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), reacted to the report by saying the research-based industry group “shares the UN agencies’ concerns regarding sustainability and scale-up of HIV treatment and services.”

But, he said, TRIPS flexibilities are only one part of the answer, and “where ARV [antiretroviral] treatments are patented, we encourage discussion with the rights-holder(s) concerned to find a mutually acceptable solution, such as differential pricing or voluntary licensing, as these approaches are generally more effective and sustainable in practice.”

“Adoption of compulsory licensing,” Jenner said, “should be viewed as a last resort as widespread use of such provisions will significantly reduce the incentive to invest in the research and development of new life-saving medicines.”

Policy Brief and the Need to Act

UN agencies are concerned with reducing deaths related to HIV, and have identified that nearly 10 million of estimated 15 million people needing antiretroviral therapy are without access to treatment, “making it absolutely critical to accelerate programme delivery to reach universal access goals” set by the WHO and others, the brief said.

The report says UN agencies have been working to accelerate access to more effective and less toxic drug combinations and diagnostics and to start antiretroviral therapy earlier. Prices for first-line antiretroviral drugs have “tremendously decreased” over the past decade, it said, but prices remain high in most middle- and low-income countries in Europe, Asia and Latin America. The average price for second-line regimens is high in low- and medium-income countries everywhere. The report notes that high prices are not only due to patents, but rather a variety of factors.

Michelle Childs, of Médicins Sans Frontières, said that while she had not seen a final version, she thought it is a “very good step.” The report “sends an important signal that the UN institutions working closely on HIV – UNAIDS and WHO – as well as UNDP, recognise that the sustainability of providing treatment to people living with HIV will rely in part on using the TRIP flexibilities and are providing information on it.”

WTO members signing the TRIPS agreement agreed to a new level of obligations to protect and enforce IP rights, but also retained policy options such as to: determine the grounds for issuing compulsory licences; allow for parallel imports (taking advantage of price differentials for the same medicine in different countries); apply exceptions such as use of patented product without authorisation in order to obtain marketing approval of a generic version before the patent expires; and use transition periods for developing and least-developed countries.

Using flexibilities can have a positive effect on competition, the report said, which is the opposite of the exclusive monopoly created by a patent, and competition can bring prices down.

Another issue cited in the report is the need to prevent the “evergreening” of patents, in which patents (which run for 20 years) are extended by a small change in the existing product resulting in a new patent.

Actions for Governments, International Organisations

The report lists actions governments and international organisations can take. For instance, high-income governments with manufacturing capacity should consider implementing the so-called Paragraph 6 mechanism that allows them to export greater amounts of affordable drugs manufactured under compulsory licence to countries lacking manufacturing capacity. They also should ensure free trade agreements remain in line with the principles of the 2001 Doha Declaration on TRIPS and Public Health, which reinforced countries’ right to use the flexibilities.

Lower income governments should revise national legislation to ensure TRIPS flexibilities related to medicines access are in there; parliamentarians should block trade agreements not consistent with the Doha Declaration; smallest economies should use the TRIPS transition to 2016; and regional cooperation should be encouraged. They also should strengthen national drug regulatory authorities, and invest in regional and national production and in local expertise.

International organisations should support national governments with appropriate technical assistance; promote inclusion of flexibilities in national legislation; monitor IP regulations and their impact on public health; and encourage debate on alternative models for stimulating innovation and any possibility to reduce the cost of drugs.

The paper also urges pharmaceutical manufacturers to consider providing voluntary licences for the manufacture and sale of antiretroviral drugs in order to increase their availability and affordability in low- and middle-income countries. This could be done through the Medicines Patent Pool set up recently by UNITAID (IPW, Public Health, 10 March 2011).

“The Pool shares the concern of UNAIDS, UNDP and WHO about the sustainability of HIV treatment,” Ellen ‘t Hoen, executive director of the Medicines Patent Pool, told Intellectual Property Watch. “The Pool’s licensing model aims to increase access to HIV treatments by encouraging robust generic competition and the development of medicines specifically geared towards the needs of adults and children in developing countries.”

The report details other actions countries can take to improve health-delivery infrastructure and encourage the financing of health products, improve coherence, and come up with alternative mechanisms for reducing medicines prices, including through pooling procurement regionally, using pricing information during procurement negotiations, and eliminating taxes and tariffs and controlling markups.

IFPMA’s Jenner reinforced this, saying, “The IFPMA recognises the right of developing countries to use TRIPS flexibilities, in line with the Doha Ministerial Declaration. However, the TRIPS agreement is only one piece of the access picture.” As the policy brief notes, he said, “investment in health-delivery infrastructure and effective policies on health financing, procurement, taxes and tariffs, are also crucial considerations.”

It remains to be seen what impact this report will have, but it brings a new attention to a set of tools that have been seen as under-represented in technical assistance from the North for many years.

William New may be reached at wnew@ip-watch.ch.

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  1. Riaz K Tayob says

    The UN agencies and the WTO have failed the poor in developing countries because these are perfectly legal rights that are enshrined in international law and practice. When international civil servants pander to the whims and fancies of the rich countries instead of to felicity to the treaties they safeguard and then finally decide to do their jobs it is cause for ambivalence.
    The Doha Declaration is the best case in point of poor countries having to fight for rights that they already had in a context where manageable diseases in the North are veritable death sentences in the South with women and girls in particular being marginalised by these actions.
    Pig Farmers in the US received more timely and better treatment by both Lamy and Chan during the swine flu “pandemic” than most Africans when they issued a joint statment advocating the consumption of pork products.
    While it is never to late for a change, like Sudhir states, the real test is whether the rich world allows the use of legal rights. If past health imperialism is anything to go by, there is not much hope even now.


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