The World Trade Organization today adopted a permanent amendment to international trade law that will make it easier for poor countries exposed to health emergencies to import cheaper generic versions of patented medicines if they are not able to produce these themselves.

The WTO General Council adopted the proposal immediately after a short meeting of the Council of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which took place against the background of a number of meetings held over the weekend.

The amendment, the first ever to the 1994 TRIPS agreement, implements a waiver that was temporarily agreed on 30 August 2003, making it possible for countries to export medicines under compulsory license to countries with no or inadequate production facilities. This waived paragraph 31(f) of the TRIPS agreement, which states that production under compulsory license should predominantly be for domestic use.

In a press conference, WTO Director General Pascal Lamy hailed the change to the TRIPS agreement as a sign of “flexibility” and “adjustment” that bolsters the current development-focused round of free-trade negotiations at the WTO.

“The agreement to amend the TRIPS provisions confirms once again that members are determined to ensure the WTO’s trading system contributes to humanitarian and development goals as they prepare for the Hong Kong ministerial conference,” Lamy said in a statement.

The waiver was more or less adopted in full in the amendment, which consists of three parts: Article 31bis (an addition to Article 31) allowing medicines to be exported under compulsory license and setting out parameters for remuneration to the patent holder; an annex on terms for using the system and an appendix to the annex that spells out assessment of manufacturing capacities of pharmaceuticals (IPW, WTO/TRIPS, 5 December).

The agreement will become part of the TRIPS agreement once two thirds of WTO members have ratified it, with a 1 December 2007 deadline, according to the documents.

Moreover, a statement made by the TRIPS Council chairman on 30 August 2003 was also read out loud and adopted according to a pre-determined “choreography,” intended to ensure a match of the 2003 adoption procedure. This was a result of “intricate legal discussions,” the WTO said in a release.

As part of this “choreography,” 11 advanced developing countries had to re-state their 2003 statement of intent to use the waiver only in cases of national emergencies. Participants at the meeting said that this was done, although some of the members had to be kept on track and reminded that they were not to make additional statements. A Brazilian delegate said that procedure was followed and he was very pleased with the outcome.

African countries also welcomed the agreement although it compromises the proposal the African Group made earlier this year. That proposal would have implemented the 2003 decision with the removal of what they perceived as technical barriers to its use.

An African official said that it was not so much the content of the amendment but the fact that it had been adopted that was important. He said that an amendment had now been made to “the most difficult agreement in the WTO,” and that this had been a “window” for the African countries.

But another developing country official said the amendment process had been too rushed, saying the decision could have waited until after Hong Kong.

Still another developing country official said, “It was a bit rushed, but the issue is not new,” and that it was maybe “the best possible compromise.”

General Council Chair Sees Use of Waiver

General Council Chairperson Amina Mohamed of Kenya said at a press conference that this was an “extremely important decision” that “gives the organisation [WTO] a very human face.”

Mohamed told Intellectual Property Watch afterward that the waiver “has delivered” although it has not been used by any country so far. She said that the success of a WTO regulation could not be judged by the frequency of use, as just the fact that the system is in place could bring comfort. It therefore is not flawed just because it has not been used, Mohamed said.

Mohamed said that the waiver had done just what it was supposed to do, namely address the public health issue and crisis in poor countries. It has also worked to lower prices on medicines for diseases such as HIV/AIDS, she said.

Moreover, Mohamed said that other reasons why it had not been used so far were that it took time for countries to implement necessary changes to national law, and that up to now it has been possible to import cheap medicines, or active substances, from India, which only this year introduced patents for pharmaceuticals. Now that drugs will be patented in India, there is a greater likelihood that countries will need to use the waiver.

In a statement the United States said it welcomed the agreement, emphasising that it had “played an instrumental role throughout the process.” US Trade Representative Rob Portman said it was a “landmark achievement” and that, “The African Group, and other developing countries, made clear that the amendment was something they saw as essential to accomplish before Hong Kong and we were pleased to make it happen.”