WTO TRIPS Agreement and its Implications for Access to Medicines in Developing Countries
Study Paper 2a, United Kingdom Commission on Intellectual Property Rights, 2002
80 Pages Posted: 9 Sep 2011
Date Written: February 14, 2002
This study accepts the consensus of experts that developing countries should make use of policy options such as compulsory licensing and parallel importation to increase the supply of low-price medicines and vaccines. The interests of the OECD and its consumers will not be undermined by such action since, inter alia, Pharma is not significantly dependent on profits from developing countries to pursue its research mission.
The Doha Declaration on the TRIPS Agreement and Public Health mandates that the agreement be interpreted in a manner that supports public health interests and promotes access to medicines for all. This study analyzes the TRIPS Agreement in light of that mandate.
As of January 1, 2005, developing countries (excluding least developed) will be required to implement and enforce pharmaceutical product patent protection and operationalize patents based on mailbox applications that were submitted during the TRIPS transition period. At that time, the world supply of low-price off patent medicines will decrease. Not only will supplies of low-price medicines within developing countries decrease, but supplies available for export by these countries will gradually diminish.
The Doha Declaration provides to least developed countries (LDCs) an extension until January 1, 2016, to implement or enforce pharmaceutical product patent protection. That extension will have a limited effect on supplies since LDCs will remain dependent on low price imports from developing countries that may no longer be available. LDCs might best take advantage of the transition period by increasing their intra-LDC capacities to make and trade medicines and vaccines, but there are practical obstacles to accomplishing this.
When the developing country transition period ends, the restriction imposed by Article 31(f) of the TRIPS Agreement on exports under compulsory license is likely to have a significant effect on the world supply of low price medicines and vaccines. If a predominant part of compulsory licensed production must supply the local market, the quantity of available exports will be limited. To remedy this problem, the TRIPS Agreement should be amended to delete Article 31(f). If Article 31(f) is not deleted, Article 30 of the TRIPS Agreement regarding exceptions to patent rights must be interpreted so as to permit making and export of pharmaceutical products and other public health related inventions to meet public health needs. The adoption of a formal interpretation by the WTO Ministerial Conference or General Council would provide legal security for countries following this approach. This study provides a detailed analysis of Article 30 indicating that such exception from the rights of patent holders is permitted, and suggests criteria on which implementation of this exception may be evaluated.
Article 8:1 of the TRIPS Agreement authorizes the adoption of necessary public health measures provided they are “consistent” with the terms of the TRIPS Agreement. There is no justification for the TRIPS safeguard to be more restrictive than the safeguards applicable to goods and services. Article 8:1 should be amended to permit the adoption of necessary public health measures inconsistent with the TRIPS Agreement.
Developing countries may consider revisiting the position many of them advocated during the GATT Uruguay Round, and propose amendment of Article 27:3(a) of the TRIPS Agreement to allow exception from patenting of public health related inventions, including medicines and vaccines.
Developing countries should implement the TRIPS Agreement recognizing that its provisions do not demand excessive levels of protection promoted by only a few OECD countries. Knowledgeable observers agree that meeting the public health needs of developing countries requires substantial subsidization from OECD countries and international organizations such as the IMF and World Bank. The Global Fund does not to date evidence that it will be adequately funded so as to address urgent developing country needs for public health supplies. Developing countries must be prepared for self-reliance, and this self-reliance requires increased capacity to produce low price medicines and vaccines, whether or not such products are under patent by Pharma enterprises. This intensifies the importance of interpreting and amending the TRIPS Agreement to reinforce developing country capacity to act in their own best interests.
Increasing attention must be devoted to research and development on medicines and vaccines of particular relevance to developing countries. Neither the market nor the TRIPS Agreement provides a solution for the lack of attention to this R & D. An option to be further explored is increasing the level of funding for publicly undertaken R & D.
Keywords: TRIPS Agreement, access to medicines, compulsory licensing, export
JEL Classification: I18, K33, O34
Suggested Citation: Suggested Citation
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By Alan Sykes