Patent on Survival

By Rebecca Bengtsson, Student Human Rights Studies

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In 1998, South Africa drew attention to the pitfalls of the World Trade Organization’s (WTO) newly written Agreement on Trade Related Aspects (TRIPS). It was through legislative change, the so called South African Medicines and Related Substances Control Amendment Act, that the country was sued by 42 pharmaceutical companies. The underlying cause of the indictment was that the country declared that they were in a state of an emergency due to the urgent HIV/AIDS situation.

Former President Nelson Mandela proclaimed that the country was in a state of emergency and that the public health was off balance as 10% (2.4 million) of the population was infected by the catching HIV/AIDS virus. The second reason for the national emergency was that the health sector was very congested. At the time the available antiretroviral (ARV) drugs cost significantly more in South Africa than in other developing countries.

The Amendment Act would involve a legal framework in order to increase the availability of ARV drugs. This meant that the minister of health would be able to regulate the flow of essential drugs to stabilize the faltering public health. This led to the U.S. and the EU using trade sanctions in protest, because they considered the task to regulate the medical supply unclear and argued that this was contrary to several articles in TRIPS. As a response, South Africa defended itself by arguing that it had a responsibility to protect and guarantee its people the right to health.

The trade sanctions and the lawsuit led to massive demonstrations all over the world and many began to question the pharmaceutical company’s moral and conduct. As NGOs and individuals fought together across national boundaries, the pressure on the pharmaceutical companies became too high, and they withdrew their lawsuit in May 2000.

The aim of this article is to get a sneak peek into the problems that occur due to the collision between the economic market, including the pharmaceutical industry’sproduction sector, and every person’s right to health.

Greed and economic interest in the writing of economic agreements?

In 1995 the members of the newly founded WTO met during the last round of GATT, the Uruguay Round, to discuss sharper guidelines in the existing intellectual property rights. The United States participated on one condition, namely that copyright would be addressed, since many poor countries had, through their pirated goods, reduced developed countries revenues. The hearing turned out to be between developed countries, with the USA leading the front against the developing countries. The poor countries had already realized what a stronger protection of intellectual property rights involves and insisted on an exclusion from the tightened law, especially the law on patent.

Firstly, the poor countries’ revenues would fall sharply as they would no longer be able to produce copied drugs. Secondly, due to the law on patent, people would die, as they could no longer afford the higher priced patented drugs. In the long run, this would lead to a decrease in the population. India was particularly skeptical to the negotiation as it had supplied its enormous domestic market with copied drugs for a long time.

The developed countries argued that countries that did not sign the TRIPS agreement would become “free-riders” on the patent holder’s profit since they did not invest in any underlying research and development (R&D). The second argument was based on the idea that a stronger protection would inspire innovation on the domestic market; this would in the long run lead to multinational companies daring to make investments, which would be advantageous for the developing countries.

The United States and the developed countries pushed the proposal through, using threats of bilateral trade sanctions amongst other things to overcome the protest of developing countries. The TRIPS Agreement was formed and entered into force on 1st January 1995. The agreement places greater demands on members of WTO by introducing a higher level of the so called “minimum standard” of contract laws, which has been adapted from the industrialized countries’ gradual development.

Early on, the agreement was beneficial to the industrialized countries. This was because the majority of the patents were owned by companies from developed countries and there was also no need for major changes in the existing law. TRIPS put much emphasis on patent laws, which negatively affected the developing countries as the agreement on patent tightened sharply along with the introduction of the 20 year protection for inventions from the time an application was submitted.

The patent dilemma

The term patent means that the owner, through intellectual property protection, gets a strict monopoly on his or her invention and any use other than private requires a license conducted by the owner. There are some occasions when it is acceptable to break patents. When this occurs, you are entitled to a limited time use of a patented product without asking the patent holder for permission. This is one of the mechanisms, called ‘statutory licensing’, that limit the patent monopoly on the market; it is under very strict rules.

According to the articles included in TRIPS, the agreement does not limit the grounds on which statutory licensing can be performed, but rather the criteria which constitute the breach of a patent. According to articles 8 and 31b there is no detailed description on what constitutes an essential national emergency, or what necessary measures are included. Therefore, countries can interpret the meaning of a national emergency based on their own needs and beliefs.

Whether or not the appeal to national emergency actually has force in practice, and whether the law is flexible, has been under discussion. As mentioned in the introduction, the pharmaceutical companies’ moral and conduct has become a controversial subject. Advocacy of a strong patent protection has resulted in an equally fragmented field for which benefits are constantly weighed against the same number of disadvantages.

TRIPS and human rights

Since the implementation of the TRIPS agreement, UN bodies and NGOs have highlighted the problems encountered with the agreement in relation to human rights. This is due to the fact that states are facing complex situations in which they both have an obligation to guarantee human rights while dealing with the economic interests. The right to life and highest attainable health are put in contrast to the right to protection of economic interests, including intellectual property rights.

The recurring question that we ask ourselves is: What controls the pricing system of pharmaceutical drugs that contributes to this unequal distribution of prices in different countries? How come that only 5 million people out of 33,3 million infected by HIV/AIDS have access to ARV drugs, especially since there have been ARV drugs on the market since 1996. Another recurring issue related to the human rights question is if all included members benefit from the agreement? Are the human rights, including the right to life and survival, being promoted or discouraged by TRIPS?

I would say that the agreement has some obvious pitfalls from a human rights perspective. Firstly, human rights are only given when the agreement may be waived; they are therefore included only in the parentheses such as a national emergency. Secondly, as mentioned above, there are no restrictions on how to interpret and balance human rights. This leads to vague conclusions when human rights should be incorporated. Third, the agreement prevents states’ individual ability to determine their development strategy and is also adapted to the developed countries benefit.

Philippe Cullet, Professor of International and Environmental Law, also directs criticism against the TRIPS for excluding human rights. He says that human rights have given room to intellectual property but not the other way around. Emphasis is put on the governments, as they must prioritize the human rights when making economic decisions about such things as TRIPS, since the first-named constitute “the basic framework guiding state actions at the domestic and international levels.”

The agreement has to be rewritten to agree with human rights. It must include grounds that promote access to health services instead of denying it. The contemporary layout of the agreement has so far been advantageous for the developed countries where a balance between a functioning health sector and the financial market already exists.

Conclusion

The right to life and the right to health are some things that a country, the international community and multinational companies always should prioritize in all elections and all positions. In this paper, however, it becomes clear that this is something that does not always happen in practice. It is the exclusion of the human rights which contributes to this. A clear example is that the right to health is only mentioned in the parenthesis of the agreement, when a country is in a state of emergency.

The contemporary design of the WTO’s TRIPS agreement has too many pitfalls to operate with the purposes for which it was created – to promote world trade by encouraging all member countries’ trade and markets. The creation of stronger intellectual property protection has resulted in major economic changes for developing countries and yet it is the industrialized countries that, so far, have benefited from the contract.

A thorough investigation is required of the effects TRIPS has, and what the future will bring to countries that are at different levels of development.

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