By Shreerupa Mitra-Jha, FirstPost | November 13, 2016
Governments engaged in bilateral and regional trade investments should ensure that these agreements do not include provisions that impinge on the right to health, and as a first step should undertake public health assessments “that are transparent and made publicly available”, India said in a strong statement delivered at the WTO highlighting a longstanding fight by India to sustain its generic drugs industry.
“These impact assessments should verify that the increased trade and economic benefits are not endangering or impeding the human rights and public health obligations of a nation and its people before entering into commitments,” India said on 9 November at a discussion on the report of the UN Secretary-General’s (SG) High-Level Panel on access to medicines at the WTO’s Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) Council.
“Governments and the private sector must refrain from explicit or implicit threats, tactics or strategies that undermine the right of WTO members to use TRIPS flexibilities. Instances of undue political and commercial pressure should be formally reported to the WTO Secretariat,” an Indian delegate said speaking in the context of proliferating mega trade deals that often contain provisions that prevent national governments from legislating in favour of public health measures or protecting the environment.
What is TRIPS?
TRIPS is an international agreement administered by the WTO that sets down minimum standards for many forms of intellectual property (IP) regulation as applied to nationals of WTO members. This agreement contains flexibilities that were enhanced and clarified during the 2001 Doha Declaration on TRIPS and Public Health. It says, for instance, that for pharmaceutical patents, there is a flexibility to interpret and implement TRIPS provisions in a manner supportive of the government’s right to protect public health.
Other provisions in the international agreement state that appropriate measures may be needed to prevent the abuse of IPRs by right holders, or to prevent resorting to practices which unreasonably restrain trade or adversely affect the international transfer of technology. The provisions also allow governments to amend their laws and regulations adopting measures to protect public health and nutrition and promote public health in sectors that are vital to their socio-economic and technological development provided that the measures are consistent with the agreement.
TRIPS and developing nations
However, in practice, many developing countries either lack the technical capacity to implement TRIPS flexibilities or are challenged both legally and politically by powerful governments and multinational companies upon using these flexibilities that are available to them through the TRIPS agreement.
For instance, a leaked memo from April — first posted by the think tank Knowledge Ecology International — suggested that Columbian officials were concerned that lowering the prices of a major cancer drug called Gleevec manufactured by Novartis may jeopardise American funding for peace talks in the war-torn South American nation.
“A slew of regional trade agreements containing TRIPS-plus standards of IP protection and enforcement have the potential to significantly undermine the effective and full use of the TRIPS flexibilities,” India argued.
Referring to investor-state disputes under regional or bilateral investment protection agreements as a major emerging challenge to the use of TRIPS flexibilities in the public interest, India urged governments to “respect the letter and spirit of the Doha Declaration on TRIPS and Public Health”.
India also made a range of recommendations to enhance the use of TRIPS flexibilities.
“Governments should adopt and implement legislation that facilitates the issuance of compulsory licenses,” India stated.
Compulsory licensing is when a government allows someone else to produce the patented product or process without the consent of the patent owner. In India, this is administered under the Indian Patent Act, 1970 under section 84, which stipulates that a compulsory license to manufacture a drug can be issued after three years of the grant of a patent on the product if the product is still not available at affordable prices.
India and TRIPS: A generic drugs industry
In 2012, India had first made use of this provision when the Indian patent office cleared the application of Hyderabad’s Natco Pharma to sell generic drug Nexava to treat renal and liver cancer which was a copy cat version of Bayer’s patented anti-cancer drug, slashing drug prices by about 97 percent.
On 10 November, India denied a patent to Xtandi (Enzalutamide), a high-priced drug for the treatment of prostate cancer, thus opening the way for generic drugs which will be less than half the price.
Such legislation must be designed to effectuate “quick, fair, predictable and implementable compulsory licenses for legitimate public health needs, and particularly with regards to essential medicines” and the issuance of compulsory licensing “must be left to the discretion of governments”, India further added.
It urged the WTO members to “adopt a waiver and permanent revision” to the agreement in order “to find a solution that enables a swift and expedient export of pharmaceutical products produced under compulsory license”.
Indian generics account for 20 percent of global exports in terms of volume making it the largest provider of generic drugs globally earning it the popular moniker “pharmacy of the poor”. Its patenting decisions affect global supply of generic drugs.
In May this year, for instance, India’s decision to grant a patent to US-based Gilead’s Sovaldi — its drug for hepatitis C for which the company charges $1,000 per pill in the US — was met with much opposition from patient groups and international humanitarian organisations. Though the cost of treatment for the Indian patient will not rise due to the availability of generics, the decision will block the flow of raw materials (APIs) for producing the drug in poorer countries, where they are most needed like Egypt and Bangladesh.
UN on runaway drug prices
To address the problem of runaway drug prices that have come to hit patients in the developing as well as the developed world, the UN SG established a high-level panel (HLP) on access to medicines in 2015 to assess policy incoherence between rights of inventors and the need to address public health through the lack of access to essential medicines.
Its report was released on 14 September this year, which met with much opposition from the US and the EU where many of the pharmaceutical and technology companies are based.
The Panel recommends the establishment of a binding research and development (R&D) treaty that delinks the cost of R&D from end prices to promote access, more transparency in terms of production, pricing and distribution of health technologies and R&D costs. It also sought disclosure of unidentified data from all completed and discontinued clinical trials, regardless whether the results are positive, negative, neutral, or inconclusive, the establishment of a Global Health R&D Observatory to provide data on R&D activities and allow the identification of R&D gaps and the expansion of the WHO Global Price Reporting Mechanism (GPRM), among other recommendations.
The US and the EU had avoided any reference to the United Nations HLP during negotiations at multilateral forums before the report was released.
Has WHO betrayed its own goal?
India, along with 13 other countries, including Brazil, South Africa and Iran, on 12 September had requested the WHO to include an item entitled Report of the UN Secretary-General’s High-Level Panel on Access to Medicines in the agenda of the upcoming 140th session of the WHO Executive Board in January 2017.
However, WHO Director-General (DG) Margaret Chan, and five other officials on WHO’s Executive Board, on 28 September, rejected the request. The rejection was particularly surprising because the UN SG Ban Ki-moon had established the UN HLP and access to essential medicines is supposed to be a core concern of the WHO.
Seventeen international humanitarian NGOs and think tanks, including Knowledge Ecology International, People’s Health Movement, Third World Network, Canadian HIV/AIDS Legal Network and Malaysian AIDS Council, wrote a strong letter to the DG marking their protest at this rejection.
This rejection represents a slap in the face to the United Nations Secretary-General Ban Ki-moon’s efforts to comprehensively review and assess ‘proposals and recommend solutions for remedying the policy incoherence between the justifiable rights of inventors, international human rights law, trade rules and public health in the context of health technologies’,” the letter said
“This rejection calls into question your commitment to WHO’s Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property, the follow-up of the report of the Consultative Expert Working Group on Research and Development: Financing and Coordination, the Sustainable Development Goals (SDGs) and the realisation of the right to health,” it added.
India along with China, Brazil and South Africa then took the matter to the WTO’s TRIPS Council to have two dedicated sessions on the UN HLP report on 8 and 9 November — a request that was accepted.
WHO chose to make a statement on this forum and called the conclusions of the UN HLP report “sobering”.
“The report thus echoes conclusions of previous reports done under the auspices of the WHO, which draw attention to disparities in the R&D system and lack of access to essential medicines,” WHO said.
“With respect to R&D, production, pricing and distribution of health technologies, we welcome the call of the Panel for more transparency of production and R&D costs, including contributions of the public sector,” the UN’s health agency said.
“WHO will consider expanding the GPRM to include more patented essential medicines,” the UN official added.
According to a report by IP-Watch, the US said at the TRIPS Council discussion that it was disappointed with the report which it found “distracts rather than benefits” the objective of achieving universal health although it is strongly committed to increasing access to life-saving medicines in the world.
The EU said that the Panel’s work starts with an assumption that there is a “policy incoherence between the justifiable rights of inventors, international human rights law, trade rules and public health”.
“Due to its limited mandate, the HLP has focused its proposals exclusively on addressing an alleged conflict between a research and development model that (partially) relies on intellectual property rights and the possibility of providing affordable medicines,” the EU delegate said. Due to this, the Panel has missed an opportunity to provide a “more balanced, comprehensive and workable solutions to the problem of access to health”.
No conclusions could be reached with the support of all members of the Panel as highlighted in the dissenting commentary attached to the report, the EU noted.
The CEO of GlaxoSmithKline was one of the members of the UN HLP on access to medicines. He gave a dissenting commentary on the Panel report.
Switzerland, Japan and Korea also underlined the “narrow scope” of the report, and remarked that the use of compulsory licences must not discourage innovation, IP-Watch reported quoting a source.