Developing World Bioethics ISSN 1471-8731 (print); 1471-8847 (online)Volume 4 Number 1 2004 PATENTS AND ACCESS TO DRUGS IN DEVELOPING COUNTRIES: AN ETHICAL ANALYSIS More than a third of the world’s population has no access to essentialdrugs. More than half of this group of people live in the poorest regionsof Africa and Asia. Several factors determine the accessibility of drugs indeveloping countries. Hardly any medicines for tropical diseases are beingdeveloped, but even existing drugs are often not available to the patientswho need them. One of the important determinants of access to drugs is the working of the patent system. This paper first maps out some facts about the globalpatent regime that has emerged as a consequence of the conclusion of theWTO-TRIPs Agreement in 1994. Attempts to construct a moral justifi-cation of the patent system have been based on three grounds: naturalrights, distributive justice, and utilitarian arguments. This paper exam-ines to what extent and on which grounds drug patents can be justified.
The final section looks at the so-called ‘Doha Declaration on the TRIPsAgreement and Public Health’, which was adopted by the WTO Ministe-rial Conference two years ago, recognising the primacy of public healthover the interests of patent proprietors.
The debate on the advisability of (certain aspects of) the patentsystem has a very long and turbulent history. The introduction ofthe WTO-TRIPs Agreement (1994) – which implies the quasi-worldwide implementation of high standards for the legal pro-tection and enforcement of intellectual property rights, includingpatents – has by no means quieted down this debate, but rather, Blackwell Publishing Ltd. 2004, 9600 Garsington Road, Oxford OX4 2DQ , UK and 350 Main Street, Malden, MA 02148, USA.
has intensified it. At the WTO, as well as in various other forums,a remarkable debate is going on about the potential impact ofpatents on access to healthcare. In August 2000, the UN Com-mission on the Promotion and Protection of Human Rightsadopted a resolution declaring that there are apparent conflictsbetween the TRIPs regime, on the one hand, and human rights(including the right to health) on the other. Other commenta-tors consider the property right of patent holders as a humanright and argue for a further strengthening of those rights. Yetothers, who do not frame the problem in terms of rights, defendpatents with economic arguments or by invoking fairness. Themain question of concern in this paper is to what extent these different arguments can justify the practice of patenting drugs,particularly in developing countries.
II SOME FACTS ABOUT PATENTS IN THE TRIPS ERA Patents form an example of intellectual property rights, next to,inter alia, copyrights and trade marks. A patent is a certificatedelivered by or on behalf of the government, attesting that theobject of the patent meets a number of requirements. The sub-stantial requirements for patentability are novelty, inventiveness,utility and sufficient disclosure of the invention in the patentapplication.
The rights of patent holders are limited in two ways. Firstly, by time: in most countries a patent is valid for twenty years (countedfrom the date of application). Secondly, by space: its validity islimited to the jurisdiction of the Patent Office that granted thepatent.
In the early 1980s, various industrial lobbies in the US reported enormous losses, which they attributed to infringements of theirintellectual property rights (IPRs).1 These infringements were saidto be due to the ‘inadequate’ legal protection of IPRs in develop-ing countries. Many developing countries note, however, that: (1)the evolution of IPR protection in industrialised countries hasalways been determined by what these countries regard as theirnational interest; and (2) in view of their economic developmentobjectives, developing countries need lower protection standards.
In the traditional forum for intellectual property negotiations, the World Intellectual Property Organisation (WIPO), the developing 1 See e.g.: US International Trade Commission. 1988. Foreign Protection of Intellectual Property Rights and the Effects on the US Industry and Trade. Publica-tion No. 2065.
countries were considered too influential (in number) by someindustrialised countries. Therefore, the US, later followed byothers, pushed for the introduction of the intellectual propertytopic on the agenda of the General Agreement on Tariffs andTrade (GATT).2 After seven years of hard talks in the so-calledUruguay Round of GATT negotiations came about the TRIPsagreement (Agreement on Trade-Related Aspects of Intellectual PropertyRights).3 The TRIPs agreement significantly strengthens patentprotection standards, and of course reduces the sovereign powerof decision of national governments.
In the industrialised countries, TRIPs came into effect on January 1, 1996. In developing countries going through a transi-tional phase from a planned economy to a market economy, theAgreement entered into force on January 1, 2000. The so-called‘least-developed countries’ were given respite until January 1,2006. During the WTO’s ministerial conference held in Doha inNovember 2001, the decision was made to extend this transitionalperiod with respect to the introduction of patents on pharma-ceutical products to January 1, 2016.
The WTO-TRIPs Agreement heralds a fundamentally new era for developing countries. In the pharmaceutical sector aproduct patent refers to the chemical structure of a drug.4The final product (the actual drug) is protected, regardless ofhow it was manufactured and of the purpose it serves. Not surprisingly, a product patent is the most coveted form of protection. Process patents offer protection for the way in which the final product is made and for the way in which theproduct is used to reach certain goals (e.g. the treatment of specific diseases). A process patent offers a ‘strong’ form of pro-tection only if there is no other (financially sound) way of pro-ducing the product in question, other than through the processcovered by the patent. In the pharmaceutical sector, this is rarelythe case.
2 See e.g.: C.A.P. Braga. The Economics of Intellectual Property Rights and the GATT: A View from the South. Vanderbilt Journal of Transnational Law 1989;22: 243–264.
3 GATT Secretariat, ed. 1994. Annex 1C: Agreement on Trade-Related Aspects of Intellectual Property Rights. In The Results of the Uruguay Round ofMultilateral Trade Negotiations. The Legal Texts. Geneva. WTO: 365–403. Also avail-able at: 4 P. Grubb. 1999. Patents for Chemicals, Pharmaceuticals and Biotechnology.
Developing countries generally offer less substantial protection for patents than industrialised countries. Many developing coun-tries have traditionally excluded pharmaceutical products frompatent protection; only processes for the production of pharma-ceuticals could be patented. The rationale of such a policy is toguarantee that the local industry can play a significant role in the manufacturing of pharmaceuticals. With the same objectivein mind, most developing countries have traditionally quasi-automatically imposed a regime of so-called compulsory licenceson patented inventions in the pharmaceutical domain. In almostevery country that has a patent system, mechanisms exist toremedy or prevent abuses of patent rights. A very importantinstrument used to that effect is the compulsory licence.5 Thegranting of compulsory licences implies that – after an adminis-trative or judicial procedure – the government forces a patentholder to grant a licence to one or more third party/ies for theuse of his patented product or process. The patent holder receivesa royalty. In the context of the patent system, compulsory licenceshave a double aim: on the one hand to force the patent owner toallow society to benefit from his invention, and on the other handto boost the industrialisation of the country in question. The basicprinciple of the system of compulsory licences is that they are onlygranted in the public interest. The rights ensuing from the pos-session of a compulsory licence are similar to those ensuing fromthe possession of a patent, except that compulsory licences haveto be granted predominantly to supply the domestic market ofthe country that grants them.6 As a result of the implementation of the TRIPs Agreement, it becomes increasingly difficult – and probably even impossible –for developing countries to pursue a ‘selective’ patent grantingpolicy, certainly as far as pharmaceuticals are concerned. Drugscannot be excluded from patentability under TRIPs. For manydeveloping countries the implementation of TRIPs in theirnational laws represents a major upheaval. This may have a pro-foundly negative impact on the access to drugs of people in thesecountries, while hundreds of millions of people already have noaccess to drugs.
What could possibly justify the quasi-worldwide introduction of 5 J-M. Salamolard. 1978. La licence obligatoire en matière de brevets d’invention. Etude de droit comparé. Genève. Librairie Droz.
III ON WHICH GROUNDS CAN DRUG PATENTS BEMORALLY JUSTIFIED? Attempts to construct a moral justification of the patent systemhave been based on three grounds: (1) natural rights; (2) dis-tributive justice; and (3) utilitarian (economic) arguments. Eachof these attempts involves many problems. After briefly discussingthe general argument, we will, for each of the three, investigateits implications for the justifiability of drug patents.
Some people believe that man has a natural right to his ideas andconsequently that society is obliged to enforce that right. Thus,the use of ideas without the authorisation of the owner must be considered as theft. Natural property rights take precedenceover social institutions and should be respected whatever the consequences.
Discussions on the natural rights argument generally refer to John Locke’s ‘labour theory of property.’7 Although Locke seemsto identify property with land, various commentators have appliedhis theory to other types of goods, including ‘intangible’ objects.
According to Locke, the appropriation of a thing occurs by manapplying his labour to it, by ‘mixing’ the thing with his labour. Byadding something of his own to the thing, he excludes othersfrom having a right to it.
If we look at the implications of this theory for the justification of drug patents, the main question seems to be: how much‘labour’ is really involved in the research and development (R&D)of drugs? The greater part of pharmaceutical R&D budgets isspent on ‘me-too’ drugs – the slightly altered versions of success-ful products manufactured by the competition. The American Foodand Drug Administration (FDA), for example, classifies the appli-cations it receives either as ‘priority drugs’ (considered a signifi-cant improvement in relation to the existing drugs) and ‘standarddrugs’ (considered similar to existing products). Of all drugsapproved by the FDA over the past six years, almost 80% belongto the standard drug category. As a large-scale survey by theNational Institute for Health Care Management Foundation (May 2002)shows, the ratio between priority-rated drugs and standard-rated 7 Which he formulated in his Second Treatise on Government (1690). See: P. Laslett, ed. 1988. Locke, Two Treatises of Government. Cambridge. CambridgeUniversity Press: 285–302.
drugs within this group of approved drugs is constantly shiftingtowards less priority-rated drugs and more standard-rated drugs.8The development of such drugs is not ‘labour-intensive’ (if‘labour’ is understood as creative intellectual labour). Also, inview of the patentability requirement of inventiveness, the grant-ing of patents for such drugs seems hard to justify.
Locke stipulated two conditions or ‘provisos’ which must be met in order for an appropriation (i.e. establishment of a prop-erty right) to be justifiable. Firstly, there must be ‘enough, and asgood left in common for others.’9 Secondly, man is not allowedto appropriate more than he can use (even if he is the ‘maker’ ofthe things in question); there should be no waste.10 Robert Nozick has applied Locke’s first proviso to the rights granted by a patent. For him, ‘The crucial point is whether appro-priation . . . worsens the situation of others.’11 He thinks this is notnecessarily so, and provides the following example: If I appropriate a grain of sand from Coney Island, no one elsemay now do as they will with that grain of sand. But there areplenty of other grains of sand left for them to do the same with.
Or if not grains of sand, then other things.12 In the case of patents, Nozick’s arguments may not be tenable,inter alia for the following two reasons. As to the statement thatenough objects will remain for others to use, this is clearly notvalid for any thing protected by a patent. Any product or processthat fits what is described in the patent’s claims is also covered bythe patent, including ‘equivalent’ (as opposed to identical) prod-ucts or processes. With regard to Nozick’s proposition that, if notenough samples of an appropriated object remain for others touse plenty of other objects will be available to them, this is irrel-evant if they need that specific object, as is often the case withdrugs.
As to Locke’s second condition – the ‘non-waste’ condition – one aspect of the patent system which can induce waste is the factthat, in its present form, the system does not oblige patent holdersto exploit their invention. If something is left unused by the onewho appropriated it, while others need it – and drugs are exam-ples of things that are often truly needed by a whole lot of people 8 A9 Laslett, op. cit. note 7, § 27.
10 Laslett, op. cit. note 7, § 31.
11 R. Nozick. 1974. Anarchy, State, and Utopia. Oxford. Basil Blackwell: 175.
12 Ibid.
– the waste is all the greater. (Of course, in a system based onnatural rights, the essence of the patent right exists in the patentproprietor determining what happens with the object of thepatent. Thus, he cannot be forced to exploit his invention.) Buteven if a patent is exploited, waste is likely to occur. Indeed, themain consequence of issuing a patent is that the patent holdercan limit the use of the invention. The extent of the wastedepends on the utility of the invention for those who are excludedfrom using it. The utility of drugs, particularly essential drugs,13is often very high.
According to the distributive justice argument, fairness requiresthat inventors be rewarded because they render a service tosociety. It would be unfair to allow people a ‘free ride’ at theexpense of others who apply themselves to the act of inventing.
Free riders – people who did not invest time or money in thedevelopment of an invention – should not be allowed to competewith the inventor under normal market conditions. Thereforesociety should grant exclusive rights to inventors.
When examined in the context of the justification of drug patents, this argument, too, seems problematic. First, the ques-tion arises whether fairness does not also require an equal accessto drugs, which is prevented by the working of the patent system.14 Another question at issue here is: does justice require that inventors be rewarded with patents, allowing them to decide whomay legally use the invention? Put differently: does it follow fromthe proposition that justice requires the rewarding of inventorsthat inventors must be granted exclusive rights of ownership ontheir inventions? Hettinger rightly observes that it does not: The mistake is to conflate the created object which makes aperson deserving of a reward with what that reward should be.
Property rights in the created object are not the only possible 13 I do not understand the concept of ‘essential drugs’ as ‘drugs that appear on the World Health Organization’s essential drug list.’ As some defenders ofstrong drug patents like to note, more than 95% of the drugs on that list areoff-patent. However, the reason for this seems to be that a drug must be ‘afford-able’ in order to get on the list, and patented drugs are usually expensive. Butof course the fact that a drug is expensive does not necessarily prevent it frombeing ‘essential’ (in the sense of badly needed by a group of patients).
14 In a utilitarian framework, as discussed below, the unequal access is said to be justified by the incentive-to-invent it creates. However, in a framework ofdistributive justice such an argument cannot be decisive.
reward. Alternatives include fees, awards, acknowledgements,gratitude, praise, security, power, status, and public financialsupport.15 Thirdly: what about the fairness of granting private propertyrights to the results of R&D, which is, in great part, publiclyfunded? In the US, for example, the National Institutes of Health(NIH) (subsidised by the federal government) are great bene-factors of the pharmaceutical industry. This year, the NIH will bespending $23 billion on research, and of course there are otherpublic institutes investing in health-related research. Much of thisresearch is directly beneficial to the industry. According to theNIH, 55% of the research projects leading to the discovery anddevelopment of the 5 best-selling drugs in 1995 was performedby researchers whose work had been financed with taxpayers’money.16 As Bernadine Healy, former senior executive of theNIH, puts it: There’s no other industry in which you have so much publicinvestment in the fundamental knowledge that enables . . . thedevelopment of the commercial industry itself.17 This seems to strengthen the case for allowing maximum accessto the products of that knowledge – inter alia drugs.
Another problem with the justification of drug patents on fair- ness grounds is whether it is fair to grant inventors rewards thatare excessive. Many manufacturers of brand-name pharmaceuti-cals relentlessly try to obtain extensions of the protection term oftheir patents, and they often succeed. This phenomenon, knownas ‘patent evergreening’, hinders producers of generic drugs(products equivalent to brand drugs, which can be put on themarket after the patent expires). Generic drugs are generallymuch cheaper than brand products. Even in the US, accordingto the Kaiser Foundation, the (retail) price of a prescription brand-name drug is 3.4 times higher than the price of a generic drug.
In developing countries, the price difference is often even more 15 E. Hettinger. Justifying Intellectual Property. Philosophy & Public Affairs 16 National Institutes of Health. 2000. NIH Contributions to Pharmaceutical Development (administrative document). Cited in: Public Citizen. 2002.
America’s Other Drug Problem: A Briefing Book on the Rx Drug Debate. Washington,DC. Public Citizen: 51.
17 Cited in: ABC News. 30 May, 2002. Peter Jennings Reporting Bitter Medicine: Pills, Profit and the Public’s Health. AABCNEWSSpecials/ pharmaceuticals_020529_pjr_feature.html striking. The public, of course, pays twice: people have to keepon paying artificially high prices for drugs, as well as the costs ofa legal system used by the companies to delay competition.
Even supposing that the patent system, as we know it, could be justified on fairness grounds, the justification of the quasi-world-wide introduction of drug patents on such grounds would remainproblematical. As Dan Brock justly remarks: It can quite plausibly be argued that in not respecting patentsdeveloping countries are free riding on the research and devel-opment efforts of drug companies that are supported by theprices of drugs in countries in which patents are respected. Butthat free riding and resulting unfairness may not be enough tomake it, all things considered, morally wrong for developingcountries not to respect product patents . . . When developingcountries choose not to respect product patents as their onlyeffective means of making available pharmaceuticals necessaryto save lives and protect the health of their citizens, doing sois arguably a step towards greater justice between the developedand developing world . . .18 Indeed, the health crisis in many developing countries hasreached proportions beyond the imaginable. More than a thirdof the world’s population has no access to essential drugs. Inseveral countries life expectancy is dropping incredibly fast. Andit is getting worse. The urgency of ensuring access to the neces-sary drugs cannot be ignored any longer. Rethinking the globalpatent regime is one of the keys to a solution.
The utilitarian justification, which is considered by many as the most convincing, is essentially based on the following twoarguments: (a) The so-called ‘incentive-to-invent-and-innovate’ argument: in the absence of patents, inventions can be copied by com-petitors. Consequently, the price must be reduced and theinvestor does not have the opportunity to regain his invest-ments, let alone make a profit. Thus, the incentive to inventand innovate is eroded. A ‘special’ incentive is required sothat enough people should be prepared to invest in R&D.
18 D.W. Brock. Some Questions about the Moral Responsibilities of Drug Companies in Developing Countries. Developing World Bioethics 2001; 1: 36–37.
According to this argument, the patent system provides thenecessary encouragement.
(b) The so-called ‘incentive-to-disclose’ argument: the patent system encourages inventors to disclose their inventionsinstead of keeping them secret. One of the patentabilityrequirements is that the applicant must disclose the inven-tion in sufficient detail in the application forms. Thanks tothe patent system, it is said, technological information isspread – making technological progress possible, which inturn induces economic growth.
Several commentators claim that both these arguments arenowhere more valid than in the pharmaceutical sector, as this isthe most research-intensive sector. However, both aforemen-tioned arguments are problematic. We will only look at some ofthe problems with the first argument, as the second one is less relevant with regard to the topic that concerns us here.
Of course, the availability of patents does result in more inven- tions of drugs; we do not wish to question this fact – but this pos-itive effect may well be cancelled out by the limitation of the useof patented drugs. The patent system allows the price of patenteditems to be kept artificially high. The introduction in developingcountries – mandated by TRIPs – of product patents in the fieldof pharmaceuticals will almost certainly lead to a price increaseof 200–300%.19 Moreover, as we noted earlier, pharmaceuticalcompanies frequently take legal action to postpone the introduc-tion of generic alternatives. This hinders the access to drugs evenmore.
The utilitarian (economic) arguments used to justify the patent system in industrialised countries do not necessarily apply todeveloping countries. Many commentators, nevertheless, auto-matically assume that they do. The advocates of strong drugpatents claim that the implementation of the WTO-TRIPs Agree-ment will offer the following advantages: (1) the encouragementof local drug research, through which new drugs would becomeavailable catering to the country’s specific needs (e.g. drugs fortropical diseases); (2) industrialised countries making importantnew drugs available in developing countries; and (3) the attrac-tion of foreign investments in the pharmaceutical sector. Each ofthese arguments is susceptible to criticism.
19 J. Watal. 2000. Access to Essential Medicines in Developing Countries: Does the WTO TRIPS Agreement hinder it? (Science, Technology and Innovation Discussion PaperNo. 8). Cambridge, MA. Center for International Development, Harvard University: 5.
Hardly any drugs for diseases occurring primarily or exclusivelyin developing countries are being developed. Of the 1223 mole-cules that were sold worldwide between 1975 and 1996, less than1% was intended for tropical diseases.20 R&D of drugs for thesediseases is desperately needed. According to some commentators,if developing countries were to grant strong patents for drugs, thiswould stimulate local research. Not granting strong patent pro-tection may well yield short-term advantages, but it would beharmful in the long run, they say, because such a situation cannever bring about drugs that meet the specific needs of thecountry in question.
The introduction and the application of new technologies are indeed important instruments to help developing countriesimprove their standard of living. However, the fact that in devel-oping countries few new technologies are being developed hasmore to do with fundamental economical problems (e.g. a lackof skilled workers and the absence of infrastructures capable of absorbing new technologies) than with patent protection standards.
Moreover, the economic purpose of patents is to enable paten- tees to recoup their investments and, if possible, make a profit.
In the pharmaceutical sector, they are used to achieve highprofits: the pharmaceutical industry is eight times more profitablethan the average of all industries represented in the Fortune 500list.21 It is highly unlikely that the recent strengthening of thepatent system will incite pharmaceutical companies to invest inR&D of drugs for diseases occurring primarily or exclusively indeveloping countries, as the majority of the stricken patients havelittle or no purchasing power, which makes the market totally 20 See: B. Pécoul, P. Chirac, P. Trouiller & J. Pinel. Access to Essential Drugs in Poor Countries – A Lost Battle? JAMA 1999; 281: 365 (Table 2). See also therecent survey by experts of the Harvard School of Public Health and an inter-national group of experts, the Drugs for Neglected Diseases Working Group, availableat: See also another recent survey which the umbrellaorganisation of the American pharmaceutical industry (Pharmaceutical Researchand Manufacturers of America) held among its members, New Medicines in Devel-opment, available at:
21 See: Fortune 500. Fortune Magazine 2002; April. In 2001, the profits of America’s 10 largest pharmaceutical companies went up by 33% – from 28 to37,3 billion dollars! – despite the bad economic situation. Profits are alsogrowing much faster than the volume of R&D investments. According to the2001 Fortune 500 ranking, the pharmaceutical industry was the most profitableindustry for the tenth time in a row.
uneconomical. Indeed, while health spending per capita in thedeveloping countries amounts to 11 dollars (of which 6 are‘public’ dollars), rich countries spend 1907 dollars per capita (ofwhich 1356 are ‘public’ dollars).22 The pharmaceutical industrydevelops profitable drugs for the wealthy regions of the world,and makes its biggest profits from hair tonics, anti-impotencydrugs, drugs for cholesterol, ulcers, depressions, allergies andhigh blood pressure. More money is invested in research of drugsagainst baldness than in research of all tropical diseases combined. . . strengthening drug patents in developing countries is notlikely to change that. The diseases of patients with little or no purchasing power are simply neglected in the pharmaceuticalmarket.
Increased Transfer of (Pharmaceutical) Technology andIncreased Foreign Investment in the Pharmaceutical Domain? The classical argument in this context is that those who possesstechnology are not too keen on transferring their technologicalknowledge to countries with a ‘weak’ patent system, for risksinvolving ‘piracy.’ If a developing country were to strengthen itspatent system, so the argument goes, the industrialised countrieswill make new medicines available in that country. This predic-tion, however, does not sound very credible. Drugs that can beproduced via conventional processes are already being broughtonto the market by local production plants in numerous devel-oping countries. Those drugs of which the production requiressophisticated technologies are generally not copied in developingcountries, as the required manufacturing capacities are only avail-able in industrialised countries. Moreover, such drugs are veryexpensive and therefore accessible only to the rich segment of thepopulation in developing countries. It is therefore highly unlikelythat the strengthening of patent protection in developing coun-tries will bring in technology previously unavailable.
As far as the role of patents in the encouragement of foreign investments is concerned, various commentators claim that theabsence or the availability of adequate protection of intellectualproperty rights constitutes a factor which plays an increasinglyimportant part in the investment-related decisions of companies.
An important element in this debate is, however, that under the 22 Keynote presentation on the occasion of the ‘Forum 5’ gathering organ- ised by the Global Forum for Health Research (,October 2001.
TRIPs regime patentees are no longer under the obligation tomanufacture their inventions in the (developing) country thatissued the patent. Art. 27(1) of TRIPs stipulates that: . . . patents [can] be granted for any inventions, whether prod-ucts or processes, in all fields of technology . . . [and] patentrights are enjoyable without discrimination as to the place ofinvention, the field of technology and whether products areimported or locally produced.23 Hence, lack of local exploitation of a patented invention can nolonger be invoked as a ground for granting a compulsory licence.
Patentees can freely choose to supply the market from their owncountry. This will lead to foreign companies investing in branchesin developing countries only if the available human and/or infra-structural capacity offers them exceptional cost-reducing possi-bilities. As far as the pharmaceutical industry is concerned, sucha situation is not very likely to occur.
Furthermore, research has shown that investment decisions are influenced by a whole series of diverse factors, one of which is thelevel of patent protection in the country in question – but this isby no means the most important one.24 IV IN SEARCH OF A FAIRER BALANCE BETWEEN THERIGHTS AND OBLIGATIONS OF PATENT HOLDERS ANDBETWEEN PATIENTS’ INTERESTS AND COMMERCIALINTERESTS: THE DOHA DECLARATION ON THE TRIPSAGREEMENT AND PUBLIC HEALTH The WTO Ministerial Conference in Doha (Qatar) in November2001 produced, among other things, the landmark Doha Decla-ration on the TRIPs Agreement and Public Health.25 The essenceof the Declaration is worded in Paragraph 4. It stipulates that theTRIPs Agreement does not and should not prevent WTO memberstates from taking measures to protect public health, and that itcan and should be interpreted and implemented in a manner sup-portive of member states’ rights to protect public health and, inparticular, to promote access to medicines for all. It declares the 23 Emphasis added.
24 See e.g.: C.A.P. Braga et al. 1999. Intellectual Property Rights and Economic Development (Background paper for the World Development Report 1999). Washington,DC. World Bank.
25 WTO Ministerial Conference. Fourth Session. Doha, 9–14 November 2001. WT/MIN(01)/DEC/2, 20 November 2001.
right of member states to use, to the full, the provisions in TRIPsthat provide flexibility for this purpose. This is somewhat fleshedout in the fifth paragraph, which recognises that these flexibili-ties include inter alia that: (b) Each Member has the right to grant compulsory licenses and the freedom to determine the grounds upon which suchlicenses are granted.
(c) Each Member has the right to determine what constitutes a national emergency or other circumstances of extremeurgency, it being understood that public health crises, in-cluding those relating to HIV/AIDS, tuberculosis, malariaand other epidemics, can represent a national emergency or other circumstances of extreme urgency.
Subparagraph (b) is important because developing countries thatintend to grant compulsory licences are sometimes put undergreat pressure (e.g. via threats to redraw investments), primarilyby the US, not to do so. However, the system of compulsorylicences enables a country to factor national interests into itspatent system and allows it to achieve a better balance betweenthe rights and the obligations of patent holders. Therefore itshould be used to the full, especially in ‘vital’ sectors such asdrugs. Unfortunately the developing countries did not takeadvantage of the Doha negotiations to obtain a reversal of theburden of proof when it comes to decisions on whether to granta compulsory license. It would seem fairer to place the burden ofproof on the side of the patent holder – in other words, to forcethe patent holder to prove that granting a compulsory licence isnot necessary, instead of forcing the applicant to demonstratethat the patent holder has abused his monopoly.
Subparagraph (c) is important in that it stresses that every member state has the sovereign power of decision to proclaim a(national) state of emergency.
The sixth paragraph of the Declaration runs: We recognize that WTO Members with insufficient or no man-ufacturing capacities in the pharmaceutical sector could facedifficulties in making effective use of compulsory licensingunder the TRIPs Agreement. We instruct the Council for TRIPsto find an expeditious solution to this problem and to reportto the General Council before the end of 2002.
As foreseen, this provision has lead to negotiations in the TRIPsCouncil. In 2002, the TRIPs Council convened on several occa-sions to reach a concrete proposal on this issue.
Pursuant to Article 31(f) of TRIPs, compulsory licences must be used predominantly for the supply of the domestic market ofthe member state that issued the compulsory licence and can,therefore, only be used to a limited extent for export. However,it would seem to be necessary that, if a country has insufficientor no manufacturing capacities and the drugs offered by foreignmanufacturers are too expensive, the country should be allowedto look elsewhere for a suitable supplier. Until 2005, this will notreally pose a serious problem because a number of developingcountries – with India as the most prominent example – have agood production capacity and are still legally allowed to exporttheir drugs, even when these are patented in other countries.
As noted earlier, the so-called ‘least developed countries’ have been granted a postponement until 2016 to conform their drug-related patent provisions to the WTO-TRIPs Agreement, but once the developing countries that can export drugs to them (e.g. India) must acknowledge drug patents – already in 2005 asforeseen in TRIPs – the least developed countries are sure toencounter even more serious problems in obtaining affordabledrugs. In this context, compulsory licences will become increas-ingly vital.
The discussions in the TRIPs Council concerning export strate- gies went off the rails during a debate about the question forwhich diseases the export of drugs under compulsory licenceshould be allowed. When the president of the TRIPS Council pro-posed a draft in December 2002 stating that the Doha Declara-tion was not limited to HIV/AIDS, malaria and tuberculosis, theUS (as the only among the then 145 WTO members) refused toaccept this draft and negotiations were broken off.26 In the mean-while they have been reopened, but there is still no consensus.
Numerous countries are opposed to a limitation of diseases for which medicines can be exported under compulsory licences andfeel that this cannot be the subject of negotiations. They justlyobserve that the Doha Declaration states that the TRIPs Agree-ment has to be implemented in such a way as to give everyoneaccess to medicines.
26 As noted by several NGOs, the position of poor countries would have been significantly worsened had this draft been adopted. MSF (Médecins Sans Fron-tières) rightly observes that: ‘[I]t would have made generic production almosteconomically unfeasible after 2005 . . . At the end of the day, the supply of afford-able versions of new medicines would have slowed to a trickle, with developingcountries left with very few alternatives to the high process and long-termmonopolies of originator companies.’ See: MSF. 2003. One Step Forward, Two StepsBack? Issues for the 5th WTO Ministerial Conference (Briefing Note). Cancún.
The US, however, fears that an interpretation of Doha that does not limit the diseases, for which drugs can be exported undercompulsory licence, to HIV/AIDS, tuberculosis and malaria, willerode incentives for the development of new drugs. In a letteraddressed to the trade ministers of all WTO members, US TradeRepresentative Robert Zoellick stated that: [I]t became clear to us that some WTO members and advocacyorganizations sought to expand the scope of disease beyondthat intended at Doha to allow countries to override drugpatents to treat a wide range of public health concerns, includ-ing obesity, asthma, cancer, diabetes, among others – evenincluding the use of Viagra. We were seriously concerned thatthis approach would undermine the WTO rules on patents thatprovide incentives for the development of new pharmaceuticalproducts.27 Given the fact that North America, Europe and Japan togetherrepresent 80% of the global pharmaceutical market, and that of the remaining 20%, Africa represents only 1%,28 Zoellick’sconcern about an ‘undermining’ of incentives for drug develop-ment is without foundation. The continuation of pharmaceuticalR&D is not dependent on the markets of developing countries.
Another argument that the US has repeatedly referred to involves the risk of cheap medicines intended for the South beingillegally diverted to the North. Brook Baker of the NGO HealthGAP rightly remarks that this objection is untruthful: there are billions of generic pills being produced each yeararound the globe that have not been diverted into the US andEurope. Not only do US and Europe outlaw such diversion, butthey also guard their borders with remarkable efficiency. As amatter of law and of practicality, the US and Europe are in totalcontrol of the diversion risk. Rich consumers in London, Paris,and New York are not going to buy black market, smuggledheart medicines out of the trunk of a Chevy.29 Indeed, the Doha Declaration should be implemented to thefullest extent without delay, in order to establish a fairer balance 27 Daily Updates. 17 January, 2003.
28 See: IMS Health Market Report: Five Year Forecast of the Global Phar- global/report.htm), quoted in: MSF. 2001. Fatal Imbalance. Available
29 Ip-health mailing list. 23 December, 2002.
between the rights and obligations of patent holders and betweenthe interests of patients and those of patent owners. Given thebasic nature of health needs, patent rules should not preventcountries from adopting policies that protect public health andpromote access to drugs.
However, after the adoption of the Doha Declaration, the US, the EU, Canada, Switzerland and Japan have constantly tried toundermine the Declaration through their attempts to limit itsscope. In addition, the US has negotiated regional trade agree-ments such as the Free Trade Area of the Americas (FTAA) Agree-ment – and is continuously negotiating others – that threaten toerode or even abandon the Doha Declaration.
Drug patents, particularly the strong kind of drug patents grantedtoday, are hard to justify on natural rights, fairness or utilitariangrounds. Many drugs are of vital importance for very large groupsof people. This vital importance should be reflected in the debateabout the justification of drug patents.
The proposition that in the absence of strong patents no R&D of drugs can be expected is typically presented as universally valid – whereas it may well be that the advisable level of patentprotection (or even the decision whether or not to grant protec-tion) has to be determined in relation to the level of economicdevelopment of a country. Unfortunately, since the forum fordecision making with regard to intellectual property shifted fromWIPO to WTO, a ‘one size fits all’ view of patents has been firmlyestablished.
As Jagdish Bhagwati rightly notes, the inclusion of intellectual property has turned WTO into a royalty collection agency.30 Theunwillingness of the major industrialised countries to accept a fullimplementation of the Doha Declaration seems to threaten thelegitimacy of the WTO-TRIPs Agreement.
It seems that the reason why pharmaceutical lobbies are such zealous advocates of strong patents in developing countries is thatit would allow them to hinder competition from local drug man-ufacturers. There is no credible evidence that the new globalpatent regime will promote the development of new medicinesfor diseases occurring primarily or exclusively in developing coun-tries. Instead, this regime severely limits these countries’ possibil- 30 J. Bhagwati. Patents and the Poor. Financial Times 16 September, 2002.
ities to implement a public health policy that addresses the healthcrises they are confronted with, and it is one of the main factorsthat hinders access to existing (patented) drugs – access whichthe lives of millions of people depend.
Sigrid SterckxDepartment of Philosophy & Moral SciencesGhent UniversityBlandijnberg 29000 [email protected]


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