BY EVA CHENG
"The [World Health Organisation's] objective is 'the attainment of all peoples of the highest possible level of health', and WHO defines health as 'a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity'... There is common ground between health and trade, and between the objectives of the WHO and the [World Trade Organisation]."
So proclaimed a 171-page joint study by the WHO and WTO, released on August 22, in which the two organisations also claimed that they placed the "questions of trade and public health" high on their agendas, and on which they have achieved "significant advances" recently.
Referring to a WTO declaration in Doha, Qatar, last November featuring the link between its Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement and public health, the study further claimed that the Doha declaration was evidence of WTO member countries' commitment to ensure the WTO's trade regime was compatible with the provision of public health services.
However, a comparison between these claims and reality reveals a very different story:
According to WHO estimates, a third of the world's population lacks access to essential drugs and more than 50% of people in poor countries in Africa and Asia do not have access to even the most basic essential drugs.
Around 14 million people die each year from infectious diseases, many of which are treatable or preventable, and such deaths account for an estimated 45% of all deaths in Africa and South-East Asia.
Around 36 million people worldwide have contracted HIV-AIDS, 25 million of whom are in sub-Saharan Africa.
The chance of survival of most HIV-AIDS victims, similar to the victims of other infectious diseases, has been seriously undermined by TRIPS and other WTO trade rules which seek to defend the pharmaceutical corporations' monopoly super-profits.
According to Families USA, in 2000 US pharmaceutical companies were the most profitable of all US corporations, with profit margins nearly four times the average of the 500 largest US companies while the prices for the 50 most-prescribed drugs to the elderly climbed at more than twice the rate of inflation.
In 1997, seeking to make essential drugs more affordable to the poor, the South African government adopted a law which, among other things, authorised the production or importation of generic substitutes of internationally patented HIV-AIDS drugs. But this attracted a legal assault by 39 transnational pharmaceutical companies. A US-based cartel, Pharmaceutical Research and Manufacturers of America (PhRMA), led the assault. Of the 39 companies, only four were involved in the production of anti-AIDS drugs.
The legal action of Big Pharma in South Africa has led to a major public outcry and sustained protests in many parts of the world, forcing the 39 companies to drop the lawsuit unconditionally in April last year.
These are sweet victories, but the bigger battle in fending off the WTO's attack on public health is far from over. Public health is only one of many areas of public well-being that is under siege, especially in the Third World, under the WTO's pro-corporate regime. Extensive privatisation of water, power supply and other essential services has devastated the lives and health of the poor in the Third World.
The enormity of the global public health crisis is daunting, but this, on its own, is no guarantee that the problem will attract widespread public concern. Awareness, nevertheless, has increased in recent years as the crisis has deepened.
TRIPS agreement
The key First World countries succeeded in forcing the TRIPS agreement through in 1994 after a long battle to resist it under the 1973-79 Tokyo round of trade negotiations. Some 50 countries, including a few developed countries like Spain and Portugal, did not grant patent rights to pharmaceutical products at that time.
To ease the transition, underdeveloped countries didn't have to fully implement the TRIPS agreement until 2005 (2016 for the least developed countries). However, many of them had already been coerced, especially by the US, into adopting the regime.
In the last eight years, under the TRIPS deal's shadow, the poor countries got by due to the availability of cheaper generic drugs. The production of a generic substitute of a patented item through alternative production processes was allowed under a process patent (which gives the patent holder control only over the patented process). But that leeway will be closed under a product patent which provides a patent holder with absolute "protection". Both types of patent will be enforced under the TRIPS agreement.
Moreover, to minimise Third World opposition to the TRIPS agreement, basic provisions have been built in, at least formally, which allow a government to put public health before patent obligations when a conflict arises. Compulsory licensing of the production of generic substitutes and parallel importing of both patented drugs and generic substitutes were specifically allowed and within the discretion of individual governments.
However, while some First World countries have a history of being active users of such discretionary measures as compulsory licensing, they tried to stop their Third World counterparts from doing the same. The US is a key culprit.
According to the United Nations' Human Development Report (HDR) 2001, among the users of compulsory licensing are Australia, Britain, Canada, Germany, Italy and New Zealand.
A 1999 study by Carlos Correa of the South Centre found that between August 1941 and January 1959, 107 judgements took place under the US anti-trust laws in which patent rights were restricted. He added that subsequently, "literally tens of thousands [more] patents" have been compulsorily licensed in more than 100 cases.
HDR 2001 notes: "Until joining the North America Free Trade Agreement, Canada routinely issued compulsory licences for pharmaceuticals... Between 1969 and 1992 such licences were granted in 613 cases for importing or manufacturing generic medicines."
In contrast, "not one compulsory licence has been issued south of the equator", says the UN report, which adds that "pressure from Europe and the United States makes many developing countries fear that they will lose foreign direct investment if they legislate for or use compulsory licences". Another fear, it adds, is the threat of "long, expensive litigation" initiated by Big Pharma.
Between 1997 and 1999, PhRMA spent US$236 million lobbying the US Congress and is believed to have been a key force driving the Clinton administration's 1998 threat to impose trade sanctions against South Africa over the AIDS drugs dispute.
With their rights under the TRIPS agreement to put public health ahead of patent obligations under threat, 50 Third World countries demanded (at a June 2001 WTO TRIPS Council special session on the TRIPS agreement's impact on public health) that the Doha summit in November that year officially affirm those rights.
Despite strong US opposition, that affirmation was eventually issued, but only in the context of the First World's desperation to obtain Third World agreement to a much broader agenda under the Doha round of negotiations.
There are residual doubts, however, over whether the First World countries will honour the affirmation in good faith. According to the July August 2001 edition of Third World Resurgence, in a similar meeting in July 2001, "the US objected, once again refusing to acknowledge that there were legitimate concerns about the impact of TRIPS implementation on access to medicines and reiterating its view that the TRIPS agreement afforded flexibility to countries to meet health care objectives".
R&D funding
A common defence for upholding pharmaceutical corporations' monopolies on patented drugs is that drug production usually requires huge financial outlays in research and development (R&D) which, it is claimed, would not be invested by profit-oriented corporations in the absence of patent protection.
However, Families USA strongly disagrees with this argument. In its 2001 report, Off the Charts: Pay, Profits and Spending by Drug Companies, Families USA revealed that drug companies spend more than twice as much on marketing, advertising and administration than they do on R&D, and that these companies remunerate their top executives lavishly.
A 2001 study by Kavaljit Singh of India's Public Interest Research Centre revealed that several patented drugs were invented by publicly funded universities and research institutions, and were then "developed" as commercial products by the drug companies. Singh wrote: "For instance, the [US] National Institutes of Health (NIH) was instrumental in the discovery of 3TC, Invirase, Ziagen, Zerit and Viramune. In December 2000, the NIH demanded $9 million in royalties from Bristol-Myers Squibb for overseas sales of didanosine, used in the treatment of AIDS."
Singh added that the NIH has estimated that in 1995 the contribution of private industry to overall US R&D was just 52% and the NIH alone accounted for 30%.
"The drug companies have rarely disclosed to the public the costs of making a particular drug... governments have been offering generous grants and tax breaks for R&D to the drug industry", Singh observed. Quoting a Boston and Globe 1998 investigation, he reported that 45 of the 50 top-selling drugs approved by the US between 1992 and 1997 had received government funding at some stage of development.
From Green Left Weekly, October 16, 2002.
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