Drug Industry Concerned Weakening HIV Drug Patents in Brazil, South Africa Would Have International Implications, NPR’s ‘Morning Edition’ Reports
As part of an ongoing series of reports on AIDS drug access, NPR's "Morning Edition" yesterday reported on drug companies' efforts to keep drug patents intact in Brazil and South Africa. NPR's John Hamilton reported on a "rare glimpse" beyond the "standard messages" into why the drug companies are "so worried" about the prospect of cheap generic AIDS drugs in developing nations, a topic "placed squarely on the table" at a recent media briefing at the Washington, D.C., headquarters of the Pharmaceutical Research and Manufacturers of America. PhRMA Vice President Judy Bello said, "While there is an agenda that many are proposing that there should be lower prices in the neediest countries, nonetheless we think it's very important for you all to see the picture that there will be enormous demand to bring those same low prices into the U.S. market." Since the formation of the World Trade Organization in 1995, most countries agree to abide by a single set of international trade rules, so if one WTO member is allowed to disregard drug patents, "pretty soon the trend will spread to other countries and other products," NPR reports, explaining drug companies' logic. Brazil has had "great success" in bringing AIDS drugs to its citizens and lowering death rates. The United States has asked the WTO to intervene in Brazil to make the country abandon its "working requirement" policy that would "force" companies to give up their patent rights in the country or manufacture the patented product locally. Bello said that "Brazil could have allowed generic HIV drugs by declaring AIDS a national health emergency," which is "technically permitted" under WTO rules, but instead Brazil is "using the veil of the AIDS crisis to mount a much broader attack" on patent protection for all products. "What is at stake for all patent owners in all industries all over the world, not limited to the United States, is that if Brazil is allowed to impose working requirements, so can everybody else around the world, which means that all patent owners in any industry in any country of the world can be required to choose: either give up your patent protection or manufacture locally," Bello said.
'Major Implications' of Brazil Case
Keith Maskus, an economics professor at the University of Colorado, said that the drug companies have "two legitimate concerns": losing the ability to profit from their brand-name products in Brazil, South America's largest market, and taking the risk that cheap foreign drugs could find their way back to the United States. "[M]ost of the profitability in pharmaceuticals comes from the American market, secondarily from the European market. It's those two markets that really pay all the research and development costs. So ... from the pharmaceutical companies' standpoint, the rest of the world is basically free riding on the high prices that exist in the United States," Maskus said. AIDS activists don't believe that the presence of generic drugs elsewhere in the world would hurt profits in the United States and Europe. James Love, director of the Consumer Project on Technology, said, "If you think about it ... 1.3% of the global market for Africa is what the entire continent represents. It's almost no money to the global drug companies, and yet they're fighting as if their life depended on it." Love argued that the drug companies could make HIV drugs "affordable" in developing countries without giving up profits elsewhere by making a deal with the World Health Organization, a move that "would also go a long way toward repairing the drug firms' tattered public image." Love said, "If I was the head of [GlaxoSmithKline] or Bristol-Myers Squibb, I would pick up the phone, I would call the WHO. I would say, 'Here's a license to use all of our patents in Africa, and if anybody dies there, it won't be our fault. It'll be your fault'" (Hamilton, "Morning Edition," NPR, 3/7). To listen to the full report in RealAudio, enter http://search.npr.org/cf/cmn/cmnpd01fm.cfm?PrgDate=03/07/2001&PrgID=3 into your Web browser and scroll down to the "HIV Drug Patents" story.