Intellectual Property Negotiations Between the United States and Colombia, Peru and Equator for a Free Trade Agreement, Relating to Medicine James Love CPTech Bogota, Colombia 21 July 2004

Bush Administration negotiating objectives of the United States in the area of medicines

What the US Wants: 1 Patents –Broader scope and lower standards of patentability –Extended terms for delays in patent approval or drug registration –Linkage between patents and drug registration Health Registration data –Exclusive rights to rely upon data Narrowed limitations and exceptions Limits on parallel trade Narrow grounds for compulsory licenses TRIPS+ standards for compensation under compulsory licensing Dispute resolution for TRIPS+ measures

What the US Wants: 2 High drug prices for innovative products –Limits on government ability to negotiate lower drug prices (proposed in CAFTA) –US oversight or regulation of drug reimbursement policies (Korea, Australia) –Weaker Price Control Oversight (1993 agreement in Thailand)

Words generally not found in USTR proposals on IPR Anticompetitive Technology transfer Abuse of rights Access to medicine Doha Flexibility Neglected diseases Traditional knowledge Genetic resources Biodiversity Public goods Open source Essential medicine Humanitarian

Every bilateral FTA under the TPA has including TRIPS plus measures that will result in higher prices for medicines

How to protect consumer interests in FTA negotiations?

Basic strategies - I Insist on more transparency –Large pharmaceutical companies have deep access to texts, but the public who buys medicines does not –Debate is limited Propose language which clarifies intent and objectives of agreements –Get decent preamble –Provisions regarding objectives and purposes are important, and public is harmed if left out of bilateral/regional FTAs

TRIPS Article 7 - Objectives The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

TRIPS – Article 8 - principles 1.Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement. 2.Appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology.

Provisions regarding coherence with other international agreements Nothing in this agreement shall prevent a party from adopting limitations and exceptions that further the purposes of the: –Universal Declaration of Human Rights –Convention on the Rights of the Child –the International Covenant on Economic, Social and Cultural Rights. –United Nations Millennium Declaration –Doha Declaration on TRIPS and Public Health –Etc....

Control of anticompetitive practice From TRIPS, Article 40 Nothing in this Agreement shall prevent Members from specifying in their legislation licensing practices or conditions that may in particular cases constitute an abuse of intellectual property rights having an adverse effect on competition in the relevant market. Member may adopt, consistently with the other provisions of this Agreement, appropriate measures to prevent or control such practices. From Chile/US FTA Nothing in this Chapter prevents a Party from adopting measures necessary to prevent anticompetitive practices.. from the abuse of the intellectual property rights

Paragraph 4: Doha Declaration on TRIPS We agree that the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health. Accordingly, while reiterating our commitment to the TRIPS Agreement, we affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO Members' right to protect public health and, in particular, to promote access to medicines for all. In this connection, we reaffirm the right of WTO Members to use, to the full, the provisions in the TRIPS Agreement, which provide flexibility for this purpose.

Treatment of Doha Declaration is key issue EC is now referencing Doha Declaration in bilateral agreements Doha Declaration is referenced in US TPA law. Ask WHO to evaluate IPR provisions impact on Doha Declaration

Resist specific provisions Propose elimination or modification of provision in the following areas –Patents Bilateral standards for scope, utility and novelty Extensions Linkage to registration –Restrictions on Parallel trade –Data

Rights in data should not be stronger than patent rights In both cases, it should be appropriate override exclusive rights, subject to compensation It is not appropriate to accept a five year period during which governments cannot address abuses of intellectual property rights or protect public health

CPTech recommends a compromise in the area of rules for health registration data Oppose exclusive rights approach. Propose system of compensatory liability, similar to that used for some agricultural chemicals in the US. Compensation based upon –Disclosure of actual costs –Reasonable share of costs, based upon global market shares –Example -- $30 million in clinical trials costs, 0.3% share of global sales, $.09 million domestic share, allocated fairly among competitors.

Change the dynamics of the negotiations

Bring in new stakeholders in the US –USTR takes advances narrow interests of big pharma sector –Other US stakeholders can change US policy NGOs, other businesses, other government agencies, etc Propose different approaches to address legitimate concerns

R&D+ as a new paradigm for trade, to replace or moderate TRIPS+

Propose a chapter on R&D Creating a committee on R&D, that can be expanded to other trading partners Propose an evaluation of the appropriate minimum levels of support for medical R&D –“big” approach – all medicines –“small” approach – neglected diseases, global public goods

Suggestions for “small” approach Offer to participate a global virtual consortium to support R&D for –Vaccines for HIV and other infectious diseases –Treatments for neglected diseases –Global public goods, such as the Human Genome Project Support open access to publicly funded research

It is important to change the language and topics of the trade negotiations Not about free ridding, but about appropriate sharing of costs and cooperation Not about protecting commercial interests, but about solving social problems that have a cross-border trade related aspect

Kerry strategy Hope that agreements are not completed before election, or at least, not approved by the Congress before the election In any case, public health and public interest groups will ask for review of entire intellectual property rights chapters. Possible changes. –Recent USTR letter on NAFTA and Canada’s paragraph 6 proposal

For more information: James Love CPTech , fax