WTO Deal on Generic Drug Access for Developing Countries Close; Agreement Could Prevent Breakdown of Trade Talks

The United States yesterday reached an agreement with a group of developing nations to give poor nations access to generic drugs, Bloomberg/Washington Post reports. The compromise with Brazil, India, Kenya and South Africa paves the way for a full World Trade Organization agreement, which could "give a boost to flagging" trade talks at the upcoming WTO meeting in Cancun, Mexico, according to Bloomberg/Post. WTO negotiators may approve the text of the compromise, which was drafted by Singapore Ambassador Vanu Gopala Menon, during their scheduled meeting today (Giles, Bloomberg/Washington Post, 8/28). WTO talks over generic drug access have been stalled since members missed a Dec. 31, 2002, deadline to reach an agreement. U.S. negotiators in February refused to sign a deal under the Doha declaration to allow developing nations to override patent protections to produce or import generic versions of drugs to combat public health epidemics, including HIV/AIDS, unless wording was included to specify which diseases constitute a public health epidemic. However, the United States in June made a concession by dropping its demand that the agreement apply only to a specified list of diseases (Kaiser Daily HIV/AIDS Report, 8/27).

Concessions
The compromise would leave intact the text discussed in December but would add a three-page "chairman's statement," delineating how the patent concessions could be used, the Washington Times reports (Sparshott, Washington Times, 8/28). A key component of the compromise is a pharmaceutical industry confirmation that it would support patent concessions for all diseases instead of limiting the scope of the diseases to a detailed list. In order to safeguard pharmaceutical company profits, countries able to import or produce the generic drugs must declare that they will not seek to profit from the drugs and will use them only for "public, noncommercial purposes under government control," the Wall Street Journal reports. In addition, in an effort to prevent the reimportation of generic drugs into wealthy countries, drugs made available under the agreement must be a different shape and color from those sold for profit. The agreement also requires the WTO to periodically review countries using the licensing to ensure that the arrangement is not being abused (Miller et al., Wall Street Journal, 8/28). The United States also successfully lobbied more than 20 developed nations to voluntarily agree not to use the agreement to import generic medicines, according to several officials (Becker, New York Times, 8/28). Some of the richest developing countries, such as South Korea and China, would agree to use the measure only in situations of national emergency or other circumstances of extreme emergency (Waddington, Reuters/Yahoo! News, 8/28).

Reaction
The new compromise was offered at a committee meeting yesterday in Geneva and was greeted with nearly unanimous approval, officials said, according to the New York Times. Several ambassadors who had expressed concerns about the compromise, including those from the Philippines and Argentina, said that they would consult their governments about the deal and they hoped the concerns could be answered by the time the issue is discussed at today's meeting. "This is better than what the United States originally wanted and doesn't limit the scope of diseases," Nelson Ndirangu, a member of the Kenya delegation to the WTO, said. Although Jeff Trewhitt, a spokesperson for the Pharmaceutical Research and Manufacturers of America, declined to comment until there is a final consensus on the measure, officials who have met with pharmaceutical industry officials say that the companies have said that they will not lobby against the agreement (New York Times, 8/28). Deputy U.S. Trade Representative Peter Allgeier said that an agreement before the meeting in Cancun next month is "possible," adding, "We are trying to find the proper balance between the concern of many developing countries that they get the ability to quickly and efficiently get the drugs they need for medical emergencies with the concern of pharmaceutical companies that this provision not undermine their intellectual property rights" (Bloomberg/Washington Post, 8/28). However, the AIDS drug advocacy group Health GAP called the compromise "disastrous." Asia Russell, director of international policy for the group, said, "In the time it would take a generic company to comply with all the conditions set out by the U.S., a patent would likely expire anyway," adding, "The current solution is designed to placate U.S. drug companies ... not to increase access to affordable generic medicines for people dying of treatable diseases" (Health GAP release, 8/28). Oxfam and Doctors Without Borders also said that the agreement would be "unworkable," according to Bloomberg/Post (Bloomberg/Washington Post, 8/28).

• The proposed compromise "is a very satisfactory outcome" for the U.S. pharmaceutical industry, and it "looks every inch the politically inspired bureaucratic fudge that health care groups feared," a Guardian editorial says. The compromise creates room for "squabbles" -- about individual drug export licenses, which diseases count as public health emergencies in which countries and what is considered to be "commercial" behavior by a developing country -- allowing the pharmaceutical industry to "make capital of the fact that it has opened the door to generic drugs, but at the same time ... restrict[ed] their distribution," the editorial says. The only "real measure" of the success of the compromise is "the number of drugs reaching sufferers on the ground," the editorial says, concluding, "In that respect, the 21 months since the Doha declaration have been wasted" (Guardian, 8/28).

• Last night's "signs ... of a breakthrough" in the debate over developing nations' access to generic drugs is breaking the "deadlock ... on one of the key barriers to a world trade agreement," Gordon Brown, British chancellor of the Exchequer, the British governmental department charged with the collection and management of the national revenue, writes in a Guardian opinion piece. Agreeing on better access to "life-saving medicines ... is the first step" in confronting the "global war against poverty, a war that must be won if we are to succeed in our war against global terrorism," Brown writes, adding, "Only by creating a virtuous circle of debt relief, poverty reduction and economic development can Africa, in particular, have a chance of moving from underdevelopment to prosperity" (Brown, Guardian, 8/28).

Back to other news for August 28, 2003