Protection Of Pharmaceutical IP By TRIPS Agreement And The Developing Countries' Policy Options

The TRIPS Agreement introduced a minimum global standard for the protection and enforcement of nearly all categories of intellectual property rights: patents, trademarks, copyrights, and undisclosed information, including those applying to Pharmaceuticals. The Agreement was the result of a decade-long campaign by a coalition of industries in the United States and other developed countries that united to secure a new international system for the protection of intellectual property that could be enforced through trade sanctions.Disappointed by the inability of WIPO to initiate global standardization and harmonization of IP standards, the pharmaceutical, computer software, publishing, and entertainment industries in the United States and other developed countries cooperated to form their own internal alliances and to lobby politicians to support enhanced intellectual property protection. This strengthened alliance then worked with industry and political leaders in developed world to motivate the importance of globalizing IP protection. While they were cementing their intercontinental business alliances, these forward thinking industries convinced first the U.S. Trade Representative and then the E.U. and Japanese trade representatives that GATT was the forum within which intellectual property protection should be pursued. Although developing countries tried to create a coalition of the unwilling, the United States used its new Section 301 to discipline recalcitrant nations and to split the alliance. Reacting to competition from generic producers, the U.S. and E.U. pharmaceutical industries played a lead role in TRIPS Agreement negotiations. At the end of the negotiation, its principal negotiator stated that the industry had achieved all of its aims: controlling the process and the content.The resulting TRIPS Agreement covers basic principles, standards, and use of patents, enforcement and dispute settlement mechanisms, and multiple other subjects, many of which are tilted in favor of IP owners and against the interests of IP users. Under its key patent provisions, member countries must provide patent protection for a minimum of twenty years from the filing date of a patent application for any invention, including a pharmaceutical product or process that fulfils the criteria of novelty, inventive step and usefulness. Although preceding multilateral agreements concerning patent rules in both the developed and developing world had allowed policy-based discrimination between fields of invention, for example by excluding medicines, Article 27.1 expressly outlawed such discrimination. Similarly, it was no longer permissible to discriminate routinely against imports in favor of locally produced nroducts, thus allowing major pharmaceutical companies to control the place of production despite illusory promises to undertake technology transfer. Because of Article 28, the major pharmaceutical producers secured exclusive rights to exclude others from "making, using, offering for sale, selling, or importing" patented pharmaceutical products or products made with a patented process. In addition, Article 39.3 protects undisclosed information (including clinical test data) from "unfair commercial use," a provision that may ultimately be interpreted to impede registration of generic drugs even where patent bars are overcome.Admittedly, there are important flexibilities in TRIPS Agreement, discussed in detail in Section 5, including autonomy under Article 6 to establish international exhaustion rules, which would thereby permit parallel importation, and authority under Article 31 to issue compulsory licenses and under Article 30 to grant limited exceptions to patent holders' right to exclude competition, but the undeniable effect of the TRIPS Agreement has been to consolidate the economic power and monopoly privileges of the proprietary drug industry. Given its pre-existing advantage in conducting research and development, the developed world's drug industry secured near absolute competitive advantage over the developing world's via the TRIPS Agreement. This advantage will eventually result in the net transfer of billions of dollars from the impoverished south countries to the affluent north countries.At the time of its passage, many public health specialists in both developed and developing countries seemed unaware of the looming consequences of a rising tide of patent protection on the treatment of diseases. However, the burgeoning AIDS crisis quickly caught people's attention, especially given the astronomical cost of triple-therapies brought to the market in the mid-1990s. As the developing world confronted the reality of tens of millions of HIV infections and the unaffordability of billions of patent-protected pills, critics questioned the deal that had been struck in the Uruguay Round. Early critics were joined later by more mainstream sources, many of whom offered their own critique of radical IP protectionism, including the prestigious U.K. Commission on Intellectual Property Rights, the UNDP, the World Bank, UNTACD, and even the WTO itself in collaboration with the WHO.Even after codifying a universally higher standard of patent protection for the pharmaceutical industry in the TRIPS Agreement, the United States and it allies continued its existing pro-pharmaceutical trade policy by threatening developing countries such as Thailand, South Africa, and Brazil with trade sanctions because they refused to grant greater TRIPS-plus rights to patent holders and/or because they proposed using TRIPS-compliant means to access more affordable medicines.Faced with the existing or emerging gravity of public health problem, it is an urgent need for developing countries to take combined effort in future related negotiations and try to make preferable amendments to the TRIPS Agreement. Before this long-term goal is attained, developing countries should utilize all the legal flexibilities within the TRIPS Agreement framework to help solve their public health problems. This article is mainly aimed at a systematic analysis of the relevant provisions of TRIPS Agreement and other legal documents, with a view to putting forward some specific policy suggestions for developing countries. This article is divided into five sections. Section 1 first looks back at the history of IP international protection and the role of GATT in enhancing its protection. Then will turn to the difficult emergence of TRIPS Agreement during the Uruguay Round of Multilateral Trade Negotiations. This will help understand how a revolution in IP protection brought about by TRIPS Agreement was possible and why it happened in the framework of the General Agreement on Tariffs and Trade.Section 2 analyses the TRIPS Agreement as a whole and assesses its specific impact on the international pharmaceutical IP agenda. The analysis and assessment are necessary steps to understand the interaction between the advanced pharmaceutical industry in developed countries and the international pharmaceutical IP agenda. First, the section analyses major elements of TRIPS Agreement (general provisions and basic principles, dispute settlements, enforcement, TRIPS Council and the system of notification). Second, the section reports on TRIPS Agreement major flaws, and focuses mainly on its lack of effectiveness in the elimination of anti-competitive practices and insufficient assistance to countries with low IP capacities. Finally, the section examines and elaborates on TRIPS Agreement pharmaceutical IP agenda. The section concludes that the newly established international pharmaceutical IP agenda, as well as the IP system generally, is highly correlated with the position and interests of the advanced pharmaceutical industry bases in developed countries.The deep divide between north and south did not vanish with the coming into effect of the TRIPS Agreement in 1995. On the contrary, the resentment of developing countries and LDCs increased as the revolution caused by TRIPS Agreement in terms of the global level of IP protection became more and more evident. Section 3 provides a brief overview of the opposition of developing countries and LDCs to TRIPS Agreement in general, and to its pharmaceutical IP agenda in particular, between 1996 and 1999. The section demonstrates the developing country's resentment to TRIPS Agreement by examining the official statements and demands of WTO members during the ministerial conferences of 1996, 1998 and 1999.Although the establishment of the TRIPS Agreement clearly required a considerable effort on the part of IP advocates, exploiting TRIPS Agreement benefits and preserving its achievements proved to be an equally challenging task. As the controversy surrounding TRIPS Agreement intensified, particularly from 1999, IP advocates, such as the advanced pharmaceutical industry in developed countries, were, for the first time, on the defensive. Section 4 links the industry's strategies and activities concerning the exploitation and preservation of TRIPS Agreement to the EU's IP approach and operations. First, the section focuses on the declarative level, describing the views of the EU and of its member states concerning the TRIPS Agreement. Second, the section analyses the operational level, assessing TRIPS-related activities of both the advanced pharmaceutical industry in Europe and the EU itself. Finally, the section puts great emphasis on the combined efforts of the industry and of its regional and international IP allies. This provides a more comprehensive insight into the common sentiments, goals and strategies shared by IP advocates globally. While reflecting the interests of the pharmaceutical industry based in developed countries, the TRIPS Agreement constitute huge legal obstacles which will hinder the developing countries' efforts to solve public health. Strengthened protection of pharmaceutical IP is to have significant impact on the prices of drugs, making it even more difficult for millions of patients in poor countries to access life-saving medicines. In Section 5, it is argued that, to help resolve public health problems in the long run, developing world should take combined effort in future related negotiations and try to make permanent and preferable amendments to the TRIPS Agreement. In the short term, however, developing countries should utilize all the legal flexibilities within the TRIPS Agreement framework to make life-saving drugs more accessible and affordable. The section focuses on a systematic analysis of the relevant provisions of the TRIPS Agreement, Doha Declaration, Paragraph 6 Implementation Decision and the General Council Chairman's Statement and then put forward some specific policy suggestions for developing countries.