Will U.S. create barriers to LDCs' future access to medicines?

Professor Brook K. Baker, Health GAP and Northeastern U. School of Law

September 7, 2015

Earlier this year, WTO Least Developed Country Members requested an unconditional extension of the expiring WTO TRIPS transition period that exempts them from having to implement pharmaceutical patents and other intellectual property protections that constrain their ability to make or procure low-cost generic medicines.  Informed sources indicate that the U.S. is currently opposing the LDC draft extension. While the exact US government position has not yet been made public, it seems likely from past US positions that the US Trade Representative might be opposing several of the most important elements of LDC request that make the extension truly meaningful for access to medicines. 

As the next TRIPS Council meeting is on October 15, it is likely that the USTR has begun bilateral negotiations with LDCs with respect to their request for an unconditional extension from the requirements of the TRIPS Agreements with respect to pharmaceutical patents, data protections, marketing exclusivity, and mailbox requirements.  LDCs are seeking an extension for as long as they remain LDCs.  They ground their request both on the language of the Doha Declaration on the TRIPS Agreement and Public Health and Article 66.1 of the TRIPS Agreement.  These binding, unanimous-consent documents grant LDCs the right to seek further extensions of their TRIPS transition period and require that such extensions "shall" be accorded upon properly motivated request. 

The USTR is continuing its traditional silence on its formal position with regard to the LDC request.  It has reportedly consulted on the request, but has not done so extensively with public health and human rights groups that are on record that the US should accede to the LDC request without conditions.

Reading the tea leaves of past US positions in negotiations on earlier transition periods and their extension and the US position on the August 30 Decision on Paragraph 6 of the Doha Declaration concerning compulsory license supply to countries with insufficient domestic manufacturing practice, it is easy to identify policy positions that the USTR must avoid.

First, the US may but must avoid efforts to shorten the time limit of the proposed extension as short extensions do not allow LDCs the policy space to secure durable sources of lower cost generic medicines nor a sufficient time period to develop sustainable local pharmaceutical capacity.  LDCs made a request two years ago for a transition period from their basic TRIPS-compliance obligations for as long as they remained LDCs.  The US and EU opposed this rational request and instead insisted on no more than the eight year extension granted (2013-2021).  The need for a transition period for pharmaceuticals as long as a country remains an LDC is even clearer than for the general TRIPS compliance, as the health needs of LDC populations requires paying the lowest possible prices for medicines of assured quality.  Surely the US will not once again oppose an extension for countries that remain trapped in an LDC development quagmire and to force them to return every few years for an additional time-limited extension.  

Second, the US may but must not tie the granting of pharmaceutical extension to a declaration, express or implied, that intellectual property protections are unequivocally good for development.  In the 2013 extension process, the USTR insisted on a IP fundamentalist clause genuflecting to the magical development elixir of patent monopolies.  It required a clause from LDCs expressing "their determination to preserve and continue the progress towards implementation of the TRIPS Agreement."  Regrettably, the best evidence is that increased IP protections and continued efforts towards TRIPS compliance do not create favorable conditions for accelerated development in low-income countries and instead that such polices increase prices and thereby reduce access to global public goods like medicines.  Questions about the negative impacts of easily granted and over-enforced patents are growing even in the U.S. where government programs and private insurers cannot afford some of the astronomically over-priced medicines that have recently hit the market.

Third, the US may but must not demand that LDCs restrict their pharmaceutical capacity, if and when they develop it, to non-commercial purposes only and in particular to serving domestic needs only (See, Chairman's Statement to the August 30 Decision requiring non-commercial purpose).  LDC countries like Lesotho, population 2 million, can simply not build viable pharmaceutical capacity that solely serve small and poor populations.  Viable pharmaceutical enterprises in LDCs, especially in the generics context, need to achieve efficient economies-of-scale and should at least reach regional markets.  More to the point, such industries need time and policy space to develop as existing capacities are non-existent or weak.  Finally, to impose export limits on commercially oriented pharmaceuticals would create a perverse carve out for medicines that is totally inconsistent with technological development rights affirmed in the 2013-21 TRIPS-compliance extension.

Fourth, the US may but must not impose conditions that require LDCs to maintain existing degrees of IP protection.  The first general LDC extension 2006-2013 unfortunately contained a stay-put provision that locked LDCs into the levels of IP protection imposed by their colonial masters or unwisely adopted because of flawed technical assistance from WIPO.  Fortunately, LDCs succeeded in reversing this stay put clause in their 2013-2021 extension with the following provision:  "Nothing in this decision shall prevent least developed country Members from making full use of the flexibilities provide by the [TRIPS] Agreement to address their needs, including to create a sound and viable technological base and to overcome their capacity constraints supported by, among other steps, implementation of Article 66.2 by developed country Members [relating to technology transfer]."  This provision grants LDCs the policy space - free from exclusive, monopoly rights - to advance their development project and to fulfill their human rights obligations including the right to health.

The USTR should immediately disclose its LDC pharmaceutical extension negotiation position.  To the extent that its position includes any of the above retrograde policies, they should be reversed.  Instead, the US should join the emerging global consensus, supported even by the European Union, that the LDC pharmaceutical extension should be granted on requested terms.  Allowing LDCs unfettered access to more affordable generic medicines will also advance the US policy objectives of halting and reversing the global AIDS pandemic where the US has saved billions of dollars in its PEPFAR program by purchasing over 90% of its antiretroviral supplies from generic sources.


Eminent scientists, researchers and activists call on world leaders to act on new advances in HIV science to end the AIDS crisis

July 19, 2015

Policy and funding must now follow evidence that shows that all people with HIV should receive antiretroviral treatment regardless of stage of disease

 Vancouver, BC – At the opening of the International AIDS Society annual conference in Vancouver, Canada on Sunday July 19, scientists, researchers and activists issued a joint-call for an immediate increase in funding and marshaling of political commitment needed for world leaders to act decisively on new scientific evidence that all people with HIV should be treated with antiretroviral therapy, regardless of stage of disease, in order to maximize the clinical and prevention benefit of HIV treatment.

 This call to action—referred to as the Vancouver Consensus by its supporters—has already been endorsed by the leadership of the U.S. President’s Emergency Plan for AIDS Relief, UNAIDS, the Global Fund to Fight AIDS, Tuberculosis and Malaria, the International AIDS Society and the International Association of Providers of AIDS Care.

 “The question no longer is whether life saving HIV treatment should be offered to all people with HIV but how to ensure treatment for all becomes a reality—through increased funding, higher quality programs, and laws and policies that defend the human rights of people with HIV and communities at greatest risk of infection,” said Asia Russell, Executive Director of Health GAP. “AIDS cannot be defeated if world leaders refuse to act on the science. Many countries facing massive burden of untreated HIV are still implementing outdated paradigms, waiting until people are sick before offering them treatment—because governments are breaking their funding promises.”

 “Achieving the global target set in 2011 of reaching 15 million people with treatment by 2015—a target many dismissed as unrealistic--shows that ambitious treatment scale up goals are achievable,” said Matthew Kavanagh, Senior Policy Analyst at Health GAP. “The challenges are real—19 million people do not know their HIV status. Many treatment programs do not invest in community based follow up for HIV positive patients that is needed to ensure people are retained and supported in care. These challenges can be overcome—but only if our leaders act.”

 Investment by some major donors, including the US government, in the AIDS response has flat-lined or been cut in recent years. This is leading to rationing of treatment in heavily impacted countries, and resulting in significantly reduced donor investments in middle-income countries with concentrated epidemics.

 The impact of the lack of sufficient donor support and political priority is that countries are not able to act on the compelling new evidence about how best to address the epidemic.

 “The Government of Malawi has already made a commitment to providing immediate access to treatment for all people living with HIV. However, we are told that this can not be implemented until 2017 and that it will not be possible without significant help from bi-lateral and multilateral donors,” said Safari Mbewe, Executive Director of the Malawi Network of People Living with HIV/AIDS (MANET+).

 “The global call to end AIDS is a false promise without sufficient funding and political will,” said Maureen Milanga, Health GAP’s Kenya National Organizer.

 Health GAP is calling on world leaders, donors and Ministry of Finance representatives from key affected countries, to convene an urgent meeting to review the latest science on the sidelines of the United Nations Summit to adopt the post-2015 development agenda, taking place in New York City in September this year.

 Early signatories of the Vancouver Consensus include United States Global AIDS Coordinator Ambassador Deborah Birx, UNAIDS Executive Director Michel Sidibé, UN Secretary General’s Special Envoy on HIV/AIDS in Eastern Europe and Central Asia Michel Kazatchkine, and President of the International AIDS Society Chris Beyrer, Editor-in-chief of The Lancet, and renowned economist Jeffrey Sachs among others.

AIDS Activists Applaud Defeat of Fast Track, Caution that Access to Lifesaving Medicines is Still At Risk in Vote Scheduled for Next Week

HEALTH GAP (Global Access Project)

Media Release • 12 Jun 2015

Contact: Paul Davis: +1 202 817 0129

Washington DC] The global health advocacy organization Health GAP applauded a vote today in the U.S. House of Representatives that dealt a major setback to the pharmaceutical industry’s policy agenda of extending monopolies over life-saving medications. The 126-302 vote rejected the Senate-passed combined Trade Assistance Authority (TAA) and fast track Trade Promotion Authority package, which would have paved the way for the adoption of dangerous trade deals, most imminently the Trans-Pacific Partnership. The vote signals a major, but potentially temporary victory for people in need of access to medicines throughout the Pacific region.

Even though House Republicans subsequently “passed” a largely symbolic stand alone Trade Promotion Authority bill, without the companion worker retraining provisions adopted by the Senate, the bill cannot be sent to the President’s desk for signature. Unless enough Republican and Democratic votes are changed over the weekend to pass the full package of bills passed in the Senate, Fast Track will be stuck in limbo.

After the failure of the TAA and symbolic passage of Fast Track, Speaker John Boehner passed a last-minute “motion to reconsider” vote scheduled for next week, effectively giving leaders from both parties the weekend to persuade Members of Congress to change their votes on TAA--a bill that supports workers displaced by the impacts of “free trade” agreements. House Minority Leader Nancy Pelosi summed up the strong views of many across the United States and around the world when she said, “people would rather have a job than assistance."

“Trade agreements should be responsible, but leaked text from the Trans Pacific Partnership has shown us that the deal is harmful,” said Heath GAP’s Amirah Sequeira. “The Fast Track bill contains negotiating objectives that will hurt patients. We urge Members of the House to resist arm twisting over the weekend and vote against the TAA when they return next week. Members who vote in favor of the passage of fast track will be hurting millions of people with HIV around the world. These deadly votes will be remembered.”

Health GAP and other public health organizations call on House members to reject the entire Fast Track package.


Trans-Pacific Partnership Transparency for the Big Pharma Wrecking Crew

Professor Brook K. Baker, Senior Policy Analyst

June 11 2015

A new WikiLeak release of the recent draft text of the US-led proposal for the Trans-Pacific Partnership annex on Pharmaceuticals and Medical Devices shows how the fig-leaf of “transparency” and “procedural fairness” is being used to allow transnational pharmaceutical companies to subvert countries’ ability to make decisions about which drugs and medical devices they can afford to cover, in order to expand access for monopoly-priced medicines.

The newly-leaked 2014 draft has facial improvements over an older 2011 draft that was universally panned by other Trans Pacific Partnership (TPP) countries. While the more recent draft no longer directly targets medicines pricing, it includes explicit provisions for Pharma’s direct involvement in government procedures and deliberations for deciding on and listing medicines and devices that will be reimbursed by government health programs, such as PHARMAC in New Zealand, the Pharmaceutical Benefits Advisory Committee in Australia, and Medicare in the United States. Pharma and device applicants will also have input of the level of reimbursement for their products. There are set timelines and requirements that the criteria used to decide which medicines will be included/excluded for reimbursement be fully disclosed and justified. These measures reduce the sovereign autonomy and flexibility of responsible agencies to make difficult assessments regarding value for money in health care. Although a separate appeals process will no longer be required, there are requirements that there be substantive reconsideration processes—appeals in another name. All of these transparency and procedural niceties can be used by pharmaceutical and medical device companies to bully government decision-makers into accepting higher-prices for medical technologies of dubious value.

Even more dangerously, the provisions included in the transparency chapter could give rise to investor claims directly against states, allowing foreign investors to bypass national courts and seek unlimited monetary damages in three-person private arbitration proceedings. For example, according to TPP Investment Chapter rules, if a pharmaceutical or medical device company was dissatisfied with a government decision, it could proceed directly to arbitration claiming that it had been subjected to unfair and inequitable treatment. Even worse, if a country with no existing system for medicine and device formularies adopts this rational system for trying to control medical costs and deter introduction of medicines and devices of dubious medical value, the pharmaceutical investor could claim that its expectations of the profits and of a stable regulatory environment has been unfairly disrupted.

The Annex on Pharmaceuticals and Medical Devices is an unveiled attempt to give drug and device companies access to government's sovereign decision-making on medicines and device formularies and price-setting policies. The provisions, as they stand, allow for endless opportunities for one-sided interventions, lobbying, and reconsideration appeals challenging lack of meaningful participation, failures of evidence-based decision-making, obstruction of introduction of medical innovations brought forward by self-interested companies (not patients). Big Pharma and medical device companies basically want to bully governments into succumbing to their excessive pricing demands for new products, regardless of medical merit or beneficial comparison to alternatives. If they lose in these deliberation, the adoption of this "transparency", fox-in-the-henhouse strategy would allow companies to pursue investor-state dispute resolution, convening biased private arbitration panels to review claims that expectations of profits have been thwarted by the adoption or implementation of formulary or health care coverage and pricing decisions.

This chapter continues to pose a threat to access to affordable medicines, potentially burdening patients, insurers, and governments with bloated prices for the medicines they need, as well as for inferior products they don’t need. It also ties governments' hands to take more serious steps to control these health care costs and to reject medicines and medical devices with marginal or no additional therapeutic benefits. Yesterday, the New York Times reported that the new draft no longer demanded protection for pharmaceutical prices. However, this is somewhat misleading. The truth is the changes are largely cosmetic. The TPP’s transparency chapter still opens the door to the pharmaceutical and device-manufacturing industries to use procedural wrecking balls to destroy the machinery of government that is created to make rational decisions on the medicines and devices that it will reimburse with its limited financial resources and on the level of that reimbursement. It will harm the health interests of patients, insurers, and governments in each and every country involved, all in the relentless drive for monopoly prices and monopoly profits.

Broad Coalition Of AIDS activists, Nurses And Other Advocates Applaud Senate Wall Street Speculation Bills Introduced By Sen. Bernie Sanders

For Immediate Release

May 19, 2015

Contact: Paul Davis, 215-833-4102, Michael Tikili, 347-217-3030

Broad Coalition Welcomes Senate Wall Street Speculation Bills

Washington, D.C. – A broad coalition of AIDS activists, nurses, students, religious and civil rights groups, environmentalists, labor and housing advocates today enthusiastically welcomed plans by Sen. Bernie Sanders to introduce two new Senate bills Tuesday that would impose a small fee on Wall Street speculation to pay for college education for all and other critical community needs.

Sen. Sanders will unveil the legislation at a Capitol Hill press conference Tuesday, May 19 at 11:30 a.m. at the Senate Swamp. Student leaders, as well as nurses, AIDS activities and other long time advocates of the Wall Street fee, also known as the Robin Hood tax, will also attend.What: Press conference with Sen. Bernie Sanders

When: Tuesday, May 19, 11:30 a.m.

Where: Senate Swamp, Capitol Hill (near Constitution Ave. and 1st St.)

(note: in the event of rain check for possible location shift)

Live Stream: http://www.robinhoodtax.org/livestream

Sanders’ landmark education bill would eliminate undergraduate college tuition fees for students attending public colleges and universities, reform student loans, and expand work-study programs. The bill is a critical step to eradicating student debt, currently pegged at nearly $1.2 trillion and the fastest growing form of consumer debt, as well as expanding educational and employment opportunity.

It also puts the U.S. on a path embraced by other nations that already provide free college education including Brazil, Chile, Finland, France, Germany, Norway, Slovenia, and Sweden.

The second Robin Hood tax bill would help reinvest in American families and communities by providing the resources for jobs and healthcare for all, affordable housing, eradicating HIV/AIDS and fighting poverty, and climate change. It parallels a House bill, HR 1464, the Inclusive Prosperity Act, introduced by Rep. Keith Ellison (D-MN) with 25 House co-sponsors.

“We applaud Sen. Sanders for this bold and far sighted step. Free college education, as many other countries already provide, opens the door for greater economic opportunity, reducing income inequality, and a better life for all Americans,” said RoseAnn DeMoro, executive director of National Nurses United, the largest U.S. organization of nurses, and a leader of the Robin Hood tax campaign, who will be speaking at the press conference.

“Nurses see first hand the irreplaceable bond between good health and economic security and social justice,” DeMoro said. The Robin Hood tax, which can raise hundreds of billions of dollars every year, paid by Wall Street speculators, “is the perfect way to fund this program, as well as providing the resources we need for other vital humanitarian needs, including healthcare and good paying jobs for all, affordable housing, eradicating poverty and environmental justice. It is the hallmark of a civilized society and a more just nation.”

Both bills set a nominal tax – 50 cents on every $100 of stock trades on stock sales, and lesser amounts on transactions involving bonds, derivatives, and other financial instruments. Passage would allow the U.S. to join dozens of other nations – including every other major global financial market – in a growing system of financial transaction taxes.

In the U.S., the Robin Hood Tax embodies a widespread campaign endorsed by 172 national organizations representing millions of members in unions, student, health, clergy, civil rights, environmental and community organizations, and other consumer and activist groups

"Income inequality is now at the center of our national political discourse, with politicians of every stripe recognizing it as a major problem of our time. What too few are willing to say is that we must demand more revenue from corporations and the 1 percent to level the playing field,” said George Goehl, executive director, National People’s Action.

“Experts are saying that we have the science we need to end the global AIDS crisis, yet everyone agrees that this will not be possible without a considerable increase in resources,” said Jamila Headley, managing director of Health GAP (Global Action Project). NPA and Health GAP are, along with NNU, major leaders of the Robin Hood campaign.

The Robin Hood tax would also slow the growth of automated high frequency trading, which makes the stock market more dangerous. A small tax would make risky HFT unprofitable, and help reduce the excess speculation on commodities like food and gas that drives up prices, which will protect the economy from computer-generated collapses and market manipulation.

Forty nations from the United Kingdom to South Korea administer or have administered a financial transaction tax. In addition, 11 nations in the European Union are finalizing details of their own financial transaction tax to be implemented on January 1, 2016.


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