Poor people in developing countries are still being denied cheaper life-saving medicines five years after world leaders signed a formal trade declaration to put health before profits.

In a report published today marking the fifth anniversary of the “Doha Declaration”, “” international agency Oxfam says that rich countries are taking little or no action towards their obligations and are in some cases actually undermining the declaration.

The declaration says that developing countries must be able to use public health safeguards written into the WTO’s intellectual property rules (called TRIPS) in order to access cheaper generic versions of patented medicines. Generic competition is the most sustainable way to keep the price of medicines down, says Oxfam.

“Rich countries have broken the spirit of the Doha Declaration,” said Oxfam’s Make Trade Fair campaign head Celine Charveriat. “The declaration said the right things but needed political action to work. That hasn’t happened. We’ve gone backwards. People are still suffering or dying needlessly.”

Since 2001 things have become worse for sick people in developing countries:

 More than 4 million people were newly infected by HIV in 2005;

 Cancer - once considered a “burden of the rich” - is increasingly affecting people in developing countries, with the rate of disease due to double by 2020 and 60% of new cases occurring in the developing world;

 Diabetes has risen from 30 million to 230 million people in the past 20 years with most new cases now reported in poorer countries.

However, the World Health Organization says that 74% of AIDS medicines are still under monopoly, 77% of Africans still have no access to AIDS treatment, and 30% of the world’s population still do not have regular access to essential medicines.

There are many reasons for this but one of the most important is that rich countries, particularly the US, are bullying developing countries to impose stricter intellectual property rules in order to preserve pharmaceutical monopolies. This is restricting generic competition and keeping prices high.

”Global health statistics are grim but the US continues to negotiate trade deals with even stricter rules that limit how a country can use public health safeguards,” said Charveriat.“ If implemented, these deals will result in Colombia having to pay an additional $940 million per year by 2020 to cover the increased cost of medicines, affecting nearly 6 million patients. Similarly in Peru, where the price of medicines could increase by 100% in 10 years and 162% in 18 years.

Other rich countries, particularly those among the European Union, have quietly consented to US actions. Pharmaceutical companies have gone even further by directly challenging countries such as India and in Philippines that have sought to use the safeguards.

In 2005, cancer patient groups in India used Indian intellectual property law to stop a patent application by the Swiss company Novartis for its anti-cancer drug, Glivec. This allowed Indian companies to continue making generic versions at $2,700 per patient a year, as opposed to Novartis having a monopoly priced version for sale at $27,000 per patient a year.

However Novartis recently appealed the court’s decision in a direct challenge to India’s right to interpret the TRIPS Agreement to protect public health. If Novartis is successful, it could jeopardize India’s generic export industry. India is the world’s leader exporter of generic medicines, with 67% of its exports going to developing countries.

“Novartis has told Oxfam that there is no commercial market for Glivec in India and that it is challenging India in order to align Indian intellectual property law with TRIPS,” Charveriat says. “However, India is only trying to use the flexibilities rightfully available to it under TRIPS and Novartis is seeking to block that right.”

Meanwhile in the Philippines, the government has conducted tests and issued a regulatory approval for a cheaper patented version of Novarsc, a heart disease drug now under patent to the US company Pfizer. The government is doing this to ensure that a cheaper patented version of Novarsc that costs almost 90% less will be available immediately from when the patent expires in June 2007.

Oxfam believes that the government’s action is consistent with the TRIPS Agreement and with the Philippines intellectual property law. However, Pfizer is now suing the government. If Pfizer is successful, it will severely limit the government’s ability to access cheaper medicines and assert its right to enforce TRIPS safeguards.

“Developing countries have a responsibility to use the public health safeguards but when they try to do so they are put under huge pressure,” Charveriat said.

In order to make the Doha Declaration work, Oxfam is calling for:

 The WTO to review the impact of the TRIPS Agreement to ensure that all members can protect public health.

 The US to stop pressuring countries to adopt stricter intellectual property rules, especially through its FTA negotiations;

 The EU to clarify that it will not push for TRIPS-plus measures within European Partnership Agreements, and that it gives developing countries the policy space to freely use TRIPS flexibilities;

 Rich countries to give political and technical support to developing countries to use the safeguards under TRIPS to ensure access to affordable medicines;

 Political will on the part of developing countries to implement the public health safeguards;

 An end to lawsuits currently pursued by Novartis and Pfizer against developing countries.

“Rich countries must live up to their commitments and stop undermining the Doha Declaration with their selfish actions,” Charveriat said. “Now more than ever we need a global trading system that puts health before profit and makes medicines affordable for all.”

Summary

Disease and ill health continue to ravage poor people worldwide. In 2005 there were approximately four million new HIV infections. Non-communicable diseases (NCDs) have unleashed a new epidemic of suffering across the developing world. Pandemics, such as avian influenza, are a serious threat to people in rich and poor countries alike.

Access to affordable, quality medicines is critical for patients in poor countries suffering a disproportionately high burden of disease. Most poor people pay for medicines out-of-pocket, so even slight price rises mean that life-saving medicines are unaffordable.

During the late 1990s, developing-country officials and civil-society groups grew increasingly concerned about the impact of intellectual property rules, introduced through the TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement, on access to medicines. Intellectual property rules create monopolies for medicines sold by multinational pharmaceutical companies, keeping inexpensive, generic medicines, which can reduce the cost of medicine in a sustainable way, off the market.

Responding to increased public outrage, developing-country governments demanded that the World Trade Organization (WTO) address this critical issue as part of the launch of a new global trade round negotiation. As a result, WTO members unanimously enacted the ‘Doha Declaration on the TRIPS Agreement and Public Health’ on November 14, 2001, asserting that intellectual property rules should not prevent countries from protecting public health. The Declaration affirmed that developing countries could enforce public health safeguards to enable price reductions via generic competition. It also directed member countries to facilitate access to generic medicines by poor countries with insufficient drug manufacturing capacity, a measure known as the ‘Paragraph 6 Public Health Solution’.

Since 2001, however, rich countries have failed to honour their promises. Their record ranges from apathy and inaction to a dogged determination to undermine the Declaration’s spirit and intent. The USA, at the behest of the pharmaceutical industry, is uniquely guilty of seeking ever-higher levels of intellectual property protection in developing countries.

The USA has negotiated numerous bilateral and regional free trade agreements (FTAs) that impose what are known as ‘TRIPS-plus’ intellectual property rules, weakening or eliminating the public health safeguards allowed under TRIPS. Patented medicines thus have even higher levels of intellectual property protection than required under TRIPS, delaying the availability of affordable generics. The USA has also pressured countries for greater patent protection through threats of trade sanctions and through the WTO accession process.

While other rich countries, and particularly the member countries of the European Union, have not pursued a TRIPS-plus agenda, their inaction has left the USA free to impose stricter intellectual property rules on poor countries. This apathy is inconsistent with the EU’s commitments under the Declaration, but is not surprising since EU pharmaceutical companies benefit from TRIPS-plus commitments that developing countries must enact through national legislation to comply with TRIPS-plus commitments in their agreements with the USA.

The ‘Paragraph 6 Public Health Solution’ has not facilitated delivery of affordable, generic medicines to poor countries with insufficient or no drug manufacturing capacity. Rich-country intransigence during negotiations created barriers that made the solution almost unworkable, and these countries are in no hurry to make the solution work. Canada, which first implemented the solution, made it even more complicated.The USA has not enacted legislation, while the EU only approved regulations implementing the solution in mid-2006.

The pharmaceutical industry has significantly benefited from the US trade agenda, as the US agenda reflects the industry’s priorities by aiming to eliminate or weaken the TRIPS safeguards in order to extend its monopolies over medicines. The industry has also pursued TRIPS-plus rules in developing countries that have no obligation to implement higher levels of intellectual property protection. Having successfully lobbied the US government to impose these more stringent rules in developing countries, the industry is now actively pushing for their enforcement, including through the threat of trade sanctions.

This is the case in the Philippines and in India, which have not signed any TRIPS-plus trade agreements and are therefore only required to implement TRIPS standards of intellectual property protection. Yet the pharmaceutical company Pfizer is challenging the Filipino government’s right to use TRIPS safeguards in an attempt to extend the company’s monopoly on the hypertension drug, Norvasc. The pharmaceutical company, Novartis, which has made progress in some areas regarding access to medicines in developing countries, is challenging public health safeguards in Indian patent law. Furthermore, it is engaged in litigation to enforce a patent for a cancer drug, Glivec, for which generic versions could be available at one-tenth the originator’s price.

Despite pressure from industry and rich-country governments, many developing countries - bolstered by effective civil-society groups and political will - are succeeding in introducing and enforcing TRIPS safeguards. Kenya introduced an Intellectual Property law in 2001 that drastically reduced prices for HIV medicines, and law-makers last year tabled an amendment to this law that would have repealed important TRIPS safeguards. In India, civil-society groups helped introduce TRIPS safeguards, preserving generic competition that is vital to millions of poor people in India and other developing countries.

Unfortunately, some countries that have used TRIPS safeguards in the past have now stopped doing so. Malaysia, which once used compulsory licensing (allowing governments to temporarily override a patent and authorize production of generic copies) to lower the price of antiretroviral drugs (ARVs), has now ceased challenging pharmaceutical companies’ high prices. Countries that remain firm in their commitments, like Kenya and India, are threatened by external pressures.

On the five-year anniversary of the Doha Declaration, there is an urgent need to reinvigorate the spirit that produced the Declaration. The abysmal record of rich countries and the pharmaceutical industry remains a central concern of civil-society groups and developing-country governments. To ensure future access to inexpensive medicines for poor people, Oxfam recommends:

 Five years after the adoption of the Doha Declaration, the WTO review the impact of the TRIPs agreement on the affordability and availability of medicines in developing countries. The review should be supported by independent studies by the WHO and other relevant international organizations, in consultation with governments and public interest groups.

 The USA stop coercing developing countries into adopting ‘TRIPS-plus’ intellectual property protections through bilateral and regional trade agreements, threats of trade sanctions, and the WTO accession process.

 G-8 countries provide technical, political and economic support to poor countries to enact TRIPS safeguards and resist TRIPS-plus rules; encourage WTO talks to ensure that IP rules represent the interests and needs of poor countries; and ensure that the Paragraph 6 solution (which permits manufacturing countries to export generic versions of patented medicines to developing countries with insufficient or no domestic manufacturing capacity) is made workable.

 Rich countries incorporate the Paragraph 6 solution into their own national legislation and provide technical, political, and economic support to poor countries to enact and enforce TRIPS safeguards and resist TRIPS-plus rules.

 Developing countries, including India, China, Brazil, and South Africa, resist TRIPS-plus rules in FTAs, prevent introduction of TRIPS-plus rules in national legislation, and fully implement TRIPS safeguards to ensure production of generic medicines for domestic consumption and for export to other developing countries.

 Pharmaceutical companies stop lobbying rich-country governments to promote stricter intellectual property rules worldwide, and stop pressuring poor countries to accept stronger intellectual property rules that undermine public health.

 UN specialized agencies such as UNCTAD, WIPO, and WHO provide independent technical assistance and support to poor countries to enact TRIPS safeguards.