Health Equity Project

The Basics of Intellectual Property Rights Laws and
Their Impact on Health Care in Developing Countries

The health of poor people in developing countries continues to be jeopardized by patent monopolies on medications, in which international trade laws inhibit access to generic drugs for HIV, tuberculosis, malaria, and many other diseases that could otherwise easily be treated.

Though efforts have been made to push the prices on life-extending AIDS medications down by creating competition with generic drugs, this has been impinged on by the priority that international economic institutions like the World Trade Organization continue to place on protecting intellectual property rights.

Intellectual property rights – the rights given to individuals over the products of their creation – are intended to encourage innovation by ensuring inventors the sole profits on their creations, but more often than not this translates into little to no access to essential medicines for those who can’t afford the name brand drugs, which can be priced at more than 15 times the price of their generic counterparts.

The Uruguay Round of the World Trade Organization established a 20-year patent law for all new pharmaceutical products in 1994, forcing all member countries to prohibit the sale of the generic version of patented drugs. This Agreement on the Trade Related Aspects of Intellectual Property Rights (TRIPS) ravaged the developing world by forcing countries to either accept the going price for patented drugs or risk violating the international trade law by buying the generic versions.

The adverse effects this agreement had on international public health were pretty widely acknowledged, however, and the TRIPS agreement was revised with the issuing of the Doha Declaration on TRIPS in November 2001.

The Doha Declaration, made at the 4 th round of WTO talks in Doha, Qatar, proved a watershed for public health, by setting a priority for public health over big business. This declaration clarified the original TRIPS agreement to allow governments the freedom to override patents on drugs that are priced out of the range of the people who need them, and import generic drugs without the fear of retribution.

The catch is that these governments must prove to the WTO that there is a genuine need for the drug, that their domestic pharmaceutical industry is unable to produce the drug on its own, and that the drug will only be for public, non-commercial use. This can often mean unnecessary red tape for governments trying to attain drugs for people in health crises, and the vague language of the declaration leaves the governments of developing countries at the mercy of the WTO’s TRIPS Council, which makes the judgment on whether there is a real “need” for a certain drug.

The Doha Declaration is a step forward, even if it isn’t perfect. But now the U.S. government has been taking actions to sidestep the WTO altogether and make IP agreements with countries on its own, through organizations like the Central American Free Trade Agreement (CAFTA), and NAFTA, and also through individual agreements with specific countries, as in the case of Thailand. These agreements completely undermine what the Doha Declaration was meant to protect – public health rights for the world’s poor.

The U.S. government argues that intellectual property rights encourage innovation by allowing the inventor to reap the benefits of his invention. The United States’ stance is a direct result of the heavy lobbying the major pharmaceutical companies have done in Washington for stronger patent protections. But the inventors being protected with these patents won’t be profiting from a country where none of its people can afford the drug at the branded price in the first place.

Decisions being made by international trade bodies clearly reflect the interests of the rich, developed countries, and only reinforce the already widening gap between the wealthy and the poor, a gap that only stands to exacerbate the lack of adequate health care for those who need it most.

We at HEP believe that health care is a human right, and human rights supercede corporate interests.

We recognize that high prices for medications is just one of the many problems that developing countries face in providing adequate health care, in addition to lack of infrastructure, education, etc. But the bottom line is that more people will be able to obtain medicines at lower prices.

We therefore advocate that all member countries of the WTO uphold the essence of the Doha Declaration on TRIPS consistently throughout their trade policies. Countries can’t shirk the commitment they made to public health with the Doha Declaration by going outside of the WTO with bilateral or multilateral trade agreements on intellectual property.

We also call upon originator pharmaceutical companies that are creating patented drugs to give price breaks to the most vulnerable populations in developing countries and to make their drugs available through local distributors in those countries to ensure availability.