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Intellectual Property in the Context of the WTO TRIPS Agreement: Challenges for Public Health MINISTER of HEALTH Humberto Costa

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Intellectual Property in the Context of the WTO TRIPS Agreement: Challenges for Public Health MINISTER of HEALTH Humberto Costa Intellectual Property in the Context of the WTO TRIPS Agreement: challenges for public health MINISTER OF HEALTH Humberto Costa PRESIDENT OF OSWALDO CRUZ FOUNDATION Paulo Marchiori Buss DIRECTOR OF NATIONAL SCHOOL OF PUBLIC HEALTH Jorge A. Z. Bermudez COORDINATOR OF NUCLEUS FOR PHARMACEUTICAL POLICIES Jorge A. Z. Bermudez Intellectual Property in the Context of the WTO TRIPS Agreement: challenges for public health EDITORS: Jorge A. Z. Bermudez Maria Auxiliadora Oliveira WHO/PAHO Collaborating Center for Pharmaceutical Policies National School of Public Health Sergio Arouca Oswaldo Cruz Foundation A S L U O T R E P O P A P H S O N I O D V I M U N Rio de Janeiro, September 2004 Copyrigth © 2004 ENSP/WHO – Oswaldo Cruz Foundation – FIOCRUZ, Jorge A.Z. Bermudez. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior permission of the National School of Public Health Sergio Arouca. ISBN: 85-88026-16-3 Cover and Graphic Design: Lucia ReginaPantojo de Brito English Translation: Laura Anne Krech Revisions: Claudia Garcia Serpa Osório de Castro Gabriela Costa Chaves Thiago Botelho Azeredo NOTE FROM THE AUTHORS This book presents information produced or compiled by Nucleus for Pharmaceutical Policies professionals and external collaborators regarding the process of implementation of the TRIPS Agreement in developing countries, focusing on its implications for public health policies, particularly those related to access to medicines. Interpretations and views expressed in this publication are solely the responsibility of the authors, not representing any official or institutional position, as to the issues here approached. Center for Scientific and Technological Information/ Library Lincoln de Freitas Cataloging-in-Publication Data 2004 Center for Pharmaceutical Policies (NAF)/ENSPSA/FIOCRUZ Av. Brasil, 4036, rooms 915/916 ZIP Code: 21 040 -361, Rio de Janeiro - Brazil Telephones:+ 55 21 38829023 Fax: + 55 21 22601652 E-mail: [email protected] Authors André Luis de Almeida dos Reis Pharmacist, Master of Science, Doctoral Candidate in Public Health/ National School of Public Health Sergio Arouca (ENSP)/Oswaldo Cruz Foundation (Fiocruz) Professor of Pharmacy at the Estácio de Sá University Researcher, Center for Pharmaceutical Policies (NAF)/ ENSP/ FIOCRUZ. Carlos Maria Correa A lawyer and economist from Argentina, Director of the Centre for Interdisciplinary Studies on Industrial Property and Economics Law, at the University of Buenos Aires. Member of the WHO Commission on Intellectual Property Rights, Innovation and Public Health. Egléubia Andrade de Oliveira Social Worker, Master of Social Work (UFRJ), Doctoral candidate in Public Health Health/ National School of Public Health Sergio Arouca (ENSP)/Oswaldo Cruz Foundation (Fiocruz) and intern at the Center for Pharmaceutical Policies (NAF)/ ENSP/ FIOCRUZ. Gabriela Costa Chaves Pharmacist, Masters candidate in Public Health/ National School of Public Health Sergio Arouca (ENSP)/Oswaldo Cruz Foundation (Fiocruz) and intern at the Center for Pharmaceutical Policies (NAF)/ ENSP/ FIOCRUZ. Germán Velasquez Economist, PhD in Economy. Coordinator of the Drug Action Programme/ World Health Organization (WHO). Jorge A. Z. Bermudez MD, Master in Tropical Medicine, PhD in Public Health. Senior Researcher and Director of the National School of Public Health Sergio Arouca (ENSP)/Oswaldo Cruz Foundation (FIOCRUZ), General Coordinator of the Center for Pharmaceutical Policies (NAF)/ENSP/Fiocruz, WHO/PAHO Collaborating Center for Pharmaceutical Policies, Rio de Janeiro, Brazil. Maria Auxiliadora Oliveira MD, Master in Tropical Medicine, PhD in Production Engineering. Researcher and Assistant Coordinator of the Center for Pharmaceutical Policies (NAF), National School of Public Health Sérgio Arouca (ENSP), Rio de Janeiro, Brazil. Maria Telma Oliveira Pharmacist, Master of Science from the Chemical Institue of the Federal University of Rio de Janeiro (UFRJ). Post-graduate specialization in Medicines and Cosmetics at the National School of Public Health Sergio Arouca (ENSP), Rio de Janeiro, Brazil. Rogério Luiz Ferreira Pharmacist, Post-graduate specialization in Public Health, Masters candidate in Public Health/National School of Public Health Sergio Arouca (ENSP)/Oswaldo Cruz Foundation (Fiocruz) and intern at the Center for Pharmaceutical Policies (NAF)/ ENSP/ FIOCRUZ. Ruth Epsztejn Bachelor’s degree in Production Engineering (UFRJ - 1977), Masters in Production Engineering (COPPE – 1988) and Doctorate in Production Engineering (COPPE – 1998). Coordinator of the Production Engineering course at CEFET/RF (1998-2003), Department Head of CEFET/RJ (1999-2003), CNPq DTI fellowship recipient for the project “Strengthening Rio’s Metros (Fortale- cimento da Rio-Metrologia)” from the Rio de Janeiro Technology Network (2003 until present). Thirukumaran Balasubramaniam Graduated from the University of Pennsylvania with a B.A. in Economics and a Minor in European History. Worked at the Consumer Project on Technology (CPTech) mainly on issues related to health care and intellectual property. He then joined the World Health Organization in Geneva as a technical officer in the Department of Essential Drugs and Medicines Policy dealing with access to medicines and intellectual property. After WHO, he worked at Health Action International in Colombo, Sri Lanka. Currently, he is CPTech’s Geneva Representative. Foreword The Brazilian pharmaceutical market is one of the world’s ten largest with a yearly income totaling close to US$ 10 billion and characterized by a high concentration of transnational companies, mainly when segmented by therapeutic class. Ministry of Health expenditures for four different categories of medicines represent one tenth of the total market value, equivalent to US$ 1 billion. Examination of the implications of intellectual property rights on access to medicines is a recent development in the field of public health Not long ago, this topic was confined to economists and lawyers specializing in intellectual property. The 49th World Health Assembly, which was held in May 1996, changed this by bringing the consequences of globalization and trade agreements on access to medicines to the forefront. In that year the World Health Assembly adopted the “Revised Medicine Strategy” resolution to be incorporated into WHO medicines policy, which included gathering “information on the impact of the World Trade Organization on national policies for essential medicines”. Following the adoption of the resolution, WHO’s Essential Medicines Action Programme developed an action plan with the following points: 1. Identification of WTO agreements related to access to essential medicines and pharmaceutical policies, with subsequent notification to Member States of their existence. 2. Study of the implications of globalization on innovation, development, production, trade and prices of medicines; with the purpose of identifying possible negative effects that the TRIPS Agreement and/or other trade agreements have on access to essential medicines. 3. Notification of Member States on the need to adopt measures to protect public health. There is no doubt that the adaptation and implementation process of the TRIPS Agreement has had an impact on the pharmaceutical sector as well as on access to medicines. Among the consequences, it is important to highlight the delay in introducing competing generic medicines to the market. In essence, patent protection creates a monopoly of exploitation rights for the patent owner. In the case of TRIPS, exclusive exploitation rights extend for twenty years. As liberal economics has demonstrated, the lack of competition results in a lack of stimuli to lower prices, which therefore remain high and end up compromising public policies aiming to expand access to medicines. One cannot ignore the fact that the extension of monopoly rights for such long periods of time inhibits local production, even when countries have the industrial capacity. In Brazil, discussion of the implications that trade agreements have on public health is firmly established in the government’s agenda and has resulted in specific actions. I am sure that the countries in this region also welcome industrial policies that promote social justice and equity for their populations. The government is taking action to help the pharmaceutical sector overcome its current external economic and technological dependence through investments and capacity building, with a special emphasis on the official network of public laboratories. Also, expansion of access will count on integrated actions and distribution decentralization. The recently inaugurated Popular Pharmacy Program (Programa Farmacia Popular do Brasil) represents a further step in the direction of ensuring access to low cost medicines. Additionally, we have the fundamental concern of doing our best to reduce the costs of medicines within our National Health System (Sistema Unico de Saude). Its mandate include universal access to medicines. Nevertheless, it is still necessary to continue to thoroughly examine all possible alternatives to effectively meet social policy needs. Publications such as this one bring to light background conflicts between social and economic policies and contribute to inform different groups of persons in a globalized world who need information to act with caution, maturity and directed towards the public
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