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Inter Press Service
HEALTH-TRADE: Low-Cost Medicine Debate Grips WTO, WHO
Gustavo Capdevila
March 28, 2001
GENEVA, Mar 28 (IPS) - Poor countries and transnational pharmaceutical firms are wrangling over the question of access to inexpensive medications, a controversy that has entangled the two international bodies governing health and trade, the WHO and the WTO, respectively.

The World Health Organisation (WHO) and the World Trade Organisation (WTO) acknowledge that global debate is heating up in regard to the compatibility of trade regulations and the ethical principles concerning the right to medical treatment, especially in those countries hard hit by the HIV/AIDS pandemic.

The contradictions entailed will be on the table for all to see during the World Health Assembly, May 14-22 in Geneva, because Brazil and South Africa are going to demand that the WHO member nations emit a declaration in favour of low-cost access to drugs for treating specific diseases.

The Brazilian and South African governments are currently involved in cases brought before national and international tribunals, where they defend what they insist is their right to protect the access of their poorest populations to economically-priced medicine.

South Africa faces a legal challenge from 39 transnational pharmaceutical firms that question the legality of the national medication policy adopted by the government.

In the case of Brazil, the United States convinced the WTO to set up a panel that is to rule on whether the health provisions of the South American country are in line with international trade norms.

Washington filed the complaint with the WTO on behalf of US- based pharmaceutical laboratories that claim damages arising from Brazil's granting of licenses, without the consent of the patent- holders, to manufacture medications at lower cost.

The US-sponsored litigation threatens Bras´┐Żlia's efforts to fight HIV/AIDS, which include providing free medical treatment for people who test HIV-positive, says the Paris-based non- governmental organisation (NGO) Doctors without Borders in a declaration of support for Brazil.

The WHO has not yet stated an opinion on the Brazilian case, but sources consulted by IPS indicated that the United Nations health agency would speak out before the upcoming World Health Assembly, its maximum governing body.

But the WHO has publicly stated that South Africa's national measures regarding medications represent "a good public health policy."

WHO director-general Gro Harlem Brundtland has pointed out that her institution worked with the South African authorities to prepare the national drug policy, the same one the pharmaceutical companies are now condemning.

Meanwhile, the director-general of the WTO, Mike Moore, maintained that the solution to the problem lies in a balanced approach that respects the protection of intellectual property rights over pharmaceutical products and access for poor people to affordable medications.

But the root of the problem can be found in one of the 18 treaties that make up the WTO legal system, the Agreement on Trade- Related Aspects of Intellectual Property Rights, known as TRIPS.

Because of its regulations on access and prices of critical products like medications, TRIPS has earned severe criticisms from developing countries. Two India-born economists living in the United States, Jagdish Bhagwati, a former professor at Colombia University, and T.N. Srinivasan, of Cornell University, have gone so far as to say that TRIPS has no place within the WTO. In the process leading up to the failed 1999 WTO ministerial conference in the US city of Seattle, the Venezuelan government had proposed freeing up patent rights on all essential drugs.

The TRIPS Council, a WTO body that oversees implementation of the accord, begins sessions Monday with Zimbabwe's Boniface Guwa Chidyausiku presiding. Developing countries are preparing to focus the debate on access to reasonably priced medicines.

In response to the international doubts and controversies on the matter, the WTO and the WHO decided to organise a workshop on the matter in Norway, April 8-11. The basic objective of the meeting, sponsored by the Norwegian government, will be to improve access of the poorer sectors of developing countries to essential medicines, but without altering the framework of trade regulations governing intellectual property.

At the workshop "Differential Pricing and Financing of Essential Drugs," representatives from drug companies, NGOs and governments are to assess the viability of a differentiated pricing system that makes essential pharmaceuticals affordable for developing countries but would prevent these low-cost drugs from being sold in wealthier countries.

To finance such a system would mean turning to a range of resources, such as foreign debt relief, contributions from the countries involved and foreign aid, as well as the involvement of the private sector - as is occurring in South Africa, where some companies cover the medical costs of their employees with HIV/AIDS.

It is not necessarily true that the TRIPS agreement causes drug prices to rise in developing countries, according to sources at the WHO. Pharmaceuticals were already expensive in those countries prior to the approval of the accord in 1994.

Nevertheless the future WTO chief, Thailand's Panichadpki Supachai, reportedly has made TRIPS reform an agenda priority. Supachai is to replace New Zealander Moore at the helm of the WTO in September 2002.