Agreement At The WTO On Access to Essential Medicines For Developing Countries:

The Pros and Cons of the Agreement

Zusammen mit unseren europäischen Partnern im AEFJN und dem ökumenischen Aktionsbündnis gegen Aids, hat sich das NAD für den Import von generischen Medikamenten, vor allem für die Behandlung der 40 Million Aids-Infizierten Menschen, eingesetzt. Unser Brüssel Büro gibt eine Bewertung des neuen Übereinkommens der WTO. Kritisiert wird, dass das Abkommen

• den Markt für Generika weniger kompetitiv macht

• die Produktionskosten für Generika erhöht

• von die Entwicklungsländer komplexe, bürokratische Prozeduren verlangt.

After long and laboured negotiation, WTO Members on 30 August reached an agreement on access to essential medicines for developing countries. The Decisions spells out the system under which countries without pharmaceutical manufacturing capacity can import generic versions of drugs still under patent. World Trade Organisation leaders have praised the agreement as evidence that the WTO 'free trade system' can meaningfully respond to humanitarian concerns and crisis situations. However, civil society groups have expressed disappointment with the deal claiming that, in the end, it will do little to improve the ease and speed with which developing countries can gain access to much needed cheaper medicines.

The positive aspects of the final Agreement were consistent with our campaign demands on this issue. They include the following:

• Developing countries were able to stop the US and the pharmaceutical lobby from limiting the scope of diseases covered under the agreement. Therefore, Least Developed Countries (LDCs) in particular can use the system to gain access to drugs for any disease they deem necessary in order to protect the public health of their citizens.
• Since the new Agreement explicitly notes that some countries will use the system only for emergencies, it is thus logical that the system outlined under the agreement normally applies to non-emergencies. Therefore, LDCs in particular will (theoretically) be able to employ the system not just in times of extreme emergency, but for routine public health care.

The negative aspects of the final Agreement serve to restrict the actual utilisation of the system for countries who want to import generic medicines and the countries who could to export them. They include the following:

• Shrinking the Market for Generic Medicines: Fearing the impact of competition from generic drug companies on big pharmaceutical corporations, the US sought to protect its monopoly in the pharmaceutical sector (and thus the high prices for essential medicines that the drugs companies can demand as a result) by dramatically shrinking the potential market for cheaper generic drugs--by getting concessions from 45 countries that they will either not use the system at all or will do so only in cases of extreme emergency-thus excluding virtually all markets with meaningful and stable purchasing power. Moreover the promotion of a healthy competitive generic medicines market (and thus the future assurance that cheaper medicines will be available to those countries in need) was further blocked by the Agreement's specific prohibition of the production of generic medicines for industrial or commercial aims. This prohibition serves as yet another disincentive for generic producers to develop and compete in the generic medicines sector.
• Increasing Costs of Production for Generic Medicines: The agreement effectively serves to increase the direct cost of manufacturing generic medicines by its overly stringent anti-diversion standards (in order to make sure that developing countries cannot sell generic drugs in middle or high income countries). Complying with such anti-diversion standards is not a cost-free process and will ultimately serve to drive up the cost of generic drugs.
• Burdensome Procedural Requirements: The Agreement requires a number of complex and bureaucratic procedural requirements to be fulfilled before developing countries can gain access to cheaper medicines under the system.

- Importing countries must submit to a notification and review process whereby developing countries who need to import generics because of incapacity in their pharmaceutical sector will be forced to prove and then defend such determinations to the WTO TRIPS Council. The same conditions will apply to those developing countries who have promised only to use the system in cases of extreme national emergency.

- The determination of "incapacity" and "health emergency" are open to interpretation and dispute, and are thus subject to potentially costly complaints/court cases at the WTO dispute settlement body.

- Finally, in order for developing countries to gain access to cheaper generic medicines, the Agreement stipulates that compulsory licenses must be issued to the potential generic producer first by the developing country in need and then (upon the request of the former) by the home country of that producer-a complex and politically risky process for exporting countries in particular who wish to avoid political and economic retaliation from the US.

9/10/2003