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 Since 1996, people with HIV and AIDS who live in well resourced countries have been able to benefit from taking a combination of HIV antiretroviral drugs (ARVs). These drugs, although not a cure, have resulted in an enormous decrease in the number of people dying from AIDS-related illnesses in such countries as the USA and the UK. Also, many people who were seriously sick are now reasonably well, and some people have been able to return to work for the first time in many years. Pressure from governments, political organisations, people living with HIV and HIV activists, has lead to major price reductions in the cost of these ARVs in developing countries. Price was always a major barrier to accessing ARVs in Sub Saharan Africa, and drug prices fell on average by 85% between 2000 and 2002. The price of generically produced drugs is even lower, this being due to changes in international trade laws and pressure being placed on pharmaceutical companies. The financial momentum has also increased recently, with an increase from just over US$300 million in 1999 to nearly US$3 billion in 2002 in global HIV/AIDS resources1. There are some programmes and initiatives in Africa that are trying to expand ARV access by providing money or by expanding the ways and means by which ARVs can be obtained. The Accelerating Access Initiative The Accelerating Access Initiative (AAI) was established in 2000. It is a public-private partnership of UNAIDS, the World Health Organisation, UNICEF, the UN Population Fund, the World Bank and six pharmaceutical companies, including GlaxoSmithKline and Merck. Their commitment is to broaden access while ensuring rational, affordable, safe and effective use of drugs. One of the ways the pharmaceutical companies are contributing to this is to further reduce the prices of their branded HIV drugs. By March 2002, the six pharmaceutical companies had supplied drugs to 35,500 people in Sub-Saharan Africa2. This initiative clearly has a long way to go before it can make an impact on the millions in need of ARVs in Africa. The Global Fund for HIV/AIDS, Malaria and TB The idea of a Global Fund, contributed to by the countries of the world and private organisations, was thought up in 2001 by Kofi Annan, Secretary General to the United Nations. Of the 28 countries that had their proposals from the first round of bidding accepted, 20 (over 70%) included money for ARVs. The first round proposal form did not request specific data from applicants on how much money would be spent on ARVs, nor how many people would be placed on ARV treatments. However, in a country such as Malawi, resources from the Global Fund are expected to expand current ARV treatment from 1,000 to 40,000 people over the next five years. Though the Fund has made a major contribution to expanding access to treatment, it remains out of reach to hundreds of thousands of people living with HIV/AIDS. US$ 3.2 billion has been pledged to the Global Fund since its establishment in 2001. However, not all of that money has been received, and some countries pledged one amount over a period of years. The actual figure that has been paid out to HIV/AIDS projects across the world is only just over US$7m, as of mid-2003, but not one of those projects is in Sub-Saharan Africa. The amount that the Fund has committed to all projects, and that have been signed, stands at US$355m. Many Sub-Sahara African countries have signed their agreements and are waiting to get the money, so they can begin their respective projects. The Fund has strict auditing procedures and this inevitably delays the disbursement of funds. The hope in the beginning was that the Fund could make US$10 billion per year; however, only one third of that amount has been pledged in the two years since its establishment, so it makes it hard to see how the Fund can ever achieve that annual figure. In principle though, the Fund can still make a massive difference to combating all three diseases around the world, and has recently made its second round of grants. More money though is needed if its work is to continue. The Gates/Merck Botswana Project Another African initiative is happening in Botswana, under a partnership between the pharmaceutical company Merck, the government and the Bill and Melinda Gates Foundation. The Gates Foundation donated US$50m in 2000, as did Merck, to spend a total of US$100m over five years. The goal of the programme is not just drugs provision, but also awareness, prevention, diagnosis and care. The Clinton Initiative The William J. Clinton Presidential Foundation HIV/Aids Initiative has negotiated a deal in October 2003 with four generic drug companies, to provide low-cost Aids drugs in the developing world. The Foundation has negotiated the price reduction with four companies, Cipla, Ranbaxy, Matrix and Aspen, to supply the individual components of the combination to antiretroviral programmes in Mozambique, Tanzania, Rwanda and South Africa and nine Caribbean states. The agreement cuts the price of a triple-drug treatment to about 38 cents (22p) a day. The Foundation said the plan would get cheaper drugs to about 2 million people by 2008. Under the deal brokered by the Foundation, the four companies opened their books to a group of Clinton Foundation advisers, who then worked with the companies to cut costs. Patented versions of the treatment cost at least $1.54 per day. The triple combination of AZT/3TC and Nevirapine negotiated is expected to cost $132 a year. It is also hoped that negotiations with Merck, manufacturer of Efavirenz, would also secure a lower price for Efavirenz. The Bush Initiative President Bush has pledged US$15b over five years (2004 - 2008) to fight HIV / AIDS, $10 billion of which is said to be new money. The money is to be spent primarily in fourteen countries. Twelve African and two Caribbean countries are on the list. The United States has committed itself to reducing mother-to-child transmission of HIV by 20% by 2005 and by 50% by 2010. They also aim to provide anti-retroviral medication, with the targets of treating 500,000 people by October 2005, one million people by October 2006, and two million people by the end of 2007. Much of this funding is to be spent through US governmental agencies, predominantly USAID. The money is to be divided so that.
For more information on the Bush Initiative and other sources of funding for HIV/AIDS, please click here There are also the efforts of private employers, who are buying ARVs and providing them to their HIV+ workers who are in need of them, often supplying them to the workers' families also.
What is TRIPS and why is it important? The agreement on Trade Related Intellectual Property Rights (TRIPS), seeks to impose international norms for patent protection and guarantees royalties to companies. When countries sign up to the World Trade Organisation (WTO), they also sign up to protect the patent rights of companies who sell products within their country. With respect to drugs, the major difference between TRIPS and previous multilateral agreements is that TRIPS requires countries to grant patent protection to pharmaceutical products for a minimum period of 20 years. Companies who have patents over their products see this as an essential element in international trade, as it guarantees them income in return for the investment they have made in the development of the drugs. However, in the case of the pharmaceutical companies, many people perceive it as putting profits before patients. In November 2001, the WTO met in Doha in Qatar. They agreed that the WTO Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) 'does not and should not prevent Members from taking measures to protect public health�we affirm that the agreement can and should be interpreted and implemented in a manner supportive of WTO Members' right to protect public health and, in particular, to promote access to medicines for all'. Their statement goes on to say that 'we reaffirm the right of WTO members to use, to the full, the provisions in the TRIPS Agreement, which provide flexibility for this purpose.' This is a clarification that countries can issue compulsory licenses and decide their own rules on parallel importing, without fear of legal challenges from other WTO members, if on the grounds of public health. What is Parallel Importing? Parallel importing involves purchasing drugs from a third party in another country, rather than directly from the manufacturer, and taking advantage of the fact that pharmaceutical companies sometimes charge significantly lower prices in one country than in another. For instance, in Britain the list price for GlazoSmithKline's Retrovir is �125, but you can purchase the same drug imported from other European countries for as little as �54. Geographical price fluctuations for the same product can be influenced by many factors. These can include differences in intellectual property rules, in local incomes, and in the degree of competition among producers. For example, in South Africa, the drug Fluconazole is available for US$8.25 per 200mg. In Thailand, where the drug is not patented and is subject to market competition, a generic version of Fluconazole is available for US$0.25 per 200mg. A 1998 study by the Consumer Project on Technology found prices for GlaxoSmithKline's version of Amoxil was $8 in Pakistan, but was $36 in Malaysia. In April 2001, two Indian generic drug manufacturers, Cipla and Hetero, announced that they were offering a triple therapy of lamivudine, stavudine and nevirapine for US$350 per person per year to government's and NGO's. By permitting some form of parallel imports, countries can shop around to obtain better prices, using market forces to lower national expenditures on a range of goods, including pharmaceuticals. Since the creation of the WTO in 1995, the United States Government has been extremely aggressive in attacking parallel imports by other countries. Parallel importing of generic drugs is also possible. For many countries, particularly in Africa, parallel importing is frequently the most effective way to improve access to essential drugs, due to the lack of knowledge to produce their own drugs and the inability to obtain the necessary raw materials. In an agreement reached in Geneva on Aug 30 2003, the WTO membership accepted a declaration stating that poor nations unable to produce the drugs they need to address their public-health problems can waive the intellectual property provisions of WTO rules and import low-cost generic drugs from abroad. Previously the WTO allowed member countries to license companies to make patented products or use patented processes without the permission of the patent owner if the products were needed to address important public-health problems, an action known as 'compulsory licensing'. However, under WTO rules, drugs manufactured through compulsory licensing had to be produced predominantly for domestic use and not for export. This meant that poor nations, most of which do not have the capacity to produce modern pharmaceuticals, could not obtain the drugs they needed by arranging compulsory licensing in another country from which the drugs could then be imported. Under the new agreement, member countries will be able to use compulsory licensing to produce drugs for export to poor nations that lack the capacity to manufacture sufficient quantities of the needed drugs at home.3 What is Compulsory Licensing? Compulsory licensing is the term given to the manufacture and use of generic drugs without the agreement of the patent holder. A patent is a legal title granted by government allowing for the production and sale of an invention or discovery, usually for a set time period. The understanding of the concepts of compulsory licensing and patenting go hand in hand. Even though countries sign up to the World Trade Organisation and are therefore expected to protect the patent rights of companies, they are allowed, under certain conditions, to issue compulsory licenses against the will of the patent holder. For example, if HIV rates in a country are particularly high, the government could decide that it is in the public interest to ensure that appropriate drugs are manufactured locally and made available at a cheaper price. However, compulsory licensing only was relevant for those countries where they could allow companies based in that country to manufacture generic copies, as compulsory licensing would not allow for drugs to sold overseas. Under the new agreement from the WTO, reached in August 2003, member countries can use compulsory licensing to produce drugs for export to poor nations that lack the capacity to manufacture sufficient quantities of the needed drugs at home. However, agreement was only reached after the US accepted assurances from developing countries that they would not bend the rules for commercial objectives. Not everyone is happy with the new agreement. A number of non-governmental organisations, such as M�dicins Sans Fronti�res and the Consumer Project on Technology, which have long campaigned for greater access to medicines for the developing world, have condemned the agreement, arguing that it places such burdensome regulations on compulsory licensing that it will make it harder, not easier, for developing nations to get the drugs they need. The industry says the regulations are needed to keep unscrupulous manufacturers from flooding western markets with cheap generic drugs made in the developing world under compulsory licensing.4 However, if generic producers are not allowed to make drugs for commercial objectives, where does that leave those companies who are producing copies at the moment? An article in the Guardian newspaper states that, 'The undertaking that the Doha get-out clause, allowing the overriding of patents, should not be used for commercial advantage meant that generics companies such as Cipla in India, which undercut the multinationals to offer Aids drugs for less than $300 (�190) a year and forced the big companies to bring down their prices, would have no incentive to produce cheap copies.'5 Which other countries are involved in Compulsory Licensing and Parallel Importing? India, Brazil and Egypt all import cheap drugs or make cheaper generic versions. All three countries have been threatened with trade sanctions by member WTO countries over the last few years for failing to strengthen patent rules dictated by the PhRMA (Pharmaceutical research and Manufacturers of America) In India, 'Cipla' and 'Ranbaxy' produce generic drugs. In 1970, India passed a Patent Law, whereby local companies could copy patented drugs, providing the altered the process of making them. In Egypt, 90 per cent of drugs are produced locally, and in India the figure is 70 per cent. Both Argentina and Thailand also produce their own drugs. Brazil has been one of the most successful developing countries in cutting its HIV and AIDS rates. They achieved this by invoking national emergency measures so as to allow local companies to manufacture low cost copies of anti-retroviral drugs. Brazil has been held-up as a shining light in the provision of care for people with AIDS. Since 1996, it has halved the AIDS death rate and cut the number confined to hospital by 80 per cent. It has done this by importing cheap drugs from India and by manufacturing its own drugs. The Doha Declaration When the WTO met in Doha, Qatar, in November 2001, they addressed the issue of compulsory licensing. When explaining the flexibilities of TRIPS, the Doha declaration says, 'each member has the right to grant compulsory licenses and the freedom to determine the grounds upon which such licenses are granted. Each member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crises, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a national emergency or other circumstances of extreme urgency.' If a country cites national emergency, they can issue compulsory licenses without prior negotiation with the patent owner, and their reasons for citing national emergency cannot be challenged by other member states. The lack of manufacturing infrastructure in many poorer countries was an issue that was addressed at the Doha meeting. The WTO recognised that some member countries did not have the capacity to manufacture pharmaceuticals and therefore would not be able to issue compulsory licenses. The WTO therefore, 'instruct(ed) the Council for TRIPS to find an expeditious solution to this problem and to report to the General Council before the end of 2002.' It was also agreed that least developed countries (LDC's) could have until 2016 to comply with TRIPS. This was a ten-year extension from the original deadline of 2006. What has happened since the Doha Declaration in 2001?
The WTO then met at the end of December 2002 at WTO headquarters in Geneva, Switzerland, with the hope of concluding this debate. Intensive negotiations however did not solve the issue of which diseases would be covered by the draft decision. The issue of least developed countries importing cheap generic copies was not resolved either. The United States blocked the deal because of concerns from US drug companies that the definition of drugs that could be copied should be as narrow as possible, and would only include HIV, TB and malaria. Other members wanted a much broader interpretation of the Doha declaration. The Director General of the WTO, Dr Supachai Panitchpakdi, said that 'failure to meet the deadlines in these negotiations has been quite disappointing. Nonetheless, delegates have informed me of their commitment to continue to work to find agreement in these complex and difficult negotiations. I am hopeful a solution can be found in the early part of 2003.' Subsequent trade talks broke down in the last week of February 2003, after the US, under pressure from its powerful pharmaceutical lobby, rejected revised proposals. Diplomats said it was unlikely that a compromise would be reached before September 2003, when WTO trade ministers gathered in Cancun, Mexico, for their biennial meeting, because agreement was probably now only possible on the highest level. The current position The final solution however, was found in Geneva on Aug 30th 2003, a few weeks before the Cancun meeting. The statement addresses the public health problems initially addressed in paragraph 1 of the Doha Declaration, which stated that WTO ministers 'recognise the gravity of the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, TB, malaria and other epidemics.' The WTO membership accepted a declaration stating that poor nations, unable to produce the drugs they need to address their public-health problems, can waive the intellectual property provisions of WTO rules and import low-cost generic drugs from abroad. The agreement covers any member country who wants to export pharmaceutical products made under compulsory licences within the terms of the agreement. All member countries are eligible to do so, but 23 developed countries stated that they would voluntarily not use the system to import. Chairperson of the General Council Carlos Perez del Castillo said that, 'the decision will be used in good faith in order to deal with public health problems and not for industrial or commercial policy objectives, and that issues such as preventing the medicines getting into the wrong hands are important.'6 The decision covers patented products or products made using patented processes in the pharmaceutical industry. Section 4 of the decision states that, 'eligible importing members shall take reasonable measures within their means�to prevent re-exportation of the products.' This was an important criteria of the agreement for the richer countries, as they were worried about a 'flow-back' of cheap generic drugs into richer western markets. Some organisations and NGOs are concerned about wording in the agreement emphasising that the statement applies to drugs needed to treat the diseases specified in the Doha Declaration. In the declaration, the ministers specify public health problems "resulting from HIV/AIDS, tuberculosis, malaria and other epidemics". The concern among some activists is that this wording was put in place so that pharmaceutical companies will be able to argue that the new compulsory licensing rules apply only to these three diseases and the occasional infectious disease outbreak.7 Other concerns centre round the fact that the US insisted in the August 30th agreement that countries who issue compulsory licenses would not bend the rules for 'commercial gain'. This leaves the door open for patent holders to reign in any country or company it feels is breaking this rule. In a statement, UNAIDS 'urges that the arrangements under the 30th August Decision of the Council for TRIPS (Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health) be implemented in the most flexible manner possible, so that developing countries can utilise the system easily and efficiently in their efforts to ensure greater access to HIV medicines for their people.'8 Whilst it is too soon after the declaration to see how it will work in practice, we hope that it can be interpreted effectively enough so as to allow developing and least-developed countries to gain access to cheap generic drugs to fight the different diseases affecting their people. The attention that has been given to anti-HIV drugs in Africa has given many people false hope that they will have access to them. The vast majority of people in Africa do not have the opportunity to take these drugs, and many will not even be able to afford the cheaper generic drugs, let alone the discounted brand name ones. Many African governments have very limited health budgets, and spending per person cannot cover even the very lowest prices that the pharmaceutical companies are offering the drugs for. There is also the problem of people in Africa presenting with HIV when their immune systems are already severely damaged. When people are already experiencing severe opportunistic infections, and there are not the resources to treat these infections, then it becomes more difficult to effectively administer the HIV drugs. This can alter people's perceptions of the effectiveness of the drugs, as they see the high mortality rates and perceive that the drugs do not work. Access to prevention information, care services and treatment for opportunistic infections remains severely limited. There needs to be a commitment by developed and developing governments to address the issue of having adequate health infrastructures, sustainable funding and simplifying drug protocols. Please click here to read our page that explains what is going on in Sub-Saharan Africa with regard to how many people are accessing ARVs. This page was written by Ben Hills-Jones and Annabel Kanabus References 1Data taken from 'A Commitment to Action for Expanded Access to HIV/AIDS Treatment', International HIV Treatment Access Coalition, December 2002, p.2 2'Partnership for Action: a Progress Report on the Expansion of Access to HIV care and Treatment in Africa since May 2000 by the Companies Involved in the Accelerating Access Initiative', Accelerating Access Initiative, 2003 3 The Lancet, Vol 362, No. 9386, Sep 6th 2003 4 The Lancet, Vol 362, No. 9386, Sep 6th 2003 5 'Last-minute deal on cheap drugs', The Guardian, 28/08/03 6 WTO press release, 'Decision removes final patent obstacle to cheap drug imports', www.wto.org, 30/08/03 7 The Lancet, Vol 362, No. 9386, Sep 6th 2003 8 Statement of the Joint United Nations Programme on HIV/AIDS (UNAIDS) at the Fifth WTO Ministerial Conference Cancun, Mexico 10-13 September 2003. |
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Since 1998, treatment activists have been increasingly concerned about the effect of international trade laws, such as the agreement on Trade Related Intellectual Property Rights (TRIPS), which they believe are restricting access to HIV-related medications as well as other essential drugs, due to the effect they have on the prices of drugs. In March/April 2001, these issues were the subject of increasing debate because of a court case in South Africa, between the South African government and the 39 largest pharmaceutical companies in the world.
WTO members have been trying to come with a solution to the questions, which were raised at the Doha conference, of how developing countries with no drug manufacturing capabilities can access generic drugs and exactly which drugs will be included in the agreement? Article 31(f) of the Agreement on Trade-Related Aspects of Intellectual Property Rights states that production under compulsory license must be predominantly for the domestic market. This therefore prevents countries with no ability to produce generic copies of HIV drugs from importing from countries that do have these drugs. A deadline date of December 2002 was given to come up with a solution.