A compromise deal

Developing countries choose the best available deal at the point when any further resistance would have cemented the tacit collusion between the U.S. and the E.U. in imposing the weakest political mandate on the campaign for essential drugs.

AS the worldwide campaign for access to essential medicines gained an irresistible momentum over the last two years, officials overseeing the application of the World Trade Organisation's (WTO) agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) were clearly at a loss for a credible response. The enormous profits earned by multinational corporations that held the patents to certain essential medicines, especially for the treatment of the HIV/AIDS (Human Immunodeficiency Virus-Acquired Immune Deficiency Syndrome) pandemic, were construed by the vigorous lobby of advocacy groups involved in the struggle as a standing reproach to the TRIPS regime. As the Doha Ministerial conference opened, this epic battle provided the backdrop for a subtle game of manoeuvre between the two main powers in the WTO, as they sought to neutralise a determined effort by developing countries to mitigate the rigours of the TRIPS regime in the interests of public health.

The draft declaration that was circulated among member-states prior to the conference (the Harbinson text) put forward two declaratory options on addressing the issue. Option one, which was advocated by India, Brazil and other developing countries, declared that nothing in the TRIPS agreement shall prevent members from taking measures to protect public health. The second option, promoted in the main by the U.S., was a weaker formulation, which affirmed that members were at liberty to use to the full the provisions in the TRIPS agreement which provide flexibility to address public health crises such as HIV/AIDS.

For the many non-governmental organisations (NGO) that were participating in the Doha deliberations, the issue touched at the very root of the WTO's legitimacy. Mike Moore, WTO Director-General, while calling for purposive action on this front, conceded that the issue was a potential deal-breaker.

The European Union (E.U.) was anxious to show sensitivity, although it remained torn by conflicting perceptions among its member-states. The halfway solution it proposed was to establish a system of tiered (or differential) pricing, which would encourage drug manufacturers to sell at relatively lower prices to the poorer countries. But this, E.U. spokespersons said, would require a reciprocal commitment from developing countries to bar the re-export of drugs obtained at concessional prices.

Developing countries thought this supposed compromise was no more than a consecration of ad hocism, which did not even remotely approach the fundamentals of a systemic problem. Commerce Minister Murasoli Maran, in his address to the opening plenary session, unequivocally declared India's commitment to the first option. Availability and affordability of essential medicines is a universal human right, he said: WTO should not deny that right. In contrast, U.S. Trade Representative Robert Zoellick likened the clause that India was urging to an effort to eviscerate the TRIPS agreement through an exception for vague public health objectives.

The U.S. was prepared to back up its endorsement of the second option with two concrete recommendations: a 10-year extension for least-developed countries to bring their pharmaceuticals patent laws in line with TRIPS, and a five-year moratorium on challenges within the WTO to any effort that sub-Saharan African nations may undertake to tackle HIV/AIDS and other health crises such as measles and tuberculosis. Brazil was quick to put on record its opposition to the augmented U.S. proposals. "We need a political signal to ensure that we can do what the U.S. and Canada have just done (in providing low-priced doses of antibiotics to combat the anthrax scare)," said Celso Amorim, Brazilian Ambassador to the WTO. The significance of this political signal would lie in its future legal and juridical value.

Amorim pointed out that the U.S. proposals when not restrictive would be redundant. Brazil has launched a very successful HIV/AIDS therapeutic programme based on cheap generic drugs manufactured locally. The U.S. took this alleged infringement of patents by Brazil to the WTO but withdrew the case under intense public pressure. This retreat, although motivated in the main by the need to avoid public opprobrium, also spoke of a shrewd strategic sense, since it effectively meant that an opportunity to develop case law on TRIPS standards and the public interest was lost. And as attention was momentarily diverted, the U.S. regrouped and made another effort to circumscribe the latitude that TRIPS afforded WTO members, even in dire public health emergencies.

The case made out by India and Brazil was bolstered by other developing countries. With its endemic HIV/AIDS problem, South Africa tilted strongly towards option one, as also most of Africa and parts of Europe that are in the midst of troubled transitions to market principles.

The E.U. in another miscued effort at bridging differences suggested that a compromise could be found by defining the circumstances under which the public health clause could be used to override patent rights. Though open to negotiations on the issue, developing countries insisted that this was a matter of detail, which could not be addressed in a Ministerial Declaration.

The matter was referred on day three of the Ministerial conference to a nine-member sub-committee. A compromise text was worked out late that night, mainly in consultations between Brazil and the U.S. It was referred on the following day to a wider committee.

On November 13, as the WTO Ministerial remained deadlocked, campaigners for the right to essential drugs were celebrating a success. An agreed text had been transmitted through all the WTO's byzantine processes to the Ministerial plenary. This text reflected a broad if somewhat ambiguous consensus. It stated that the TRIPS agreement did not and should not prevent members from taking measures to protect public health. Developing countries as also the NGOs that had rendered them invaluable sustenance, were not entirely satisfied. To say that TRIPS does not prevent members from protecting public health, they said, is a negation of facts.

Similarly, they said, to say that the members should utilise all available flexibilities within the TRIPS agreement to safeguard public health, was too weak a formulation, not amounting to a legally binding commitment or obligation. The word in expert estimation only amounted to a best endeavour clause and did not confer the strong mandate that public health contingencies demanded. Maran reprised this theme at the concluding plenary, where he likened the public health obligation placed on governments to the biblical injunctions that are couched in the imperative 'shall' rather than 'should'.

But even the strongest advocates of option one were willing to accept the compromise text for several reasons. It was clearly the most that the U.S. would yield. Secondly, the E.U. had once again sought, in its self-appointed role as the honest referee, to run away with the ball. When developing countries were seeking to confer on member-governments a stronger mandate for overriding drug patents in the public interest, the E.U. proposed a compromise solution which seemed suspiciously akin to the U.S.' discredited option two. It read: Having examined the flexibilities of some provisions of the TRIPS agreement we agree that WTO members can use these flexibilities to address public health crises, such as HIV/AIDS without prejudice to the rights and obligations of members.

Further resistance may have only cemented the tacit collusion between the E.U. and the U.S. in imposing the weakest political mandate on the campaign for essential drugs. It was at this point that developing countries chose the best available deal.

One method available to the public authority to prevent price abuses by patent-holders is to license other manufacturers in the patented product. This provision for compulsory licensing has been strengthened in the Doha Declaration, which confers on every member the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted.

Developing countries had also demanded that countries lacking the capacity for essential drugs should be at liberty to license an overseas manufacturer to produce at the most economical prices. This compulsory 'licensing for export' clause was simply too strong for the holders of proprietary medicines. The declaration on TRIPS and public health that has been adopted by the WTO confines itself to an assurance that the TRIPS Council in the WTO would study the matter prior to recommending solutions before the end of 2002. But even with this rather equivocal provision, the Doha Declaration on TRIPS and public health has been celebrated by the global campaign on access to essential medicines as a signal triumph.