February 27, 2007
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By Dr. Jean-Hervé Bradol
President, Médecins Sans Frontières

Applying the rules of international trade to medicines has provoked an aggressive response from several major pharmaceutical companies, which fear they will lose their monopoly on the sale of one of their products. Novartis' current lawsuit in India offers an excellent example of the situation. The Indian courts have refused to issue the company a patent for one of its drugs, on the grounds that the product does not constitute an innovation.

The monopoly that follows from issuing a patent (essentially voiding the principle of free competition) is supposed to reward invention. In this case, the medication in question is a derivative (a "salt") of imatinib, an excellent anti-cancer drug patented in the U.S. and Europe in 1993. After careful review, the Indian court found no significant difference between this derivative and the original product. Thus, it would not issue a new patent. The matter could have ended there, but Novartis mounted an attack in the Indian courts against the very provisions in the law on which this judgment is based.

According to Novartis, the law that the Indian legislature passed in 2005, following the country's entry into the World Trade Organization (WTO), violates the WTO agreement on trade-related intellectual property rights (TRIPS.) However, no complaint has been filed against India at the WTO. In fact, since the WTO's founding in 1995, the TRIPS agreement has authorized States to promote the manufacture of generic drugs and, thus, competition among producers, in the interest of addressing public health needs. The WTO first laid out conditions for applying this measure at the opening of the 2001 Doha round of talks. In 2003, in Geneva, the WTO adopted measures that, while draconian, governed the export of these generic drugs.

Drug companies like Novartis now seek to unduly extend the length of their monopoly on the sale of a drug. According to the company, all research and development (R&D) could collapse if companies are not adequately rewarded by the profits generated by the issuance of patents. This argument does not stand up to the facts any more than claims that intellectual property rights have been violated. R&D investments are well rewarded, indeed, a fact illustrated by the doubling of the international pharmaceutical market in recent years (from $300 billion dollars in 1999 to $600 billion dollars in 2005.) The major pharmaceutical companies' profits are among the highest of any manufacturing sector. The rules governing intellectual property, which they hold so dear, now apply to India and China, which have joined the WTO.

For patients in poor countries, the benefits of medical research have been extremely limited, to say the least. Over the last thirty years, only 1% of medicines brought to market treat diseases like tuberculosis, malaria and sleeping sickness that most affect people in developing countries. Between 1975 and 2004, only 21 of the 1,556 new drugs marketed were intended to treat these neglected diseases. During the same time, India became a critical source of affordable medicines and today provides 50% of the drugs used to treat AIDS in those countries.

For Médecins Sans Frontières, which spends one-third of its drug budget in India, the danger is real and immediate. The weakening of competition in a market already characterized by shortages and prices beyond the reach of the poorest patients would create a new surge in prices. The example of AIDS treatments is, again, revealing. Early in this decade, before the Indian generic products appeared on the market, prices were one hundred times higher than they are today, obviously placing those medicines out of reach of countries with the greatest number of victims.

This reality is a far cry from the image promoted by pharmaceutical companies. According to them, they are the victims of repeated violations of intellectual property law. This rhetoric tends to criminalize the production of generics, even though the rules of international trade provide for such production under very restrictive conditions.

If we look more closely, what we see is not a brilliant inventor dispossessed of the profits of his or her invention. Rather, we are looking at a group of businesspeople, comfortably ensconced in a market protected from competition based on the support of the most powerful countries, without regard for economic or health logic and contrary to WTO rules. Indeed, we are witnessing a paradigm shift: patents no longer exist as a means of rewarding invention, but to extend corporate profits. By defending that shift, those corporations threaten access to medicine for most of humanity.