CENTRAL AMERICA
Profit or the right to health?
Jill Replogle
CAFTA free trade accord under fire by public health advocates.
Regional health professionals have raised a voice of concern over the
Central American Free Trade Agreement (CAFTA) with the United States,
saying it contains tough measures of intellectual property rights
protections that will make access to generic medications nearly
impossible.
The trade agreement, expected to be ratified in the coming months by the
legislatures of Costa Rica, El Salvador, Honduras, Guatemala, Nicaragua,
the Dominican Republic and United States, gives priority to profit over
lives and threatens the weak public health and regulatory systems of
Central American countries, the critics say.
"The rights of patent owners are placed above human rights, especially
the right to health," says Guillermo Murillo, assistant director of Agua
Buena, a human rights organization based in San Jose, Costa Rica.
CAFTA supporters, for their part, say the agreement will assure access
to safe, quality drugs for the population through stricter
pharmaceutical testing and approval standards. They also say it will
stimulate innovation by providing protection for pharmaceutical research
and development.
If CAFTA is approved, more than 80 percent of US-made goods can
immediately enter participating countries duty-free. Remaining tariffs
will be phased out over the following 10 years.
In return, the agreement will open the US market to many products —
particularly textiles — from the six smaller countries and encourage US
investment in their struggling economies.
The debate over the effects of free trade on health care has intensified
over the past decade along with market liberalization. Concerns that
investment rights could override public health needs led member
countries of the World Trade Organization (WTO) to forge a historic
agreement in Doha, Qatar, in 2001 to protect public health within the
Agreement on Trade-Related Aspects of Intellectual Property Rights
(TRIPS).
This Doha Declaration on the TRIPS Agreement and Public Health
specifically called for the provision of access to medicine for all. It
also assured member nations the right to do this within TRIPS
provisions.
"The Doha Declaration was the product of the international community at
its best, recognizing an overriding commitment to healthcare that cannot
be subordinated to commercial considerations," Robert Weissman of the
Washington-based organization Essential Action wrote in a recent
analysis on CAFTA. Weissman and other health activists say these
priorities would be reversed under CAFTA.
Critics in the health sector have centered their concerns on provisions
in the intellectual property rights chapter of the agreement, which give
greater protection for patent holders and pharmaceutical companies than
in most prior trade agreements, including the WTO TRIPS agreement.
As it stands, CAFTA would severely limit the practice, commonly used by
companies that produce generic drugs, of relying on another company’s
safety and efficacy data to gain market approval for a generic copy of
an original pharmaceutical drug.
An article of the draft CAFTA text establishes a minimum five years of
exclusivity on undisclosed data used to register a pharmaceutical
product.
Many health activists, like Murillo, say the data exclusivity provisions
in CAFTA essentially grant pharmaceutical companies a monopoly on new
drugs registered in member countries, since they could be manipulated to
extend up to ten years.
These same data exclusivity rights are given to owners of patented
pharmaceutical products for the minimum 20-year life span of the patent.
Meanwhile, multinational pharmaceutical companies applaud the measures
as defending the average US$900 million investment required to turn a
single chemical entity into a marketable pharmaceutical product.
"What we want is a fair, open market," said Dr. Rodolfo Lambour,
executive director of the Central American Federation of Pharmaceutical
Laboratories, which represents major international pharmaceutical
companies in the region.
"We’re not against generics," Lambour said, "they can come into the
market once intellectual property rights expire."
Besides data exclusivity, CAFTA goes beyond TRIPS by requiring member
countries to compensate patent owners for "unreasonable delays" in
granting a patent by extending the patent life from three to five years.
The agreement also establishes patent term restoration for delays in
marketing approval.
The CAFTA text does uphold the rights of member countries under the
TRIPS agreement, including the ability to override patent-holder rights
in emergency situations. However, some health activists are worried that
the limits on using undisclosed data for approving generics will make it
nearly impossible to use emergency mechanisms, such as compulsory
licensing and parallel imports.
These and other provisions of CAFTA’s intellectual property rights
chapter have led health activists to dub the treaty "TRIPS Plus."
HIV/AIDS organizaions are particularly alarmed by the restrictions on
generics. It is estimated that 300,000 people in the six CAFTA countries
of Central and the Caribbean are infected; around half live in the
Dominican Republic. Of the 35,000 AIDS patients who require
antiretroviral drugs, only around 6,000 currently receive them.
Because few of those with AIDS in the CAFTA countries can afford to pay
for their own medication, the high cost of antiretroviral treatment
falls on the already overburdened public health institutions in the
region.
"Health budgets will have to be increased, or there will be even less
distribution [of medications] for lack of resources," says Luis Villa,
general coordinator of Médecins Sans Frontières in Guatemala.
CAFTA critics also worry that the limited resources of Central American
public health and regulatory agencies could not stand up to a legal
challenge under CAFTA’s investor-state dispute settlement provisions.
"Since [Central American governments] are aware that multinationals can
sue them, they simply won’t register a [generic] medicine if there is
any doubt," said Villa.
Nevertheless, there are still a number of steps to be taken before the
trade agreement enters into effect, including legal revision of the text
and passage by the legislative branches of all participating countries.
Though the target date for putting CAFTA into effect is January 1, 2005,
many feel the US presidential and congressional elections in November
could delay the accord’s approval.
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