The deal is the result of a retreat by the Bush administration;
the US stood alone last year in blocking a similar deal closing at
that time.
"This is a historic agreement for the WTO," said
Director-General Supachai Panitchpakdi. "The final piece of the
jigsaw has fallen into place, allowing poorer countries to make
full use of the flexibilities in the WTO's intellectual property
rules in order to deal with the diseases that ravage their
people."
The decision waives countries' obligations under a provision of
the WTO's intellectual property agreement. An Article of the
Trade-Related Aspects of Intellectual Property Rights (TRIPS)
Agreement says that production under compulsory licensing must be
predominantly for the domestic market. This effectively limited the
ability of countries that cannot make pharmaceutical products from
importing cheaper generics from countries where pharmaceuticals are
patented.
In the decision, WTO member governments have agreed that the
waiver will last until the article is amended.
Background
Flexibilities such as "compulsory licensing" are written into
the TRIPS Agreement — governments can issue compulsory licenses to
allow other companies to make a patented product or use a patented
process under licence without the consent of the patent owner, but
only under certain conditions aimed at safeguarding the legitimate
interests of the patent holder.
But some governments were unsure of how these flexibilities
would be interpreted, and how far their right to use them would be
respected. The African Group (all the African members of the WTO)
were among the members pushing for clarification.
A large part of this was settled at the Doha Ministerial
Conference in November 2001.
In the main Doha Ministerial Declaration of 14th November 2001,
ministers stressed that it is important to implement and interpret
the TRIPS Agreement in a way that supports public health — by
promoting both access to existing medicines and the creation of new
medicines.
They therefore adopted a separate declaration on TRIPS and
Public Health. They agreed that the TRIPS Agreement does not and
should not prevent members from taking measures to protect public
health.
They underscored countries' ability to use the flexibilities
that are built into the TRIPS Agreement, including compulsory
licensing and parallel importing.
And they agreed to extend exemptions on pharmaceutical patent
protection for least-developed countries until 2016.
On one remaining question, they assigned further work to the
TRIPS Council — to sort out how to provide extra flexibility, so
that countries unable to produce pharmaceuticals domestically can
import patented drugs made under compulsory licensing.
The problem Article of the TRIPS Agreement says products made
under compulsory licensing must be "predominantly for the supply of
the domestic market". This applies directly to countries that can
manufacture drugs — it limits the amount they can export when the
drug is made under compulsory licence. And it has an indirect
impact on countries unable to make medicines and therefore wanting
to import generics. They would find it difficult to find countries
that can supply them with drugs made under compulsory
licensing.
Members were deadlocked over how to resolve this question, and
the original deadline of 31 December 2002 was missed.
The decision
This 30th August 2003 agreement allows any member country to
export pharmaceutical products made under compulsory licences
within the terms set out in the decision. All WTO member countries
are eligible to import under this decision, but 23 developed
countries are listed in the decision as announcing voluntarily that
they will not use the system to import.
A separate statement by General Council chairperson Carlos Pérez
del Castillo, Uruguay's ambassador, is designed to provide comfort
to those who feared that the decision might be abused and undermine
patent protection. The statement describes members' "shared
understanding" on how the decision is interpreted and
implemented.
It says 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.
A number of other countries announced separately that if they
use the system it would only be for emergencies or extremely urgent
situations. They are: Hong Kong China, Israel, Korea, Kuwait, Macao
China, Mexico, Qatar, Singapore, Chinese Taipei, Turkey and United
Arab Emirates
The decision covers patented products or products made using
patented processes in the pharmaceutical sector, including active
ingredients and diagnostic kits.
The decision takes the form of an interim waiver, which allows
countries producing generic copies of patented products under
compulsory licences to export the products to eligible importing
countries. The waiver would last until the WTO's intellectual
property agreement is amended.
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