Large Multinational Pharmaceutical Companies - Essay Example

Intellectual property is a new concept introduced into modern-day vocabulary not too long ago, catching fire in 1994 when the World Trade Organization (WTO) made it an integral part of its mission and structure. Large multinational pharmaceutical companies are among its most ardent advocates as they lobbied to have intellectual property ownership institutionalized to mean "physical ownership of things you create, including medicines and other medical formulation to heal the sick and the afflicted" and recognized by all countries. The concept spawned a complex web of controversies and ethical issues between patents and patients, between wealth and health, between corporate giants and developing countries. This paper recognizes where the patent makers are coming from. It likewise understands why developing countries are averse to the idea. It believes the recognition and understanding where both parties are coming is a vital first step to soften the impact of the conflict until a happy compromise is found. With a focus on Medicine, consider the importance of Intellectual Property to the Promotion of Health in a Global Context Intellectual property ownership is a relatively new concept of ownership with staggering social implications. For large pharmaceutical companies investing billions of dollars to continually develop new medicines against diseases, it provides the necessary incentives in the form of patents to provide wider latitude in the development, promotion, and distribution of new drugs to recoup their investments and earn significant revenues for years of research and hard work. It also serves as an incentive for pharmaceutical companies to develop new products for the prevention or treatment of common as well as dreaded diseases. But for low-income countries struggling to provide basic healthcare services and affordable drugs to their citizens, intellectual property is an onerous imposition that threatens to wreck lives in the wake of killer diseases, like pneumonia, HIV/AID, tuberculosis, hypertension, and measles that claim 37,000 men, women, and children everyday (WHO, 2005). The same report said more than one third of the world's population lacked regular access to essential drugs. Every year, millions of children and adults in developing countries around the world still die from common diseases that could be readily treated by drug therapies, and more economically cured with generic drugs. HEATED DEBATE The law on intellectual property rights allows pharmaceutical companies unrestricted rights to manufacture and distribute medicines at prices they command Without access to the drugs in the treatment of HIV, for example, to combat the spread of the dreaded disease, people from many countries in Africa experiencing an HIV/AIDS pandemic will die in record number. AIDS has killed more than 25 million people since it was first recognized on December 1, 1981, making it one of the most destructive pandemics in recorded history. According to current estimates, HIV is set to infect 90 million people in Africa, providing an enormous market for an anti-HIV medicine. There is currently no vaccine or cure for HIV or AIDS. The only known method of prevention is avoiding exposure to the virus. However, an antiretroviral treatment, known as post-exposure prophylaxis is believed to reduce the risk of infection if begun directly after exposure. Current treatment for HIV infection consists of highly active antiretroviral therapy, or HAART, an expensive procedure that many poor countries in Africa are forced to take. Non-African countries, like the Philippines, may not suffer as much as the Africans in terms of exposure to dreaded diseases, but they are also victims of expensively priced medicine. Pharmaceutical giant Pfizer, invoking its patent rights, recently filed an infringement lawsuit against the Philippines for its plan to import a generic and cheaper version of Norvasc in India. Norvasc is a maintenance medicine for people with heart condition. For sure, intellectual property has sparked a heated debate between patent holders and the market for which they have designed their products. Despite the noise sounded by angry protestors that represent the market, it looks like policy makers are more inclined to listen to patent makers represented by large multinational companies and supported by countries with developed economies, like the United States, EU, and Japan (UNDP Report, 2001). The tragedy is that even amidst this urgent and compelling need to address this global problem, the right of the people to health care still remains inextricably intertwined with a rigid intellectual property regime that developed countries and multinational companies have formally institutionalized through the World Trade Organization (WTO). Pharmaceutical companies are reeking in profits at the expense of lives that are wasted everyday due to the high cost of medicines spawned by laws that aim to protect "intellectual property." WHAT IS INTELLECTUAL PROPERTY The law on intellectual property rights allows pharmaceutical companies unrestricted rights to manufacture and distribute medicines at prices they command. While an increase in the prices of medicine may not affect first world countries, like the United States, the effect of higher cost of medicine has an immediate impact on the mortality of people living in developing countries. But what exactly is "intellectual property" How is it protected from whom What is there to protect "An intellectual property can allow you to own things you create in a similar way to owning physical property. You can control the use of your IP, and use it to gain reward. This encourages further innovation and creativity" (UK Intellectual Property Office, 2007). The idea of "intellectual property" was first officially used in October 1845 when in ruling a patent case between Davoll et all v. Brown, Massachusetts Circuit Court Justice Charles l. Woodbury wrote that "only in this way can we protect intellectual property, the labors of the mind, productions and interests as much a man's own...as the wheat he cultivates, or the flocks he rears" (Intellectual Property Rights, Wikipedia). The term's origin could probably be traced to a much earlier date, but it was rarely used until 1967 when the World Intellectual Property Organization (WIPO) was established and actively promoted the use of the term. The term further shot into prominence with the passage of Bayh-Dole Act on December 12, 1980, "creating a uniform patent policy among the many federal agencies that fund research, enabling small businesses and non-profit organizations, including universities, to retain title to inventions made under federally-funded research programs" (Bayh-Dole Act, 1980). WTO The idea finally zoomed into international prominence when the World Trade Organization (WTO) adopted the The Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) and set down minimum standards for many forms of intellectual property (IP) regulations. It was negotiated at the end of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) treaty in 1994 (Wikipedia, 2007). The WTO, composed of 150 countries, is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world's trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business (World Trade Organization, 2007). Membership in the organization precludes adherence to the principles it stands for, including the adoption of TRIPS among all individual member countries. Unlike other treaties, TRIPS has a powerful enticement as well as enforcement mechanisms to exact compliance from its member countries. Even countries like Russia and China are enticed to join the WTO for the numerous trading opportunities it opens, but like any other country that wants to explore these new markets they must observe the intellectual property guidelines mandated by TRIPS. Some countries are encouraged to join the WTO not only for the economic opportunities it offers, but also for the chance to inject organizational and policy reforms which would not be possible for anyone who is a non-member. Under pain of sanctions, TRIPS requires member states to provide strong protection for intellectual property rights, including the following (Agreement on Trade-Related Aspects of Intellectual Property Rights, Wikipedia): 1. Copyright terms must extend to 50 years after the death of the author, although films and photographs are only required to have fixed 50 and 25 year terms, respectively. 2. Copyright must be granted automatically, and not based upon any "formality", such as registrations or systems of renewal. 3. Computer programs must be regarded as "literary works" under copyright law and receive the same terms of protection. 4. National exceptions to copyright (such as "fair use" in the United States) must be tightly constrained. 5. Patents must be granted in all "fields of technology," although exceptions for certain public interests are allowed (Art. 27.2 and 27.3 [1]) and must be enforceable for at least 20 years (Art 33). 6. Exceptions to patent law must be limited almost as strictly as those to copyright law. 7. In each state, intellectual property laws may not offer any benefits to local citizens which are not available to citizens of other TRIPS signatories by the principles of national treatment (with certain limited exceptions, Art. 3 and 5 [2]). TRIPS also has a most favored nation clause. Using their rights as WTO members and drawing support from the academe and non-government organizations, insider critics of the International Property Rights have openly criticized trade liberation as a bad policy that "move money from people in developing countries" (Intellectual Property Rights, Wikipedia). They are particularly enraged by the high cost of medicine as a result of TRIPS, causing deaths across Africa and other impoverished countries. They have demonstrated their opposition to TRIPS in various fora, including mass rallies and demonstrations during important WTO meetings. In the light of this, the WTO issued a new policy called the Doha Declaration of 2001 which indicated that TRIPS should not prevent individual member states from dealing with public health crises. Under the new declaration, TRIPS contains new safeguard mechanisms to protect public health. The two distinct safeguards are (1) parallel importation, and (2) compulsory licensing (Doha 4th Ministerial Declaration, 2001). India, which manufactures cheap medicine because of its access to cheaper raw materials, is one of few countries that sell cheap drugs. Many governments are opting to import their medicines from India and other countries rather than patronize the same medicines offered at higher prices by pharmaceutical companies operating in their respective countries. Imported generic drugs cost 70 per cent cheaper than branded drugs manufactured by patent holders (Intellectual Property Rights, Wikipedia). Some low-income countries in Africa, like Cameroon, Ghana, Mozambique, and Zambia have opted for compulsory licensing to reduce the cost of medicine for HIV/AIDS, a disease that has reached pandemic proportions in these countries. In compulsory licensing, a government compels patent holders to allow the state to use private patent in exchange for negotiated royalties. Even if the government does not exercise this option, compulsory licensing serves as deterrent against possible abuse by patent holders. Since parallel importation and compulsory licensing need legislative approval to become a state policy, some pharmaceutical companies are actually lobbying against the passage of such legislation to protect their interest. Multinational pharmaceutical companies use their vast network of resources to deter countries where they operate from using the declaration to encourage the use of generic drugs and to import medicines from countries that offer them cheaper. Parent countries of some pharmaceutical companies have resorted to other tactics to stop developing countries from pursuing direct importation and compulsory licensing as state policies through trade treaties. CONCLUSION Clearly, there is still much work to be done and there is no such thing as a "one declaration fits all" mechanism to address the conflict between patent and patient, between private profit and public health. There is, without doubt, a need to provide inventors as well as investors with incentives to encourage them to undertake more researches and discover new medicines to provide better healthcare for everyone to improve the quality of life. Nevertheless, it is necessary to examine the tension between intellectual property law and the right of the patient to health care, and to explore the specific ways that the latter cannot be compromised by the former, or vice versa, since an unresolved conflict is detrimental to both. It is also necessary to look at the possible options and solutions to overcome this problem and create an intellectual property regime that will put health over profit and patients over patents. It is important to stress here that patent holders are to be protected just as much as the patients, but this is not to say that there should be no control mechanism to deter man's natural lust for wealth. After all, amassing boundless wealth is a natural consequence of globalization, especially if the commodity for sale is an elixir for well-being and for prolonging human life. List of References Ubac, Michael Lim 2007. Social reform bills pushed in Congress' last session days, Philippine Daily Inquirer, Manila. United Nations Development Programme 2001. Compulsory Licensing: Models for State Practice in Developing Countries, Access to Medicine and Compliance with the WTO TRIPS Accord UK Intellectual Property Office 2007. What is Intellectual Property London. Wikipedia, the free encyclopedia. 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The Anarchist in the Library: How the Clash Between Freedom and Control Is Hacking the Real World and Crashing the System. Basic Books. New York. Read More