WTO panel OK's easing rules on generic drugs in 3d World

By Naomi Koppel, Associated Press, 8/29/2003

GENEVA -- A World Trade Organization panel agreed yesterday to allow poor nations access to inexpensive copies of drugs to fight such diseases as AIDS and malaria, after the United States dropped its objections.

Approval by the WTO's council on intellectual property set the stage for the entire 146-member organization to make a final decision on the plan.

But weary diplomats adjourned for the night after a marathon session that extended into early today, and WTO spokesman Keith Rockwell said that a final decision wasn't likely until trade ministers meet Sept. 10 in Cancun, Mexico.

Yesterday's agreement resolved a dispute among panel nations over whether poorer countries should be allowed to ignore some patent rules in importing drugs from cheaper generic manufacturers.

US representatives endorsed the plan after it was amended to include safeguards against drug smuggling, a key concern of the United States and its pharmaceutical research industry.

"This decision is extremely important for many African countries who need to be able to import generic drugs which are affordable and who don't have the capacity to produce them," said South Africa negotiator Faizel Ismail.

Under WTO rules, countries facing public health crises have the right to override patents on vital drugs and order copies from cheaper, generic suppliers. However, until now they could order only from domestic producers -- useless for the huge majority of developing countries that have no domestic pharmaceutical industry.

US pharmaceutical research companies were concerned that a deal to allow countries to import the cheaper drugs would be abused by generics manufacturers and also could lead to drugs being smuggled back into rich countries.

However, all sides have accepted that the problem has to be settled for humanitarian reasons and because of the damage it has done to the public perception of the WTO, a 146-nation body that sets rules on international trade.

The statement approved late last night says that rules allowing countries to override patents "should be used in good faith to protect public health . . . not be an instrument to pursue industrial or commercial policy objectives."

It calls for special measures to prevent drugs being smuggled back to rich country markets, including special packaging or different colored tablets.

The wording of the statement was agreed by a core group of negotiators from the United States, Brazil, India, Kenya, and South Africa.

But the aid group Oxfam called the plan a "disaster."

"This would be a travesty of an agreement that would no doubt be presented as a wonderful thing for development," said Oxfam's Head of Advocacy in Geneva, Celine Charveriat. "The text contains so much red tape and so many obstacles that if it were accepted, developing countries would still struggle to get access to cheap medicines and thousands of people would continue to die unnecessarily."