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MOUNT CARMEL INSTITUTE OF

MANAGEMENT

TITLE: EVALUATION OF DOHA


DECLARATION
SUBJECT: BUSINESS ENVIRONMENT

BY GROUP ‘7’
PRIYADARSHINI.S
RITUPARNA.B
RASHMI.K
PUJA SARMAH
STUTEE PRIYA
PRATHANA

UNDER THE GUIDANCE OF


Prof.Ranita.J
Ist PGDBM, Sec-B
2010

ACKNOWLEDGEMENT

This a project on, “DOHA declaration” which an in-depth


Knowledge about when it started and how it has progressed till
date. We were able to understand the concepts and evaluate the
TRIPS agreement. This project has definitely helped us to gain
more knowledge into this subject. We would like to thank our
Prof.Ranita for giving us such a wonderful opportunity and
making the subject more interesting.

INDEX

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3
INTRODUCTION

DOHA
DECLARATION

4
MEANING :
DOHA DECALARATION- The document agreed upon by the
trade ministers of the member countries of the WTO at the Doha
Ministerial meeting. It initiates negotiations on a range of some
21 subjects. A distinctive feature is the emphasis placed on the
interests of developing countries.

Following the adoption of TRIPS in 1995, the novelty of the


agreement and its hard-to-understand text left developing
countries uncertain of their right to promote access to essential
medicines. It was clear that there were conflicting
understandings as to how developing countries could implement
the sections relating to pharmaceutical patents.

The Doha Declaration clarified that developing countries


maintain substantial flexibilities under TRIPS, and that TRIPS
should be interpreted in a fashion that supports the obligation to
protect public health and promote access to medicines.

One key section of the Declaration indicates that developing


country members have the right to grant compulsory licenses on
patented medicines and the freedom to determine the grounds
upon which such licenses are granted. Compulsory licenses
authorize price-lowering generic competition for products that
remain on patent. Generic competition for AIDS drugs has
reduced their price in developing countries by more than 98
percent.

The United States joined the consensus of WTO member


countries adopting the Doha Declaration in 2001. Unfortunately,

5
the administration has not respected the letter or spirit of the
Declaration in several ways, including by negotiating provisions
in bilateral trade agreements that restrict the use of TRIPS
flexibilities, and by threatening countries using the flexibilities.

HISTORY :
The November 2001 Doha Declaration on the TRIPS
Agreement and Public Health was adopted by the WTO
Ministerial Conference of 2001 in Doha on November 14, 2001.
It reaffirmed flexibility of TRIPS member states in
circumventing patent rights for better access to essential
medicines.

The WTO ministerial meeting held in Doha, Qatar, November


10-14, 2001, at which it was agreed to begin a new round of
multilateral trade negotiations, the Doha Round. The round of
multilateral trade negotiations begun January 2002 as a result of
agreement at the Doha Ministerial. Also called the Doha
Development Round or the Doha Development Agenda.

In November 2001 at the World Trade Organisation Ministerial


Conference in Doha, Qatar, WTO Members passed the
groundbreaking "Declaration on the TRIPS (Trade-related
aspects of intellectual property rights) Agreement and Public
Health." For the first time, the Declaration sent a clear political
message that TRIPS "can and should be interpreted and
implemented in a manner supportive of WTO Members' right to
protect public health and, in particular to promote access to
medicines for all." Among other measures, the Declaration
affirmed the right of countries to use compulsory licenses and to
determine the grounds on which to grant them. It also gave least-
developed nations a ten-year extension from 2006 until at least
2016 to institute patents on pharmaceuticals. Both of these
provisions can help countries to secure more affordable essential
medicines through generic competition.

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Since the Doha meeting, MSF and other concerned actors have
been working to translate this political message into action, and
ultimately, into better access to medicines for patients on the
ground. An important step will be to ensure that countries take
advantage of the Declaration as they develop national legislation
regarding patents and medicines. Recognizing the vital role that
international technical assistance plays in this process, MSF and
other NGOs convened a conference in March 2002 to examine
the best ways to implement Doha, and specifically, to consider
how the World Intellectual Property Organization (WIPO) has
and has not promoted health concerns through its technical
assistance programs.

As the United Nations body charged with developing intellectual


property systems worldwide, WIPO is in a critical position to
determine whether the Doha Declaration benefits developing
countries, or whether it becomes a useless piece of paper. MSF's
experiences in West Africa and Cambodia have raised concerns
that WIPO is not helping countries to maximize their options to
protect access to medicines; rather, some countries receiving
WIPO advice have instituted more stringent protections on
intellectual property than is required or advisable in light of
pressing health needs.

Many legal and political hurdles remain before the world's


poorest patients see any benefits from Doha; thus, public
pressure exerted by MSF and others will be necessary to hold
responsible actors, including WIPO, the WTO, and Member
governments, accountable. Such sustained scrutiny will be
required to translate the political victories won at Doha into
tangible improvements in people's lives.

In 2005, WTO members reached agreement on an amendment to


the TRIPS Agreement to make permanent the temporary waiver
contained in the August 30 WTO Decision, which itself fulfilled
the requirement of para.6 of the Doha Declaration on the TRIPS
Agreement and Public Health of November 14, 2001. This
decision created a mechanism to allow WTO members to issue

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compulsory licences to export generic versions of patented
medicines to countries with insufficient or no manufacturing
capacity in the pharmaceutical sector.

In the Doha Declaration, governments agreed that:


"The TRIPS Agreement does not and should not prevent
Members from taking measures to protect public health.
Accordingly, while reiterating our commitment to the
TRIPS Agreement, we affirm that the Agreement can and
should be interpreted and implemented in a manner
supportive of WTO Members' right to protect public health
and, in particular, to promote access to medicines for all.
In this connection, we reaffirm the right of WTO Members
to use, to the full, the provisions in the TRIPS Agreement,
which provide flexibility for this purpose.
Accordingly and in the light of paragraph 4 above, while
maintaining our commitments in the TRIPS Agreement,
we recognize that these flexibilities include:
(a) In applying the customary rules of interpretation of
public international law, each provision of the TRIPS
Agreement shall be read in the light of the object and
purpose of the Agreement as expressed, in particular, in its
objectives and principles.
(b) Each Member has the right to grant compulsory
licences and the freedom to determine the grounds upon
which such licences are granted.
(c) Each Member has the right to determine what
constitutes a national emergency or other circumstances of
extreme urgency, it being understood that public health
crises, including those relating to HIV/AIDS, tuberculosis,
malaria and other epidemics, can represent a national
emergency or other circumstances of extreme urgency.
(d) The effect of the provisions in the TRIPS Agreement
that are relevant to the exhaustion of intellectual property
rights is to leave each Member free to establish its own

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regime for such exhaustion without challenge, subject to
the MFN and national treatment provisions of Articles 3
and 4.
We recognize that WTO Members with insufficient or no
manufacturing capacities in the pharmaceutical sector
could face difficulties in making effective use of
compulsory licensing under the TRIPS Agreement. We
instruct the Council for TRIPS to find an expeditious
solution to this problem and to report to the General
Council before the end of 2002."

These provisions in the Declaration ensure that governments


may issue compulsory licenses on patents for medicines, or take
other steps to protect public health.

The 2005 Ministerial Declaration stated:


"We reaffirm the importance we attach to the General Council
Decision of 30 August 2003 on the Implementation of Paragraph
6 of the Doha Declaration on the TRIPS Agreement and Public
Health, and to an amendment to the TRIPS Agreement replacing
its provisions. In this regard, we welcome the work that has
taken place in the Council for TRIPS and the Decision of the
General Council of 6 December 2005 on an Amendment of the
TRIPS Agreement." The amendment, the first ever to the TRIPS
Agreement, was circulated to WTO members for formal
adoption. A deadline of December 1, 2007 was set for members
to accept the permanent amendment. For the amendment to be
put into effect, at least two-thirds of members must formally
adopt it.

On November 30, 2007 Peter Mandelson, the then European


Union's Trade Commissioner, announced that the European
Union formally accepted the World Trade Organization
-approved protocol of December 2005, amending the TRIPS
Agreement. However, in order for the decision to have legal
effect, two-thirds of the WTO's 151 Members are required to

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ratify the agreement. The European Union's acceptance only
brings the number to 41.

In 2008 a decision was made to extend the deadline for


accepting the TRIPS agreement amendment. The deadline has
been extended until 31 December 2009 or "such later date as
may be decided by the Ministerial Conference."

10
IMPLEMENTATION
OF
DOHA
DECLARATION

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IMPLEMENTATION OF DOHA
DECLARATION:
The WTO Ministerial Conference at Doha declared that the
exclusivity afforded by patent rights could not prevent
governments from taking steps to protect public health,
including, most importantly, providing access to affordable
medicines. Despite that declaration, there are significant legal
and economic barriers to the implementation of policies which
will actually result in the availability of reasonably priced
medicines.

The Agreement on Trade-Related Aspects of Intellectual


Property (TRIPS), with certain exceptions, requires that member
countries honor a patent owner's exclusive right to make, use
and sell the patent invention. Article 31 of TRIPS provides a
clear pathway for member nations to compulsory licenses under
patents. Presumably, the issuance of such licenses would lead to
lower cost drugs while still providing some compensation to the
patent owner. Article 30 of TRIPS permits a member nation to

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provide for limited exceptions to the exclusivity afforded by a
patent. There appears to be general agreement that these
provisions provide sufficient flexibility for a member nation to
produce lower cost medicines for its own use. But the issuance
of a compulsory license by a member nation that lacks capacity
for the domestic production of a patented drug is of no use
unless the grant of the license is sufficient to permit the
manufacture and sale of a drug for export to that nation.
Therefore, post-Doha discussions have focused on developing
interpretations or amendments to TRIPS that would allow
exports to the nation issuing the license without violating TRIPS
obligations in the country of export.

It would be wrong to assume that the mere existence of a


TRIPS-compliant compulsory licensing regime will insure the
availability of a low-cost supply of newly developed drugs to the
least developed nations. The current supply of low cost generic
drugs from developing nations results from the fact that those
countries have not yet fully implemented patent protection for
pharmaceuticals. Therefore, the markets are large and the
availability of generic drugs from multiple sources have served
to keep prices and per unit profits low. Once India and other
developing nations that have significant drug manufacturing
capability fully implement pharmaceutical patent enforcement
(after 2006), the ability to develop and sell copies of patented
drugs in those countries may disappear. Absent a domestic
market for such products, the issuance of a compulsory license
by a least developed nation may not provide a sufficient
economic incentive to spur the development of low cost generic
drugs by companies located in developing nations.

For the foregoing reasons, a supply of low cost drugs to the


poorest countries is critically dependent on whether those drugs
are available (at low cost) in the developing nations. There are
only two possible ways in which such availability can be
assured, namely: (1) the routine issuance of compulsory licenses
for pharmaceutical products in the developing nations or (2) the
implementation of stringent price controls by developing nations

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that are based on the cost at which such drugs would be
available if production by multiple generic sources was
permitted. It is the thesis of this paper that a price control system
is preferable to a compulsory license system since price controls
are not prohibited by TRIPS and do not undermine the exclusive
right of the patent owner. In any event, for obvious economic
reasons, compulsory licensing alone can not assure that a supply
of low cost medicines will be developed and produced.

Economic Barriers to Implementation of the Doha


Declaration

A meaningful strategy for making available low cost


medications can not be developed without a basic understanding
of the costs and risks associated with the production of both
innovative new drugs and generic copies of those drugs. Some
important basic principles are as follows:

1. Most manufacturers of generic drugs in developed nations


are not capable of producing the ingredients which go into
a drug. They are totally dependent on a relatively small
number of companies that have the ability to produce
specialty chemicals. Prior to 1990, the largest producers of
such chemicals were located in Europe. As a result of
changes in European patent law from a system which only
granted process patents to a system which granted full
patent protection for pharmaceutical products, the major
markets for production of active pharmaceutical
ingredients are now located in the developing countries,
such as India, that have not yet implemented patent
protection for pharmaceutical products.
2. The costs involved in developing a suitable process for the
commercial production of a chemical can be significant.
The most efficient production processes or intermediates
may be patented thereby making it difficult, and in some
cases, impossible, to find a non-infringing production
method. Moreover, because the purity of the chemicals is
critical to safety concerns, production must take place

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under highly controlled conditions in facilities which must
be inspected and approved by regulatory authorities such
as the FDA. In the United States, for example, unless there
is an approved Drug Master File for the source of the bulk
active ingredient it is not possible to obtain the approval of
a finished dosage form containing that ingredient.
3. The costs of developing a bioequivalent generic dosage
form are also significant. It takes both time and money to
develop a formulation which exhibits dissolution
characteristics similar to the original product; to produce
commercial-sized batches of that formulation; to evaluate
the product's stability; to conduct clinical studies designed
to establish bioequivalence to the original product; and to
apply for and receive regulatory approval. In the United
States, assuming a supplier for the active ingredient can be
found, it takes 2-3 years to develop and obtain approval for
a generic product and development costs, including the
value of invested dollars, can easily run to more than $2
million for a single product. These investments are not
made lightly because most generic drug companies need to
develop dozens of new drugs each year. In making
investment choices a company must examine the risk of (i)
non-approval for technical reasons, (ii) competition from
other generic manufacturers that may drive down prices to
unprofitable levels, (iii) how long it will take before the
development investment is recovered, and (iv) the
possibility that the product being copied may become
obsolete by virtue of the introduction of a second
generation "me-too" products by the innovator before the
product being copied is approved for marketing.
4. The degree of risk for the bulk chemical manufacturer is
also significant. The sale of a bulk chemical in commercial
significant quantities is dependent on the success of a
finished dosage form manufacturer in developing an
approved product and establishing a market. In addition,
the demand for the bulk chemical can be small. For
example, if the finished product contains 10 milligrams of

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the active ingredient, only 100 kilograms (220 pounds) of
material is needed to produce 10 million tablets. Therefore,
unless the chemical manufacturer directly or indirectly
participates in the profits derived from the sale of the
finished product, it may be unable to make a sufficient
return to justify the investment in developing a new
chemical.
5. Not surprisingly, given all of the foregoing costs and risks,
the major producers of the active pharmaceutical
ingredients in countries like India are primarily engaged in
the production of final dosage forms for consumption in
their home market. Absent patent protection, the
investment in the development of a new product can be
more quickly recovered due to the immediate prospect of
high volume sales. The eventual incremental additional
profit to be derived from the export of either bulk
chemicals or finished dosages is certainly a plus but it is
not the driving force in prioritizing product development
projects and maintaining a profitable enterprise.

Once India and other developing nations become fully compliant


with TRIPs, they will no longer have a domestic market for a
generic drug until patent rights expire. Therefore, there will be
no incentive to invest in the development of processes for the
production of bulk pharmaceutical ingredients or finished
dosage forms until late in the life of a patent when a
determination can be made as to the likelihood that a viable
market for a generic product will exist after the patent expires.
Thus, even if TRIPS is construed as permitting a nation lacking
the capacity to produce pharmaceuticals to issue a compulsory
license that could be legitimately filled by importing product
from a more developed nation, like India, no such product may
actually exist anywhere in the world.

Could the issuance of a compulsory license spur the


development of such a product? Perhaps. But there would be a
significant time lag to enable development and both the price
and guaranteed volume of purchases would have to be high

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enough to induce the investment in development. Indeed, the
availability of a low-cost generic product could ultimately
become dependent on whether a sufficiently large group of least
developed nations would find it feasible to pool their
compulsory licensing capability and buying power to create an
exclusive compulsory license thereby guaranteeing a sufficient
volume of business to induce the development of a product.
Clearly, the price at which a least developed nation could
acquire a supply of generic drugs would be far higher in this
scenario than in the current environment where there are
multiple existing producers seeking to make a small amount of
additional profit by increasing the volume of production of an
existing product for which development costs have already been
recovered in their home market.

The truth is that in a TRIPs-compliant world, the patent owner is


likely to be the lowest cost producer since the cost of producing
an additional volume of a product which is already in mass
production will be lower than the cost of producing a newly
developed product at low volume. The critical question,
therefore, may become whether the patent owner can be induced
(or compelled) to make product available to least developed
nations at a small mark-up from the actual cost of production.

In summary, those who believe that the mere issuance of a


compulsory license by a least developed country will spur
competition between multiple generic sources and result in the
availability of low-priced generic products for the least
developed nations are mistaken. Anyone who doubts it should
take note of U.S. experience where blockbuster drugs attract
large numbers of generic entrants while many relatively low
volume products remain as single-source drugs available only
from the patent owner even after the expiration of all patents.
The usual cause of that seemingly inexplicable result is the
unavailability of a supply of the active ingredient.

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DEPARTMENTS
OF DOHA
DECLARATION

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DEPARTMENTS COVERED IN DOHA
DECLARATION:

The 21 subjects listed in the Doha Declaration (and the


paragraphs that refer to them). Most of these involve
negotiations; other work includes actions under
“implementation”, analysis and monitoring:

AGRICULTURE
Negotiations on agriculture began in early 2000, under
Article 20 of the WTO Agriculture Agreement. By
November 2001 and the Doha Ministerial Conference,

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121 governments had submitted a large number of negotiating
proposals.

These negotiations will continue, but now with the mandate


given by the Doha Declaration, which also includes a series of
deadlines. The declaration builds on the work already
undertaken, confirms and elaborates the objectives, and sets a
timetable. Agriculture is now part of the single undertaking in
which virtually all the linked negotiations are to end by
1 January 2005.

The declaration reconfirms the long-term objective already


agreed in the present WTO Agreement: to establish a fair and
market-oriented trading system through a programme of
fundamental reform. The programme encompasses strengthened
rules, and specific commitments on government support and
protection for agriculture. The purpose is to correct and prevent
restrictions and distortions in world agricultural markets.

Without prejudging the outcome, member governments commit


themselves to comprehensive negotiations aimed at:

• market access: substantial reductions


• exports subsidies: reductions of, with a view to phasing
out, all forms of these
• domestic support: substantial reductions for supports that
distort trade

The declaration makes special and differential treatment for


developing countries integral throughout the negotiations, both
in countries' new commitments and in any relevant new or
revised rules and disciplines. It says the outcome should be
effective in practice and should enable developing countries
meet their needs, in particular in food security and rural
development.

The ministers also take note of the non-trade concerns (such as


environmental protection, food security, rural development, etc)
reflected in the negotiating proposals already submitted. They

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confirm that the negotiations will take these into account, as
provided for in the Agriculture Agreement.

Services
Negotiations on services were already almost two years old
when they were incorporated into the new Doha agenda.

The WTO General Agreement on Trade in Services (GATS)


commits member governments to undertake negotiations on
specific issues and to enter into successive rounds of
negotiations to progressively liberalize trade in services. The
first round had to start no later than five years from 1995.

Accordingly, the services negotiations started officially in early


2000 under the Council for Trade in Services. In March 2001,
the Services Council fulfilled a key element in the negotiating
mandate by establishing the negotiating guidelines and
procedures.

The Doha Declaration endorses the work already done, reaffirms


the negotiating guidelines and procedures, and establishes some
key elements of the timetable including, most importantly, the
deadline for concluding the negotiations as part of a single
undertaking.

The negotiations take place in “special sessions” of the


Services Council and regular meetings of its relevant
subsidiary committees or working parties.

Market access for non-agricultural products

The ministers agreed to launch tariff-cutting negotiations on all


non-agricultural products. The aim is “to reduce, or as
appropriate eliminate tariffs, including the reduction or
elimination of tariff peaks, high tariffs, and tariff escalation, as

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well as non-tariff barriers, in particular on products of export
interest to developing countries”. These negotiations shall take
fully into account the special needs and interests of developing
and least-developed countries, and recognize that these countries
do not need to match or reciprocate in full tariff-reduction
commitments by other participants.

At the start, participants have to reach agreement on how


(“modalities”) to conduct the tariff-cutting exercise (in the
Tokyo Round, the participants used an agreed mathematical
formula to cut tariffs across the board; in the Uruguay Round,
participants negotiated cuts product by product). The agreed
procedures would include studies and capacity-building
measures that would help least-developed countries participate
effectively in the negotiations. Back in Geneva, negotiators
decided that the “modalities” should be agreed by 31 May 2003.
When that date was missed, members agreed on 1 August 2004
on a new target: the Hong Kong Ministerial Conference in
December 2005.

While average customs duties are now at their lowest levels after
eight GATT Rounds, certain tariffs continue to restrict trade,
especially on exports of developing countries — for instance
“tariff peaks”, which are relatively high tariffs, usually on
“sensitive” products, amidst generally low tariff levels. For
industrialized countries, tariffs of 15% and above are generally
recognized as “tariff peaks”.

Another example is “tariff escalation”, in which higher import


duties are applied on semi-processed products than on raw
materials, and higher still on finished products. This practice
protects domestic processing industries and discourages the
development of processing activity in the countries where raw
materials originate.

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Trade-related aspects of intellectual property
rights (TRIPS)

TRIPS and public health. In the declaration, ministers stress


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 refer to their separate declaration on this
subject.

This separate declaration on TRIPS and public health is


designed to respond to concerns about the possible implications
of the TRIPS Agreement for access to medicines.

It emphasizes that the TRIPS Agreement does not and should


not prevent member governments from acting to protect public
health. It affirms governments’ right to use the agreement’s
flexibilities in order to avoid any reticence the governments may
feel.

The separate declaration clarifies some of the forms of


flexibility available, in particular compulsory licensing and
parallel importing. (For an explanation of these issues, go to the
main TRIPS pages on the WTO website)

For the Doha agenda, this separate declaration sets two specific
task. The TRIPS Council has to find a solution to the problems
countries may face in making use of compulsory licensing if
they have too little or no pharmaceutical manufacturing
capacity, reporting to the General Council on this by the end of
2002.(this was achieved in August, 2003, see intellectual
property section of the “Agreements” chapter.) The declaration
also extends the deadline for least-developed countries to apply
provisions on pharmaceutical patents until 1 January 2016.

Geographical indications — the registration system.


Geographical indications are place names (in some countries

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also words associated with a place) used to identify products
with particular characteristics because they come from specific
places. The WTO TRIPS Council has already started work on a
multilateral registration system for geographical indications for
wines and spirits. The Doha Declaration sets a deadline for
completing the negotiations: the Fifth Ministerial Conference in
2003.

These negotiations take place in “special sessions” of the


TRIPS Council.

Geographical indications — extending the “higher level of


protection” to other products. The TRIPS Agreement provides
a higher level of protection to geographical indications for wines
and spirits. This means they should be protected even if there is
no risk of misleading consumers or unfair competition. A
number of countries want to negotiate extending this higher
level to other products. Others oppose the move, and the debate
in the TRIPS Council has included the question of whether the
relevant provisions of the TRIPS Agreement provide a mandate
for extending coverage beyond wines and spirits.

The Doha Declaration notes that the TRIPS Council will handle
this under the declaration’s paragraph 12 (which deals with
implementation issues). Paragraph 12 offers two tracks:

“(a) where we provide a specific negotiating mandate in this


Declaration, the relevant implementation issues shall be
addressed under that mandate;

(b) the other outstanding implementation issues shall be


addressed as a matter of priority by the relevant WTO bodies,
which shall report to the Trade Negotiations Committee [TNC],
established under paragraph 46 below, by the end of 2002 for
appropriate action.”

In papers circulated at the Ministerial Conference, member


governments expressed different interpretations of this mandate.

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Argentina said it understands “there is no agreement to negotiate
the ‘other outstanding implementation issues’ referred to under
(b) and that, by the end of 2002, consensus will be required in
order to launch any negotiations on these issues”.

Bulgaria, the Czech Republic, EU, Hungary, India,


Liechtenstein, Kenya, Mauritius, Nigeria, Pakistan, the Slovak
Republic, Slovenia, Sri Lanka, Switzerland, Thailand and
Turkey argued that there is a clear mandate to negotiate
immediately.

Reviews of TRIPS provisions. Two reviews have been taking


place in the TRIPS Council, as required by the TRIPS
Agreement: a review of Article 27.3(b) which deals with
patentability or non-patentability of plant and animal inventions,
and the protection of plant varieties; and a review of the entire
TRIPS Agreement (required by Article 71.1).

The Doha Declaration says that work in the TRIPS Council on


these reviews or any other implementation issue should also
look at: the relationship between the TRIPS Agreement and the
UN Convention on Biodiversity; the protection of traditional
knowledge and folklore; and other relevant new developments
that member governments raise in the review of the TRIPS
Agreement. It adds that the TRIPS Council’s work on these
topics is to be guided by the TRIPS Agreement’s objectives
(Article 7) and principles (Article 8), and must take development
fully into account.

Relationship between trade and investment

This is a “Singapore issue” i.e. a working group set up by the


1996 Singapore Ministerial Conference has been studying it.

In the period up to the 2003 Ministerial Conference, the


declaration instructs the working group to focus on clarifying
the scope and definition of the issues, transparency, non-

25
discrimination, ways of preparing negotiated commitments,
development provisions, exceptions and balance-of-payments
safeguards, consultation and dispute settlement. The negotiated
commitments would be modelled on those made in services,
which specify where commitments are being made — “positive
lists” — rather than making broad commitments and listing
exceptions.

The declaration also spells out a number of principles such as


the need to balance the interests of countries where foreign
investment originates and where it is invested, countries’ right to
regulate investment, development, public interest and individual
countries’ specific circumstances. It also emphasizes support
and technical cooperation for developing and least-developed
countries, and coordination with other international
organizations such as the UN Conference on Trade and
Development (UNCTAD).

Interaction between trade and competition


policy

This is another “Singapore issue”, with a working group set up


in 1996 to study the subject.

In the period up to the 2003 Ministerial Conference, the


declaration instructs the working group to focus on clarifying:

• core principles including transparency, non-discrimination


and procedural fairness, and provisions on “hardcore”
cartels (i.e. cartels that are formally set up)
• ways of handling voluntary cooperation on competition
policy among WTO member governments
• support for progressive reinforcement of competition
institutions in developing countries through capacity
building

26
The declaration says the work must take full account of
developmental needs. It includes technical cooperation and
capacity building, on such topics as policy analysis and
development, so that developing countries are better placed to
evaluate the implications of closer multilateral cooperation for
various developmental objectives. Cooperation with other
organizations such as the UN Conference on Trade and
Development (UNCTAD) is also included.

Transparency in government procurement

A third “Singapore issue” that was handled by a working group


set up by the Singapore Ministerial Conference in 1996.

The Doha Declaration says that the “negotiations shall be


limited to the transparency aspects and therefore will not restrict
the scope for countries to give preferences to domestic supplies
and suppliers” — it is separate from the pluri lateral
Government Procurement Agreement.

The declaration also stresses development concerns, technical


assistance and capacity building.

Since the 1 August 2004 decision, this subject has been dropped
from the Doha agenda.

Trade facilitation

A fourth “Singapore issue” kicked off by the 1996 Ministerial


Conference.

The declaration recognizes the case for “further expediting the


movement, release and clearance of goods, including goods in
transit, and the need for enhanced technical assistance and
capacity building in this area”.

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In the period until the Fifth Ministerial Conference in 2003, the
WTO Goods Council, which had been working on this subject
since 1997, “shall review and as appropriate, clarify and
improve relevant aspects of Articles 5 (‘Freedom of Transit’), 8
(‘Fees and Formalities Connected with Importation and
Exportation’) and 10 (‘Publication and Administration of Trade
Regulations’) of the General Agreement on Tariffs and Trade
(GATT 1994) and identify the trade facilitation needs and
priorities of Members, in particular developing and least-
developed countries”.

Those issues were cited in the 1 August 2004 decision that broke
the Cancún deadlock. Members agreed to start negotiations on
trade facilitation, but not the three other Singapore issues.

WTO rules: anti-dumping and subsidies

The ministers agreed to negotiations on the Anti-Dumping


(GATT Article 6) and Subsidies agreements. The aim is to
clarify and improve disciplines while preserving the basic,
concepts, principles of these agreements, and taking into account
the needs of developing and least-developed participants.

In overlapping negotiating phases, participants first indicated


which provisions of these two agreements they think should be
the subject of clarification and improvement in the next phase of
negotiations. The ministers mention specifically fisheries
subsidies as one sector important to developing countries and
where participants should aim to clarify and improve WTO
disciplines.

WTO rules: regional trade agreements

WTO rules say regional trade agreements have to meet certain


conditions. But interpreting the wording of these rules has

28
proved controversial, and has been a central element in the work
of the Regional Trade Agreements Committee. As a result, since
1995 the committee has failed to complete its assessments of
whether individual trade agreements conform with WTO
provisions.

This is now an important challenge, particularly when nearly all


member governments are parties to regional agreements, are
negotiating them, or are considering negotiating them. In the
Doha Declaration, members agreed to negotiate a solution,
giving due regard to the role that these agreements can play in
fostering development.

The declaration mandates negotiations aimed at “clarifying and


improving disciplines and procedures under the existing WTO
provisions applying to regional trade agreements. The
negotiations shall take into account the developmental aspects of
regional trade agreements.”

These negotiations fell into the general timetable established for


virtually all negotiations under the Doha Declaration. The
original deadline of 1 January 2005 was missed and the current
unofficial aim is to finish the talks by the end of 2006. The 2003
Fifth Ministerial Conference in Mexico was intended to take
stock of progress, provide any necessary political guidance, and
take decisions as necessary.

Dispute Settlement Understanding

The 1994 Marrakesh Ministerial Conference mandated WTO


member governments to conduct a review of the Dispute
Settlement Understanding (DSU, the WTO agreement on
dispute settlement) within four years of the entry into force of
the WTO Agreement (i.e. by 1 January 1999).

The Dispute Settlement Body (DSB) started the review in late


1997, and held a series of informal discussions on the basis of
proposals and issues that members identified. Many, if not all,

29
members clearly felt that improvements should be made to the
understanding. However, the DSB could not reach a consensus
on the results of the review.

The Doha Declaration mandates negotiations and states (in par


47) that these will not be part of the single undertaking — i.e.
that they will not be tied to the overall success or failure of the
other negotiations mandated by the declaration. Originally set to
conclude by May 2003, the negotiations are continuing without
a deadline.

Trade and environment

New negotiations

Multilateral environmental agreements. Ministers agreed to


launch negotiations on the relationship between existing WTO
rules and specific trade obligations set out in multilateral
environmental agreements. The negotiations will address how
WTO rules are to apply to WTO members that are parties to
environmental agreements, in particular to clarify the
relationship between trade measures taken under the
environmental agreements and WTO rules.

So far no measure affecting trade taken under an environmental


agreement has been challenged in the GATT-WTO system.

Information exchange. Ministers agreed to negotiate


procedures for regular information exchange between
secretariats of multilateral environmental agreements and the
WTO. Currently, the Trade and Environment Committee holds
an information session with different secretariats of the
multilateral environmental agreements once or twice a year to
discuss the trade-related provisions in these environmental
agreements and also their dispute settlement mechanisms. The

30
new information exchange procedures may expand the scope of
existing cooperation.

Observer status. Overall, the situation concerning the granting


of observer status in the WTO to other international
governmental organizations is currently blocked for political
reasons. The negotiations aim to develop criteria for
observership in WTO.

Trade barriers on environmental goods and services.


Ministers also agreed to negotiations on the reduction or
elimination of tariff and non-tariff barriers to environmental
goods and services. Examples of environmental goods and
services are catalytic converters, air filters or consultancy
services on wastewater management.

Fisheries subsidies. Ministers agreed to clarify and improve


WTO rules that apply to fisheries subsidies. The issue of
fisheries subsidies has been studied in the Trade and
Environment Committee for several years. Some studies
demonstrate these subsidies can be environmentally damaging if
they lead to too many fishermen chasing too few fish.

Negotiations on these issues, including concepts of what are the


relevant environmental goods and services, take place in
“special sessions” of the Trade and Environment Committee.
Negotiations on market access for environmental goods and
services take place in the Market Access Negotiating Group
and Services Council “special sessions”.

Ministers instructed the Trade and Environment Committee,


in pursuing work on all items on its agenda, to pay particular
attention to the following areas:

• The effect of environmental measures on market access,


especially for developing countries.
• “Win-win-win” situations: when eliminating or reducing
trade restrictions and distortions would benefit trade, the
environment and development.

31
• Intellectual property. Paragraph 19 of the Ministerial
Declaration mandates the TRIPs Council to continue
clarifying the relationship between the TRIPS Agreement
and the Biological Diversity Convention. Ministers also
ask the Trade and Environment Committee to continue to
look at the relevant provisions of the TRIPS agreement.
• Environmental labelling requirements. The Trade and
Environment Committee is to look at the impact of eco-
labelling on trade and examine whether existing WTO
rules stand in the way of eco-labelling policies. Parallel
discussions are to take place in the Technical Barriers to
Trade (TBT) Committee.
• For all these issues: when working on these (market
access, “win-win-win” situations, intellectual property and
environmental labelling), the Trade and Environment
Committee should identify WTO rules that would need to
be clarified.
• General: ministers recognize the importance of technical
assistance and capacity building programmes for
developing countries in the trade and environment area.
They also encourage members to share expertise and
experience on national environmental reviews.

Electronic commerce
The Doha Declaration endorses the work already done on
electronic commerce and instructs the General Council to
consider the most appropriate institutional arrangements for
handling the work programme, and to report on further progress
to the Fifth Ministerial Conference.

The declaration on electronic commerce from the Second


Ministerial Conference in Geneva, 1998, said that WTO
members will continue their practice of not imposing customs
duties on electronic transmissions. The Doha Declaration states
that members will continue this practice until the Fifth
Ministerial Conference.

32
Small economies

Small economies face specific challenges in their participation


in world trade, for example lack of economy of scale or limited
natural resources.

The Doha Declaration mandates the General Council to


examine these problems and to make recommendations to the
next Ministerial Conference as to what trade-related measures
could improve the integration of small economies.

Trade, debt and finance

Many developing countries face serious external debt problems


and have been through financial crises. WTO ministers decided
in Doha to establish a Working Group on Trade, Debt and
Finance to look at how trade-related measures can contribute to
find a durable solution to these problems. This working group
will report to the General Council which will in turn report to
the next Ministerial Conference.

Trade and technology transfer

A number of provisions in the WTO agreements mention the


need for a transfer of technology to take place between
developed and developing countries.

However, it is not clear how such a transfer takes place in


practice and if specific measures might be taken within the
WTO to encourage such flows of technology.

WTO ministers decided in Doha to establish a working group


to examine the issue. The working group will report to the
General Council which itself will report to the next Ministerial
Conference.

33
Technical cooperation and capacity building

Through various paragraphs of the Doha Declaration, WTO


member governments have made new commitments on technical
cooperation and capacity building.

For example, the section on the relationship between trade and


investment includes a call (par 21) for enhanced support for
technical assistance and capacity building in this area.

Within the specific heading “technical cooperation and capacity


building”, paragraph 41 lists all the references to commitments
on technical cooperation within the Doha Declaration:
paragraphs 16 (market access for non-agricultural products), 21
(trade and investment), 24 (trade and competition policy), 26
(transparency in government procurement), 27 (trade
facilitation), 33 (environment), 38-40 (technical cooperation and
capacity building), 42 and 43 (least-developed countries).
(Paragraph 2 in the preamble is also cited.)

Under this heading (i.e. pars 38-41), WTO member governments


reaffirm all technical cooperation and capacity building
commitments made throughout the declaration and add general
commitments:

• The Secretariat, in coordination with other relevant


agencies, is to encourage WTO developing-country
members to consider trade as a main element for reducing
poverty and to include trade measures in their development
strategies.
• The agenda set out in the Doha Declaration gives priority
to small, vulnerable, and transition economies, as well as
to members and observers that do not have permanent
delegations in Geneva.
• Technical assistance must be delivered by the WTO and
other relevant international organizations within a coherent
policy framework.

34
The Director-General reported to the General Council in
December 2002 and to the Fifth Ministerial Conference on the
implementation and adequacy of these new commitments.

Following the declaration’s instructions to develop a plan


ensuring long-term funding for WTO technical assistance, the
General Council adopted on 20 December 2001 (one month
after the Doha conference) a new budget that increased technical
assistance funding by 80% and established a Doha Development
Agenda Global Trust Fund. The fund now has an annual budget
of 24 million Swiss francs.

Least-developed countries

Many developed countries have now significantly decreased or


actually scrapped tariffs on imports from least-developed
countries (LDCs).

In the Doha declaration, WTO member governments commit


themselves to the objective of duty-free, quota-free market
access for LDCs’ products and to consider additional measures
to improve market access for these exports.

Members also agree to try to ensure that least-developed


countries can negotiate WTO membership faster and more
easily.

Some technical assistance is targeted specifically for least-


developed countries. The Doha Declaration urges WTO
member donors to significantly increase their contributions.

In addition, the Sub-Committee for LDCs (a subsidiary body


of the WTO Committee on Trade and Development) designed a
work programme un February 2002, as instructed by the Doha

35
Declaration, taking into account the parts of the declaration
related to trade that was issued at the UN LDC Conference.

Special and differential treatment

The WTO agreements contain special provisions which give


developing countries special rights. These special provisions
include, for example, longer time periods for implementing
agreements and commitments or measures to increase trading
opportunities for developing countries.

In the Doha Declaration, member governments agree that all


special and differential treatment provisions should be reviewed
with a view to strengthening them and making them more
precise.

More specifically, the declaration (together with the Decision on


Implementation-Related Issues and Concerns) mandates the
Trade and Development Committee to identify which of those
special and differential treatment provisions are mandatory, and
to consider the implications of making mandatory those which
are currently non-binding.

The Decision on Implementation-Related Issues and Concerns


instructed the committee to make its recommendations for the
General Council before July 2002. But because members
needed more time, this was postponed to the end of
July 2005.

36
IMPARTANCE OF
DOHA
DECLARATION

37
Price Controls-A Potential Path to
Affordable Medicines?
"Issuance of a patent does not signify government approval to
commercialise the patented product. It only prevents others from
doing so for the period of the patent. Approval by a regulatory
agency, such as the Food and Drug Administration or the
Environmental Protection Agency, may be necessary before a
patented product can actually be marketed by the patent holder
or licensee."
Every nation in the world appears to exercise some degree of
control over the price at which a pharmaceutical can be sold and
the exercise of that control is not subject to TRIPs.3 In fact,
TRIPS leaves the question of whether to allow parallel imports
of patented pharmaceuticals to the discretion of each nation. The
primary incentive for parallel imports is lower prices.

38
Significant international price differentials for pharmaceuticals
primarily result from variations in price controls.

It is not the purpose of this paper to discuss the various


techniques used by nations to determine a price for a particular
pharmaceutical. Suffice it to say that the price is determined by a
negotiation with the manufacturer which involves an evaluation
of a variety of factors including the price of competitive
products, the relative value of the product, the price in non-
control nations like the United States, etc. The most significant
fact, in relationship to this discussion, is that the price of a new
drug is not based on its cost of manufacture whereas the price of
a generic copy of that drug is usually related to its cost of
manufacture except when there is only one source for the
generic product. To put the matter in perspective, the cost of
goods for a patented drug rarely amounts to 10% of the selling
price whereas the cost of goods represents 50% or more of the
selling price of most multi-source generic drugs. That is why it
is not uncommon to see a patented drug that sells for
$1.00/tablet eventually become a generic drug that sells for
$0.20/tablet.

Unquestionably, some group of consumers must pay for the cost


and investment made in research and development to discover
new drugs even though it appears that governments are bearing
an ever-increasing portion of that burden. The price of drugs in
the U.S. is also inflated by costs associated with advertising,
physician marketing and lobbying and by public acceptance of
corporate and government policies geared to produced
extraordinary returns for pharmaceutical companies.

Despite some effort to take advantage of Canadian drug prices,


it is unlikely that, in the near term, the United States or other
developed nations will adopt policies that eliminate differential
pricing between the richest and the poorest nations. So long as
that remains true, it is reasonable to assume that major
pharmaceutical companies will reluctantly accept reasonably
stringent price controls imposed by the least developed or

39
developing nations. The fact is that the profits derived from
sales to those nations are currently small to non-existent and do
not materially affect the earnings or market value of the major
pharmaceutical companies. Obviously, over time, the vast
populations in these regions represent a source of sales and
profit growth. Moreover, there is no valid economic or social
rationale for compelling a poor nation to pay a price that
incorporates costs connected to the manner in which drugs are
sold and distributed in developed nations. Indeed, for drugs that
were primarily developed for western markets, a reasonable
basis exists for arguing that the price to the poorest nations
should be based solely on production cost and exclude any
development costs.

Given the foregoing, developing nations could adopt the strategy


of maintaining a flow of affordable medications, despite patents,
which would fix the price of a drug in relation to the costs
involved in producing it plus a reasonable manufacturing profit
and a reasonable royalty based on those costs. In short,
developing and least developed nations can fix a price that
would approximate the cost of a generic version of a drug plus a
small royalty (5% or less) based on that price in recognition of
the patent rights. The manufactured cost could be determined in
one of several ways, as follows: (i) a nation could demand that
the patentee seeking approval to sell must submit those costs,
(ii) the costs could be estimated by qualified chemists and
process engineers based on process information disclosed in the
patent or other published sources, or (iii) the costs could be
established by an actual price quote from a potential generic
manufacturer.

This is not a compulsory licensing scheme. It merely uses some


of the analysis that might occur in establishing a compulsory
license to establish a pricing mechanism. A compulsory license
destroys exclusivity. The basic patent right, namely, the right to
exclude other from making, using or selling the patented
invention could be rigorously enforced by a nation so long as the

40
patent owner is willing to sell product at the price fixed in the
manner described.

Using TRIPS Exceptions to Enforce Price Controls

If patent owners are willing to submit to the proposed price


control scheme and to supply a nation's requirements of a drug
on these terms, all new drugs will be available to the poorest
nations at affordable prices, i.e., a price within 5% or less of the
price of an unpatented drug. Indeed, for reasons previously
discussed, production efficiencies enjoyed by the patented
source and development costs incurred by the generic source
could result in prices that are comparable to today's low-cost
generics even after a royalty burden is added to the price.

What happens if the patent owner refuses to sell at such prices or


offers an inadequate supply of drug? To put it simply, the
pricing mechanism can be readily enforced by applying the
compulsory license provision of TRIPs (Article 30) and/or the
exemptions from exclusivity provision (Article 31). Thus, for
example, if India (or China) adopted the proposed pricing
mechanism and a patent owner refused to sell at those prices, all
of the prerequisites to the grant of compulsory license defined in
Article 31 would be in place. In effect, the patent owner would
have a right of first refusal to sell all of a nation's requirements
at a price that covered costs, a manufacturer's reasonable profit
and a royalty. Does the patent owner have a right to complain
solely because it seeks monopoly pricing and profits? There is
nothing in Article 31 of TRIPs, any other provision of TRIPs, or
the Doha declaration that would suggest that such a complaint
could succeed. To the contrary, giving the patent owner the right
of first refusal to maintain exclusivity and the right to always
collect a reasonable royalty would appear to go further in the
direction of honoring patent rights than the Doha conferees
contemplated.

The adoption of stringent price controls by developing nations


that have the capacity to produce generic substitutes is critical to

41
insuring a flow of low cost medications to the least developed
nations. It insures that the low cost drug will exist either by
virtue of production and sale by the patent owner or by a local
producer under a compulsory license. Under the terms of the
Doha Declaration, the least developed nations will not be
required to enforce pharmaceutical patent protection until at
least 2016. Accordingly, they will be able to purchase the low
cost drug either directly from the patented source at prices
comparable to the controlled price in the developing nation or
from a licensed producer in the developing nation. It might be
argued that product produced in one country under a compulsory
license can not be exported to another country without violating
Article 31(f) of TRIPS. However, Article 31(f) does not bar such
sales completely but merely requires that products produced
under a compulsory license be "predominantly" for the domestic
market. A compulsory license issued by a developing nation
because of a patent owner's refusal to sell product at a controlled
price would clearly be issued primarily for the purpose of
satisfying domestic needs. The fact that product was also
produced for export to a least developed nation would not
change the predominant purpose of the license. Therefore,
Article 31(f) of TRIPs will not be an impediment to honoring
cross-border compulsory licenses.

It is hard to contemplate a reason why a patent owner would


agree to sell at the controlled price in a developing nation but
refuse to sell at the same price in a less developed nation with no
capacity to produce a substitute product. Nevertheless, the right
of first refusal to sell at the controlled price would also appear to
satisfy the prerequisites to invoking an exception under TRIPs
Article 30 in a producing nation for the benefit of a non-
producing nation. Clearly, if a patent owner refuses to deal after
a legitimate offer to purchase goods at a reasonable price has
been proffered, it would be hard to argue that granting an
exception to the patent right either "conflicts with the normal
exploitation of the patent" or "unreasonably prejudice(s) the
legitimate interests of the patent owner". Therefore a nation
"taking account of the legitimate interests" of the non-producing

42
nation should be able to produce the goods for export that the
patent owner refused to supply.

At first blush, it might be presumed that the large


pharmaceutical companies would vigorously oppose this
restrictive pricing scheme but, in fact, it contains much to
commend it that would be of interest to these multi-national
companies including:

1. It provides justification for differential pricing between


nations. The implementation of this proposal by poorer
countries could provide a powerful argument against
parallel imports to developed nations.
2. It puts generic competition out of business and gives the
research-based companies control over distribution. By
controlling the size, color and shape of products
manufactured and distributed in the poor countries, it
lessens the opportunities for the production of counterfeit
goods or the possibility that legitimate goods imported to
treat illness in poor nations could be easily exported to
developed nations for profit.
3. It provides a predictable, albeit small, profit on the
consumption of drugs by billions of people in poor nations.
As those markets grow and prosper, respect for patents,
and the profits which flow from that respect, will grow.
4. It solves a major political problem. The large drug
companies are under increasing pressure to help the
underprivileged. Attempts to enforce patents have been a
public relations disaster and have led some drug
companies to talk about offering free drugs to the poorest
nations. A system which addresses the public health needs
of poor people, shows respect for patents and produces a
small profit is preferable to the current environment of
relentless attacks on the morals of pharmaceutical
companies.
5. There is no significant amount of money to be made in the
markets of the poorest nations under any conditions in the
foreseeable future.

43
CONCLUSION
44
THE DOHA DECLARATION ON TRIPS
AND PUBLIC HEALTH, FIVE
YEARS ON:
Government officials, businesses and civil society groups alike
are this week commemorating the fifth anniversary of the
adoption of the Doha Declaration on the WTO TRIPS
Agreement and Public Health (WT/MIN(01)/DEC/2).

Signed by WTO Members on 14 November 2001 at the global


trade body’s fourth Ministerial Conference in Doha, Qatar, the
declaration aimed to address concerns that the patent protections
and other rules set out in the Agreement on Trade-Related
Aspects of Intellectual Property (TRIPS) could raise the price of
pharmaceuticals. Hailed at the time as “a giant victory” for
access to affordable medicine, it was said to be proof that the

45
multilateral trading system could respond to global public health
concerns.

Five years down the road, although most concur that the
declaration was an important milestone, many remain deeply
concerned about the impact of intellectual property rules on
access to medicine.

“The Doha Declaration said all the right things but to date has
delivered virtually nothing to poor patients,” said Celine
Chaveriat of Oxfam International. “We’ve gone backwards in
five years.” Guy Willis of the International Federation of
Pharmaceutical Manufacturers & Associations disagreed. He
told Bridges that that the “Doha Declaration represents a
balanced approach” and that developments over the last five
years have “helped to clarify the declaration.”

Adopted in conjunction with the launch of the Doha Round trade


talks, the declaration marked international consensus just two
months after the terrorist attacks of 11 September 2001. It came
at a time when concern over intellectual property rights’ effects
on access to medicines was higher than ever before. Fears of a
possible outbreak had rich country governments threatening to
override patents on anthrax drugs. Major legal battles over South
Africa and Brazil’s attempts to make treatment more affordable
for their millions of HIV/AIDS patients had thrust the issue to
the forefront of the WTO agenda.

In the declaration, government agreed that the “TRIPS


Agreement does not and should not prevent Members from
taking measures to protect public health.” Recognising “the
gravity of public health problems” that poor countries face,
especially due to epidemics such as HIV/AIDS, tuberculosis,
and malaria, they stressed that the agreement “can and should be
interpreted and implemented in a manner supportive of WTO
Members’ right to protect public health and . . . promote access
to medicines for all.”

46
The declaration aimed to clarify ambiguities in WTO intellectual
property rules about countries’ ability to produce and import
affordable drugs. It reaffirmed Members’ rights to “determine
what constitutes a national emergency or other circumstances of
extreme urgency,” and to “to determine the grounds” for
granting ‘compulsory licences’ authorising the production of
patented medicines without the consent of the patent holder.

Although the TRIPS Agreement permitted governments to use


compulsory licences, Article 31(f) specified that the generic
copies of patented drugs thus produced could only be sold on a
country’s domestic market. This rendered compulsory licensing
useless for countries lacking sufficient pharmaceutical
manufacturing capacity, no matter how severe their public
health problems. The declaration instructed Members to find “an
expeditious solution to this problem” by the end of 2002.

In addition, the Doha declaration reaffirmed Members’ right to


export and import legitimate medicines at lower prices. Known
as ‘parallel trade’ or parallel import/export,” the legitimacy of
this practice had been questioned by some countries.

Finally, it specified that least developed countries could delay


implementation of the TRIPS agreement with respect to
pharmaceuticals until January 2016.

Speaking in 2001, James Love of Consumer Project on


Technology called the declaration the “strongest and most
important international statement yet on the need to refashion
national patent laws to protect public health interests.” Oxfam’s
Michael Bailey added that the principles set out within the
document would make it “much harder for the US and drug
companies to bully poor countries over their patent policies.”

However, five years later, the struggle to improve countries’


access to medicines continues.

It took WTO Members until August 2003 — long after the 2002
deadline in the Doha declaration — to reach an accord on

47
helping countries lacking manufacturing capacity to make use of
compulsory licenses. The so-called ‘30 August 2003 decision’
was effectively a temporary waiver of the requirement that
medicines produced under compulsory licence be restricted to
the domestic market, pending an amendment of the TRIPS
agreement (see BRIDGES Weekly, 4 September 2003). Even at
the time, critics charged that its numerous requirements set an
impracticably high bar for the legal importation of drugs
produced under compulsory licences.

So far, not a single country has used the waiver. Nevertheless, in


December 2005, WTO Members agreed to make the 30 August
2003 decision a permanent amendment to the TRIPS agreement.
The amendment will enter into force when two-thirds of the
WTO’s 150 Members ratify it. To date, three countries have
ratified the amendment: the US, Switzerland, and El Salvador.
In the meantime, the waiver decision remains in effect.

Some have explained that since developing countries were


allowed to delay patent protection for pharmaceutical products
until January 2005, the full effect of the agreement has not been
realised. The mechanism “hasn’t been used because it’s too
early,” clarified one WTO official. “It will come up when there
is a single supplier in the market,” which will be the case once
developing countries and LDCs fully implement their TRIPS
commitments.

At a 14 November meeting in Geneva to commemorate the fifth


anniversary of the declaration, Ellen ‘t Hoen of the Campaign
for Access to Essential Medicines suggested that since some
major generics producers such as India are now providing patent
protection for newer medicines, their prices are being driven up.
“It should alarm us,” she said. “We’re getting back to where we
were five years ago.”

Third World Network’s Sangeeta Shashikant said that five years


after Doha, WTO rules were far from the only trade-related
threat to access to medicine. She pointed to the impact of

48
bilateral and regional free trade agreements (FTAs) on “limiting
the grounds on which governments can issue compulsory
licences,” for example, to cases of national emergency,
government non-commercial use, and to address anti-
competitive practices. She also warned that new protections for
clinical test data in FTAs delay generics from coming to market.
Added Oxfam’s Jennifer Brant, “What’s the point in having the
Doha declaration if it’s being chipped away?”

“The Doha declaration was of politically symbolic importance


by making people stop and think about it,” said Guilherme de
Aguiar Patriota, a Brazilian trade diplomat. Since then, however,
multinational corporations had steadily engaged in “damage
control,” quietly eroding the impact of the declaration. He added
that dissatisfaction with the WTO process had motivated
countries such as Brazil and Kenya to propose setting up a
global framework for research and development in the World
Health Organization.

One trade expert suggested that the declaration had served to


open the eyes of the WHO to the effects of intellectual property
rules. In recent years, the WHO has commissioned high-level
investigations into the relationship between intellectual property,
innovation, and public health.

ICTSD reporting; “Views on the Draft Declaration on the


TRIPS Agreement and Public Health,” CONSUMER PROJECT
ON TECHNOLOGY, 13 November 2001; “Views on the TRIPS
Agreement and Public Health: 5 Years down the Road,”
CONSUMER PROJECT ON TECHNOLOGY, 14 November
2006.

49
50