E-drug: Open letter to the USTR
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This is an open letter to the USTR responding to the recent PhRMA
report on Thailand (http://www.phrma.org/issues/intl/nte.html).
Tido
Tido von Schoen-Angerer, MD
Medecins sans Frontieres, Thailand
msfdrugs@asianet.co.th
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Dear Ambassador Barshefsky
We are concerned that the National Trade Estimate Report on Thailand
that PhRMA has submitted to the US government will negatively
influence the year 2000 USTR NTE report. We are writing to ask the
USTR to abstain from its previous 'TRIPS PLUS" approach and to
carefully review the accusations on Thailand that PhRMA has made.
The PhRMA report claims that Thai law is still not TRIPS compliant in
many points.
1. Regarding S. 9(1) of the Patent Act. The Report suggests that the
provision is against the TRIPs Agreement since it excludes naturally
existing biologicals. Art. 27.3(b) of the TRIPs authorized the Member
states to exclude living organisms other than microorganisms. Thai
law does not exclude all kinds of microorganism but only those
organisms that exist in nature. This is not against the spirit of the
international agreement as microoganisms that are not technically
created are not considered invention. They are merely discovery and
no country's law protects discovery.
2. The PhRMA report attacks the Bolar type provision that is part of
patent law in many countries. As to Section 36(4) of the Thai Patent
Act, the law exempts from patent infringement the use of patented
products for market approval during the duration of the patent. This is
again not contrary to the TRIPS because the patent holder continues
to enjoy market exclusivity during the patent term. The use of
patented products for clinical trials is further not a commercial use and
does not affect the patent rights. Generic drugs can be released into
the market only after the patent expires. Without Bolar provisions
patent protection is in practice unfairly extended beyond the current
20 years.
3. PhRMA comments that absence of local working is reason for
compulsory license in Thai law. It is true that failure to manufacture
the patented product in the country is one of the grounds for the
application of compulsory license under Section 46 of the Thai Patent
Act. However we do not believe that TRIPS obliges member states to
recognize importation as sufficient working of the patent. Following
active USTR intervention under "special 301" the Thai government
adopted regulations in 1993 that restrict the use compulsory license
as to Section 46 of the Thai Patent Act. The regulations broadly
exclude many reasons for compulsory license, including importation.
4. We disagree that the provision on dependent compulsory licenses is
not in line with the TRIPS. Art. 31(j) of the Agreement states "any
decision relating to the remuneration provided in respect of such use
shall be subject to judicial review or other independent review by a
distinct higher authority in the Member". Though the Thai law does
not provide for judicial review in this case, the affected party is able to
appeal the decision to grant a compulsory license to the Patent Board,
which comprises representatives from various sectors and is
absolutely independent from government control.
5. As to Section 6(4), Thailand recognizes a 12-month priority period
for foreign applications, not 18 months as mentioned in the PHRMA
report. This is found in Section 19 B of the Thai Patent Act, not in
Section 6(4). Section 6(4) applies the 18-month period because in
most countries patent applications are published for public scrutiny
after 18 months from the filing date. This is a normal practice in most
countries and does not fall outside the scope of the TRIPs.
6. Regarding the Draft Trade Secret Law, the "public interest"
provision can be found in all countries' intellectual property law. We
are surprised that PHRMA considers this provision illegal.
7. PhRMA mispresents facts on parallel import in Thailand and speaks
of "the dangers that such imports pose to national health". PhRMA
confuses illegal smuggling of counterfeit drugs into Thailand with the
legal parallel importing under the supervision of the Thai FDA. All
imported drugs need to be registered with the FDA and are assessed
according to quality, safety and efficacy. Section 36(7) of Thai Patent
Law now authorizes parallel importation. "The TRIPS Agreement
explicitly states that if a country allows parallel imports - that is,
imports of goods already put on the market in another country with
the right holder's authorization - those practices cannot be challenged
under the Agreement" (Text of the official WTO booklet to the Seattle
meetings).
8. PhRMA complains that drugs still under the Safety Monitoring
Program can not be included in the National List of Essential Drugs
(NLED). PhRMA believes that the Thai government is setting up
market access barriers by using the NLED as a maximum list for
government hospitals and by setting maximum prices for drugs in the
NLED.
a) Making the NLED a minimal rather than a maximum list in public
hospitals as PhRMA suggests would undermine the very concept of an
essential drug list as is it is promoted by WHO. The rationale for the
use of a limited number of essential drugs is that it leads to an
improved supply of drugs, more rational prescribing and lower costs.
b) Following pressure by the USTR the Thai government is since
1994 providing 5- years of market exclusivity as pipeline protection of
drugs. This protection is given under the cover of the Safety
Monitoring Program (SMP) that provides extremely limited safety data
due to the passive monitoring system; so far SMP has in no case
detected safety problems that were not reported earlier in other
countries. Pharmaceutical companies were thus given pipeline
protection and "safety monitoring" purely to grant market monopoly;
how can PhRMA now demand that provisionally registered pipeline
drugs should be included in the NEDL?
c) Price control of medicines is a legitimate way of increasing
affordability of drugs and is clearly permissible under TRIPS. Thailand
has made very limited use of price control. Most medicines on the
NLED are still not affordable for the majority of people and are
reimbursed only for the small group of people covered by social
insurance.
Pharmaceutical companies have repeatedly emphasized that public
health policy rather than price is the main obstacle to insufficient
access to medicines. PhRMA here actively attempts to undermine
good, WHO recommended standards of national drug management.
We are seriously concerned that PhRMA policies negatively affect
public health in Thailand if given impact on the USTR NTE report. We
urge the USTR to consult with DHHS on this issue as was announced
by President Clinton during the 1999 Seattle meetings.
Sincerely,
Jakkrit Kuanpoth, PhD
Associate Professor, School of Law
Sukhothai Thammathirat University, Thailand
Jiraporn Limpananont, PhD
Associate Professor, Faculty of Pharmaceutical Sciences
Chulalongkorn University, Thailand
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