E-drug: Reuters on WTO panel US - Brazil
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SWITZERLAND: Update 1- WTO to rule on U.S.- Brazil patent row.
By Stephanie Nebehay
02/01/2001
Reuters English News Service
(C) Reuters Limited 2001.
GENEVA, Feb 1 (Reuters) - The World Trade Organisation ( WTO ) on
Thursday set up a dispute panel to examine a U.S. complaint that
Brazilian patent law discriminates against imports, a WTO spokesman
said.
The decision, which pavesg the way for neutral arbitration, was taken
by the WTO 's Dispute Settlement Body, composed of the global trade
watchdog's 140 member states.
Brazil countered by saying it had detected "several discriminatory
provisions" in the U.S. Patents Codes - an allegation rejected by the
U.S. delegation - and would seek new consultations with the United
States.
At the heart of the row - which could decide the fate of U.S.
pharmaceutical firms in Brazil - is Brazil 's 1997 patent law that
obliges products to be manufactured domestically. If they are not,
then after three years a local company can win the legal right to
produce another firm's patented product.
Diplomats said the alleged "patent theft" case could for the first
time test an exception in WTO intellectual property rules that allows
countries to grant "compulsory licensing" to skirt global patent
rules when a national emergency is invoked.
Medecins Sans Frontieres (Doctors Without Borders) called on the
United States to withdraw its complaint, arguing that it might
handicap Brazil 's successful AIDS programme, which freely
distributes antiretroviral drugs, many of which are produced
generically by Brazilian companies.
In 1994, Brazil 's government urged local firms to start making drugs
against AIDS, and Brazil now makes eight of the 12 antiretroviral
drugs used in the so-called AIDS cocktail.
Prices of those drugs have plummeted more than 70 percent. A typical
treatment now costs about $4,500 a year in Brazil , compared with
about $12,000 in the United States.
"The U.S. complaint threatens the Brazilian AIDS policy, which
includes providing free drugs to HIV-infected people. The lives of
hundreds of thousands of patients depend on this system," the
Brussels-based medical group said.
AIDS DEATHS DOWN
Medecins Sans Frontieres said Brazil 's programme, currently treating
90,000 HIV-AIDS patients with antiretroviral therapy, had cut AIDS
deaths by 50 percent between 1996 and 1999. The statistic is from
Brazilian government data, a spokesman said.
"A key factor in the success of this programme is the free
distribution of ARV drugs, many of which are manufactured
domestically by Brazilian companies," the humanitarian group said in
a statement in Geneva.
The U.S. delegation criticised Brazil 's law for imposing a "local
working" requirement that "all patents, regardless of who owns them
or who funds their creation, be subject to compulsory license unless
locally manufactured".
This violated the WTO 's agreement on Trade-Related Aspects of
Intellectual Property Rights, known as the TRIPS agreement, according
to the U.S. delegation.
The row could decide the future of U.S. pharmaceutical firms
operating in the South American country, the world's eighth largest
pharmaceutical market, according to diplomats.
Brazilian ambassador Celso Amorim said the law was consistent with
the TRIPS agreement. " Brazil is confident that a panel will only
confirm that our legislation is fully consistent with the TRIPS
agreement and that the U.S. action amounts to a demand for
commitments, which go beyond the agreement through resort to dispute
settlement procedures."
Amorim added: "...this is not only legally unfounded. It may prove
politically disastrous".
Four other countries - Japan, India, Honduras and the Dominican
Republic - reserved their "third-party" rights in the dispute,
according to diplomats.