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This article provides information about the implication of TRIPs for the developing countries:
TRIPs will affect the poorer countries that do not have the knowledge by increasing the gap; and by shifting bargaining power towards the producers of knowledge most of whom are in the industrialised North. Not only that, national governments which used to exempt certain areas and items such as medicine, agriculture etc. from patent laws now have to comply with WTO regimes.
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This will be most strongly felt in the area of patents and its effects on the prices of medicines. Equally endangered would be knowledge which has never been patented and which was in public domain of traditional and indigenous communities. This knowledge is being either cleverly siphoned off or stolen – also known as “biopiracy”.
More than 97 per cent of all patents worldwide is concentrated in a handful of countries; in 1993, ten countries accounted for 84 per cent of global R&D; 95 per cent of patents granted in the US over the past two decades were conferred on applications from ten countries which captured more than 90 per cent of cross-border royalties and licensing fees; 70 per cent of global royalty and licensing fee payments were between parent and affiliate in TNCs; and more than 80 per cent of the patents that have been granted in the developing countries belong to residents of industrial nations.
The fact that knowledge can be patented has serious implications for access to health, agricultural practices, and related fields such as bioengineering. TRIPs and Health: A pharmaceutical company can get a patent for both the process and product for 20 years under the TRIPs agreement. Product patents provide for absolute protection of the product, whereas process patents provide protection in respect of the technology and method of manufacture. A process patent system promotes a more competitive environment and a check on prices, as compared to the monopoly system created through product patents.
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With the TRIPs requirement for both product and process patents, it will therefore be possible to apply for patent rights over a product for 20 years, and thereafter, further periods of protection could be applied for the processes by which the product is produced. Earlier the Third World countries produce some medicines themselves, for example India, China, Brazil and Egypt allow patents on pharmaceutical processes but not the final products.
That means they can produce the drug legally using a different process from the original used. This supported the development of national domestic industries to produce generic drugs, which were cheaper than the branded originals. But now they have to comply with TRIPs agreement as members of WTO and have their patent laws amended and in place.
However, under TRIPs “countries can still gain access to drugs and protect public health under ‘compulsory drugs licensing’. Article 31 of TRIPs states that member states ‘may use the subject of a patent without the authorisation of a right-holder including use by the government’ in the public interest. It also says that ‘the right-holders shall be paid adequate remuneration taking into account the economic value of the authorisation’.
Thus governments can grant a license to make copies of patented drugs without the approval of the patent owner and pay a royalty to the latter. ‘Compulsory licensing’ is part of the patent law of many countries. This option has been used by countries to restrict the monopoly rights of companies in the interest of the public good”.
The US has applied for compulsory license domestically in hundreds of cases. But many developing and underdeveloped nations hesitate to opt for compulsory licensing because of trade sanctions against then. It happened with Thailand, when it tried to product generic drugs for its increasing AIDS patients under compulsory licensing scheme. It was forced to drop the plan when US threatened to increase tariff on wood products and jewellery from Thailand.
Similar threats were deployed on South Africa and was stopped with the accusation that South Africa was violating patent laws by opting to produce a generic drug for its 4 million AIDS patients. The pharmaceutical companies, backed by TNCs and US governments filed a petition. Thanks to intense pressure by AIDS activist and others that US retreated from its position and reached negotiations.
Free from competition, the company will be able to keep the price of the drug high during the protection period. By virtue of TRIPS protection, no generic equivalent can come into the market until expiry of the 20 years, denying patients cheaper alternatives. Patents on Life Forms Biological Material: Article 273 (b) of TRIPs allows patenting of life forms in the sense that microorganism and micro-biological processes have to patented and accord protection to plant varieties by patents or some legal means.
These enable the biotechnology lobby and Northern governments to exert private monopolistic rights over terrestrial biological resources. These measures will legitimise the private appropriation of community-based resources and knowledge and undermine indigenous and local communities. It gives the North legal right to plunder the biological heritage of the developing world. For instance, it will further the patentability of traditional medicines and crops which in the developing world have been in the public domain for millennia.
The developing world is the source of some 90 per cent of the world’s store of biological resources. Bio- prospectors have for many years stolen the plant knowledge of local people for profitable uses. For example the rosy periwinkle found in Madagascar contains anti-cancer properties, Eli Lilly developed a drug from it making $100 million in annual sales but nothing for Madagascar.
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The value of the trade in medicinal plants is currently estimated at US$43 billion a year; whilst the value of crops varieties improved and developed by traditional farmers to the seed industry amounts to US $15 billion, ether natural products so derived like sweeteners, perfumes, bio-pesticides, fabrics and cosmetics indicate the immense contribution and value of biological resources from the developing world.
In terms of the contribution to pharmacology, some three quarters of the plants that provide active ingredients for prescription drugs drew the attention of researchers because of their use in traditional medicine of the 120 active compounds currently isolated from the higher plants and widely used in modern medicine, 75 per cent show a positive correlation between their modem therapeutic use and the traditional use of the plant from which they were derived. Landmark discoveries were made of an important class of antihypertensive agents – ACE inhibitors from plant extracts collected from Malaysia, Ghana and Costa Rica.