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Brazil’s sick of patent exploitation

The country is fighting the intellectual property laws that hiked up the cost of its HIV programme.

In 1996, in reaction to the enormity of the country’s HIV epidemic and citing its constitutional obligation to protect the right to health, the Brazilian government began to offer antiretroviral drugs (ARVs) to all those in need, free of charge. 

The programme was an early success. Whereas today South Africa champions a 50% treatment coverage rate, Brazil had placed 70% of those in need on ARVs by 2010, according to the Kaiser Family Foundation, a United States-based global health organisation. 

But Brazil’s HIV treatment programme comes with a heavy price tag. Take the price of two key ARVs, used for second and third-line treatment. This is medicine that is needed by patients who have become resistant to treatment used earlier in the progress of the disease. Both darunavir and raltegravir cost about $5 000 a patient a year. And patient numbers aren’t negligible. Nearly 6 000 patients take darunavir, and 6 000 take raltegravir, according to the most recent numbers from the country’s ministry of health.

Health campaigners say that Brazil could help to reduce exorbitant prices like these by amending its intellectual property laws. This would enable the country to better balance its obligation to protect the right to health with its obligation to protect pharmaceutical companies’ patent rights.

Tibotec (now Janssen) and Merck, the companies that make darunavir and raltegravir, respectively, have both filed handfuls of patents on their drugs. Health campaigners say that, if new patents are granted, the monopoly period could extend beyond 20 years, keeping the prices of these two ARVs high.

New report

Amending intellectual property legislation is just what the country aims to do with the release of a 363-page report earlier this week by the Brazilian Centre for Strategic Studies and Debates. 

The report’s suggested changes mirror those outlined in a Bill tabled in Brazil’s Parliament earlier this year. 

Although the Bill has yet to be heard, lead report writer Pedro Paranaguá, intellectual property adviser for the ruling Workers Party, says that he hopes the document “will serve as a means for influencing court decisions, the competition authority, and academics – nationally, and internationally”.

One suggested change includes ensuring that patent terms can only last 20 years. Currently, extensions can be granted if there is a significant delay in patent examination. 

Another aims to make it easier for compulsory licences to be granted. These licences would allow the government to overrule a company’s patent so that cheaper generic versions can be made. 

The paper also suggests that patent criteria are strengthened so that applications for patents on new versions of old medicines will not be considered and that interested parties, such as civil society organisations and generic companies, should be allowed to oppose patents before they are granted.

Paranaguá insists that the report and adjoining Bill should not be seen as intellectual property reform, but as revision. 

He says that Brazil is trying to fix “mistakes” it made by allowing for extensive intellectual property protection, beyond what was required by international law, when it changed its national legislation to be in line with the World Trade Organisation agreement on Trade-Related Aspects of Intellectual Property (Trips) in 1996. 

The recommendations are only “minor and urgent”, explains Paranaguá, and fall under the broad category of so-called agreement flexibilities, measures that can be undertaken by countries to help them to balance the protection of domestic and development interests with intellectual property protection.

International opposition 

Still, significant reaction is expected from the US, the European Union and pharmaceutical companies, according to Brook Baker, professor of law at Northeastern University in Boston. 

A small army of academics and health campaigners has been formed as defence. Dozens of organisations from around the world have signed a letter supporting Brazil’s report, and handfuls of lawyers and academics have signed a separate letter in support

Andy Gray, senior lecturer at the department of therapeutics and medicines management at the Nelson R Mandela School of Medicine at the University of KwaZulu-Natal, is one of the signatories.

“Any country that is attempting [a] review, which is often subject to considerable resistance from those with vested interests in the status quo, is deserving of support,” he says.

“In particular, given the importance of the Brics formation [a political organisation that comprises Brazil, Russia, India, China and South Africa], it is important for those engaged with these issues in these countries to stand together … Brazil …. provides useful examples of what can be achieved, in line with [World Trade Organisation] requirements.”

Brazil’s attempts to amend its legislation is part of a larger trend in which low- and middle-income countries are pushing back against pressure from the likes of the US and the EU, and the big-name pharmaceutical companies they house, to strengthen intellectual property legislation. 

Brazil knows this pressure well. Although developing countries had until 2005 to adopt the Trips Agreement into their national laws, Baker says that Brazil acceded nearly a decade earlier because the US pressured the country into adopting more stringent intellectual property measures by placing it on its Special 301 Report.

Trade sanctions 

The report is released annually by the Office of the US Trade Representative and highlights countries that do not provide what the US considers adequate intellectual property protection. Those on the so-called watch list can face trade sanctions, and Brazil did.

According to Baker, the country was pegged with tens of millions of dollars in tariffs as a result of it being on the list in the 1980s and was placed on the list a few other times. Fearing further sanctions, Brazil adopted Trips in 1996, and as a result had to respect 20-year patent terms on all medicine at the height of its HIV epidemic. 

India, in contrast, waited until the 2005 deadline. As such, the country did not have to respect pharmaceutical patents, which helped India to develop a strong generic pharmaceutical sector. The country is now famously known as the “pharmacy of the developing world”, supplying the majority of the ARVs used in Africa

The Brazilian report and the tabled Bill attempt to make up for lost time. 

“Brazil came to understand that it prematurely and unwisely became Trips compliant [early] … and it also learned that it had failed to use the flexibilities allowed by Trips,” says Baker. 

Brazil isn’t the only country amending its intellectual property legislation. Last month, South Africa’s department of trade and industry released a draft policy that attempts to streamline the country’s legislation while ensuring that development issues such as health and education are at the forefront of intellectual property-related legislative amendments. 

India has gone further. Earlier this year the country’s supreme court upheld a decision of the Indian patent office not to grant a patent on a newer crystalised form of imatinib, branded as Gleevec, a blockbuster anti-cancer drug made by Novartis.

Because multiple generic versions are available, Indian patients can procure imatinib at R10 694 a year, according to the medical aid group Médecins sans Frontiéres (MSF). In South Africa, only one generic is on the market: Cipla’s Imavec goes for nearly R210 000 a year

Though overly technical and even seemingly trivial to the casual observer, countries’ attempts to use Trips flexibilities are about something much larger.

“It’s a counter-hegemonic move,” says Baker. “Instead of being bullied by Europe and the United States, key middle-income countries are standing up and exercising their rights.”

Baker notes that attempts to use Trips flexibilities, as well as to amend intellectual property laws, stem in large part from civil society pressure. 

“Civil society fought very hard to get the reforms in India, and civil society fought very hard for the reforms in Brazil, and the MSF and the HIV advocacy group the Treatment Action Campaign fought very hard for the reforms that may be undertaken in South Africa. The government had to be forced to do it.”

Mara Kardas-Nelson was an OSF fellow at the Bhekisisa Centre for Health Journalism.