Biomedical Research in Developing Countries - UNICRI

PATENTING ISSUES AND ACCESS TO ESSENTIAL MEDICINES
The conduct of clinical research of drugs has, of course, as its final objective, the
marketing of a new product. Generally, newly patented drugs are marketed at high
prices to regain the costs of R&D. According to the Tufts Centre for the Study of
Drug Development 17 the average time for an experimental drug to reach the market
is 10 to 15 years. Only 5 in 5.000 compounds that enter pre-clinical testing are
admitted to human testing. Eventually, one of these 5 reach the market. On average,
it costs US$1.3 billion for research, development and marketing of a new drug.
With the growth of the market for generic medicines and the patents on bestselling
drugs expiring, the pharmaceutical industry is facing new challenges in the
development of innovative R&D products relevant to developing countries.
The TRIPS Agreement followed by the 2001 DOHA Declaration 18 , and by the WTO
Decision of 30 August 2003 19 have especially made the pharmaceutical industry
cautious to invest into new R&D for developing countries, due to the fear of losing
profits from being forced to sell at marginal costs. In the field of AIDS for example,
the number of new compounds under development has strongly declined between
1998 to 2001 from 250 to 173.
Article 31 of the TRIPS Agreement, in particular, addresses the use of “compulsory
licences” a number of mechanisms that allow governments or third parties
authorized by the governments to use a patent, behind payment of royalties,
without authorization of the right holder, for the production of medicines that have
a national relevance or in a state of emergency. Together with “parallel
importation”, that allows countries to shop around for the best price of a branded
drug on the global market, without permission from the patent holder, this
mechanism has been actively used by emerging market economies such as India,
17 Tufts Centre for the Study of Drug Development (Accessed at http://csdd.tufts.edu/Default.asp on December
2008)
18 The WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) allows governments
and third parties authorized by governments to issue compulsory licences in specific circumstances, including
public health emergencies, to use a patent without authorizaton by the right holder. This Agreement has paved
the way to the production of generic versions of branded name drugs at much lower prices. However, the TRIPS
Agreement also stipulates that the generics thus produced should be “predominantly” for the domestic market,
thus limiting the amount that can be exported to countries with an insufficient domestic pharmaceutical base.
19 The DOHA Declaration on the TRIPS Agreement and Public health reaffirmed flexibility of TRIPS member states
in challenging patent restrictions for better access to essential medicines and mandated WTO to find a solution,
by the end of 2002, to the inability of some countries to use compulsory licenses to produce the needed medicines
because they lacked the necessary manufacturing infrastructure, while those countries that had such capability
were not permitted to export to them. For months, WTO member states cold not reach agreement on how to ease
the importation restrictions, the debate being stalled by the US, under pressure from the pharmaceutical lobby.
In August 2003, WTO member states decided to waive the TRIPS domestic consumption requirement under
certain conditions to allow poor countries to import drugs produced under compulsory licence elsewhere. This
provisional waiver was made into a formal amendment to the TRIPS Agreement in December 2005, despite
criticism from health activists that its administrative requirements were so complex that no country had tried to
use it.
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