TPP Chiefs Raise Doubts about USTR’s Corporate IP Wish List

At the May 13th stakeholder briefing of the Trans-Pacific Partnership (TPP) trade talks outside Dallas, at least six countries' Chief Negotiators began to openly distance themselves from the Office of the United States Trade Representative (USTR), particularly from USTR’s radical intellectual property (IP) proposals, which would expand the scope and duration of pharmaceutical monopolies and challenge internet freedom.

In the past, these stakeholder briefings have felt like exercises in the art of saying little. USTR has sought to keep all nine countries on a common, limited message. But perhaps USTR can only push other countries and the public so far.

Early in the session, I asked the Chiefs:

The past year has witnessed the rise of an internet freedom social movement, with more than 3 million people petitioning the US Congress to block SOPA [the Stop Online Piracy Act] and tens of thousands protesting in the streets across Europe to shut down ACTA [the Anti-Counterfeiting Trade Agreement]. I think in Poland, these may have been the largest demonstrations since the Solidarity movement. Even Germany’s ministry of economic development is recommending against developing countries signing ACTA. Given that you are not releasing the TPP text, how will you assure people that the TPP will not pose similar problems?

Chile kicked things off, answering:

We are nine countries with many different positions—we are not all the same.

This may sound tame, but for those listening to the evolution of TPP sound bites, it was a surprisingly public distancing from USTR and its copyright and enforcement demands. And it set the pace for the day.

More Tumult at the TPP: Secret Negotiations Against Internet Freedom Continue this Week in Chile; Big Pharma Allies Attempt to Shut Down Critics’ Event (Again)

Talks on the Trans-Pacific Partnership Agreement (TPP), which the U.S. is negotiating with Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam, are continuing this week (April 9-13) in Santiago, Chile in the form of an “intersessional meeting” on intellectual property (IP) – focusing on internet policy. The last time such a meeting was convened on IP in January in Hollywood, a stakeholder event organized by public interest groups in the same hotel as the negotiations was cancelled after the hotel received pressure from the Office of the United States Trade Representative (USTR). Simultaneously, USTR made sure the Motion Picture Association of America (MPAA) had access to negotiators, as they were given an exclusive tour of 20th Century Fox Studios guided by a representative of the studio’s government relations office.

USTR is clamping down on public participation to minimize the spread of information which challenges their hardline IP maximalist agenda. In addition to increasing reliance on intersessionals, like this week’s Santiago meeting, where stakeholders are not given a forum to participate, USTR has now effectively reduced stakeholder participation in the official negotiating rounds by eliminating their opportunity to give presentations to negotiators in an official forum. USTR’s response signals the substantial impact critics of the TPP are having. At the March negotiating round in Melbourne, one stakeholder presentation after another criticized USTR’s aggressive pro-Big Pharma patent proposal, filling most of the afternoon. Now TPP countries are resisting USTR demands that would imperil their access to medicines.

Cozy relationships with government aren’t the only way corporations are influencing these talks. This week, American University and the University of Chile arranged to host an event to present analyses critical of particular proposals in the TPP. These include leaked provisions that would greatly favor Big Pharma, expand drug monopolies and raise medicine prices. The keynote speaker was to be Senator Ricardo Lagos, a major political figure in Chile considered to be a possible candidate for the Presidency. Nevertheless, the public University of Chile law school canceled the event on less than two days’ notice, evidently on the advice of a member of the faculty who is a paid advisor of the multinational pharmaceutical companies’ association in Chile (the Cámara de Industria Farmacéutica, or CIF).

The cancellation sent organizers scrambling for a new venue, which they found in Chile’s Catholic University.

Stakeholders from a spectrum of communities concerned with the implications of the TPP are continuing to shine light on the negotiations. Criticism of the TPP process is mounting from members of both state and federal government in the United States. Internet activists in Chile are calling on their government to defend the rights of their citizens from what could be the next SOPA, while analyses from academic experts on IP show that the U.S.-proposed TPP provisions go beyond those seen in ACTA. Meanwhile, USTR claims that allowing 600 corporate advisors to examine the negotiating text, including representatives of the Recording Industry Association of America (RIAA) and the Entertainment Software Association (ESA), while keeping it hidden from the general public justifies their claim of “unprecedented” transparency in the negotiations.

SOPA proved that the netroots can beat IP maximalism and rulemakings from Washington designed to curb internet freedom, while the populist response to ACTA has shown that policy laundering attempts by industry and their allies in government will face serious resistance. Ambitious, secret economic agreements have been defeated before through public awareness and organizing. Now it’s time to stand up and tell our governments we will not stand idly by while our rights are under siege.

Senator Wyden files amendment for more transparency in the TPP negotiations

A couple of weeks ago we reported about Senator Wyden's lively exchange with U.S. Trade Representative Ron Kirk regarding transparency in the Trans-Pacific Partnership Free Trade Agreement (TPP).

Senator Wyden has now increased pressure on USTR by filing a legislative amendment for more transparency in the TPP negotiations related to intellectual property and the internet. Our colleagues at KEI posted a short blog about the amendment.

November Deadline for Obama’s First Trade Deal Falls Away as Controversies Roil Chicago Trans-Pacific Trade Talks

American Medical Assoc. Enters Fray Over Inclusion of Tobacco, Alcohol in Deal; Obama Administration Proposal Limiting Access to Medicines Stirs Fury

CHICAGO – A range of controversies, mostly on health issues, has emerged at negotiations of the Trans-Pacific Free Trade Agreement (FTA) in Chicago this week, such that the vaunted deadline to complete the deal – the November Asia-Pacific Economic Cooperation (APEC) summit in Hawaii – will not be met. And after this eighth round of negotiations, troubling signs are emerging that the Obama administration’s first trade deal could roll back initial reforms made on affordable access to medicines made during the last round of George W. Bush-era trade deals, Public Citizen said today.

“While the administration keeps touting this potential first Obama trade pact as a new 21st century model, and instead of implementing the many specific trade reforms President Obama pledged as a candidate to avoid more job loss and ensure import safety, it appears the administration is pushing for something like NAFTA on steroids with Vietnam and Malaysia,” said Lori Wallach, director of Public Citizen’s Global Trade Watch.

Growing controversy over the trade deal’s threats to domestic regulation of cigarettes and alcohol escalated when the American Medical Association (AMA) made its first foray into the trade debate, sending a letter on Sept. 8 to U.S. negotiators demanding that tobacco and alcohol be excluded from the pact. The AMA and other public health groups intensified their focus on trade talks after the World Trade Organization (WTO) ruled recently that the U.S. ban on clove, cola and candy-flavored cigarettes in the 2009 legislation to combat youth smoking violated WTO requirements, and ordered the policy changed. This followed an attack by tobacco giant Philip Morris Asia against Australia’s proposed cigarette “plain packaging” rules using an international commercial agreement that follows on a similar assault by a Swiss Philip Morris unit on a similar Uruguayan law initiated last year. Both attacks use the “investor-state” private enforcement system the Obama administration is pushing for in the Trans-Pacific pact.

Meanwhile, various countries and U.S. health, consumer and development groups reacted with ire as the Obama administration sought to distract attention from a proposal it was submitting earlier this week to roll back Bush-era 2007 improvements for affordable medicines access by expanding trade pact patent rules. While the U.S. proposal was being submitted behind closed doors, a paper was released publicly announcing a U.S. “Trade Enhancing Access to Medicines (TEAM) initiative” that was advertised as revealing a new policy to increase access to medicines for consumers. In fact, this initiative simply repackaged many of the most problematic aspects of the long-standing, retrograde U.S. position on trade patent rules that restrict medicinal access.

“It is insulting that the Obama administration released this paper on ‘access to medicines’ on the same day that it put forth its most controversial and access-restricting provisions at the Trans-Pacific FTA negotiations,” said Peter Maybarduk, director of Public Citizen’s Global Access to Medicines Program. “The U.S. intellectual property proposal rolls back even some of the few protections for access to medicines in the Bush-negotiated trade pacts. The administration is heading rapidly in the wrong direction, at the expense of global public health.”

The Obama administration’s attempts to roll back the “May 2007” reforms of trade pact patent rules relating to medicine access, its insistence over objections by Australia and other countries that private corporate “investor-state” enforcement be included, and its rejection of exclusions for any product from the deal is likely to add more dead weight to its efforts to pass pending Bush-negotiated trade deals with South Korea, Colombia and Panama. These deals were signed in 2007. After months of insisting votes would happen “within weeks,” it is increasingly likely that Congress could consider the deals in October. These three trade deals contain the same foreign investor rights and private enforcement used by Philip Morris to attack tobacco regulation in other countries.

“Obama folks always say that there just was not much they could do to fix the Bush-negotiated Korea, Colombia and Panama deals, but that when the new administration negotiated its own trade pacts, it would do them differently,” Wallach said. “Well, now they’re negotiating their own trade deal, and it’s looking like a Bush NAFTA-style deal in key respects – and even worse in some areas – and that only builds even more opposition to Obama’s call to pass Bush’s  old deals.”

Trans-Pacific FTA negotiations currently include Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the United States and Vietnam. The next round of Trans-Pacific FTA negotiations will be held next month in Lima, Peru. No high-level negotiations will take place at the APEC summit in Hawaii in November.

Bombshell Australian Report Finds FTAs "Oversold"

Yesterday, the Australian Government's Productivity Commission released a 400-page report examining the effects of Australia's "Free Trade" Agreements (FTAs). The Productivity Commission is the Australian Government’s independent research and advisory body on economic and social issues. The Age reports:

The Productivity Commission has told the government there is little evidence to suggest Australia's six free-trade agreements have produced ''substantial commercial benefits''....

Copyright provisions inserted in the US-Australia Free Trade Agreement could eventually cost Australia as much as $88 million per year....

The report also rails against investor-state lawsuit provisions like NAFTA's Chapter 11 that allow foreign corporations to sue sovereign governments for taxpayer compensation when governments take necessary action to protect the health and safety of their citizens: "There does not appear to be an underlying economic problem that necessitates the inclusion of ISDS [Investor-State Dispute Settlement] provisions within agreements.....Experience in other countries demonstrates that there are considerable policy and financial risks arising from ISDS provisions." The report goes on to note that millions of dollars of taxpayer funds has been paid out to multinational corporations due to corporate lawsuits filed under NAFTA's investor-state dispute settlement provisions. 

The report recommends that the Australian government "seek to avoid the inclusion of investor-state dispute settlement provisions in [FTAs] that grant foreign investors in Australia substantive or procedural rights greater than those enjoyed by Australian investors."  Australia excluded investor-state lawsuit provisions from the U.S.-Australia FTA due to justified fears that foreign corporations would demand compensation if environmental or public interest laws reduced their "expected profits."  The Australian trade negotiators would be wise to heed the well-reasoned recommendations of the Productivity Commission and ensure that investor-state lawsuit provisions are excluded from the proposed Trans-Pacific Partnership.
 
The report notes that the totality of evidence on FTAs "suggest that the economic value of Australia’s [FTAs] has been oversold." That sounds familiar. Oh, that's right, Public Citizen found that the same was true for U.S. FTAs in our September report, "Lies, Damn Lies, and Export Statistics: How Corporate Lobbyists Distort the Record of Flawed Trade Deals," in which we revealed that U.S. exports to FTA partners have grown at half the pace of U.S. exports to the rest of the world. There seems to be a consensus developing here.

University of California Study Finds that CAFTA Intellectual Property Rules Hinder Access to Medicines in Guatemala

A new study from the University of California concludes after rigorous analysis that the Central American Free Trade Agreement (CAFTA) elevates the prices of medicines in Guatemala while removing cheaper, generic options from the market. 

Guatemala is a low-income country with a domestic generic drug industry.  CAFTA’s intellectual property rules affect the drug market not as much through patent protections, but through data protection (or data exclusivity), which inserts an administrative barrier to generic drugs entering the market even if there is no patent in place, providing one company with a monopoly. Not only are generics denied registration and entry into the market by CAFTA’s market protections but generics already in the market are removed. 

The study looked at drugs used to treat some of the most common causes for sickness and mortality in Guatemala, including cancer, pneumonia, diabetes, and cardiac disease and stroke. The intellectual property rules in CAFTA have had a significant effect on medication costs in Guatemala, making many of them prohibitively expensive. In every case included in the study, the data-protected drug was more expensive than its generic equivalent. For example, the insulin Lantus, used to treat diabetes, costs 846 percent more than its generic equivalent. The antifungal Vfend, used to treat infections, costs 810 percent more than the generic medication. 

In fact, CAFTA’s rules on intellectual property provide even stronger monopoly protections than U.S. law or the WTO’s Agreement on Trade-Related Aspects of Intellectual Property (TRIPS).  Unfortunately, Guatemala is a prime example of the effects of CAFTA’s intellectual property rules and the Guatemalan people are paying the price, literally and figuratively. 

For more information, see GTW’s information on CAFTA and access to medicines.

The University of California article, entitled “A Trade Agreement’s Impact on Access to Generic Drugs,” can be found here. 

Botox protectionism

Defenders of the trade status quo sometimes like to point out that the economic argument in favor of free trade is identical whether you're talking about trade between countries, individuals or state lines. And that's true, so long as you believe the models and are willing to dismiss the notion of a national interest. Some interest gets protected at the expense of another: there may be a surplus created, but who can say where this goes without looking at specific distributions?

In the latest news off of Roll Call, it's Botox that's getting protected:

Those wrinkle-busting Botox injections can cost $500 a squirt, but if you were waiting for the price to come down when a generic version hits the market, well, get used to your frown lines.

That’s if a bill introduced late last week by Reps. Anna Eshoo (D-Calif.) and Joe Barton (R-Texas) makes it into law.

The measure, which would create a pathway for generic versions of biotech drugs, exempts pharmaceuticals that contain “select agents and toxins,” such as Botox’s botulinum toxin type A, mainly on the the grounds of national security, according to people on both sides of the issue...

A lobbyist for the generics industry said the national security argument doesn’t hold up. “They spin it as a national security issue — that botulism could be used in terrorist plots,” said this lobbyist. “I don’t know how in the hell they justify how generic botox is any more of a terrorist threat than brand-name Botox.”

The fact that this is a protectionist measure that is not free trade that benefits Botox producers at the expense of other segments of society is not discussed in the article. Barton, who voted against fair trade on 19 out of 20 votes, says on his website that "I firmly believe that free and open trade benefits all people." Eshoo claims to have a good trade record because she supports labor standards and trade adjustment assistance, but she was only marginally better and voted against fair trade on 15 out of 19 occasions, including through her votes for NAFTA, WTO, and the Peru FTA. Isn't this discrepancy worth a mention?

On the other hand, as our own Health Research Group at Public Citizen has pointed out, to the extent that Botox is dangerous, maybe it's a good thing that it's made out of reach for more people!

Nobelists on trade, globalization

Leonid Hurwicz, Roger Myerson, and Eric Maskin were awarded the Nobel in Economics yesterday for their work in mechanism design theory. Alex Tabarrok at Marginal Revolution has a pretty good explanation of this work, and Maskin told the Times:

Mechanism design, Professor Maskin explained, can be thought of as the “reverse engineering part of economics.” The starting point, he said, is an outcome that is being sought, like a cleaner environment, a more equitable distribution of income or more technical innovation. Then, he added, one works to design a system that aligns private incentives with public goals.

One recent subject of Professor Maskin’s wide-ranging research has been on the value of software patents. He determined that software was a market where innovations tended to be sequential, in that they were built closely on the work of predecessors, and innovators could take many different paths to the same goal. In such markets, he said, patents might serve as a wall that inhibited innovation rather than stimulating progress.

What Maskin is writing about is the textbook theory of the value of free trade. It also complements work in the development economics literature about how "late developers" can adopt the technological advancements of rich countries, thus "leapfrogging" a stage of development. It should be noted that this is something that our current WTO- and NAFTA-enforced intellectual property protectionism regime sharply limits.

Maskin has also written recently on inequality and globalization:

Supporters of the anti-globalization movement argue that “globalization has dramatically increased inequality between and within nations” (Mazur, 2000), and in particular that it has marginalized the poor in developing countries and left behind the poorest countries. Meanwhile, more moderate mainstream politicians argue that the poor must invest in education to take advantage of globalization (Clinton, 2000). Such views are difficult to reconcile with a standard Heckscher-Ohlin trade model with two countries, two goods, and two factors (skilled and unskilled labor, or alternatively capital and labor) [which predicts that] inequality will rise in the rich country and fall in the poor country...

There are, however, at least two empirical problems with the Heckscher-Ohlin story. First, it predicts that bilateral trade will be greatest when factor endowments are most different, ceteris paribus (Vanek, 1968). There is little trade between advanced countries such as the U.S. and very poor countries such as Chad. A second problem with the Heckscher-Ohlin model is that evidence from examination of specific developing countries following trade liberalization and from cross-country studies does not suggest that trade liberalization generally reduces inequality in poor countries and in fact frequently suggests that trade liberalization can increase inequality...

We propose a model of production by workers of different skill-levels (Kremer and Maskin, 1997) that is consistent with 1) the small scale of trade between countries with very different factor endowments and 2) the possibility that globalization may increase inequality in both rich and poor countries.

Their model shows that it's possible that the least-skilled masses in poor countries will be totally marginalized under globalization, and that inequality can thus rise in both rich and poor countries. Maskin and co-author Michael Kremer conclude, "if people measure their status relative to others in their own society, then they will perceive inequality increasing. This analysis corresponds to the view of many anti-globalization protestors that globalization benefits elites in both rich and poor countries."

Nine Inch Nails, Radiohead embrace free trade

Nine Inch Nails just announced that they're following Radiohead's lead and making their music available for download at whatever price fans want to pay. Conversation over at Dani Rodrik's blog has already spoken about some of the economic issues involved.

This is huge. Technological change is unraveling the entertainment industry's ability to use protectionist devices like copyright and patents to have the nanny state enforce their monopolies. As Dean Baker writes:

Whether or not copyright protection is a desirable public policy, it is undeniably a huge government intervention in the market. In the case of prescription drugs, patent monopolies raise the average price of protected drugs by more than 200 percent, and in some cases by as much as 5,000 percent. In the case of copyright protection, items like software and recorded music and movies that would otherwise be available at zero cost over the Internet, can instead be sold for hundreds of dollars. Clearly these forms of protection are substantial interventions in the economy.

The fact that copyright and patent protections are forms of intervention does not mean that they are bad, but it is essential to at least recognize this fact in order to assess their merits. Suppose we eliminated all welfare to needy mothers in the form of cash benefits from the government, and instead assigned them the right to control traffic intersections in major cities. Then we allowed these poor mothers to charge people to make turns from the intersections. These women could have the police arrest anyone who crosses the intersection under their control without paying them their royalty, just as Bill Gates will have the police arrest anyone who sells Windows without paying him a royalty. The royalties they collect could provide enough income to support them without any money from the government. In this way, we could get rid of welfare - the classic big government social program — and still ensure that poor mothers have the income needed to support their family.

Giving people the right to charge royalties to cross intersections is government intervention in the economy and is every bit as much “big government” as if the government taxed people and redistributed the money to low-income mothers. It would not change anything if we declared the right to charge fees at an intersection a “copyright.” Government intervention by any other name is government intervention.

But trade agreements like NAFTA and the WTO, although often described as "free trade" agreements, in fact contain provisions that extend the reach and length of government intervention on behalf of copyright holders. This is not surprising, since these industries are among the top lobbyists for NAFTA-style trade pacts.

Progressives should reject these NAFTA expansions to Peru and other countries. These deals will increase patent protectionism at the expense of the poor and sick in Peru. And while copyrights may seem like a less burning issue, pacts like CAFTA have already cut away at free trade in Central America by forcing a crackdown on vendors engaging in free trade in music and computer programs, much as Nine Inch Nails and Radiohead have done to the delight of their fans.

Drinking, Dieting, Industrial Policy

As I recently noted, Ha-Joon Chang is coming out with a book very soon in the US - "Bad Samaritan: Rich Nations, Poor Policies and the threat to the developing world." The book has spawned a sharp debate over at the Financial Times over the desirability of active trade and industrial policies.

After having studied industrial policies myself, I remember being surprised to hear a presenter at the American Enterprise Institute say that "the arguments for industrial policy don't hold up to closer scrutiny." Granted, any argument for or against industrial policy has to be sensitive to local conditions (landlocked Chad is unlikely to build a successful shipbuilding industry, as Martin Wolf notes), so I didn't quite understand what the presenter was referring to... was the statement meant to discredit the boom years of Latin America in the 1960s, Korea in the 1970s, China in the 1990s? It couldn't have been to celebrate the experience of Latin America or Africa for the last quarter century - during which time practically no industrial policies were practiced (except in Chile, as I talk about here.), right?

So I have still been waiting for further clarification from orthodox economists about what is meant by this pooh-poohing of the lessons of history. Here are the arguments, summarized from the FT debate, with the quick and dirty response taken from Ha-Joon:

• Orthodoxy: Dude, industrial policy is so 19th century. Sanity: Latin America, Asian, and Scandinavian development did not happen in the 19th century, dude.
• Orthodoxy: Korea didn't use industrial policy (that's why it grew before the late 1970s), except when it did (that's why it didn't grow in the late 1970s, early 1980s). Sanity: That is so 1980s of you. Korea used industrial policy before, during, and after the period in question, and it grew the whole time, except when it didn't, and that was due to a little something called a world recession.
• Orthodoxy: Free trade is the best! But if you practice free trade and you don't grow, blame it on on some other policy. Sanity: Where are we, Middle Earth?

The whole debate is worth a read, and it is not as idiotic in tone as I have made it seem. But the days when orthodox economists could shove facts under the rug for 20 years is gone, and you can tell it's causing some growing pains. To part, here are some choice Hajoonisms:

• I feel like a man being accused of promoting a copious consumption of vodka when all I have done is to recommend moderate amount of red wine as a part of balanced diet.
• It may be possible to dismiss the US as an "exception", but if there are another two dozen countries that have to be dismissed as "exceptions", then the theory has simply too many holes (the exercise reminds me of the pre-Copernican practice of drawing "epi-circles" in order to square evidence with geo-centrism).
• I think it is wrong to dismiss one’s opponent’s theory by labelling them with negative words (‘nineteenth-century’). How would Alan feel if I described him and his colleagues as "defenders of free-trade theory that was so strongly advocated by American slave-owners and opium-trafficking British imperialists"?
• I am a man whose book recommending the Mediterranean diet has been reviewed by a well-known anti-fat dietician, who unintentionally misrepresented me as praising beneficial qualities of all fats, when I had only praised olive oil. This was bad enough, but then a few other anti-fat dieticians read the review, go into a Pavlovian reaction on seeing the word, "fat", and accuse me of promoting excessive consumption of all fats, brandishing American obesity figures and Scottish heart-attack statistics. I regretfully have come to conclusion that I was absolutely right to say what I said at the end of chapter three in the book – "Trade is simply too important for economic development to be left to free trade economists".

Sherrod Brown and Tom Allen Demand Pro-Public Health Trade Policy

Well, Sen. Sherrod Brown (D-Ohio) and Rep. Tom Allen (D-Maine) have done it again. While the Deathstar Deal is needlessly splitting party unity on trade, they are showing the positive fair trade alternative. Check out this Dear Colleague that they are circulating, and go to the Essential Action page to learn more about the issues at stake.

July 9, 2007

*Support our Nation's commitment to the Doha Declaration on TRIPS and Public Health*

Dear Colleague:

We write today to invite you to co-sponsor a resolution that reaffirms the commitment of the United States to the 2001 Doha Declaration on TRIPS and Public Health (S. Res 241) and (H. Res 525).

The 2001 Doha Declaration on the TRIPS Agreement and Public Health, to which the United States and all WTO members are signatories, "affirm[s] that the [TRIPS] Agreement can and should be interpreted and implemented in a manner supportive of WTO members' right to protect public health and, in particular, to promote access to medicines for all." This international agreement properly emphasizes the importance of public health considerations in implementation of patent rules.

However, the Bush administration included Thailand on its 2007 Special 301 Report for intellectual property violators, citing "a weakening of respect for patents."

Health groups bash process and substance of "deal"

Health Gap, Essential Action and Student Global AIDS Campaign - some of the nation's leading groups fighting for access to life-saving medicines - have released a statement bashing the process and substance of the "deal." Their conclusion, even with the "deal" fixes, the FTAs "restrict rather than expand access to lifesaving medicines." Read the full analysis after the jump.

Civil society putting Big Pharma on the defense

Around the world, news is streaming in that civil society - and even governmental pressure - is putting Big Pharma on the defensive, deepening the people's revolt that David talked about here.

First off, Brazil. According to the Working Group on Intellectual Property (GTPI) from the Brazilian Network for the Integration of Peoples (REBRIP), the Brazilian federal government has decided

to issue a compulsory license for the antiviral drug, Efavirenz, whose patent is current held by Merck Sharp & Dohme. This historical decision reinforces the efforts of civil society groups fighting for access to medicines, for the sustainability of public health policies, such as universal and unlimited access to antiretroviral medicines used in the treatment of HIV/AIDS, and for the strengthening of the Brazilian public health care system, the Unique Health System (SUS).

Next stop, Thailand. Here, too, civil society is successfully pressuring governments to issue compulsory licenses for life-saving drugs. According to Congress Daily (sorry, not linkable):

U.S. officials added Thailand to the Priority Watch List in their Special 301 report, partly because of Thailand's handling of compulsory licenses it issued to import generic versions of two HIV/AIDS drugs and a heart medication ... Health activists and advocates of fewer restrictions on the use of intellectual property criticized the move. One of them, James Love, executive director of Knowledge Ecology International, said, "The sanctioning of countries for using legitimate and important flexibilities in the [WTO] agreement brings shame to all U.S. citizens who are increasingly seen in Thailand and elsewhere as bullies and hypocrites."

And, final stop, the U.S. of A. Here, public health groups and fair trade activists' pressure on House Democratic leadership may be leading to a groundbreaking reversal of the "patent protectionism" long practiced by the Clinton and Bush administrations in trade deals. Says Mark Drajem of Bloomberg (not linkable):

The negotiators also want to remove requirements that drug patents be extended if the companies face long delays in getting approval to sell their products in those countries, they said. The proposals, if adopted as part of a larger package of changes, would mean House Ways and Means Chairman Charles Rangel and the White House would cut provisions the U.S. insisted upon when those trade agreements were being negotiated... Health activists back the changes, saying they will mean cheaper life-saving medicines for AIDS victims and others in poor nations, according to Rohit Malpani of Oxfam America.

Needless to say, Big Pharma is not happy about these changes, which is why it's crucial that we continue to make our voices heard by clicking here.

Rangel speak at IIE

House Ways and Means Chairman Charlie Rangel (D-N.Y.) gave a speech last night to the Peterson Institute for International Economics.

Worth noting is the continued deliberations over what/how/if labor rights may/could/should/will be incorporated into FTAs and Fast Track. Follow the full verbatim transcript after the jump.

Corporate lobbyists hate Americans, part deux

Well, we've already heard from the U.S. Council for International Business and the Emergency Committee for American Trade, and they told us that they hate working Americans. Today, we found out (not that this is really a huge surprise or anything) that the National Association of Manufacturers does too! NAM will oppose any free trade agreement that includes new labor standards for American workers. This from Bloomberg's Mark Drajem - sorry, not linkable:

The National Association of Manufacturers, the largest industrial lobbying group, said it will oppose new trade agreements unless Democrats agree to exempt the U.S. from new labor provisions. [...] The business group is joining organizations such as the U.S. Chamber of Commerce in objecting to proposals, pushed by Democrats in Congress, that the organizations say may force revisions in state and federal labor laws such as those that limit the ability of workers to strike.

Also, in a rare moment of candor, NAM president John Engler actually said this, as reported in the article: "In addition to the labor provisions, the manufacturer's group opposes Democratic proposals to change the intellectual property provisions of the pending agreements so that developing countries can make cheaper versions of generic drugs sooner, Engler said."

In other words: "Our profit is more important than your wages or life-saving medicines." Catnip anyone?

Because drug prices aren't high enough already

As predicted, the U.S.-Korea FTA (what should we call this thing? SKFTA? SKOFTA? KORUS, like USTR is calling it? Hmm...) will almost certainly lead to an increase in drug prices — apparently not just in Korea, but maybe in the U.S. as well. According to a PharmaTimes story yesterday:

As part of the FTA, Korea has agreed to abandon its policy of requiring drugmakers to negotiate prices with the government in order for their products to be placed on the national health care system's positive reimbursement list. This policy was reported to be a major stumbling block at the talks, with US negotiators regarding it as a potential barrier to trade. Korea has also agreed to extend its patent period on innovative drugs [...] the Korean Federation of Medical Groups for Health Rights has forecast that these concessions will increase costs to Koreans by 1 trillion won over the next five years, while US critics have warned that they could also increase drug prices in the USA.

Interestingly, doesn't the Korean price-negotiation scheme that U.S. negotiators nixed sound awfully like the Democrats' Medicare drug bill that the House passed in January?

For more on this issue in general, over at Beat the Press, Dean Baker frequently riffs on how patent protection for drug companies is, ironically, a kind of protectionist boondoggle for Big Pharma, despite being promoted by "free-traders" as a necessary part of new FTAs.