[linux-elitists] Patent Laws

Brooklyn Linux Solutions CEO ruben@mrbrklyn.com
Thu Apr 19 19:41:44 PDT 2001

before my involvement with SOftware, I was a Pharmacist.  Patent issues are
very parallel in the two fields.

A note that I recieved a Patent Office letter thanking me for nominating

   April 20, 2001 

          News Analysis: Defensive Drug Industry
          Fuels Fight Over Patents


              he big pharmaceutical
              companies march to the beat of
          a steady chant - that patent
          protection for drugs is essential for
          innovation. At the urging of the drug
          companies, the United States
          government has pressed many
          nations to honor patents on

          But now, it seems, the industry may have overplayed its hand.
          patents are under attack, blamed for high AIDS drug prices that
          deny life- saving therapy to millions of people in developing
          countries. And some analysts say the industry itself fueled the
          backlash by staunchly defending its intellectual property in the
          of a pandemic that could claim more lives than the Black Death of
          the Middle Ages. 

          The latest clash over patents on AIDS drugs came to a boil in
          Africa yesterday, when 39 drug companies dropped a suit trying to
          block a law the companies asserted would make it too easy for the
          government to abrogate their patents.

          The debate has erupted in other countries as well. Brazil has
          threatened to grant licenses to local manufacturers on patents
          AIDS drugs held by Merck and Hoffman-La Roche. In Thailand,
          AIDS patients and activists are planning a legal challenge to the
          validity of a Bristol-Myers Squibb patent on an AIDS drug.

          The uproar over AIDS drugs is threatening moves toward more
          globalization, eight years after most nations approved the
          Agreement on Trade-Related Aspects of Intellectual Property
          Rights, or Trips, which commits them to enforce drug patents.
          Activists are campaigning against the proposed Free Trade Area of
          the Americas, saying the United States wants more patent

          "The Trips agreement was probably the greatest political economic
          achievement that the pharmaceutical industry ever had," said Jim
          Keon, president of a trade group representing generic drug
          companies in Canada. "Now it's coming home to roost, though. Can
          the world afford it? Is it ethical?" 

          Even some supporters of patents are pulling back somewhat.
          Washington says it will no longer pressure poor countries that
          production of cheaper versions of patented drugs for major health
          problems, provided they adhere to Trips guidelines. The European
          Parliament has expressed "solidarity and support" for South
          and Kenya in their efforts to gain access to lower- priced AIDS

          Until recently, the industry worried that erosion of patent
rights or
          prices in one country could lead to similar actions elsewhere,
          particularly in the United States, where the industry gets much
of its

          "There was a feeling that if a country deliberately went against
          there would be a castle-of-cards effect," said Jean-Pierre
          chief executive of GlaxoSmithKline, a major supplier of AIDS
          drugs. "Without patents, the industry ceases to exist."

          But now, judging from their actions, drug companies have decided
          sacrifice prices in some poor countries in order to argue that
          manufacturers are not needed and to relieve the pressure on the
          patent system. In Brazil, for example, Merck recently agreed to
          price cuts for two AIDS drugs to prevent the government from
          allowing a local generic manufacturer to make a copy of one of

          Some AIDS activists, however, say it is better to rely on
          from generic manufacturers than on voluntary actions by big drug
          companies. They say drug companies' recent discounting was only
          response to an offer of low-priced AIDS drugs by a generic
          manufacturer in India. But under Trips, India and other countries
          will have to enforce patents by 2005 or 2006. 

          "If we don't deal with the problem now, 5 to 10 years from now
          have no possibility of bringing prices lower and we'll be
          at the mercy of the big drug companies," said Ellen 't Hoen, an
          attorney with Doctors Without Borders.

          Drug company executives argue that patents are not a barrier to
          treatment of AIDS. Even generic drugs are out of reach for
          countries that spend less than $10 a year per person on public
          and lack doctors and clinics to deliver the medications.
Moreover, in
          many countries of Africa besides South Africa, AIDS drugs are not

          "At least for AIDS drugs, patents have been a barrier only as an
          exception rather than the rule in Africa," said Amir Attaran,
          director of international health research at Harvard University's
          Center for International Development. Drug companies and some
          experts argue further that if developing countries honor patents,
          drug companies will have more incentive to develop treatments for
          tropical diseases. But others say what deters companies from
          developing those drugs is the small market size.

          Patents award an inventor exclusive rights to make or sell a
          for a set period. In countries that adhere to the Trips
          patents run for 20 years from the filing of the application.
          provide an incentive for innovation, and in return, the invention
          publicly disclosed so others can learn from it. 

          Drug companies argue that they need patents because it can take
          more than a decade and hundreds of millions of dollars to develop
          and test a drug, which can be copied relatively easily once it is
on the
          market. Many countries have viewed drugs as meriting exceptions
          patent law because of their importance to public health. But with
          trade agreements like Trips, countries have tightened their

          Trips does not go as far as drug companies would like, and it
          some exceptions to patent protection. For example, countries can
          force patent holders to license their patents to others, like
          manufacturers. But so far, no country has. 

          Some activists say the countries have not used licensing because
          pressure from drug companies and Washington. But the United
          States has partly reversed its policy and is no longer raising
          objections to compulsory licensing in the case of health crises
          developing countries. 

          The country with the most experience with compulsory licensing,
          albeit before Trips took effect, is Canada. For decades Canada
          allowed any company to apply for a license to make a patented

          In 1969, it allowed copies of patented drugs to be imported, and
          generic industry began to thrive. The compulsory licensing system
          was weakened in 1987 and then abandoned in 1993.

          Since then, spending on research and development by drug
          companies in Canada has zoomed, to about $900 million in 1999
          from $166 million in 1988. The Canadian experience suggests that
          protecting intellectual property may prompt greater investments
          drug companies and even the development of a homegrown industry.

          But it is not clear if African countries have the scientific
          for a research-oriented drug industry. Moreover, some experts say
          the drug companies promised in advance to increase spending in
          Canada if the law was changed. 

          The precedent that most worries drug companies now is that
          weakened patent protection in developing countries will lead to
          pressure to weaken patents - and in the process, their latitude
to set
          prices - in the United States. 

          The Consumer Project on Technology, a Washington group founded
          by Ralph Nader, has asked the government to let it make a
          low-priced version of d4T, the Bristol-Myers AIDS drug. The
          National Institutes of Health has in the past rejected such

          Even without the AIDS crisis, there is pressure on patents as a
          of high drug prices in the United States. While innovation should
          rewarded, some drug industry critics say, the drug industry is
          most profitable in the nation. Moreover, many drugs are initially
          developed with government money. 

          Gail Wilensky, a senior fellow at the international health
          organization Project Hope who ran Medicare under former
          President George Bush, has proposed shortening the life of drug
          patents to let competition lower drug prices, as an alternative
          regulatory options that are sometimes discussed.

          A report issued last year by the National Institute for Health
          Management Foundation, an organization supported by health
          insurers, said the effective patent life for some drugs has grown
          8 years in the early 1980's to 14 or 15 years now. 

          "We have moved more toward increasing market power of
          pharmaceutical companies than we wished to," Dr. Wilensky said.

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