Council for TRIPs
TRIPs and Access to Medications
(20 June, 2001)

Delegation of Brazil

Thank you Mr. Chairman,

·At the outset, may I personally congratulate you for your indication as Chairman of the TRIPs Council. It is a very auspicious sign that the exercise of discussions on "TRIPs and Access to Medications" takes place under the Chairmanship of a representative from an African country, a continent that has been particularly affected by health problems. We trust that discussions under your guidance will be productive and results-oriented.

I also wish to congratulate the African Group for taking the lead in this process. While the question of access to medication concerns the whole WTO Membership - and developing countries are particularly interested in achieving results from this process - , the African continent deserves special attention in light of the grave situation of AIDS, tuberculosis and malaria pandemics in that continent.

Mr. Chairman, Brazil is proud to be one of the co-sponsors of a document circulated in this Council on the issue of "TRIPs and Public Health". The document reflects the reading of nearly 50 developing country Members on the relevant provisions of the TRIPs Agreement related to public health. In the drafting process of this document, all delegations contributed actively to bring meaningful elements to the discussion. Such a "team work" was largely facilitated by the fact that the participants shared the same goals of ensuring that TRIPs should not - and, indeed, in our view does not - prevent protection of public health. In the substantive debate, we hope that other delegations may support the elements contained in this paper. Confirmation that TRIPs should not run counter to the protection of public health will be crucial to provide clear guidance for Members, avoiding the explicit or implicit threats of using the dispute settlement mechanism to enforce restrictive, imbalanced and, indeed, incorrect interpretations of TRIPs.

The Members that subscribe this paper consider that the special discussion on TRIPs and Public Health at the TRIPs Council is not a one-off event. It should be part of a process to ensure that narrow readings the TRIPs Agreement do not in any way undermine the legitimate right of WTO Members to formulate and implement their own public health policies. In this regard, and without prejudice to other possible actions, we believe that the Ministerial Conference in Qatar in November this year will be the best opportunity to confirm this understanding in an unambiguous and unconditional way. This should go a long way to build the required confidence between developed and developing countries for any future discussions we may embark on, not only on this subject. It would also send a very powerful message to all those growing sectors of civil society, both in the North and in the South, that see the WTO as a soulless organization at the service of the rich and the powerful.

As it became known to the world public opinion since the beginning of this year, Brazil has a successful Programme for Universal Distribution of HIV/AIDS Medicines. The Programme clearly demonstrates that, important as they are, prevention policies alone are not sufficient to control the AIDS pandemics: indeed prevention and cure are intrinsically linked (In this respect, an article in the "Opinion" section of toda'ys 'International Herald Tribune' by three renowned health experts mention the consensus among experts that "prevention and treatment are inseparable - or, in the authoritative words of the UNAIDS expert committee, 'their effectiveness is immesurably increased when they are used together'"). Treatment based on access of patients to AIDS drugs plays an essential role in achieving concrete results. In Brazil, the benefits of access to drugs are very concrete: in the last four years, the number of deaths related to AIDS has decreased by half (although in some hospitals in São Paulo, where the incidence of HIV-infected patients is the highest in the country, the number of deaths was decreased by 71%). While such an aggressive policy to fight AIDS justifies itself on the ethical ground, as it saves human lives and alleviates suffering of patients, it also brings very concrete benefits for the better allocation of resources: the dramatic decrease in opportunistic infections resulting from drugs-based treatment has reduced in 80% the number of admissions in hospitals. This has brought an economy of US$ 422 million dollars in hospital admissions - not an insignificant figure for a country like Brazil.

Two elements are absolutely necessary for the success of the Brazilian Programme for Universal Distribution of HIV/AIDS Medicines (and indeed to make it sustainable): the local production of medicines and negotiations with the pharmaceutical industry. The two elements are closely linked to each other and directly related to our discussions here. In the case of drugs used in Brazil in the treatment of AIDS, local manufacturing has been utilized so far for products that were already in the public domain, without any infringement to patents. But the possibility of issuing compulsory licenses is also an essential element of the negotiation between the Government and pharmaceutical industries. Besides that, local production of pharmaceutical products is often crucial to ensure that medications are readily available at affordable prices. Local manufacturing of pharmaceutical products also encourages sustainable access to medications by insulating the price of patented medicines against currency devaluations, as well as supporting the development of local expertise, which is vital in addressing local needs.

The Brazilian AIDS Programme is strictly consistent with the TRIPs Agreement. The Brazilian Law on Industrial Property provides strong patent protection for pharmaceutical products, and efficient mechanisms to fulfill the objectives of the TRIPs Agreement in a coherent way with our public health policy. While Brazil has never resorted to compulsory licenses under the current law, a recent experience of our Ministry of Health in negotiations with one pharmaceutical company has demonstrated that the very existence of compulsory license mechanisms - together with the political will of the Government to issue it - is important to persuade patent holders not abuse their rights to the detriment of public health objectives. In this case, a pharmaceutical company, which was refusing to bring its unreasonably high prices on two patented anti-retrovirals, has agreed to cut its price in 64% and 59% respectively, when the Government gave unambiguous signs of its intention to issue a compulsory license. Therefore, this remains an essential element to our health policy - and we intend to keep it.

As regards the issue of parallel imports, Mr. Chairman, Brazil believes that Members should confirm their right of applying regimes of exhaustion of rights in their jurisdiction. For developing countries, in particular least-developed countries and smaller economies, parallel importation can be a significant way of increasing access to medications, where the prices charged by patent holders for their products are unaffordable. I must say that I welcome the reference by the EC that differential prices should not impinge Members on any right in respect to parallel imports.

In this respect, we favour discussions on differential prices as means to improve access to affordable medicines, although the issue may be best discussed in other fora with the mandate to address public health policies, such as UNAIDS, UNICEF and the WHO, for instance. We note that nothing in the TRIPs Agreement prevents Members from establishing differential prices schemes. It is a prerogative of Members to adopt the most appropriate measures to accommodate such schemes, such as prohibition of parallel imports from poor countries to high-income countries, for instance. At the same time, discussions on differential pricing should in no way result in restriction to or modification of the rights ensured to Members by the TRIPs Agreement to make use provisions such as parallel imports and compulsory licenses, as may be necessary.

The beginning of special discussions on the issue of "TRIPs and Public Health" in the TRIPs Council is a momentous occasion for Members to ensure that nothing in the TRIPs Agreement will prevent Governments from taking measures to protect public health. We hope that the debate here will confirm this understanding.

Economic theory has for a long time established a link between price and value. The nature of such link, however, has never been fully resolved. In the end, our discussions today is also about the relation between price and value. The price of medicines seen as a profit-bringing commodity and the value of human life. We understand that as any other industry, the pharmaceutical producers have to remunerate their activity. We are not against them. But we hope that, with our help, they will find ways of doing it without beating what should be the very purpose of their activity: to save lives and to alleviate poverty.