Rising Powers, Emerging Markets: Implications of Multipolarity for Intellectual Property
Rules, Access to Medicines and Global Health
By Suerie Moon, MPA, PhDSchool of Public Health & Kennedy School of Government, Harvard University
Global Health Diplomacy Network Conference Chatham House, London, 28 June 2011
Overview
1. Introduction2. 1999-2010: How have middle-income countries
(MICs) shaped global IP rules for health?3. 2011-?: How will MICs shape the future global IP
regime? 4. Access to medicines for NCDs5. Conclusions: the challenge for global health
diplomacy
1. Introduction: North-South politics of intellectual property
• Pre-1994 international patents regime: – Flexible, with policy space for tailoring to country context
• 1994 WTO TRIPS* Agreement– Harmonized to Northern standards, – Reduced flexibility, shrank policy space re: medicines patents
– Critique: patent monopolies medicines prices ↑– Critique: no R&D into diseases of the poor– Political bargain: IP protection for market access
• North-South divide
* World Trade Organization Agreement on Trade Related Aspects of Intellectual Property Rights
1. Introduction: North-South politics of access to medicines
The Access to Medicines Crisis:• 1999-2001: global social reaction against TRIPS, triggered by HIV pandemic and high drug prices
• 2001: WTO Doha Declaration: health before patents• 2002-2010: increased access to HIV medicines via more flexible approach to patent rules
• By 2011, increased flexibility in:– Formal international law– Formal national laws– Informal rules and norms– Practices by governments (North & South) & companies
Figure 2. Overall ARV market share (volume) for Indian generic, non-Indian generic, and originator (brand) manufacturers, 2003-2008
39%
80%
64%
83%88% 87%
1%
13%
3%3% 8%
61%
19% 23%14%
9% 5%
0%
20%
40%
60%
80%
100%
2003 2004 2005 2006 2007 2008
Ma
rke
t S
ha
re (
vo
lum
e)
Indian Generic Non-Indian Generic Brand
Figure 4. Countries reporting purchases of Indian generic ARVs in 2008
Countries reporting purchase of Indian-produced generic ARVs in 2008
Source: Waning, Diedrichsen, and Moon (2010)
Generic Competition and HIV Treatment Scale-Up
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010$0
$100
$200
$300
$400
$500
$600
$700
$800
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
People in LMICs on treatment Lowest generic price first line ARV regimenOriginator price of first-line ARVs
$10,400$2700
Source: Medicines Patent Pool, June 2011
2. How have MICs shaped global IP rules for health?: Strategies & Roles
• Which countries?: Argentina, Brazil, Ecuador, India, Indonesia, Kenya, Malaysia, Philippines, South Africa, Thailand, Zimbabwe, others
• Re-framing of IP from economic to social issue: – 1998: South Africa and World Health Assembly– 2001: Brazil & UN Human Rights Commission
• Mobilization of normative power via global CSO networks• Mobilization of expert power via global expert networks• Exercise of state regulatory power
– 2002, 2007, 2009 South African Competition Commission
• Domestic factors in key MICs:– Civil society, Parliament, generics industry, Constitutional right to health
• Multipolarity: MICs growing economic & political power
Economic power shifts
Changes in export markets:
US EU-27 Industrialized China Developing0%
10%
20%
30%
40%
50%
60%
70%
Brazil
20012009
US EU-27 Industrialized China Developing0%
10%
20%
30%
40%
50%
60%
70%
India
20012009
Economic power shifts
Changes in export markets:
US EU-27 Industrialized China Developing0%
10%
20%
30%
40%
50%
60%
Thailand
20012009
US EU-27 Industrialized China Developing0%
10%
20%
30%
40%
50%
60%
70%
South Africa
20012009
TRIPS-Related Disputes at the WTO DSB (1995-2010)
North complaint against North (N-N) 17North complaint against South (N-S) 1996: US vs Pakistan 1996: US vs India 1996: US vs Indonesia 1997: EU vs India 1999: US vs Argentina 2000: US vs Argentina 2000: US vs Brazil 2007: US vs China 2008: EU vs China
9
South complaint against North (S-N) 2001: Brazil vs US 2010: India vs EU 2010: Brazil vs EU
3
Total TRIPS-related Disputes at WTO DSB (1995-2009) 29
3. How will MICs shape the future global IP regime?
1999-2010: North v South• Re-framing of IP rules• Normative claims & shift• Mobilization of CSOs and
expertise• Rise of multipolarity• Coattails effect for LICs/LDCs
2011- ?: Multipolar System• IP rules re-framed as social issue• Normative shift consolidating• Experts & CSOs networked• MICs ↑ economic power• MICs ↑ power in global rule-
making• R&D capacity in some MICs ↑• MICs as emerging markets ↑• Health demands in MICS ↑• Demands for global R&D
burden-sharing ↑
Which way for the MICs on IP?
R&D capacity in some MICs
↑
MICs as emerging markets ↑
Pharm industry consolidation
Demands for global R&D
burden-sharing
MICs ↑ economic power
MICs ↑ as global rule-makers
MICs ↑ health demands
Limited R&D capacity in most
MICs
Demands for global R&D
burden-sharing
Stringent(eg TRIPS+, lengthened or strengthened monopolies)
Flexible(eg compulsory licensing,
strict patentability standards)Domestic Political Contests
4. Access to medicines for NCDs in MICs
“Double burden of disease (CDs+NCDs)” in MICs ↑Demand for healthcare & coverage ↑
NCD drugs w therapeutic advance = demands for access (price ↓)NCD drugs = market growth for industry (price ↑)
Short-Medium Term Political Conflict: North + Patent-based industry vs MICs
TRIPS Political Bargain Under Increasing StrainMedium-Long Term ?
4. Access to medicines for NCDs in HICs
Demand for healthcare & coverage ↑NCD drugs w therapeutic advance = demands for access (price ↓)
NCD drugs = market growth for industry (price ↑)
Medium-Long Term ?
5. Conclusions: The Challenge for Global Health Diplomacy
Short-Medium Term:• Identifying solutions to access problems Medium-Long Term: to negotiate new global rules & institutional
arrangements for:• Equitably sharing the global burden of financing medical R&D• Ensuring widespread, global access to new medicines • Providing sufficient, predictable resources for innovation that meets
priority health needs• Investing resources efficiently• Amending or re-negotiating global rules that do not deliver the above.
Ongoing: WHO Consultative Expert Working Group on R&D
5. Conclusions: Implications for the future
1. MICs can increasingly challenge IP rules that favor the North some protection for health gains & for LDCs/LICs
2. Domestic political contests in MICs over defining national interest; will health have a voice?
3. Ongoing North-MICs political conflict in foreseeable future4. MICs will face growing expectations to contribute to R&D
that benefits other/all countries. 5. MICs can shape alternative global arrangements for ensuring
sufficient financing, equitable access, and needs-driven R&D6. Challenge for all diplomats: negotiate a better global system
for medical innovation & access in LICs, MICs, and HICs
Thank YouComments welcome at: [email protected]
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