CPATH Statement:

Stop Using Special 301 Reports to Drive Up

 Drug Prices

Antiretrovirals Driven Out of the Hands of Guatemalans

Docket number USTR-2010-0003

 

Ellen R. Shaffer, PhD MPH, Joseph E. Brenner, MA

March 3, 2010

 

U.S. trade policy is driving up the price of drugs at home and abroad.

 

CAFTA Raises Prices, Limits Availability of Life Saving Drugs for U.S. Trade Partners

Our recent report published in the peer-reviewed journal Health Affairs demonstrates how intellectual property rules in the U.S. - Central America Free Trade Agreement (CAFTA) keeps lower-priced generic versions of life-saving drugs off the shelves and out of the hands of some of the poorest people in our hemisphere:  A Trade Agreement’s Impact on Access To Generic Drugs .

 

But PhRMA’s submissions to the 301 Report process have played an even more insidious and destructive role.  In 2008, the USTR published PhRMA’s complaint that “Guatemala has not corrected the tax discrimination caused by Decree 16-2003 against R&D products that has been in force for more than four years.”  This policy facilitated the government’s purchasing of discounted drugs through agencies like the Pan American Health Organization, the Global Fund and the Clinton Fund.

 

In 2009, the government of Guatemala got the message. It instructed the Ministry of Health to purchase these drugs directly from brand-name originator drug companies at full price. Prices increased in some cases by a factor of 13, forcing the Ministry of Health to sharply curtail the medicines and services it was able to provide. The devastating impact has reverberated throughout the country.  Jakelin Cucuyan Sosa, a member of  Mujeres Positiva and a mother living with AIDS, told us that her clinic can no longer afford Truvada, the medicine that she had finally begun to respond to after much trial and error. Patients with more expensive medication regimens are now given medication every 8 days, forcing many to quit treatment rather than take time off from their jobs for the long trip to the clinic. Lab work that used to be done every 3 months to monitor and titrate the therapy is no longer available at all.

 

Guatemalan IP Laws – A Tug-of-War Over Access to Medicines. Intellectual property (IP) rules, in particular data exclusivity (DE), have been a contentious legislative issue in Guatemala since the late 1990s.  Guatemala reversed its DE laws every year for 5 years, until the adoption of the Central American Free Trade Agreement in 2006.

 

Trade Policy Advice is Unbalanced – Dominated by Corporate Advisers without Public Health Representation.  The U.S. Trade Advisory Committee system, which provides advice on trade negotiations to USTR and the President, is dominated by for-profit corporate interests, with virtually no representation from the public health community.  As of the Summer of 2009, there were 27 representatives from the pharmaceutical industry alone on the various U.S. trade advisory committees, compared to 20 in 2005; four representatives from the pharmaceutical industry sit on the top Advisory Committee for Trade Policy and Negotiations (ACTPN). Without the benefit of balanced representation in the public interest from the public health community, U.S. policy reflected in Special 301 has prioritized commercial interests over access to medicines.

 

We call on the Administration to change course in using Special 301 regarding public health and access to medicines:

 

1. Ensure that Special 301 is not used to promote TRIPS-plus restrictions on access to medicines.

 

2. Adopt a policy guideline banning USTR from using Special 301 to punish nations which take regulatory action to promote public health and access to medicines.

 

3. Prioritize public health in U.S. trade policy. Include health experts and advocates in all levels of trade policy development, effective immediately.

 

4. Indicate support for Guatemala’s Decree 16-2003, and the Guatemalan government’s legal authority and obligation to purchase medicines at the most affordable price in order to treat the largest number of people.