Asia Pacific Consultation on FTA’s and their impact on access to medicines Organized by Health Action International Asia – Pacific in collaboration with Drug Study Group (DSG), Health & Development Foundation ,Social Pharmacy Research Unit (SPR), 25-27th August 2008 at Asia Hotel, Bangkok, Thailand Welcome and Opening ceremony Prof Pirom Kamol-Ratnakul, President of Chulalongkorn University welcomed the guests and thanked HAIAP for selecting Thailand to host the meeting. Dr. Mongkol Na Songkhla, Former Minister of Public Health acknowledged the importance of taking up a topic relevant to the global trend and wished successful deliberations for a fruitful meeting. Dr. Niyada Angsulee gave an introduction to HAIAP to begin the formal seminar. Objectives of the Seminar Dr. K Balasubramanium, Advisor and Coordinator for HAIAP gave an introduction to the purpose of the consultation. HAI has been working towards a world where all people, especially the poor and disadvantaged, are able to exercise their right to health which requires equitable access to affordable quality healthcare and essential medicines. Since its inception HAIAP has carried out workshops and educational programs to protect and promote the realization of the Right to Health and build a just and equitable society. HAIAP’s goals have been to ensure access to Essential Medicines at affordable prices quality health and healthcare, promote rational use of medicines, rational prescribing and dispensing of medicines. HAIAP has worked to promote awareness of consumers, civil society and policy makers through information and education on medicines policies so that these are developed through democratic processes. HAIAP has achieved considerable success in access to essential medicines. All countries in the region have developed lists of essential drugs. The major components of a national drug policy are in place in these countries. Our members are invited by Health Ministry officials in several countries of the region to sit in official committees discussing drug and health policies and their inputs are taken in. Free Trade Agreements and their impact on Access to Medicine: an overview By: Nusaraporn Kessomboon, PhD Facilitator- Dr. Vithaya Kulsomboon The presentation outlined recent US FTAs related to intellectual property including TRIPs-Plus, extension of patent term and data exclusivity. A linkage between Patent Status and Drug Registration was outlined together with Thai-US FTA and its impact. Studies were presented by Dr. Nusarapon to demonstrate the necessity of eliminating IPR protection on pharmaceuticals from FTAs. Free Trade Agreements and Access to Medicines By: Amit Sen Gupta Dr Amit Sen Gupta gave an introduction to free trade by presenting an introduction to David Ricardo’s 19th century concept of comparative advantage. The concept was the basis for promoting free trade. Yet no nation has successfully industrialized under a regime of unrestricted trade. There is data to show that when free trade expanded the global economy contracted. It doesn’t translate to benefit for all, it results in a greater gap among the population. Dr. Amit also presented evidence to show that the FTAs negotiated covered of the same areas that are already the subject of obligations under WTO agreements: such as issues related to patentability, patent term extensions, linkage of test data protection and marketing approval, compulsory licenses and parallel importation but with more restrictions compared to the WTO agreement, therefore it is called TRIPS plus. In conclusion bilateral agreements have been a disaster, for the developing countries and for the global trading system. These FTAs are creating a world in which there are two groups -the first consist of “my friends who can get in free “and the other, consist of countries that have to pay tariffs. Secondly, bargaining between the United States and developing countries is not bargaining. Especially under the Bush (administration), it has been a take-it-or-leave-it situation. There are thousands of people dying in developing countries because of the trade agreements with the United States. It’s not about trading goods; it’s about losing sovereignty and it’s about helping American drug companies. It’s about America pushing for a particular agenda. It has not benefited any country. In fact, the free trade agreement with Mexico was the strongest, but the gap between Mexico and the United States increased in the first decade. Dr. Amit concluded his presentation by quoting Joseph Stiglitz, former chief economist World Bank “They are not free trade agreements. They are not about free trade, but they are advantaged trade agreements. And they managed to advantage the United States at the cost of the developing countries”. Trade Liberalization, FTAs and Children By: Claudio Schuftan Dr. Schuftan presented the impact of trade agreements on the lives of poor children and their families. He reiterated that trade liberalization is not the way to reduce poverty and inequities. Childhood poverty cannot be simply deduced from household poverty data, it is also shaped by the intra- household distribution of power and resources. Economic shocks experienced as an infant or child have lasting impacts on human capacity development. Therefore, specific attention is to be paid to childhood poverty effects. Price fluctuation and resulting changes in family income are important factors which determine the fulfillment or non-fulfillment of children’s rights. Households’ consumption patterns are also affected by changes in prices of goods. In the case of children, of particular concern are modifications in the households’ food basket, as well as families’ ability to afford education and healthcare. Families do seek to shield children from the negative effects of economic shocks so that taking children out of school is a last-resort coping mechanism when faced with economic shocks. FTAs result in declining poor household living standards, leaving them with few alternative coping mechanisms – none of them good for children. Girls may have to help women shoulder both productive and caring work responsibilities with negative consequences on their schooling and leisure time. Moreover, trade liberalization and FTAs lead to decreased coverage of community health centers leaving increased reliance on the private as the only option left. Children’s health is thus affected by the degree to which the government is willing and able to fund public health. Social disparities are exacerbated and access to services for children becomes unequal. Children’s work in household chores – equally taxing for children’s physical and mental health – receives less attention than paid labor. There is a need to adopt target-specific programs for minorities and the marginalized. Finally, decision-makers not only from trade and economic ministries, but also those responsible for social development need to take concerted action for children and youth so that negative impacts are at least minimized. We must question and oppose FTAs that do not take this into consideration and insist that the remedies discussed here are implemented as appropriate if FTAs are already a fait-accompli. Country Presentations Australia- Australia- US FTA and the PBS (Pharmaceutical Benefit Scheme) By : Dr. Ken Harvey Dr. Ken Harvey presented an overview of the Australian Medicines policy, a report on the Australia- US FTA and some international ramifications. The goals of the medicinal drug policy are to ensure medicines are of high quality, safety and efficacy and there is equitable access to necessary medicines, quality use of medicines and a viable and that there is a viable responsible local pharmaceutical industry. The PBS has emerged as an FTA issue due to conflicting goals of the PBS and the Big Pharma. Pharmaceutical industries spend millions of dollars on influencing drug policy to earn profits. The PBS stands in the way of these profits reducing the price ratio by 1.5 between the standard prices and Australian prices. While drug prices in Australia are two to three times lower than those in similar countries, price differences vary across different categories of pharmaceuticals. In addition, the Australian Department of Industry, Tourism & Resources administers a $300 million Pharmaceuticals Industry Investment Program (PIIP) that provides additional rewards for pharmaceutical manufacturers for undertaking research and development in Australia. The negotiated FTA focuses entirely on the rights of manufacturers on innovative pharmaceutical products and it doesn’t mention the rights of consumers to equitable access to affordable medicines. It also leaves out the hard won principle of Doha Declaration on TRIPS agreement in public health. IT also ignored the crucial role of generic manufacturers in protecting public health. There was concern that the AUSFTA opens up additional pressure points on the PBS that could ultimately result in higher drug prices, less generic competition and more pharmaceutical promotion. Dr. Harvey presented various campaigns which have been launched to oppose the AUSFTA. The history of the PBS (and recent AUSFTA negotiations) highlights the fat that health (and access to pharmaceutical) is a contested territory between those who believe it is best left to market forces and individual responsibility (U.S PhRMA) and those believe it is a civic good for which the community accepts shared responsibility (HAI, WHO, MSF, Oxfam, Australian PBS) Malaysia-A Country Report By: Dr. Jayabalan Dr. Jayabalan presented a paper by TWN on the impact of the US-Malaysia FTA on access to medicines in Malaysia. He presented the facts on TRIPS plus provisions incorporated in the US- Malaysia FTA and its implications. There are many issues negotiated under the Malaysia-US FTA. Malaysia would enter an FTA with the US to increase its exports to the USA, irrespective of the Australian and Singaporean experience with the increasing trade deficit after entering the FTAs. Dr. Jayabalan presented information to prove that more medicines may be patented and that more applications will be filed for patenting as a result of the FTA. Prolongation of the patent period, parallel importation will be restricted and data exclusivity under TRIPS plus provisions were further explained by him. Malaysia-US FTA will provide more protection for its investors in Malaysia and key Malaysian policies such as the new economic policy, industrial policy, investment policy, capital control and the 9th Malaysia plan may be affected. Sri Lanka- Service trade agreements in Health sector, a Sri Lankan Experience By: Dr. Chrishantha Weerasinghe The presentation gave a brief introduction to the Comprehensive Economic Partnership Agreement (CEPA) between India and Sri Lanka. This FTA was focused on removing barriers between India and Sri Lanka to enable full commitment under market access and national treatment for subsectors. Due to opposition following the failure of CEPA emerging requests for liberalization of health services is becoming a major concern. There has been little transparency in the negotiation process. Dr. Weerasinghe concluded his presentation by calling for regional networking to face these challenges. Thailand- The impact of Free trade Agreements on Access to Medicines By: Sangsiri Treemunka Ms Treemunka presented the current situation of the Universal coverage scheme existing in Thailand to provide health insurance for all who cannot afford it or not covered by another scheme. The currently negotiated Thai-US FTA poses a grave threat on ensuring access to medicines. More than 11 networks in Thailand are involved in protesting against it, urging the general public to demand an open negotiation process and urging the government to pass the negotiation framework to the parliament for transparency and demanding to remove TRIPs plus provisions. The protests have succeeded in postponing the agreement but the new Thai government has presented a policy to re-open negotiations with the US. Thailand’s patent law is also being re-written by the Ministry of commerce. Vietnam- A country report By: Claudio Schuftan FTA has been sold as a gesture of friendship towards countries. In Vietnam there has been no transparency or discussion with the public on the negotiations of the US-Vietnam FTA. Vietnam has one hundred and fifty pharmaceutical companies and sixty of them are operating under private ownership. A number of these pharmaceutical companies have found it profitable to depend on trade rather than manufacturing which in turn poses a threat to the distribution of medicines. A profit driven distribution is taking place with the threat of polypharamacy spreading around the country. Dr. Schuftan also presented some developments in the health sector which have taken place to increase access to health care. Day 2 Improving access to medicines in Thailand: The use of TRIPS flexibilities By: Dr. Vichai Chokevivat Dr. Vichai presented the background to the patent act in Thailand, needs for use of TRIPS flexibilities, Compulsory Licensing in Thailand and its success. Access to medicines in Thailand was impeded when the US forced Thai Government to make amendments to their patent act in 1979 to cover product patents and to extend data exclusivity from 15 to 20 years. As a result of different stages of amendments introduced to the 1979 patent act in 1999 article 51 of the patent act enabled the Thai government to issue compulsory license for government or public non commercial use. In 2004 Universal health coverage and in 2005 Universal ARVs coverage were introduced. As a result of NGO protests and government negotiations two ARV’s, one heart disease medicine and three medicines for cancer have been approved for compulsory licensing. Thai government is now in the process of producing these drugs instead of importing them. Dr. Vichai concluded his presentation by reiterating that a patent is in fact not a property. It is a right that a state or global community grants to a patent holder to promote invention for human good. Such a right must be flexible ensured by the WTO. Dr.Vichai concluded called the members to stand firm on their national dignity and lawful right to compulsory licensing to protect the citizens and ensure that they will have sustainable access to health security for all. The Universally Accessible Cheaper and Quality Medicines Act of 2008: A stratergy to increase access to essential medicines? By: Yolanda R. Robles,Phd One third of the Fillipinos do not have regular access to medicines and prices of medicines are among the highest in Asia and in the world. Government has made efforts to address the issues of access to medicines through the national drug policy; generic drugs act parallel importation and so on. Dr. Yolanda presented amendments recently made to Intellectual property code of Philippines (1997), Generics Law (1988) and Pharmacy Law (1969, amended in 1987) brought in new features to strengthen the Bureau of Food and Drugs and medicine price regulation in the Phillipines. These amendments have brought greater competition among players which could drive lower prices of medicines, and lower prices of drugs can ensure affordability. There have been some price regulation for some “priority drugs” and more parallel imported drugs are available through drug outlets. More retail outlets have been established for OTC drugs. She also presented some weakness in the amendments; such as lack of direct provision on assurance of quality drugs and there have been no real price regulatory body therefore the impact on access have been minimal. Dr. Yolanda concluded her presentation by presenting recommendations to improve the act. Movement towards access to medicines By: Lawan Sarovat, FTA Watch Ms Sarovat presented a slide show of demonstrations against the Thai-US FTA. She shared her experience and reiterated the importance of gaining support from diverse sections of the community such as the government, civil society and NGOs to fight against detrimental FTA’s. Day 3- Working Group Presentations Group 1- Indo Nepal Members- Dr. Mira Shiva, Dr. PK. Sarkar, Dr. Amitava Guha, Dr. Amit Sen Gupta, Dr. Susantha Roy, Mr. Tarak Banerjee, Dr. Pranaya Mishra, Mr. P. Subish. Mr. Kadir Alam The group discussed the present FTA situation in each country. Both India and Nepal have not entered FTAs but bilateral (Indo –EU ) and multilateral agreements (SAFTA and ASEAN ) are being negotiated. Certain other bilateral agreements are already in place (Indo-US knowledge initiative on agriculture, Monsanto, Cargill, Walmarton the board). There is evidence of total lack of transparency about FTAs being signed. In spite of the campaigns against bilateral agreements there hasn’t been civil society engagement in the issues of FTA. (Indo-US nuclear deal) The group also presented strategies to overcome the negative impacts of FTAs- such as raising public awareness, understanding the extent to which the FTAs can affect access to medicines, nutrition and health and campaigning for the removal of corporate controlled retail services. Preventive and supportive mechanisms for circumventing the impacts of FTAs were also discussed, such as; national production of pharmaceuticals (at least the essential medicines, vaccines etc…). Public sector has a major role to play in this area. Strict price control and ensuring regular production monitoring is essential for ensuring access to medicines. It is imperative to promote research and use of traditional medicines after scrutiny of safety and efficacy of medicines. Governments must be encourages to utilize the maximum flexibility of the TRIPS. There should be further support for ensuring drug price control order (DPCO), generic prescribing and dispensing in India. There is also a need for establishing a price control policy in Nepal. The patent materials in both the countries need to be revised. Countries which have production facilities also need compulsory licensing. However we need to campaign against data protection, data exclusivity and ever greening (Section 3 ‘d’of Indian patent act). A provision of pre grant opposition should be included (Gleevac, Novartis cases). The group members also presented the importance of continuing strict follow up and monitoring of the WHO commission on Innovation, IPR and public health. Group 2- Sri Lanka, Bangladesh and Pakistan Members: Dr. Chrishanta Weerasinghe, Jinani Jayasekera, Meghana Bahar, Gilles Angles, Tariq Bhutta,Shaik Tanveer Ahmed, Qassam Chowdahury, Zafrullah Chowdhary, Joel Fernando, Sophie Bloeman,Dr. Tasleema Sri Lanka Sri Lanka has entered a goods and services agreement with India and is in the process of negotiating with Pakistan. Since Board of Investment (BOI) provisions are used in these agreements exclusive rights are granted to the investors. BOI provisions do not need to go the parliament and has been ratified in 1992. BOI has positive and negative lists, health in on positive which means health is open for investment and for liberalization. There is a US agreement with the Sri Lankan government, but it has not been tabled at the parliament yet. The contents of the agreement have not been open to the public. Sri Lanka is mainly importing pharmaceuticals from India and some quantities from Malaysia and Indonesia. There is no pricing policy at the moment. Civil society activity is extremely low in the country and no NGOs are working on this. Bangladesh Bangladesh is a least developed country, therefore can produce any medicine according to needs and has not signed any FTA with any country. The national medicines policy in 1982 was based on essential drugs, price controls and generics, ninety four percent of the needs of market were produced by the local industry. Due to pressure by pharmaceutical industry the medicine policy was revised in 1994. As opposed to the 1982 medicines policy, the current is ineffective. Price control which was introduced in 1982 was abolished and a two tier system was introduces. This has resulted in a price hike in certain drugs. Essential drug prices still remain very low. Due to the increase in prices of non-essential drugs problems of smuggling these drugs and counterfeits have taken root in the country. Pakistan Pakistan has signed an FTA with China and is presently negotiating with Malaysia and Sri Lanka. People have very little knowledge on FTAs and in general they have a positive idea of FTAs. Patent law was recently modified to include TRIPS flexibilities. There hasn’t been much impact on patent laws by the existing FTAs, but an FTA with US may cause serious adverse effects. There is a need to inform and educate people and government officials in ministries. The members discussed the strategies among members to confront the FTA and for improving access for medicines. They discussed the matter of being more proactive on future FTAs (With collapse of WTO negotiations, there will be more and more FTAs coming our way). The importance of networking was highlighted during the discussions and need for sharing all experiences in the region. Dissemination of studies for education of government officers, parliament will empower the public, community power, media. The group recommended targeting Ministry of Commerce as well as health for education. Information provided to government officials and members of parliamentarians should not be more than one or two pages. It is important to have representatives of government in civil society meetings There should be preventive and supportive mechanisms for the situation in Asia Pacific to improve access to medicine at affordable prices. Such mechanisms should encompass price control of essential drugs. Matters regarding pharmaceuticals should be dealt with by the health ministry and local production should be encouraged even more. The members supported the declaration of the consultation, which states that pharmaceuticals are essential to exercise the right to health – a fundamental Human Right. Group 3: Australia; Malaysia; Philippines; Thailand & Vietnam FTA Situation: Australia When the AUSFTA was signed it was reassured by government negotiators that Public Benefit Scheme (PBS) was not on the agenda. But later it was found that PBS concessions were “traded” for reduced agricultural tariffs (which mainly did not eventuate). Two parliamentary inquiries were rushed; minor concessions only. A broad coalition of civil society opposed the inclusion of PBS (a social policy) in trade negotiations. Public support for PBS also made government wary of making too many concessions despite US pressure. AUSFTA produced some benefit such as greater industry transparency, but splitting PBS into F1 & F2 will result in higher drug prices long-term FTA Situation: Malaysia Malaysia has signed an FTA with Japan and its impact has not been assessed yet. An FTA with USA is being negotiated without transparency. Civil society lobbying has played an important role in preventing from entering the FTA in haste. There is concern that a FTA with US would have an impact on government procurement. FTA Situation: Philippines There is greater influence in the Philippines by the US. An FTA with Japan is also being negotiated but not yet ratified. There has been a proposal to exchange Filipino nurses for Japanese waste. Civil society has been active under very difficult circumstances, and in most cases there has been no transparency in the FTAs negotiated. FTA Situation: Vietnam An FTA with the 8USA was part of the conditions to re-establish relations after war. There are FTAs negotiated with ASEAN & EU. These FTAs need more detailed analysis. Civil society activity is weak as there are only a few NGOs, often led by ex-government officials. Government criticisms are not tolerated. The group presented recommendation to confront FTAs. There is a need for a simple primer on FTAs such as defining terms, demystify, point out dangers and giving country examples. It is important to sensitize and educate all levels of society to potential dangers including parliamentarians, industry, health professionals, religious leaders, media and consumers. Building coalitions to consult, gather evidence, critique draft agreements will play a critical role in opposing detrimental FTAs. In order to ensure affordable access, an essential drug list is required supported by open, transparent, international drug purchasing tenders. Civil society and government must bargain with industry to lower drug prices for drugs purchased or subsidized by government and private insurance schemes. There should also be price controls for key drugs in private market. In order to sustain access to affordable medicines local R&D and production of essential drugs must be encouraged backed by tax and land incentives and subsidies paid for local production &/or sourcing of key essential drugs. Regulatory authorities need to help local companies reach standards of GMP; not shut them down. ASEAN negotiations have not been up to international standards. Regional co-operation is required to oppose FTAs. The group also recommended rational drug use programs, therapeutic guidelines and drug utilization studies. Independent continuing medical education, academic detailers, generic campaigns, etc… are also important in assuring rational use of medicines. The group also mentioned performance indicators (with incentives and sanctions) and ethical guidelines for industry and health workers (with monitoring, incentives and sanctions). Pharmaceuticals and Health services should not be included in FTAs. This position must be linked to international declarations on health as a human right. It should be the responsibility of FTA proponents to show why they wish to depart from the fundamental position that “Health is not for trade!” Finally the usage of Trips Flexibilities may prove to be only a pragmatic, temporary, tactical response until health is taken out of the ambit of the WTO! What Next? Facilitated by: Dr. Bala, Amit Sen Gupta, Ken Harvey. The final session of the consultation was a discussion to plan many activities and to give direction to HAIAP to proceed forward. HAIAP will play a major role to increase awareness among public and policy makers. Dr Bala suggested that the discussion should be based on how to make initiatives as a collective membership and to plan the things we can do as collective activities. Prof Sarkar said that the primer prepared by HAI is in English and that he will translate it to the local language and disseminate among the public. He felt that activists do not know many things about FTA’s, the implications and the meaning of it. Dr. Mira suggested a mechanism to alert the membership about what’s going to happen, when it’s going to happen to take action. Dr Claudio suggested that material related to FTAs and their implications are available in MSF specifically prepared for people to understand, we can disseminate this among public. The more generic material was suggested to be translated to Thai and English and made available. Dr. Niyada offered to coordinates this activity and Australia agreed to send in material. A mechanism is also needed to track and evaluate what has happened to countries that have entered into FTA’s and their impact. It is important to create solidarity and a campaign of movement as an outcome of the consultation. Prof Bhutta suggested organizing seminars at the national level to educate public, media and policy makers. People coming from other countries should participate in these to share experiences. Dr. Tanveer suggested a comparative protocol to study the impact of FTA’s and circulate it among members. Prof Romeo sharing his views mentioned the importance of social connection, reaching out to grass root levels and other key groups; understanding their issues is needed before you sell your issues. Integration among medical Doctors, fishing communities and so on is important. There are groups in the US who are sympathetic towards these issues who can lobby with the governments. Identifying these groups is important to continue our work. Dr Manoj highlighted the importance of communicating the message to different professional bodies through publishing in pharmacy and medical journals. Prof Izham stated that information needs to be disseminated among the young generation or the future prescribers and pharmacists, nurses and so on. The medicine and pharmacy curricula are old and it’s important that we include the components we discussed today in to the curricula. HAIAP will prepare a media release on the FTA consultation which will be published on the national news letters. FTA’s are a part of the large issue of trade- consolidated view on trade and health. It was also suggested that the outcomes of the consultation is shared with WHO SEARO and Manila office to form a relationship with WHO to deal with this issue. HAIAPs strength has understood how medicines will help the public health issues. What HAI should do is look at other material add our values to it and get other interested parties involves in what we do. We need to keep a strong link with what we do such as medicines policy, rational drug use and so on. Not to make poor copies of the other people’s material but to add our expertise in to it. Sessions were closed by Dr. Niyada Angsulee thanking Dr. Bala and staff who was involved organizing the consultation Dr. Tarique bhutta thanked the organizers for a successful meeting. The session concluded with Prof Samlee presenting the certificate of participation to all participants.