By assuming that current minimum international Intellectual Property
Protection (IPP) standards hurt developing countries, they ask "How
national IPR regimes could best be designed to benefit developing
countries with the context of international agreements, including
By assuming that the WTO Agreement on Trade Related Aspects of Intellectual
Property Rights (TRIPS) is slanted against developing countries they
ask "How the international framework of rules and agreements
might be improved and developed?"
By assuming that there is conflict between intellectual property and
public health they ask: "What is the broader policy framework
needed to complement intellectual property regimes?"
asking these questions, the Report starts with a number of unstated,
implied and unproven assumptions:
That the TRIPS Agreement provides an unreasonably high level of IP
protection with unprecedented, new patent obligations. In fact, the
TRIPS Agreement simply provides on an MFN basis patent and other protections
that date back more than 100 years in well-established Treaties of
the World Intellectual Property Organization (WIPO).1
TRIPS provides a minimum level of IP protection, weaker in many respects
than laws in the US, EU states, and Japan.
That one size fits all for developing countries — i.e. while
attacking TRIPS as "one size fits all," the report assumes
that all developing countries have the same needs, lumping together
sophisticated industrializing states and UNDP Least Developed Countries.
The assumption is that the so-called "South" will never
have any ideas worth protecting, and will rely on theft of others'
IP for their development. This is not only untrue, but insulting.
That the US and other developed states achieved their development
goals in large part by flouting patent and other IP protections, and
so should developing countries. In fact, the US and other countries
have provided patent protection as part of their Constitutional or
other basic laws.2 Even if
this were true in the past, economists now believe that growth in
the future will depend not on reverse engineering or compulsory licensing,
but through FDI and technology transfer, both of which need strong
rule of law regimes, including IP protection.3
The Report reflects the authors' professional backgrounds and their
views, which are consistent with the views of developing countries.
the authors started with different questions, for example: How has
protection of IPRs benefited developing countries?, and consulted
with other disciplines from within the developed countries, then the
broad conclusions of the Report might not have tilted so negatively
toward the "costs" of IPRs and so favorably toward exceptions
to TRIPS rules and compulsory licensing.4
issue of "Integrating Intellectual Property Rights and Development
Policy" is an important one; however, there exists fundamental
disagreement with the Report and its authors that weaker IPRs and
weaker protection of those rights would better assist the world's
intellectual property rights are critical to provide incentives and
protection for innovation, including research into finding new cures
for diseases particularly affecting developing countries, as well
as diseases affecting all of humankind. For example, heart disease
and diabetes affect millions in developing countries.
are polar opposite views of the impact of IP policies on the world's
poor: IPP helps to stimulate economic growth and reduce poverty vs.
IPP does little to stimulate invention in developing countries because
the "human and technical capacity" does not exist. (Introduction,
IPP has dramatically increased in level, scope, territorial extent,
and role over the last 20 years (Background, p.2), adding "heavy
costs" with less easily identifiable benefits to developing countries.
(Our Task, p.6),
IPP can be viewed as akin to political or human rights, or as economic
or commercial rights (Our Task, p.6); the Report considers an IPP
as "one of the means by which nations and societies can help
to promote the fulfillment of human economic and social rights."
(Our Task, p.7)
IPP systems and policy, in turn, may introduce distortions that are
detrimental to the interests of developing countries. (Our Task, p.9)
reality the TRIPS Agreement merely incorporates many of the substantive
obligations included in the WIPO Paris Convention and other treaties.5
(Under the WTO, these obligations are provided on an MFN basis, which
means that if Indian inventors benefit from patents in the US market,
US inventors should gain these rights in India. The WTO also provides
enforcement.)6 While it is
true at the broadest level that the impact of IP policies on the poor
"will vary according to socio-economic circumstances" (p.2),
this ignores the fact that all countries need to adopt a minimum international
standard for IP protection (represented by TRIPS) to ultimately succeed
in achieving higher levels of economic growth and development.7
Overview appears to set the tone for the oft-repeated charge that
IPP is a neo-colonialist conspiracy of big business.
Commission began with a false premise-that intellectual property protection
impedes economic development efforts and forces a transfer of wealth
from poor nations to the rich. Clearly this is at odds with mainstream
economic theory." Ms. Shannon Herzfeld, PRMA Senior Vice President,
International Affairs, News Release, September 12, 2002.8
overview fails to take into account the need to provide a rule of
law culture, including IPP to reverse brain drain and encourage innovators
to remain in their countries of origin.
Chapter 1: Intellectual Property and Development
and copyrights provide incentive for innovation or creation that may
benefit society, but they also impose costs on users of the protected
works. (The Rationale for IP Protection, pp. 16, 20)
have historically been able to adapt IPP regimes to facilitate technological
learning and promote their own industrial policy objectives; however,
today, with the "advent of TRIPS," the flexibility in the
design of IPP regimes can no longer follow the paths of other countries.
"Technological learning" and "establishing a genuine
indigenous innovative capacity" must be done differently. (History,
Report focuses not on IPP as an end in itself, but on how IPP contributes
to development and the reduction of poverty. (The Evidence About the
Impact of IP, p.23)
developing countries, any beneficial trade and investment effects
are unlikely to outweigh the costs at least in the short and medium
countries must promote more effective research and cooperation with
and among developing countries to strengthen their scientific and
technological capabilities. (Technology Transfer, pp. 30-31)
at every stage of development benefit from protecting the intellectual
capital of their people. No part of the world has a monopoly on good
ideas. Intellectual property rights insure that the benefits of a
novel idea flow to the inventors, no matter where they might live.
Respect for intellectual property rights helps developing countries
build their economies and improve public health for their people."
Herzfeld September 12, 2002 News Release. 9
Chapter 2: Health
considerations must be the main objective in determining what IP regime
should apply to healthcare products. (Introduction, p.35)
evidence suggests that the IPP system does not play a role in stimulating
research on diseases prevalent in developing countries (except for
those diseases that are also prevalent in developed countries). (Research
and Development, p.38)
of IPP will not increase R&D expenditure for diseases affecting
developing countries. (R&D, p.39)
must adopt a range of policies to improve access to medicines, including
improving services, delivery mechanisms and infrastructure; Countries
must ensure that their IPP regimes do not run counter to their public
health policies and that they are consistent with and supportive of
such policies. (Access to Medicines for Poor People, p.46)
countries should be permitted to use "compulsory licensing"
as a means to facilitate the availability of lower cost medicines,
as well as differential pricing and parallel imports. (Policy Implications,
pp.48, 49, 51-61)
Health breeds wealth, and there is demonstrated association
between increased IPP standards and improved access to medicines and
better public health. Where IPP systems are established as part of
a rule of law culture, with transparency and in conformity with other
WTO standards, PhRMA companies have a great track record of developing
medicines for patients in poor countries. For example, pharmaceutical
investment in Mexico and Brazil increased significantly after each
country strengthened IPP in the 1990s. Investment in Brazil totaled
$2 billion between 1996 and 2000, increasing jobs, tax revenue, exports,
and GDP.10 Indeed, in many
other countries the chemical and pharmaceutical/biotech sectors can
become engines of growth. Countries benefiting from adoption of IPP
include Italy, South Korea, and most recently Jordan.11
The case of Argentina is also instructive: from the mid-1800s through
the 1930s, Argentina had healthy institutions, including strong IPP
and an open economy [IPN, p.12], and as a consequence was one of the
world's wealthiest countries. After the 1930s, IPP deteriorated, rule
of law was undermined, and political corruption became rife. Today,
Argentina's infant mortality rates continue to fall, capital flow
into Argentina has slowed, and brain drain from Argentina continues.12
in the WTO Doha Declaration: TRIPS protections encourage pharmaceutical
innovation and should be fully implemented as stated, taking into
account the flexibilities in the Agreement.
licenses, are an exceptional remedy for use only in the case of market
failure or significant abuse of a patent (e.g. a demonstrated antitrust
violation linked to use of a specific patent, or a state of national
emergency under which normal rules of commerce are suspended). In
most countries in the developing world, patent systems are still evolving.
Compulsory licenses severely curtail or eliminate the anticipated
benefits that accrue from the exclusive rights associated with a patent.13
Significantly, apart from Zimbabwe, no developing country has stated
its intention to issue a compulsory license as the best mechanism
to address public health needs.
trade has never been shown to facilitate the availability of lower
costs medicines. Parallel traders buy goods in low-price countries
and re-sell at a higher price in the importing country. This form
of arbitrage benefits neither patients nor governments; only the parallel
trader is financially enriched. In fact, it sucks medicines from poorer,
lower-cost markets into higher cost markets.14
trade is not the panacea for lowering prices of medicines; little,
if any, savings are passed on to purchasers. Instead, the integrity
of the pharmaceutical market can be compromised by the infiltration
of counterfeit and poor quality goods.15
Report ignores the inherent dangers of counterfeit medicines. Indeed,
in its negative attitude toward the relationship between IPP and the
interests of developing countries, the Report overlooks the TRIPS
provisions on trademarks (Article 16), one of the most important tools
for consumers in developing countries to avoid lower quality products.
adverse impact of counterfeit drugs on public health is enormous:
"In most cases, counterfeit drugs are not equivalent in safety,
efficacy and quality to their genuine counterparts. Even if they
are of the correct quality or contain the correct amount of active
substance, their production and distribution are not within the
control of the drug regulatory authority of the country concerned.
… In many cases [counterfeit drugs] have been found to be
without active ingredients, or with wrong ingredients or with incorrect
quantities of active ingredients. … As a consequence of such
damaging effects, counterfeit drugs may erode public confidence
in health care systems [and] health car professionals…."16
3: Agriculture and Genetic Resources
TRIPS countries must apply some kind of IP protection to plants, generally
patents; however, patents also pose a threat to farmers' traditional
practices of reusing, exchanging and selling seeds. (Intellectual
Property in Agriculture, p.66, 75)
countries should generally not provide patent protection for plants
and animals because of restrictions patents place on use of seeds
by farmers and researchers. (The Impact of Patents, p.75)
should be oriented to the needs of the poor farmers; public sector
varieties of seed should be available to provide competition for private
sector varieties; the world's plant genetic resource heritage should
be maintained. (Conclusion, p.76)
IPP are critical to provide incentives and protection for innovation
regardless of industry, including research based on plants and seed.
Chapter 4: Traditional
Knowledge, Access and Benefit Sharing and Geographic Indications
debate over the protection and promotion of traditional knowledge
is complex: some wish to conserve traditional knowledge and protect
it from commercial exploitation, and others wish to ensure that it
is exploited in an equitable manner for the benefit of its holder.
(Traditional Knowledge, pp.83-92)
Report seeks to influence the discussion of the intellectual property
value of traditional knowledge, which is a topic of WTO review.
TRIPS protections, along with contract protections available under
national legal regimes, should be used to protect traditional knowledge.
Chapter 5: Copyright, Software and the Internet
there is an enormous knowledge gap between the riches and the poorest
countries; stronger copyright protection may help to stimulate local
cultural industries in developing countries, as long as other conditions
affecting the success of those industries are also met. In the short
to medium term, copyright protection is likely to reduce the ability
of developing countries and poor people to close this gap by getting
textbooks, scientific information and software they need at affordable
cost. (Copyright as a Stimulus to Creation, p.109)
strong protection and enforcement of copyrights would reduce access
to knowledge-related products in developing countries, with potentially
damaging consequences for poor people. (Copyright-based Industries
and Copying of Protected Works, p. 112)
countries should be entitled to "fair use" rights in reasonable
numbers for educational and research purposes. ((Delivering the Potential
of the Internet for Development, p.120-121)
with the overall tone of the Report, Chapter 5 assumes that (1) all
knowledge is sacred and therefore must be in the public domain; (2)
IPP restricts the flow of ideas; and (3) that countries can close
the knowledge gap only through piracy or copying.
makes knowledge available and provide financial incentives for copyright
holders to divulge information so that the information may be disseminated,
further researched and enjoyed. Arguably, without copyright protections,
many people would elect not to share their creativity, and public
access to that information and those ideas would suffer.
authors' neo-colonialist implications that poor economies cannot develop
without adopting illegal means (see p.112), such as pirating software,
source codes, music, literature, and the like, are insulting to developing
Chapter 6: Patent Reform
countries, because of the vast differences in their technical and
scientific capacities, must choose an IP system that they feel best
meets their development objectives and economic and social circumstances.
best patent system for a developing country may be one that applies
strict standards of patentability and results in fewer patents meeting
these criteria. (The Design of Patent Systems in Developing Countries,
of a patent system may not be suitable for developing countries as
it would further limit their freedom to design appropriate patent
policies. (Executive Summary, p.23)
and better patents would be the most effective way of "reducing
the burden on the major patent offices and, more importantly, securing
widespread support for the patent system." (International Patent
The Report's contention that the patent system must be reformed in
order to assist developing countries is an extreme one. Patents may
adversely affect some powerful vested interests, such as generic pharmaceutical
manufacturers, and thereby will have an economic and political cost
in the short term; however, the benefits of IPP protection in the
medium to long term-in the form of increased foreign direct investment,
technology transfer, and local product development-vastly outweigh
these transitional costs.
the benefits of IPP will create entirely new economic actors, such
as clinical research organizations, academic/private research partnerships,
etc., it is important not to let the voices at the table drown out
the opportunities for the future that will bring greater opportunities
to a broader class.17
Chapter 7: Institutional Capacity
developing countries, the implementation of TRIPS requires changes
to IP legislation; however, many developing countries have weak institutional
capacity, and in particular lack experienced and skilled personnel.
(Introduction, p.153, 154)
countries should not divert resources from already over-extended health
and education budgets to subsidize the administration of a system
for IPRs. (Executive Summary, p.25)
and OECD countries have an obligation to provide technical assistance
and capacity building. USTR and the US private sector, WIPO and other
UN organizations are working at meeting these obligations and can
and should do more. This developed country assistance is critical
for developing countries to achieve the benefits of the TRIPS Agreement.
Chapter 8: The International Architecture
and other agreements that encourage developing countries to adopt
higher standards of IP protection (TRIPS-plus Agreements, p.181) can
undermine the multilateral system by limiting use of flexibilities
and exceptions permitted by TRIPS and other treaties. (The TRIPS Agreement,
have generally made a positive contribution to voicing concerns about
the impact of IP on developing countries. (The Role of Civil Society,
authors recommend creating an "international network and partnership
initiative which would bring together development agencies, developing
country governments, IP researchers and NGOs. The aims would be to
identify priorities and promote coordination of research programmes;
improve knowledge sharing amongst partners; and facilitate wider dissemination
of finding through sponsorship of publications, conferences and Internet-base
resources." (Deepening Understanding About IP and Development,
to the sweeping, broad conclusion of the Report, strong IPP advances
simplistic and incorrect to blame IPP for denying healthcare treatment
in the developing world. Few patent applications for innovative medicines
are filed in developing countries (even though such patents are available).18
Ninety-five percent of essential medicines needed in developing countries
are not protected by patents.
provides the flexibility to take into account public health needs
of developing countries, and actions taken by developing countries
demonstrate that the TRIPS approach is practical and workable.
disease in the developing world is a complex struggle that requires
constructive partnerships between the public and private sectors.
The U.S. research-based pharmaceutical industry is leading the private
sector's fight against widespread diseases, especially in the world's
Michael P. Ryan, Knowledge Diplomacy: Global Competition and the
Politics of Intellectual Property 94 (1998) (noting that TRIPS incorporates
previously existing IP obligations under the various international
treaties, including Paris and Berne, administered by WIPO); see
also WIPO General Information: The Beginning (detailing the long
history of international agreements regarding patent protection
dating back to the Paris Convention of 1884), at http://www.wipo.org/about-wipo/en/index.html?wipo_content_frame=/about-wipo/en/gib.htm.
See U.S. Const. Art. I, Sec. 8, Cl. 3; see also
Constitution of the Dominican Republic, Sec. 8 Articles 13, 14 (NEED
TO CORRECT CITE)
Keith E. Maskus, Intellectual Property Rights in the Global Economy
129, 141-142 (2000) (analyzing various IPR, FDI & technology transfer-related
studies to conclude that FDI, licensing, and technology transfers
for pharmaceuticals would significantly increase in developing countries
as IPRs are strengthened). The author also notes that "[w]eak
patent rights are significant barriers to manufacturing trade, particularly
in IPR-sensitive goods."). id. at 118.
See id. at 147 (citing a 1997 study by Evenson and
Westphal demonstrating that the high degree of knowledge investment
required for advanced technologies and innovations present with
strong IPP provide "high social returns" for developing
countries and are "crucial" for raising levels of productivity);
see also id. at 148 (citing a 1999 Maskus and McDaniel study of
the effect of a strong patent system on postwar Japan as an "important
source" for its technological leadership).
See Ryan, supra note 1 (noting that many TRIPS obligations
preexist in international treaties).
See Maskus, supra note 3, at 17 (noting that TRIPS
was the first instance in which international IP obligations were
required on a MFN basis).
See supra note 3, 4 (discussing the importance of
IPR to economic development); see also A dark day in Britain? The
Economist 13-14 (Sept. 14, 2002) (reasoning that economies of developing
countries would benefit from stronger IPP).
e.g., supra note 3, 4; George G. Korenko, Intellectual Property Protection
and Industrial Growth, 2 J. of World Intell. Prop. 47, 70-71 (1999)
(comparing the potential economic growth in developing countries that
have strong IPP, like Brazil, with the "brain drain" and
loss of innovative scientists present in India, which provides no
pharmaceutical patent protection); Charles E. Barfield & Mark
A. Groombridge, Parallel Trade in the Pharmaceutical Industry: Implications
for Innovation, Consumer Welfare, and Health Policy, 10 Fordham Intell.
Prop. Media & Ent. L.J. 185, 220 (noting economic surveys indicating
significant benefits for developing countries with stronger IPP and
resultant inflows, not outflows, of investment).
See Barfield & Groombridge, supra note 8 (discussing
positive economic impact of IPP upon developing countries); Martin
Krause, Qualifying for the World Cup, TRIPS and Healthcare: Rethinking
the Debate (International Policy Network) (suggesting a direct correlation
between the strength of a country's property laws and the health
of its citizens).
Singham, infra note 14, at 378 (noting that Mexico has benefited greatly
from strong IPP).
See id. (noting that South Korea has seen some
of the greatest technological innovations since implementing strong
IPP); Korenko, supra note 8, at 72 (analyzing relevant data and
concluding that since 1978 Italian changes in patent law, domestic
Italian pharmaceutical firms have increased production and employment,
foreign firms' share of pharmaceutical sales have decreased, and
R&D has increased).
See Krause, supra note 9, at 14.
See Bibek Debroy, The Compulsory Licensing Anomaly,
TRIPS and Healthcare: Rethinking the Debate (International Policy
Network) (July 15, 2001) (concluding that compulsory licensing reduces
gains in research and development, innovation, and is not the optimal
manner in which to target medicines for poor people), available
See Shanker A. Singham, Competition Policy and
the Stimulation of Innovation: TRIPS and the Interface Between Competition
and Patent Protection in the Pharmaceutical Industry, 26 Brook.
J. Int'l L. 363, 408 (emphasizing that the main beneficiaries of
parallel trade in pharmaceuticals would be distributors and wholesalers,
not consumers and patients). The author highlights the adverse effect
of parallel trade on research and development. Id. In addition,
a sharp contrast is drawn between the national exhaustion and parallel
trade. Id. at 409-410.
See Barfield & Groombridge, supra note 8, at
254 (raising serious concerns regarding the safety and quality of
medicines obtained via parallel trade).
Magali LeParc, ed., Protecting Medicines &
Pharmaceuticals: A Manual of AntiCounterfeiting Solutions 14 (Reconnaissance
See Julian Morris, TRIPS and Healthcare: Rethinking
the Debate (International Policy Network) (noting that much of the
opposition to stronger IPP comes from powerful generic companies
in developing countries), available at http://www.policynetwork.net/publications.php;
see also supra notes 3, 4, 7 (discussing the positive impact of
strong IPP on developing countries in the areas of FDI, technology
transfer and local economic and social welfare).
See generally Amir Attaran & Lee Gillespie-White,
Do Patents for Antiretroviral Drugs Constrain Access to AIDS Treatment
in Africa?, 286 JAMA 1886 (2001) (concluding that patents are not
the barrier to HIV/AIDS medicines access in Africa, but that a variety
of other factors, including a severe lack of international aid finance,
is to blame). Significantly, the authors note that out of 795 possible
instances of patenting in Africa, only 172 (21.6%) exist, suggesting
that most anti-retrovirals are not subject to African patent protection.