Professional Documents
Culture Documents
MANAGEMENT
BY GROUP ‘7’
PRIYADARSHINI.S
RITUPARNA.B
RASHMI.K
PUJA SARMAH
STUTEE PRIYA
PRATHANA
ACKNOWLEDGEMENT
INDEX
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INTRODUCTION
DOHA
DECLARATION
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MEANING :
DOHA DECALARATION- The document agreed upon by the
trade ministers of the member countries of the WTO at the Doha
Ministerial meeting. It initiates negotiations on a range of some
21 subjects. A distinctive feature is the emphasis placed on the
interests of developing countries.
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the administration has not respected the letter or spirit of the
Declaration in several ways, including by negotiating provisions
in bilateral trade agreements that restrict the use of TRIPS
flexibilities, and by threatening countries using the flexibilities.
HISTORY :
The November 2001 Doha Declaration on the TRIPS
Agreement and Public Health was adopted by the WTO
Ministerial Conference of 2001 in Doha on November 14, 2001.
It reaffirmed flexibility of TRIPS member states in
circumventing patent rights for better access to essential
medicines.
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Since the Doha meeting, MSF and other concerned actors have
been working to translate this political message into action, and
ultimately, into better access to medicines for patients on the
ground. An important step will be to ensure that countries take
advantage of the Declaration as they develop national legislation
regarding patents and medicines. Recognizing the vital role that
international technical assistance plays in this process, MSF and
other NGOs convened a conference in March 2002 to examine
the best ways to implement Doha, and specifically, to consider
how the World Intellectual Property Organization (WIPO) has
and has not promoted health concerns through its technical
assistance programs.
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compulsory licences to export generic versions of patented
medicines to countries with insufficient or no manufacturing
capacity in the pharmaceutical sector.
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regime for such exhaustion without challenge, subject to
the MFN and national treatment provisions of Articles 3
and 4.
We recognize that WTO Members with insufficient or no
manufacturing capacities in the pharmaceutical sector
could face difficulties in making effective use of
compulsory licensing under the TRIPS Agreement. We
instruct the Council for TRIPS to find an expeditious
solution to this problem and to report to the General
Council before the end of 2002."
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ratify the agreement. The European Union's acceptance only
brings the number to 41.
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IMPLEMENTATION
OF
DOHA
DECLARATION
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IMPLEMENTATION OF DOHA
DECLARATION:
The WTO Ministerial Conference at Doha declared that the
exclusivity afforded by patent rights could not prevent
governments from taking steps to protect public health,
including, most importantly, providing access to affordable
medicines. Despite that declaration, there are significant legal
and economic barriers to the implementation of policies which
will actually result in the availability of reasonably priced
medicines.
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provide for limited exceptions to the exclusivity afforded by a
patent. There appears to be general agreement that these
provisions provide sufficient flexibility for a member nation to
produce lower cost medicines for its own use. But the issuance
of a compulsory license by a member nation that lacks capacity
for the domestic production of a patented drug is of no use
unless the grant of the license is sufficient to permit the
manufacture and sale of a drug for export to that nation.
Therefore, post-Doha discussions have focused on developing
interpretations or amendments to TRIPS that would allow
exports to the nation issuing the license without violating TRIPS
obligations in the country of export.
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that are based on the cost at which such drugs would be
available if production by multiple generic sources was
permitted. It is the thesis of this paper that a price control system
is preferable to a compulsory license system since price controls
are not prohibited by TRIPS and do not undermine the exclusive
right of the patent owner. In any event, for obvious economic
reasons, compulsory licensing alone can not assure that a supply
of low cost medicines will be developed and produced.
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under highly controlled conditions in facilities which must
be inspected and approved by regulatory authorities such
as the FDA. In the United States, for example, unless there
is an approved Drug Master File for the source of the bulk
active ingredient it is not possible to obtain the approval of
a finished dosage form containing that ingredient.
3. The costs of developing a bioequivalent generic dosage
form are also significant. It takes both time and money to
develop a formulation which exhibits dissolution
characteristics similar to the original product; to produce
commercial-sized batches of that formulation; to evaluate
the product's stability; to conduct clinical studies designed
to establish bioequivalence to the original product; and to
apply for and receive regulatory approval. In the United
States, assuming a supplier for the active ingredient can be
found, it takes 2-3 years to develop and obtain approval for
a generic product and development costs, including the
value of invested dollars, can easily run to more than $2
million for a single product. These investments are not
made lightly because most generic drug companies need to
develop dozens of new drugs each year. In making
investment choices a company must examine the risk of (i)
non-approval for technical reasons, (ii) competition from
other generic manufacturers that may drive down prices to
unprofitable levels, (iii) how long it will take before the
development investment is recovered, and (iv) the
possibility that the product being copied may become
obsolete by virtue of the introduction of a second
generation "me-too" products by the innovator before the
product being copied is approved for marketing.
4. The degree of risk for the bulk chemical manufacturer is
also significant. The sale of a bulk chemical in commercial
significant quantities is dependent on the success of a
finished dosage form manufacturer in developing an
approved product and establishing a market. In addition,
the demand for the bulk chemical can be small. For
example, if the finished product contains 10 milligrams of
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the active ingredient, only 100 kilograms (220 pounds) of
material is needed to produce 10 million tablets. Therefore,
unless the chemical manufacturer directly or indirectly
participates in the profits derived from the sale of the
finished product, it may be unable to make a sufficient
return to justify the investment in developing a new
chemical.
5. Not surprisingly, given all of the foregoing costs and risks,
the major producers of the active pharmaceutical
ingredients in countries like India are primarily engaged in
the production of final dosage forms for consumption in
their home market. Absent patent protection, the
investment in the development of a new product can be
more quickly recovered due to the immediate prospect of
high volume sales. The eventual incremental additional
profit to be derived from the export of either bulk
chemicals or finished dosages is certainly a plus but it is
not the driving force in prioritizing product development
projects and maintaining a profitable enterprise.
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enough to induce the investment in development. Indeed, the
availability of a low-cost generic product could ultimately
become dependent on whether a sufficiently large group of least
developed nations would find it feasible to pool their
compulsory licensing capability and buying power to create an
exclusive compulsory license thereby guaranteeing a sufficient
volume of business to induce the development of a product.
Clearly, the price at which a least developed nation could
acquire a supply of generic drugs would be far higher in this
scenario than in the current environment where there are
multiple existing producers seeking to make a small amount of
additional profit by increasing the volume of production of an
existing product for which development costs have already been
recovered in their home market.
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DEPARTMENTS
OF DOHA
DECLARATION
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DEPARTMENTS COVERED IN DOHA
DECLARATION:
AGRICULTURE
Negotiations on agriculture began in early 2000, under
Article 20 of the WTO Agriculture Agreement. By
November 2001 and the Doha Ministerial Conference,
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121 governments had submitted a large number of negotiating
proposals.
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confirm that the negotiations will take these into account, as
provided for in the Agriculture Agreement.
Services
Negotiations on services were already almost two years old
when they were incorporated into the new Doha agenda.
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well as non-tariff barriers, in particular on products of export
interest to developing countries”. These negotiations shall take
fully into account the special needs and interests of developing
and least-developed countries, and recognize that these countries
do not need to match or reciprocate in full tariff-reduction
commitments by other participants.
While average customs duties are now at their lowest levels after
eight GATT Rounds, certain tariffs continue to restrict trade,
especially on exports of developing countries — for instance
“tariff peaks”, which are relatively high tariffs, usually on
“sensitive” products, amidst generally low tariff levels. For
industrialized countries, tariffs of 15% and above are generally
recognized as “tariff peaks”.
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Trade-related aspects of intellectual property
rights (TRIPS)
For the Doha agenda, this separate declaration sets two specific
task. The TRIPS Council has to find a solution to the problems
countries may face in making use of compulsory licensing if
they have too little or no pharmaceutical manufacturing
capacity, reporting to the General Council on this by the end of
2002.(this was achieved in August, 2003, see intellectual
property section of the “Agreements” chapter.) The declaration
also extends the deadline for least-developed countries to apply
provisions on pharmaceutical patents until 1 January 2016.
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also words associated with a place) used to identify products
with particular characteristics because they come from specific
places. The WTO TRIPS Council has already started work on a
multilateral registration system for geographical indications for
wines and spirits. The Doha Declaration sets a deadline for
completing the negotiations: the Fifth Ministerial Conference in
2003.
The Doha Declaration notes that the TRIPS Council will handle
this under the declaration’s paragraph 12 (which deals with
implementation issues). Paragraph 12 offers two tracks:
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Argentina said it understands “there is no agreement to negotiate
the ‘other outstanding implementation issues’ referred to under
(b) and that, by the end of 2002, consensus will be required in
order to launch any negotiations on these issues”.
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discrimination, ways of preparing negotiated commitments,
development provisions, exceptions and balance-of-payments
safeguards, consultation and dispute settlement. The negotiated
commitments would be modelled on those made in services,
which specify where commitments are being made — “positive
lists” — rather than making broad commitments and listing
exceptions.
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The declaration says the work must take full account of
developmental needs. It includes technical cooperation and
capacity building, on such topics as policy analysis and
development, so that developing countries are better placed to
evaluate the implications of closer multilateral cooperation for
various developmental objectives. Cooperation with other
organizations such as the UN Conference on Trade and
Development (UNCTAD) is also included.
Since the 1 August 2004 decision, this subject has been dropped
from the Doha agenda.
Trade facilitation
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In the period until the Fifth Ministerial Conference in 2003, the
WTO Goods Council, which had been working on this subject
since 1997, “shall review and as appropriate, clarify and
improve relevant aspects of Articles 5 (‘Freedom of Transit’), 8
(‘Fees and Formalities Connected with Importation and
Exportation’) and 10 (‘Publication and Administration of Trade
Regulations’) of the General Agreement on Tariffs and Trade
(GATT 1994) and identify the trade facilitation needs and
priorities of Members, in particular developing and least-
developed countries”.
Those issues were cited in the 1 August 2004 decision that broke
the Cancún deadlock. Members agreed to start negotiations on
trade facilitation, but not the three other Singapore issues.
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proved controversial, and has been a central element in the work
of the Regional Trade Agreements Committee. As a result, since
1995 the committee has failed to complete its assessments of
whether individual trade agreements conform with WTO
provisions.
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members clearly felt that improvements should be made to the
understanding. However, the DSB could not reach a consensus
on the results of the review.
New negotiations
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new information exchange procedures may expand the scope of
existing cooperation.
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• Intellectual property. Paragraph 19 of the Ministerial
Declaration mandates the TRIPs Council to continue
clarifying the relationship between the TRIPS Agreement
and the Biological Diversity Convention. Ministers also
ask the Trade and Environment Committee to continue to
look at the relevant provisions of the TRIPS agreement.
• Environmental labelling requirements. The Trade and
Environment Committee is to look at the impact of eco-
labelling on trade and examine whether existing WTO
rules stand in the way of eco-labelling policies. Parallel
discussions are to take place in the Technical Barriers to
Trade (TBT) Committee.
• For all these issues: when working on these (market
access, “win-win-win” situations, intellectual property and
environmental labelling), the Trade and Environment
Committee should identify WTO rules that would need to
be clarified.
• General: ministers recognize the importance of technical
assistance and capacity building programmes for
developing countries in the trade and environment area.
They also encourage members to share expertise and
experience on national environmental reviews.
Electronic commerce
The Doha Declaration endorses the work already done on
electronic commerce and instructs the General Council to
consider the most appropriate institutional arrangements for
handling the work programme, and to report on further progress
to the Fifth Ministerial Conference.
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Small economies
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Technical cooperation and capacity building
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The Director-General reported to the General Council in
December 2002 and to the Fifth Ministerial Conference on the
implementation and adequacy of these new commitments.
Least-developed countries
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Declaration, taking into account the parts of the declaration
related to trade that was issued at the UN LDC Conference.
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IMPARTANCE OF
DOHA
DECLARATION
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Price Controls-A Potential Path to
Affordable Medicines?
"Issuance of a patent does not signify government approval to
commercialise the patented product. It only prevents others from
doing so for the period of the patent. Approval by a regulatory
agency, such as the Food and Drug Administration or the
Environmental Protection Agency, may be necessary before a
patented product can actually be marketed by the patent holder
or licensee."
Every nation in the world appears to exercise some degree of
control over the price at which a pharmaceutical can be sold and
the exercise of that control is not subject to TRIPs.3 In fact,
TRIPS leaves the question of whether to allow parallel imports
of patented pharmaceuticals to the discretion of each nation. The
primary incentive for parallel imports is lower prices.
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Significant international price differentials for pharmaceuticals
primarily result from variations in price controls.
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developing nations. The fact is that the profits derived from
sales to those nations are currently small to non-existent and do
not materially affect the earnings or market value of the major
pharmaceutical companies. Obviously, over time, the vast
populations in these regions represent a source of sales and
profit growth. Moreover, there is no valid economic or social
rationale for compelling a poor nation to pay a price that
incorporates costs connected to the manner in which drugs are
sold and distributed in developed nations. Indeed, for drugs that
were primarily developed for western markets, a reasonable
basis exists for arguing that the price to the poorest nations
should be based solely on production cost and exclude any
development costs.
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patent owner is willing to sell product at the price fixed in the
manner described.
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insuring a flow of low cost medications to the least developed
nations. It insures that the low cost drug will exist either by
virtue of production and sale by the patent owner or by a local
producer under a compulsory license. Under the terms of the
Doha Declaration, the least developed nations will not be
required to enforce pharmaceutical patent protection until at
least 2016. Accordingly, they will be able to purchase the low
cost drug either directly from the patented source at prices
comparable to the controlled price in the developing nation or
from a licensed producer in the developing nation. It might be
argued that product produced in one country under a compulsory
license can not be exported to another country without violating
Article 31(f) of TRIPS. However, Article 31(f) does not bar such
sales completely but merely requires that products produced
under a compulsory license be "predominantly" for the domestic
market. A compulsory license issued by a developing nation
because of a patent owner's refusal to sell product at a controlled
price would clearly be issued primarily for the purpose of
satisfying domestic needs. The fact that product was also
produced for export to a least developed nation would not
change the predominant purpose of the license. Therefore,
Article 31(f) of TRIPs will not be an impediment to honoring
cross-border compulsory licenses.
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nation should be able to produce the goods for export that the
patent owner refused to supply.
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CONCLUSION
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THE DOHA DECLARATION ON TRIPS
AND PUBLIC HEALTH, FIVE
YEARS ON:
Government officials, businesses and civil society groups alike
are this week commemorating the fifth anniversary of the
adoption of the Doha Declaration on the WTO TRIPS
Agreement and Public Health (WT/MIN(01)/DEC/2).
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multilateral trading system could respond to global public health
concerns.
Five years down the road, although most concur that the
declaration was an important milestone, many remain deeply
concerned about the impact of intellectual property rules on
access to medicine.
“The Doha Declaration said all the right things but to date has
delivered virtually nothing to poor patients,” said Celine
Chaveriat of Oxfam International. “We’ve gone backwards in
five years.” Guy Willis of the International Federation of
Pharmaceutical Manufacturers & Associations disagreed. He
told Bridges that that the “Doha Declaration represents a
balanced approach” and that developments over the last five
years have “helped to clarify the declaration.”
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The declaration aimed to clarify ambiguities in WTO intellectual
property rules about countries’ ability to produce and import
affordable drugs. It reaffirmed Members’ rights to “determine
what constitutes a national emergency or other circumstances of
extreme urgency,” and to “to determine the grounds” for
granting ‘compulsory licences’ authorising the production of
patented medicines without the consent of the patent holder.
It took WTO Members until August 2003 — long after the 2002
deadline in the Doha declaration — to reach an accord on
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helping countries lacking manufacturing capacity to make use of
compulsory licenses. The so-called ‘30 August 2003 decision’
was effectively a temporary waiver of the requirement that
medicines produced under compulsory licence be restricted to
the domestic market, pending an amendment of the TRIPS
agreement (see BRIDGES Weekly, 4 September 2003). Even at
the time, critics charged that its numerous requirements set an
impracticably high bar for the legal importation of drugs
produced under compulsory licences.
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bilateral and regional free trade agreements (FTAs) on “limiting
the grounds on which governments can issue compulsory
licences,” for example, to cases of national emergency,
government non-commercial use, and to address anti-
competitive practices. She also warned that new protections for
clinical test data in FTAs delay generics from coming to market.
Added Oxfam’s Jennifer Brant, “What’s the point in having the
Doha declaration if it’s being chipped away?”
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