While this case is literally full of negative aspects, we will only focus on the main points for both arguments. Pharmaceutical companies want to be sure that the products they spend years and millions of dollars to create are not easily reproduced and sold at discount prices. The profits pharmaceuticals make of their patented products are supposed to refinance new research. So taking away their exclusive distribution rights and allowing other manufacturers to just copy the product and sell it at minimal costs also harms the innovative processes in which new and better drugs are developed .
Those less concerned with the patents for these drugs are concerned about the alarming AIDS statistics, which clearly demonstrate the fact that there is an AIDS epidemic in some of the poorest countries in the world. Recovering Expenses In some of the countries where the with AIDS infected population is not only very large but also very poor, local companies will reproduce one or more of the drugs that comprise the AIDS “cocktail” and sell it at prices lower than those of the company who originally introduced it and is trying to recover some of their costs from research and development.
According to the case in the textbook, on average it takes ten to fifteen years for a drug to be created from start to finish, at a cost of $800 million. Even then, the case goes on to state that only 30 % of the completed product will earn revenues equal to its research and development. With the protection of a patent, the companies that make the drugs can charge high prices in an attempt to make their money back. Due to the fact that people with HIV/AIDS are always going to need the medicine, the price of the drugs tends to be relatively price insensitive during the time when they are protected by a patent .
AIDS Statistics One of the saddest aspects of this case is just the statistics. The first table in the case study breaks down how many people have HIV/AIDS according to the country the live in; there are a total of forty million people, including adults and children, infected with HIV/AIDS. In an article in a November 2006 issue of USAToday written by Kofi Anan, former Secretary-General for the United Nations and a patron of The Global Fund to Fight AIDS, Malaria, and Tuberculosis, he adds that AIDS is the number one killer of men and women aged fifteen to fifty-nine.
The Costs of AIDS The high number of those infected with HIV/AIDS goes hand-in-hand with the high cost of treating it. According to the case in the book, seven or eight years ago the cost of a one year supply of a “cocktail” of drugs used in AIDS treatment was equal to $10,000 – $12,000 in developed countries. In developing countries this cost was more than one person’s yearly income. Secretary-General Kofi Anan also reports that an estimated $3 billion has already been spent in the fight against AIDS.
Anan speculates in the same article mentioned above that, “by 2010, total needs for a comprehensive AIDS response will exceed $20 billion a year. ”  Health experts have been pushing for the prevention of AIDS to be a high priority since there is no cure or vaccine for the disease. The amount of money that was sent to developing countries for the purposes of spreading prevention was very small, as the case states. In these developing countries, such as in the sub-Saharan region of Africa, there is widespread poverty and few are very highly educated.
It is because of this that the people there don’t know what to do to prevent getting the disease in the first place. Progress over Time Even if after reading this case it can be thought that it has no positive aspects, on the contrary, it presents us with very interesting facts to consider and get a broader view of the matter. One of the things that have to be taken into consideration is the period of time that has passed since this problem started in the 1980’s. AIDS is a problem for the world; it triggers a lot of issues, which we can directly see in the case we are studying.
If you look at how everything has developed since AIDS was first regarded as s major threat to public health in the beginning of the 1980’s it could be said that a lot of progress has been made. Not in a way where infected individuals around the world get the treatment they need or the developing countries get completely the support necessary, but today the world is closer to that goal than years before. This is important to outline because people tend to forget the progress been made, as they are only searching for a certain ending or result.
The final solution to the dilemma between distribution of drugs to all people in need and the costly and continuous research required to find a cure, is not in reach . What would Help? An important point is that every time the pharmaceuticals yield a little bit to the grounds of intellectual property, big problems start arising everywhere. This could make us wonder if the pharmaceuticals would have yielded completely to what the developing countries were asking, would have people suffering from this terrible virus really gotten the help they needed?
It is difficult to answer this question and as seen on the case the solution isn’t as easy as it looks. It wasn’t just a matter of letting generic drugs be produced and sold, there also had to be some regulations to this process to make sure that it was really helping people in developing countries. Another positive aspect of this case is that the pharmaceuticals got back the money they spent on research and development, and by this they could assure their continuous search for better drugs. Some of which can deliver even better results than the ones that existed some years ago on the market.
If the drugs would have been sold at the prices they have been in the present, research and development money couldn’t have been restored and new projects could have been jeopardized . Even if it is thought that there is no point of producing more drugs because no one can really afford them, there are actually people, who need and buy them, since AIDS is not only a problem of developing countries but also widespread through industrialized nations, as the case shows. In time AIDS drugs can become cheaper, when they pass that stage of returning the expenses made on research and development.
Also people forget that after all the goal of any company is to make profits. The pharmaceuticals are no exception here. They need to sell drugs at certain prices, which is for general business rules. They shouldn’t let anyone just copy their projects, where it took them so much time to complete them. Medical Infrastructure Another factor is the lack of medical infrastructure in developing nations. This does not necessarily contribute to the cost of medication itself but makes the distribution more complicated .
There are several requirements for a useful treatment which are not easily to fulfill. A drug is not a supply good like food or water, which can be just given out by random volunteers. It requires medical assistance, laboratories for evaluating results and effectiveness of the therapy and a continuous supply with the drug since the antiviral cocktails require a daily intake . Taking this into consideration puts the treatment in an even more complex context and adds costs which are not often thought of. Implications of Prevention.
Even if the use of these drugs is very important people tend to forget that advertising about prevention is also very important and since there is no cure for AIDS, most effective too. Developing countries shouldn’t just try to get the drugs, but they should invest on prevention campaigns, because this virus is spreading very fast and it can jeopardize the future and the welfare of most countries. The first step for a solution of the problems of AIDS is to try to prevent it and to ensure that the number of people who get infected with the disease decrease or at least that they don’t continue growing alarmingly in numbers.
This can only be achieved by prevention campaigns so that people are conscious that this is a serious problem, and that there is no cure yet and probably not in the sooner future . Resolution The TRIPS Issue After all there is to say that since the agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was released in 1994 it was a quest for developing nations to try to supply their population in need for medication, but still obeying the laws implied by TRIPS.
Since the TRIPS agreement was made in 1994 in the Uruguay round of the GATT there has been a lot of shifting back and forth between protecting intellectual property laws and evading these strict rules. Critics said that after TRIPS especially countries with low income levels and without a domestic pharmaceutical industry could suffer the most, particularly in the sector of public health . This called the WTO to issue a more focused statement, the Doha Declaration in 2001. Allowing the least developed countries (LDCs; this status is awarded after several indicators fixed by the United Nations) exemptions from the TRIPS agreement.
This new agreement became necessary mostly because the term “public health emergencies” was not further specified in TRIPS. Such an emergency would have allowed the discharge of property laws to produce generic drugs for the domestic market. But this applied only to countries with domestic production capacities . Most LDCs don’t have those capacities and so the Doha Declaration was necessary to even out this disadvantage and allow imports of generic drugs. Also the Doha Declaration extended the time in which LDCs have to apply all restrictive regulations implied by TRIPS until 2016.
Alternatives to TRIPS could be a possibility to solve the conflict between the need for cheap, available drugs in effected countries and the need for a proper remuneration of innovative pharmaceutical companies also seeking a profit. There could be models which would award innovative companies for their R&D efforts and try to even out the long periods of spending when there is no income generated by the product itself. A sort of global innovations fund, working similarly to the existing AIDS funds but diverting resources to pharmaceuticals which make their products available to the people in need.
This would allow lower profit margins once the product is on the market, resulting in lower prices for the most up to date medical products. Positions Change Depending on the point of view players in this dispute changed their minds. The U. S. government for example sided with their large pharmaceutical industry under Bill Clinton. This happened once after South Africa passed a law in 1997 which permitted compulsory licensing of some drugs to fight AIDS. Only under pressure of NGOs the U. S. government relaxed their threat to impose economical sanctions against South Africa.
Another case was the opposition against Brazil’s plans to boost its own generic drug industry in 1996. Even though Brazil was successful in cutting AIDS related deaths within the first three years by 50% with their project, U. S. pharmaceuticals, supported by the government, warned Brazil and called the WTO to prohibit Brazil’s practices . Paradoxically the U. S. was a frontrunner in two later cases when it came to the request of breaking strict patent laws. It was in 2001 as a threat of anthrax-attacks on the U. S. was arising that the government wanted to break Bayer’s patent on an effective drug.
This request was made to speed up production and increase availability. Also with the fast spread of the bird flu and its projection to be a possible pandemic the U. S. called for relaxation of patent laws . These cases just showed again the vague meaning of “public health emergencies” and its implications on intellectual property laws, which made the Doha Declaration necessary. A more consistent position of the industrialized nations could help bring the process of finding a compromise forward.
If a nation like the U. S.acts more as a global player and not put only their public health emergencies first but the global health issue, there would be much more bargaining power behind finding the right price for drug distribution. The same criticism is applicable to Europe. The WTO and all global health funds are dependent on the resources provided by those few nations. If pharmaceutical research is too expensive to provide rewarding health care for those people in need, institutions or funds need to take over the responsibility to not let the nations struck by AIDS epidemics fall further behind in their overall development.
Conclusion In the discussion about protecting intellectual property rights for patented drugs, the focus is on pros and cons of distributing AIDS drugs for less developed countries. Countries, in which the economy is not strong enough to have an own pharmaceutical industry, where there are huge financial deficits and the majority of people living below the poverty line, are struck hardest. At the same time those countries are least able to solve the problem by themselves.
Helping the governments to build a strong preventive network and being able to supply the infected population with effective drugs should be the main priority for the global community. The case and its analysis showed that there is no straight and even path to reach this goal. Too many different interests and legal issues have an effect on the process of finding a suitable solution. Time and restless discussions have had a positive impact on the forthcoming of finding a compromise. A solution with which every party is satisfied is not in reach, but the people dying of AIDS are the ones who don’t have a chance to yield.
So a commitment of those who can afford it is in need to supply pharmaceuticals with the resources which will ensure the steady process of curing AIDS at an acceptable cost. A new danger could arise when HIV starts to transform its string and becomes resistant to current life-prolonging drugs. A new generation of drugs would be required; possibly challenging the world with all the same health related issues it experienced over the past 25 years. One can only hope that at least the accompanying legal issues will be put to rest, to react more quickly than at this time possible.
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