Free Trade Area for the Americas

Fourth Trade Ministerial and Americas Business Forum
San Jose, Costa Rica

Position Paper Submitted To The
Working Group on Technology and Intellectual Property Rights
Recommendations on Health Care and Intellectual Property

Endorsed by

Consumer Project on Technology
Health Action International

Submitted February 15, 1998, for meetings in March 1998

The Consumer Project on Technology is a non-government organization (NGO) created in 1995 to investigate a wide range of issues concerning technology and consumer interest. CPT is involved in issues relating to intellectual property (IP), information technologies, medical technologies, and electronic commerce and privacy. CPT presented a paper to the 3rd Business Forum, held in 1997 in Belo Horizonte, Brazil, which is available on the Internet at (no period). Additional information about CPT is on the web at: (no period).

Health Action International (HAI) is a global network of health, development, consumer and other public interest groups in more than 70 countries working for a more rational use of medicinal drugs. HAI represents the interests of consumers in drug pol icy and believes that all drugs marketed should be acceptably safe, effective, affordable and meet real medical needs. HAI also campaigns for better controls on drug promotion and the provision of balanced, independent information for prescribers and cons umers. HAI is currently involved in efforts to evaluate the impact of the WTO and the TRIPS agreement on public health. HAI has several regional offices, include an office in Lima Peru. More information about HAI is on the web at: (no period).

Recommendations for Healthcare and Intellectual Property

1. Intellectual property regimes for healthcare should achieve public health goals. It is not appropriate to treat healthcare is a matter of commerce only.

2. In the area of healthcare, the focus of trade agreements on intellectual property should be the equitable and reasonable sharing of the costs of research and development, rather than the particular mechanisms for R&D support, such as patents o r exclusivity marketing provisions.

3. An important measure of equitable sharing is per capita expenditures on healthcare R&D. Countries with higher per capita incomes should assume higher burdens for R&D expenditures.

4. Countries should have discretion to choose mechanisms that raise per capita R&D expenditures. R&D by commercial firms is important, but so is R&D spending by governments, non-profit entities and other public health entities.

5. Policies should encourage R&D for pharmaceuticals and other new therapies and medical devices, as well as items less likely to attract private investment. There are important market failures in R&D. Research on basic medical science, adv erse reactions to pharmaceuticals, dietary practices, appropriate technologies for rural healthcare, epidemiology, therapies for low income patient groups, and more generally, research which is not likely to lead to profitable inventions, is also importan t. Public health goals reflect research priorities that differ in important respects from investor priorities.

6. Countries should have discretion to limit or eliminate patent protections for areas of public interest, such as healthcare or life forms.

7. Countries should have discretion to use compulsory licenses to achieve public interest goals. This is particularly important in complex fields of technology, where inventions are essential inputs for other inventions.

8. Countries should have discretion to require minimum levels of reinvestment in healthcare R&D. A program of minimum reinvestment in R&D, or a required contribution to a national R&D program (as has been proposed by the U.S. Senate) may achieve fair burden sharing for R&D.

9. Countries should avoid overbroad patents and other rights that discourage innovation and lead to anitcompetitive practices.

10. Protection of trademarks should not be interpreted a limitation on a government's ability to regulate marketing of products or services. In the area of healthcare, governments clearly have the power to require plain paper packaging of cigarettes, b ar billboard ads for cigarettes or alcoholic beverages, require standardized packaging of infant formula, and other matters which protect the public's health.

11. Sweat of the brow protections for health care research should not be excessive, or create inappropriate anticompetitive barriers to entry. Protections based upon investment, rather than genius, should be limited to avoid anticompetitve eff ects, and subject to compulsory licenses, where licensing fees are related to the costs (and risks) of the unpatented research. Firms seeking sui generis marketing exclusivity for unpatented investments in research should be required to make fina ncial disclosures about investments that receive exclusivity marketing privileges. Such disclosures are needed to evaluate the reasonableness of the exclusivity privileges.

12. A blanket five year period of exclusivity for reliance upon health registration data is excessive.

13. Health registration data should be disclosed to the public, following the principles presented by the International Working Group on transparency and accountability in drug regulation.

14. Patent, copyright and trademark provisions of the FTAA should not create barriers to parallel imports. Parallel imports of pharmaceuticals are particularly important for smaller economies which suffer from inadequate competition. (See CPT's Octob er 16, 1997 comments to the Portfolio Committee on Health, Parliament, Cape Town, South Africa, on the Medicines and Related Substances Control Amendment Bill and South African Reform of Pharmaceutical Policies, on the web at: (

15. Patent or other IP rights should not be used to prevent persons from engaging in health care research. When necessary, governments should provide for policies on material transfers or compulsory licenses which expand opportunities for medical researc hers.

16. Patents should not be issued for surgical procedures or doses of medications.

Return to CPT Home Page | Health Care Page

This page has been accessed times since April 21, 1998.