8th June 2005
BRAZIL MOVES TO BREAK AIDS DRUG PATENTS; ANALYSTS MOOT PATENT-BREAKING AS WTO RETALIATION
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On 1 June 2005 the Justice and Constitution Commission in Brazil’s lower house of Congress unanimously voted to disregard product and process patents on drugs used to treat HIV/AIDS. The draft legislation requires approval from the upper chamber before the president can sign it into law. While Brazil has threatened to break patents in recent years, it has yet to issue a compulsory license authorising domestic companies to copy the drugs without the patent-holders’ permission. The threat alone has induced companies to lower their prices for drugs used in the country’s celebrated AIDS treatment programme. This time the intention to move further seems real, especially as the draft law calls not only for disregarding individual drug patents, but for generally excluding HIV/AIDS drugs from patentability.
In related news, some Brazilian trade analysts at the University of Sao Paulo have suggested that Brazil could consider breaking patents as a possible cross-retaliatory mechanism if the US fails to change its cotton subsidisation policy in accordance with the demands of the WTO dispute settlement body. The ruling agreed with Brazil that US subsidies to its cotton farmers distorted international prices, and gave the US until 1 July 2005 to remedy the situation (see BRIDGES Weekly, 9 March 2005).
The scholars contend that developing countries, with their smaller economies, have a tremendous disadvantage in retaliation against industrialised countries, since retaliatory tariff increases on, say, US imports will scarcely be felt. Hence, they argue that in light of the US’ history of non-compliance with certain WTO rulings, governments like Brazil’s could threaten to disregard intellectual property rights (IPRs) within their national markets. This would make their threats of retaliation more credible, since actually doing so would inflict palpable damages upon US industries, while also benefiting domestic consumers and producers.
ICTSD reporting; “CCJ aprova quebra de patente de drogas da Aids,” O GLOBO, 2 June 2005; “Câmara aprova projeto de lei contra patente de anti-retroviral,” JORNAL DO BRASIL ONLINE, 1 June 2005.
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