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Drug Spat Strains Global Trade System

The dispute over licensing generic versions of patented medicines severely tests global health and health-care-access policy.

The dispute over licensing generic versions of patented medicines severely tests global health and health-care-access policy.

Most recently, as the issue reverberated in the headlines and at the World Health Organization (WHO) meeting in Geneva, Abbott and Thailand did negotiate, though unsuccessfully. Thailand repeated its offer to refrain from compulsory licensing if the patent holders lower prices to generic levels. Abbott reduced Aluvia's price to $1,000 per patient annually, still above Thailand's generic price of $695 and out of range of a deal.

If fighting over that $300 difference while lives hang in the balance seems petty, it may also be a sign that the two sides are not so far apart this time. Yet the issue is much bigger than one HIV drug in one country. Cancer, heart disease, diabetes and other chronic illnesses loom large throughout the developing world, and so does the issue of access to medication to treat them.

Brazil and Thailand announced at the Geneva WHO meeting that they will cooperate on health care, a sign that as their drug needs grow, developing countries could organize and exert collective power on pricing and generic licensing.

The growing conflict particularly hurts trade relations with the United States, where most advanced drug research and development are located, and Asia, where most of the generic manufacturing is located. Investors know AIDS, severe acute respiratory syndrome, avian influenza and other diseases may threaten Asia's emerging economies, so drug-access disputes in Asia also hurt their interests. But trade issues aside, isn't equitable drug access a human right?

Neither the flawed patent system nor the disputed TRIPS agreement can adjudicate these complex issues adequately. Thailand, Brazil and others may bring the pharmaceutical companies to the table by invoking TRIPS compulsory-licensing and other provisions, but may not reach equitable compromises on pricing without more help.

It's time for Group of Eight governments to get involved. They can re-engage TRIPS, reaffirm WTO intellectual-property rules, and stop pressuring developing countries into trade agreements that destabilize them. Renewed leadership and creative thinking could strike an equitable balance between the interests of patent holders and the interests of global health and human rights. Meanwhile, they remain on a collision course.

Elizabeth H. Williams is the acting director of the Asia Society's Initiative on HIV/AIDS and Global Health.