Poor countries set to gain as EU states agree deal on cheap drugs

Date: 28/05/03

By David Cronin

EU GOVERNMENTS this week rubberstamped a plan to provide cheap anti-AIDS drugs to developing countries, while allaying industry concerns that these could be re-imported into richer nations.

After months of talks, governments have accepted a scheme which would allow both patented and generic drugs used for the treatment of AIDS, tuberculosis and malaria to be placed on a special register.

To be included on the list, the medicines have to be made available to 76 poor countries, at 75 less than their average basic price (before retailers add their mark-up) in member states of the Organisation for Economic Cooperation and Development or at 15 above the cost of production.

Trade Commissioner Pascal Lamy described the scheme as a "brick in the wall" in the fight against the three leading killers in poor countries. These diseases account for the bulk of the 19,000 deaths attributed to major 'poverty diseases' each day.

Lamy added that he hoped other wealthy countries will emulate the initiative. "We are working on getting the Americans to budge a bit," he said.

The products entered into the register, due to be set up as soon as the regulations covering it are published in the EU's Official Journal, are due to be branded with a Union-approved logo, that incorporates the image of a serpent, the traditional symbol of healing.

The logo is designed to help customs authorities in EU states identify them to prevent their re-importation into Europe.

Lamy explained that the re-importation ban was designed to placate pharmaceutical firms, which had voiced concerns that cheap drugs could be taken back into Europe and possibly sold on the black market.

"The drugs sold cheaply to developing countries must remain in poor countries and must not be re-imported into rich countries," said the French commissioner.

The scheme is not directly related to current talks at the World Trade Organization on amending international patent rules to allow countries without the means to manufacture their own medicines for AIDS, TB and malaria to import generic drugs.

At present such a move is forbidden by the trade-related intellectual property rights (TRIPS) agreement, which states that compulsory purchase licences must only be issued for the domestic market of production.

Anti-poverty group Oxfam described the new EU scheme as "a minor step in the right direction".

"But there are so many other steps that have to be taken to increase affordability [of medicines in poor countries]," said Sonia Vila-Hopkins from the charity's Brussels office.

The EU's Member States have reached agreement on a plan to provide developing countries with cheaper drugs to treat AIDS, malaria and tuberculosis, whilst preventing these drugs from re-entering the European market at discounted prices.