[Ip-health] Stiglitz on IP provisions of TTIP and TPP
M Fabiana Jorge
mfjorge at mfjint.com
Fri Jan 30 09:48:08 PST 2015
Dear all, Stiglitz spoke to TPP negotiators this week in NY. Please see
below the link to the video.
On 1/30/15 12:14 PM, "Dean Baker" <Dean.Baker1 at verizon.net> wrote:
> The Opinion Pages
> <http://www.nytimes.com/pages/opinion/index.html> | Op-Ed
> Don't Trade Away Our Health
>By JOSEPH E. STIGLITZ. January 30, 2015
>A secretive group met behind closed doors in New York this week. What
>they decided may lead to higher drug prices for you and hundreds of
>millions around the world.
>Representatives from the United States and 11 other Pacific Rim
>countries convened to decide the future of their trade relations in the
>so-called Trans-Pacific Partnership (T.P.P.). Powerful companies appear
>to have been given influence over the proceedings, even as full access
>is withheld from many government officials from the partnership countries.
>Among the topics negotiators have considered are some of the most
>contentious T.P.P. provisions those relating to intellectual property
>rights. And we¹re not talking just about music downloads and pirated
>DVDs. These rules could help big pharmaceutical companies maintain or
>increase their monopoly profits on brand-name drugs.
>The secrecy of the T.P.P. negotiations makes them maddeningly opaque and
>hard to discuss. But we can get a pretty good idea of what¹s happening,
>based on documents obtained by WikiLeaks from past meetings (they began
>in 2010), what we know of American influence in other trade agreements,
>and what others and myself have gleaned from talking to negotiators.
>Trade agreements are negotiated by the office of the United States Trade
>Representative, supposedly on behalf of the American people.
>Historically, though, the trade representative¹s office has aligned
>itself with corporate interests. If big pharmaceutical companies hold
>sway as the leaked documents indicate they do the T.P.P. could block
>cheaper generic drugs from the market. Big Pharma¹s profits would rise,
>at the expense of the health of patients and the budgets of consumers
>There are two ways the office of the trade representative can use the
>T.P.P. to maintain or raise drug prices and profits.
>The first is to restrict competition from generics. It¹s axiomatic that
>more competition means lower prices. When companies have to fight for
>customers, they end up cutting their prices. When a patent expires, any
>company can enter the market with a generic version of a drug. The
>differences in prices between brand-name and generic drugs are mind- and
>budget-blowing. Just the availability of generics drives prices down: In
>generics-friendly India, for example, Gilead Sciences, which makes an
>effective hepatitis-C drug, recently announced that it would sell the
>drug for a little more than 1 percent of the $84,000 it charges here.
>That¹s why, since the United States opened up its domestic market to
>generics in 1984, they have grown from 19 percent of prescriptions to 86
>percent, by some accounts saving the United States government, consumers
>and employers more than $100 billion a year. Drug companies stand to
>gain handsomely if the T.P.P. limits the sale of generics.
>The second strategy is to undermine government regulation of drug
>prices. More competition is not the only way to keep down the prices of
>essential goods and services. Governments can also directly restrain
>prices through law, or effectively restrain them by denying
>reimbursement to patients for ³overpriced² drugs thus encouraging
>companies to bring down their prices to approved levels. These
>regulatory approaches are especially important in markets where
>competition is limited, as it is in the drug market. If the United
>States Trade Representative gets its way, the T.P.P. will limit the
>ability of partner countries to restrict prices. And the pharmaceutical
>companies surely hope the ³standard² they help set in this agreement
>will become global for example, by becoming the starting point for
>United States negotiations with the European Union over the same issues.
>Americans might shrug at the prospect of soaring drug prices around the
>world. After all, the United States already allows drug companies to
>charge what they want. But that doesn¹t mean we might not want to change
>things someday. Here again, the T.P.P. has us cornered: Trade
>agreements, and in particular individual provisions within them, are
>typically far more difficult to alter or repeal than domestic laws.
>We can¹t be sure which of these features have made it through this
>week¹s negotiations. What¹s clear is that the overall thrust of the
>intellectual property section of the T.P.P. is for less competition and
>higher drug prices. The effects will go beyond the 12 T.P.P. countries.
>Barriers to generics in the Pacific will put pressure on producers of
>such drugs in other countries, like India, as well.
>Of course, pharmaceutical companies claim they need to charge high
>prices to fund their research and development. This just isn¹t so. For
>one thing, drug companies spend more on marketing and advertising than
>on new ideas. Overly restrictive intellectual property rights actually
>slow new discoveries, by making it more difficult for scientists to
>build on the research of others and by choking off the exchange of ideas
>that is critical to innovation. As it is, most of the important
>innovations come out of our universities and research centers, like the
>National Institutes of Health, funded by government and foundations.
>The efforts to raise drug prices in the T.P.P. take us in the wrong
>direction. The whole world may come to pay a price in the form of worse
>health and unnecessary deaths.
>//Joseph E. Stiglitz, / a Nobel laureate in economics, a professor at
>Columbia and a former chairman of the Council of Economic Advisers, is
>the author of ³The Price of Inequality.² /
>Dean Baker (baker at cepr.net)
>Center for Economic and Policy Research 1611 Connecticut Ave., NW
>Washington, DC 20009
>202-293-5380 (ext 114)
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