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[e-drug] Reuters: Drug firms in South African fight for patents

E-DRUG: Reuters: Drug firms in South African fight for patents
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[out of the tens of international press statements on the court
case, this one from Reuters Securities. Copied as fair use. NN]


Reuters: Drug firms in South African fight for patents

This is from "Reuters Securities"

Thursday March 1, 9:08 am Eastern Time

ANALYSIS-Drug firms in South African fight for patents

By Steven Swindells

JOHANNESBURG, March 1 (Reuters) - The world's most powerful 
drug firms go head-to-head with the South African government next 
week in a landmark case that could decide the developing world's 
access to affordable medicines, including AIDS drugs.  

The drug industry goes to the Pretoria High Court on Monday in a 
bid to strike down legislation that would allow the state to import 
and manufacture generic versions of patent medicines, especially 
antiretroviral anti-AIDS drugs.  

``This case in South Africa is really about what comes first -- the 
commercial interests of companies or the rights of people who are 
trying to stay alive,'' said Ellen 't Hoen (eds: spelling correct), drugs 
coordinator at aid group Medecins Sans Frontieres (MSF).  

At stake is the right of pharmaceutical companies such as giant 
GlaxoSmithKline (quote from Yahoo! UK & Ireland: GSK.L) to keep 
jealously guarded intellectual property rights on patented drugs 
whose sales, it argues, fund vital research and drug development.  

For South Africa and the developing world, the case will determine 
whether they will be able to secure cheap drugs to combat an 
AIDS pandemic and other poverty-related diseases without falling 
foul of international trade rules.  

A court success for the government also would help to close a 
chapter in Pretoria's handling of HIV-AIDS, which hit rock bottom 
when President Thabo Mbeki questioned the link between HIV and 
AIDS and denied anti-AIDS drugs on cost grounds.  

For the drug firms, the nightmare scenario is that a final ruling 
against them would set a precedent that could see cheaper generic 
drugs flooding into potentially enormous consumer markets, which 
would dent multi-billion dollar profits.  

For non-government organisations, the case will determine whether 
profit or the rights of people battling to live is more important and 
how quickly drugs can reach the world's poorest.  

A court ruling is not expected until the end of the year and appeals 
going to the top Constitutional Court are likely.  

SOUTH AFRICA DEMANDS JUSTICE

South Africa wants to enact its Medicines and Related Substances 
Control Amendment Act No.90, which has been held up for three 
years by objections from Pharmaceutical Manufacturers' 
Association of South Africa (PMA), the group representing 39 
leading drug firms at the hearing.  

The act would allow Pretoria's health minister to override existing 
patent legislation and mandate the import of generic drugs or to 
approve local manufacture of cheaper drugs.  

South Africa's black majority government insists it is its 
constitutional duty to provide proper health care to millions of poor 
who were marginalised under apartheid.  

``The issues at stake here are very fundamental to the promise that 
the new democracy and constitutional dispensation hold for our 
people,'' Ayanda Ntsaluba, Director-general of the Health 
Department, told reporters on Thursday.  

``We are confident of success because we think what we are doing 
is correct...We feel very strong and passionate about this,'' 
Ntsaluba said.  

Pretoria insists it will act within World Trade Organisation patent 
rules, specifically the agreement on Trade Related Intellectual 
Property Rights (TRIPS) which guarantees patents for 20 years, 
but allows governments to shop for the cheapest source of drugs 
when it faces emergencies on the scale of the AIDS pandemic, 
which already affects 4.2 million South Africans.  

The government also alleges that well publicised offers by drug 
firms to cut the price of their drugs under agreed United Nations 
programmes have failed to materialise. They say drugs have been 
offered at prices that, though discounted, are still too expensive 
and not sustainable for developing countries where millions are 
living with HIV-AIDS.  

DRUG FIRMS FIGHT BACK

To the drug firms like Merck & Co (NYSE:MRK - news) and Bristol-
Myers Squibb (NYSE:BMY - news), the South African act is 
fraught with dangers, not least for sections that it fears would allow 
generic substitution and the abrogation of all patent rights for any 
drug upon ministerial discretion.  

``The PMA court case...seeks to set aside law that we believe 
would give the health minister unfettered discretion to override 
patent rights for medicine in this country. Such a law...would do 
nothing to improve sustainable access to quality medicine,'' PMA 
head Mirryena Deeb said in a statement.  

``It is this apparent arbitrariness that we are asking the court to 
adjudicate, rather than hinder access to quality and sustainable 
medicine,'' Deeb said.  

Pretoria will argue that the industry is misinterpreting the minister's 
powers under the act and that fresh legislation would have to be 
enacted to allow the minister to import generics from countries 
such as Brazil and India.  

The trade association has blasted Pretoria for failing to take up its 
joint offer of discounted and preferential AIDS drugs. Pretoria says 
that even if AIDS drugs were offered at 80 percent discount, it 
would still exceed its entire drugs budget.  

AIDS GROUPS BLAST INDUSTRY

AIDS groups urged drug firms on Thursday to drop their court case, 
blasting firms for putting profit ahead of lives.  

``This case will define how much freedom developing countries are 
going to have in a globalised world to legislate to get greater 
access to medicines,'' Ellen 't Hoen told reporters.  

British charity Oxfam also attacked drug firms, accusing them of 
bullying governments around the world.  

``This court case symbolises the hypocrisy of the pharmaceutical 
industry. They talk about wanting to improve people's access to 
medicines, but only on their terms,'' said Oxfam policy director 
Justin Forsyth.  

``This is a chilling message from the drug companies to other 
developing country governments: Play by our rules, or face the 
consequences,'' Forsyth said.

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