Home Science Health US' TPPA proposals will raise PBS medicine prices

US' TPPA proposals will raise PBS medicine prices

The poll ratings of the Australia federal Labor government are likely to drop further if it gives in to draconian new proposals made by the US as part of the secret Trans Pacific Partnership Agreement.

According to documents leaked on the web overnight by the Citizens Trade Campaign, an advocacy group, the Obama administration is trying to empower big drug companies to attack schemes like Australia's Pharmaceutical Benefit Scheme (PBS) and New Zealand's Pharmaceutical Management Agency (PHARMAC) that provide citizens of these countries with lower priced drugs.

If the proposals made by the US, contained in the Intellectual Property Rights Chapter of the TPPA, are accepted, it would mean greater restrictions on generic competition and rising medicine costs for the Asia-Pacific region.

The Labor government has indicated that it may accede to US proposals with the Australian ambassador to the US, Kim Beazley, reportedly telling a US hearing on the agreement that everything was on the table.

Australian Trade Minister Simon Crean has reportedly made a similar statement.

The new leaked draft includes a proposal to lengthen and create new pharmaceutical monopolies, grant additional exclusive controls over clinical trial data and eliminate safeguards against the abuse of patients, according to analysis by Public Citizen, a US group. The group has also posted comparative analyses of how the IP proposals measure up against existing regimes in Australia, Vietnam, Malaysia and Peru.

In the process, the US has backtracked on a free trade agreement it struck with Peru just four years ago; the proposed changes would force Peru into conflict with the Andean Community, a trade grouping, and its Common Intellectual Property Regime.

The TPPA is a deal that has been negotiated in secret since March 2010; the opening round of talks was held in Canberra. The last round of talks is coming up in Peru shortly and US President Barack Obama is expected to announce a framework for the agreement at the APEC Summit in Hawaii in November.

The countries involved in the negotiations are the US, Australia, New Zealand, Peru, Chile, Brunei, Malaysia, Vietnam, and Singapore. The nine have a combined population of about 470 million and combined gross domestic product of $A18 trillion.

According to the analysis, the US proposal seeks to ramp up second-use patents for minor variations on known drugs and any new uses of these medicines.

There is also a proposal to increase drug monopolies by patent term adjustments that will delay the bringing to market of generic equivalents of drugs; this will mean higher prices for patients.

The US also wants to remove any safeguards against the abuse of patents and prevent third parties from challenging patent applications.

It wants to extend the control over clinical trial data, providing an extra three years of data exclusivity for new uses of existing products. This is in addition to five years for first uses of the same product.

Other documents leaked by the Citizens Trade Campaign include a draft of the regulatory coherence chapter which seeks to remove local regulatory controls of proposals made in the TPPA and vest them in an international body. Professor Jane Kelsey of the University of Auckland, has written an analysis of this document.


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Sam Varghese

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A professional journalist with decades of experience, Sam for nine years used DOS and then Windows, which led him to start experimenting with GNU/Linux in 1998. Since then he has written widely about the use of both free and open source software, and the people behind the code. His personal blog is titled Irregular Expression.