Brazil Slams EU for Seizure of Generic Drugs

4 February 2009

The Brazilian ambassador to the WTO condemned the EU on Tuesday for seizing a shipment of generic drugs that was bound for his country, claiming that the move “sets a dangerous precedent” for public health.
 
The cargo, 500 kilograms of the hypertension drug losartan potassium, was confiscated on 4 December while the ship that was delivering it to Brazil was docked in a port in the Netherlands. The Dutch authorities held the shipment for 36 days before returning it to India, where the drugs had been manufactured (see Bridges Weekly, 28 January 2009, http://ictsd.net/i/news/bridgesweekly/38841/). 
 
Under the existing intellectual property architecture (which includes the WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights, or TRIPS Agreement), patents are territorial and protected according to each country's national system.
 
Losartan potassium is patented in Europe, where DuPont and Merck Sharp & Dohme own the patent and marketing rights to the drug, according to media sources. The medicine is not patented in Brazil or India.
 
The seizure of the drugs has added new fuel to an ongoing debate between rich and poor countries over how best to ensure that people in the developing world can have access to affordable medicines.
 
“The protection of intellectual property cannot supersede the protection of more fundamental values, such as the protection of life and the right to promote public health,” Brazilian ambassador Roberto Azevedo said at the WTO’s General Council meeting on Tuesday.
 
“The decision to impede the transit of a cargo of generic medicines – which was not headed for the Dutch market – is unacceptable and sets a dangerous precedent,” Azevedo said. “Worse still, there are indications that this is not an isolated incident.”
 
Azevedo alleged that the EU’s action violates the ‘freedom of transit’ section (Article V) of the General Agreement on Tariffs and Trade, which provides that “traffic coming from or going to the territory of other contracting parties shall not be subject to any unnecessary delays or restrictions and shall be exempt from customs duties and from all transit duties or other charges imposed in respect of transit.”
 
Seconding Brazil’s criticism, India also decried the EU’s actions, stressing the potential ramifications of establishing such a precedent.
 
“Barriers to legitimate trade of generic drugs will seriously impair the efforts of organisations like the Medecins Sans Frontieres, Clinton Foundation, Bill and Melinda Gates Foundation and a whole lot of other organisations engaged in providing medicines and improving public health in the least developed parts of the world,” Indian ambassador Ujal Singh Bhatia said.
 
Bhatia also drew attention to what he called the recent trend toward a ‘maximalist’ approach to the enforcement of intellectual property, or IP, norms in various international fora. This push he said, represents an “effort to upset the delicate balance between the rights of [intellectual property rights] holders and the public policy objectives under the TRIPS Agreement.”  
 
Sixteen other WTO Members also supported the Brazilian ambassador’s statement, sources said. The other countries were Argentina, Bolivia, Burkina Faso, China, Costa Rica, Cuba, Ecuador, Egypt, Indonesia, Israel, Nigeria, Peru, Pakistan, South Africa, Thailand and Venezuela.
 
But EU Ambassador Eckart Guth defended the EU’s actions. The seizure “is allowed by TRIPS and is based on provisions in EU customs law that allow customs to temporarily detain any goods if they suspect that these goods infringe an intellectual property right,” Guth said, according to IP Watch.
 
He claimed that the actions could be justified under the TRIPS Agreement, which permits customs authorities to temporarily hold goods that they suspect might be in violation of intellectual property laws.
 
Specifically, Guth referred to Article 51 of the TRIPS Agreement, which allows rights holders who suspect that a batch of imported goods might violate intellectual property law “to lodge an application in writing with competent authorities, administrative or judicial, for the suspension by the customs authorities of the release into free circulation of such goods.”
 
But Guth maintained that Brussels in no way intends to damage public health as it seeks to protect its patent holders.
 
“Let me make it very clear that the EU has absolutely no intention to hamper any legitimate trade in generic medicines or to create legal barriers to prevent movement of drugs to developing countries, nor have our measures had this effect...We are absolutely committed to all the efforts that are being made to facilitate access to medicines,” Guth said.
 
Brazilian foreign minister Celso Amorim has indicated that Brazil is willing to challenge the EU’s actions at the WTO, the Associated Press reported last week. Amorim met with Indian trade minister Kamal Nath on the sidelines of the World Economic Forum this week to discuss their approach to the issue.
 
ICTSD reporting. “Concern erupts over WTO system and medicines shipments; TRIPS talks rekindling,” IP WATCH, 3 February 2009; “Developing states attack EU on generic drug seizure,” REUTERS, 4 February 2009; “Brazil slams Dutch for seizing medicine shipment,” AP, 30 January 2009; “India, Brazil to take on EU over regulation,” LIVEMINT, 30 January 2009.

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