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Published on February 15, 2008

The Samak government has put on hold the compulsory licensing of cancer drugs - as planned by the previous government - pending a review of legislation which would make the drugs more widely available to poor patients. One of the prevailing arguments against compulsory licensing is that trade and humanitarian ideals should be managed separately, or else the benefits of a humanitarian act could outweigh the costs. Deputy Prime Minister and Commerce Minister Mingkwan Sangsuwan has been assigned to work with the Public Health and Foreign Affairs ministries to tackle the issue. For Chaiya Sasom-sab, who succeeded Dr Mongkol na Songkhla, the compulsory licensing champion, at the Public Health Ministry, it is clear that the previous government's decision should be reversed. The new Public Health Minister believes that compulsory licensing isn't economically sound, and the country could face costly retaliation from major trading partners such as the US and the European Union. Thailand could probably save about Bt500 million a year by buying generic drugs, but could lose much more from exports to the US or the EU, he said.

During the previous government's tenure, compulsory licensing was used as a humanitarian measure to overrule the patents of international drug firms which have invested billions of dollars developing medicines, including treatments for Aids and cancer patients. Proponents argue that there is a strong humanitarian reason to issue compulsory licenses because the drugs are very expensive, and out of reach of huge numbers of poor people. By introducing the compulsory measure, cheaper generic versions of the drugs could be produced and supplied by local or regional pharmaceutical firms. However, the country's major trading partners have opposed this proposal. The Samak government knows that it will have trouble defending such action when its economic ministers go overseas to promote trade and foreign investment to Thailand.

According to the International Intellectual Property Alliance (IIPA), Thailand is likely to remain on the US's Priority Watch List (PWL) due to a number of factors, including the compulsory licensing issue. The IIPA recently recommended to the US Trade Representative in the annual "Special 301" review of copyright piracy that Thailand's trade status on the PWL should be maintained. It also said Thailand should be subject to further scrutiny for any progress on IP suppression, which should include the compulsory licensing issue. Trade losses due to copyright infringements in Thailand were put at US$356 million in 2005. The preliminary figure for 2006 was $220 million but the total amount is expected to exceed the previous year. Piracy damages involved music (about $20.7 million), business software ($164 million) and books ($35 million). Figures for entertainment software and motion picture piracy losses are not yet available.

Previously, it was expected that Thailand could be upgraded to the "Watch List" because of its improved intellectual property rights protection measures, but such hope is now fading. "I am disappointed that the IIPA has recommended that Thailand be left on the PWL," said Puangrat Asavapisit, director-general of the Intellectual Property Department. "The department will write a letter to clarify Thailand's progress on intellectual property rights protection and try to convince the USTR to upgrade Thailand's trade status."

In an attempt to manage trade and humanitarian issues separately, we should consider the proposal from Pornsilp Patcharintanakul, secretary-general of the Board of Trade, who told the new government to look at other measures rather than compulsory licensing. For example, the government should come up with a special public health budget, or a new levy to cover the cost of expensive cancer drugs, especially for the under-privileged, who should undoubtedly be subsidised so they can access life-saving drugs. A model used by TPBS, the country's first public TV station, funded by the so-called "sin tax" on cigarettes and alcohol, is also worth considering. In this respect, the government will find that managing trade and humanitarian concerns separately is more efficient and effective. On the other hand, the country could face more trouble on the trade front if the government moves towards further compulsory licensing approvals.

Pornsilp of the Board of Trade could be right when he warned that we could lose more than we gain from cheaper generic drugs.

The Nation