Towards a patent-free nirvana?

"Patents kill", say the anti-globalists who want to see patents on Aids drugs loosened for Africa. If pharmaceuticals were not so expensive, their argument suggests, diseases--old and new--would cease to plague the developing world.

This hypothesis might be worth taking seriously if there weren't a country that has already proven it false. But there is one: India. Succumbing to one of their fits of nationalism, Indian lawmakers thirty years ago passed the Patents Act of 1970. The loophole-filled Act made it legal to ignore patents for drug products.

As a result, drugmakers in Bombay, Delhi, and Calcutta are free to replicate the recipe Crixivan, Epivir, Stocrin, or any of the other new ingredients in the Aids cocktails to their heart's content. And have been since the mid-1990s, when the first versions of the cocktail became available.

In other words, India should be on a parallel course to the US, where many Aids patients are now living longer. But alas, that is not what the experiment has yielded.

Today, some 1,000 people a day die of Aids in India, as my colleague Angus Donald has reported. Another 1600 become infected with the disease, according to UNAIDS, an arm of World Health Organisation. The periodical India Today reported that in six Indian states - Manipur, Nagaland, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu -- epidemic levels have been reached.

With the patent obstacle and the associated high prices out of the way, why isn't India the globe's health treatment model? One answer is that legalised disrespect for intellectual property hurts product quality; drugs in India may be plentiful, or cheap, but they are too often unreliable.

But another is that patents are not really the problem when it comes to challenges like Aids. As in Africa, citizens who are well-informed about the dangers of the disease still routinely engage in the sort of risky behaviour that can infect them. Literacy, good roads, efficient hospitals and medical infrastructure -- all the components required to deliver and monitor the taking of the Aids cocktail are lacking.

Naturally, there are those within India and outside it who would contest the pro-patent thesis. One is Yusuf Hamied, the chief executive officer India's big drug company, Cipla. Mr Hamied has been pressuring Western drug companies to distribute their drugs at cost or for free in his country. He's even been lauded as a cultural hero for doing so. (See Business Week's July 2 issue, "The Stars of Asia").

But observers ought to be wary of pinning too much hope on such efforts. Aids, in fact, is not the first Indian example of the futility of scapegoating intellectual property. That honour belongs to tuberculosis.

TB drugs were discovered so long ago that their patents have expired, yet TB, which ought to have been eradicated, is a growing health danger in India -- "rampant" is the word the Indian press sometimes uses. And with AIDS around now to weaken immune systems, the TB-AIDS nexus threatens much of the developing world.

Fortunately, the Indian experiment with abuse of intellectual property could come to an end in 2005. That's the date by which India, along with other developing countries, must comply with the World Trade Organisation's new patent regime, the Agreement on Trade-Related Aspects of Property Rights.

That is, unless the anti-globalist crowd frightens western governments into abrogating or eroding the agreement, and giving into the absurd notion that a patent-free world can yield health nirvana.

© Copyright 2001 Financial Times

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To book Amity Shlaes for a speaking engagement, contact Jamie Brickhouse at the Red Brick Agency, 646.281.9041.
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