The Inter-American Dialogue asked Essential Action and others to respond to a series of questions on Venezuela’s recently announced plans to review its patent system for an article that appears in today’s copy of its English-language daily bulletin, “Latin America Advisor.” The questions are posted below, as are Peter Maybarduk of Essential Action’s responses. If you wish to read the entire article, which also includes responses by David Vivas-Eugui of the International Centre for Trade and Sustainable Development, José Luis Di Fabio of the Pan American Health Organization and Adrian Cruz of Cross Keys Capital, you can download the bulletin here: IADVZprinted.pdf
Inter-American Dialogue’s Latin America Advisor
Will Venezuela Move to Modify Pharmaceutical Patents?
Earlier this month, Venezuela’s trade minister said the government was carrying out a review of patents, including those on pharmaceutical products, arguing patents elevate the prices of goods and fill the coffers of multinational corporations. Leaders of Venezuela’s pharmaceuticals industry say revoking patents and allowing drug makers in Venezuela to produce patented medications could discourage foreign investment in Venezuela and also cause shortages of medicine. Do you agree? Will more medicine reach the neediest people if patents are revoked? How much do protections for intellectual property rights matter in Latin America’s health systems?
Answer: Peter Maybarduk, Essential Action Access to Medicines Project
It’s worth clarifying what the Venezuelan government has and has not said. The government announced plans to review patent rules. Improving public access to medicines and generic medicine manufacturing capacity are key priorities of this review. The government has not yet announced a detailed policy, and statements by some government opponents seem to have exaggerated the substance of the announcements. A clarifying source is Venezuela’s intellectual property office, SAPI, which has posted notices on the subject: http://www.sapi.gov.ve/.
Over the last ten years, generic competition worldwide has produced a revolution in HIV/AIDS treatment, reducing prices from $10,000 to near $100 per person per year, and enabling more than three million people to access lifesaving antiretroviral therapy. Competition and domestic manufacturing have helped Brazil save $1 billion since 2001, and develop one of the world’s most effective HIV/AIDS treatment programs.
Multinational drug companies, based almost exclusively in northern countries, routinely use patent monopolies on key medicines to keep prices at high, anti-competitive levels – often too high to enable widespread treatment, including throughout Latin America.
There are several tailored ways Venezuela could improve access to medicines while contributing to pharmaceutical research and development costs, and complying fully with domestic laws and WTO patent rules. For example, by issuing compulsory licenses, Venezuela could authorize generic competition with specific patented medicines, in exchange for reasonable royalties to the patent holder.
It is not true the Venezuelan pharmaceutical industry uniformly opposes revisions to patent rules. The generics chamber CANAMEGA publicly supports revisions, and domestic manufacturers would benefit from flexibilities allowing them to produce more medicines.
Targeted reforms to Venezuela’s patent system could protect international investment incentives, while also improving market efficiency, increasing investments in innovative research and development – and supporting access to medicines for all.