Letter to Charlene Barshefsky regarding review of US trade policy as it relates to access to essential drugs

Dear Ambassador Barshefsky:
We are very pleased that the US government has ended its efforts to seek the repeal or modification of the South African Medicines Act provisions as they relate to compulsory licensing and parallel imports, on public health grounds. We are writing to ask that the USTR now begin a broader review of US trade policy, as it relates to public health considerations, not only in terms of trade policy toward the government of South Africa, but as it relates to all countries.

Ralph Nader
P.O. Box 19312, Washington, DC 20036

James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC
202.387.8030, fax 202.234.5176

Robert Weissman
Essential Action
P.O. Box 19405, Washington, DC 20036

October 6, 1999

Charlene Barshefsky
United States Trade Representative
600 17th Street, N.W.
Washington,DC 20508

Dear Ambassador Barshefsky:

We are very pleased that the US government has ended its efforts to seek the repeal or modification of the South African Medicines Act provisions as they relate to compulsory licensing and parallel imports, on public health grounds. We are writing to ask that the USTR now begin a broader review of US trade policy, as it relates to public health considerations, not only in terms of trade policy toward the government of South Africa, but as it relates to all countries.

As you know, after nearly 18 months of debate, the World Health Assembly (WHA) enacted a “Revised Drug Strategy” resolution in May 1999. The resolution (EB103/4), which passed with US government support, requires member countries to:

(1) to reaffirm their commitment to developing, implementing and monitoring national drug policies and to taking all necessary concrete measures in order to ensure equitable access to essential drugs;

(2) to ensure that public health interests are paramount in pharmaceutical and health policies;

(3) to explore and review their options under relevant international agreements, including trade agreements, to safeguard access to essential drugs;

We believe it is time to implement commitments required by the WHA resolution, and to recognize that U.S. trade policy should reflect the fact that American citizens are generally supportive of sound public health policies worldwide, as reflected by generous charitable giving, for example, and that it is not appropriate for U.S. government agencies to simply advance the commercial interests of the largest pharmaceutical companies.

The policy review should include the following specific issues:

1. Compulsory licensing of patents. In several countries, the US government has pressed for very restrictive policies on the use of compulsory licensing. For example, in some cases, the US government has asked countries to limit the scope of compulsory licensing to cases involving anticompetitive practices, national emergencies and air pollution control. There are also disputes involving the use of compulsory licensing for research purposes. In Thailand, where there are reportedly one million HIV/AIDS patients, the US government has opposed the use of compulsory licensing of HIV/AIDS drugs. For starters, the US government should revisit its opposition to compulsory licensing in Thailand, where public health groups such as MSF support the use of compulsory licensing to get drugs such as ddI, 3TC, d4T or Norvir to AIDS patients. More generally, USTR should immediately extend the policy in the South African case to all developing countries.

2. Parallel Imports. The US government has opposed the use of parallel imports of pharmaceuticals in New Zealand, South Africa, Thailand, Ecuador, Israel, Argentina, Indonesia and many other countries. We believe restrictions on parallel importing are highly protectionist and impede national efforts to stretch national health care budgets, particularly in countries that do not have competitive distribution markets. Again, the policy decisions in South Africa should be extended to other countries.

3. Patent exemptions for research. The U.S. is involved in disputes with Cyprus, Israel, Canada and many other countries over exceptions to patent rights or compulsory licensing for medical research. Public health groups generally support policies that would permit medical research involving patented materials, either through US styled patent exceptions (the Bolar amendment) or through programs of compulsory licensing for research. As you know, pending disputes before the WTO are addressing the issue of the role of Article 30 of the TRIPS in permitting medical research. We ask that the US government declare its support for the broadest possible rights to medical researchers, under national laws, and we further ask that the US government end its opposition to efforts by foreign countries to enact research exemptions in their national patent laws.

4. Health Registration Data. The US government has pressed the Netherlands, New Zealand, Australia, South Africa, India and many other countries on the issue of “unfair commercial use” of health registration data. In plain language, the US government doesn’t want generic drug companies to be able to “rely upon” scientific data that is “owned by” someone else, when seeking marketing approval of a drug. This is mostly an issue for drugs not protected by patents, such as drugs that were developed with US government support. Central to this dispute is the registration of generic versions of Paclitaxel, a US government invention used to treat ovarian and breast cancer, and Kaposi Sarcoma, a disease that afflicts many patients who suffer from HIV/AIDS. Having obtained (for free) exclusive rights to use NIH sponsored clinical data on Taxol, Bristol-Myers Squibb now enjoys monopolies for its Taxol version of Paclitaxel in many countries. Largely because of US trade pressures against the use of generic versions of Taxol, access to this important cancer drug is extremely limited in many countries. For example, in New Zealand and in England, Taxol is off formulary for much of the population, due to its high cost — leading to unnecessary suffering and death. In some cases, such as in South Africa, the US government has asked countries to match the 10 years of market exclusivity for test data that is used in the European Union, despite the fact that US law only requires 5 years (and even that period has been criticized as excessive). Moreover, the EU’s 10 year market exclusivity for test data was initially only a measure to compensate for the lack of patent protection in Spain and Portugal; it is completely inappropriate for drugs like Taxol that were invented by government researchers. The US government should immediately cease efforts to keep generic competitors of Taxol off the market worldwide, and the US should not seek to promote the 10 year EU period of market exclusivity as an international norm. (CPT is developing specific proposals for more appropriate norms that are consistent with Article 39 of the TRIPS.)

5. . Market Exclusivity for older drugs. In a number of countries, including Korea, China, India, Pakistan, Thailand and Brazil, to mention a few, the US government has asked countries to extend various forms of regulatory exclusivity to older products that are not protected by patents in those countries. The objective of this trade policy is to seek commercial benefits for US exporters of pharmaceutical drugs. However, these retroactive market exclusivity policies generally do not create forward looking incentives, since the drugs are already on the market. From a public health point of view, it is better to remove market exclusivity for drugs off patent, and particularly when the drugs were developed years ago. As a direct result of US pressure, the drug fluconazole received market exclusivity in Thailand until last year. Pfizer charged such high prices for fluconazole that HIV/AIDS patients risked blindness and death because they could not afford treatment. With the elimination of market exclusivity last year, two generic companies entered the market, and prices dropped from 200 baht to 6.5 baht in nine months — a decrease of more than 95 percent. The US government should ask the WHO to identify other older essential drugs that should not be protected by retroactive market exclusivity regulatory barriers.

6. Generic drug substitution. There have been disputes in Mexico, South Africa, Thailand, the Philippines, Pakistan and elsewhere over the mandatory prominent display of the generic name of a drug on product packaging, or in mandatory generic prescribing by public health workers. Claiming that TRIPS trademark provisions give companies complete control over product packaging and protect the promotion of the brand name, PhRMA asserts that government policies to promote the use of generic names and generic prescribing dilute and violate company trademark rights under TRIPS. The US government should reject the PhRMA arguments, and declare that in similar disputes, public health considerations are paramount.

7. National use of price controls or limits on government reimbursements for drugs. In many countries, including Pakistan, Thailand, Taiwan and New Zealand, to mention a few, the US government considers domestic policies regarding reimbursement of drugs to constitute “trade barriers” for US exports. The US government has engaged in a global campaign against even the most market driven efforts to control pharmaceutical prices, such as the New Zealand reference pricing system. The US government should cease its efforts to bully countries on domestic pricing issues.

8. R&D reinvestment. The US government should support efforts by countries to require “compulsory research” on essential public health problems. R&D reinvestment requirements should not be considered barriers to trade.

These are only a few areas where the US government should begin a review of US policy with regard to pharmaceuticals, trade and the public health. We look forward to your response, and we hope for a constructive dialogue on these issues.


Ralph Nader

James Love

Robert Weissman

Letter to NIH, urging it provide the World Health Organization with access to U.S. government-funded medical inventions

We are writing to ask that you enter into an agreement with the World Health Organization (WHO), giving the WHO the right to use health care patents that the US government has rights to under 35 USC Sec 202 (c)(4) of the Bayh-Dole Act or under 37 CFR 404.7, for government owned inventions.

Ralph Nader
P.O. Box 19312, Washington, DC 20036

James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC 20036

Robert Weissman
Essential Action
P.O. Box 19405, Washington, DC 20036

September 3, 1999

Dr. Harold E. Varmus
Building 1, 126
National Institutes of Health
Bethesda, Maryland 20892

We are writing to ask that you enter into an agreement with the World Health Organization (WHO), giving the WHO the right to use health care patents that the US government has rights to under 35 USC Sec 202 (c)(4) of the Bayh-Dole Act or under 37 CFR 404.7, for government owned inventions.

Under the regulations concerning government owned inventions, the US government has an:

irrevocable, royalty-free right of the Government of the United States to practice and have practiced the invention on behalf of the United States and on behalf of any foreign government or international organization pursuant to any existing or future treaty or agreement with the United States. 37CFR404.7(a)(2)(i)

With respect to government’s rights in inventions funded by the US government through grants and contracts to Universities and small businesses under the Bayh-Dole Act, the US government has worldwide rights to practice or have practiced inventions on its behalf (37CFR401.14), and it may require that foreign governments or international organizations have the right to use inventions, under 37CFR401.5(d).

As you must know, the US government has rights to a large portfolio of health care inventions that were invented with public funds. These include inventions in many HIV/AIDS drugs, such as government-owned inventions on ddI, ddC and FddA, and university and contractor inventions such as d4T, 3TC and Ritonavir, as well as drugs to treat malaria and many other illnesses. The private pharmaceutical companies that have obtained exclusive rights to market these products charge prices that are excessive, and too expensive for many patients, including persons in the United States and Europe. Most seriously, the hardships are particularly difficult in developing countries, where countries do not have high enough national incomes to pay for expensive medicines.

In some cases poor countries can issue compulsory licenses to use these inventions, but not every country has the legal authority to issue such licenses, and many countries have small domestic markets without the economies of scale to make compulsory licensing economically feasible. The WHO, with new dynamic leadership, has expressed an interest in using these intellectual property rights. If the WHO uses efficient procurement programs, it can obtain production of these government funded inventions at a small fraction of current world prices. These lower prices would lead to expanded access to essential drugs and stretch public health budgets.

There are number of steps that can be taken by NIH to make these publicly funded inventions more widely available to poor consumers.

1. The NIH should enter into an agreement with the WHO that would permit the WHO to use US government intellectual property rights for public health initiatives. The NIH should specify the terms under with the WHO could use US government intellectual property rights, to ensure that the public interest is served.

2. In those cases where the US government can now give the WHO rights to health care inventions under 37CFR404.7 and 37CFR401.5, the WHO should be authorized to use those rights.

3. The US government should revise its grant and contract practices so that all new grants and contracts reference the WHO’s rights to use patents, under 37CFR401.5.

4. The NIH should ask its general counsel to determine the scope of the NIH’s rights to government funded university and small business inventions under 37CFR401.14, and to the extent appropriate, engage the WHO, US AID or other international organizations or US agencies to use these rights to expand treatment opportunities for the poor.

This is a matter of extreme urgency. It is immoral for the US federal government to hoard its intellectual property rights to benefit a handful of commercial interests, particularly when the research was paid for by US taxpayers, and the drug companies are already reaping billions in profits from government funded inventions.

We would like you meet with you and your staff to discuss this matter further.


Ralph Nader

James Love

Robert Weissman

cc: Leon Fuerth, Secretary Donna Shalala

Letter to Al Gore: End Pressure on South Africa

Dear Vice President Gore,
We are writing to express opposition to trade pressures you are bringing against the people of South Africa over their struggle to obtain access to essential medicines.

August 1, 1999

Dear Vice President Gore,

We are writing to express opposition to trade pressures you are bringing against the people of South Africa over their struggle to obtain access to essential medicines.

The White House dispute with South Africa concerns three basic points.

1. The South Africa government has indicated it wants to use compulsory licensing of medical patents to produce cheaper copies of HIV drugs and other essential medicines. This is of course legal under the WTO/TRIPS agreement, subject to Article 31 safeguards.
2. The South Africa government wants to authorize “parallel imports” of pharmaceuticals, so that it can buy drugs in the United States, Europe or elsewhere, in order to get the best world price. As you know, parallel importing of pharmaceuticals is legal under Article 6 of the WTO/TRIPS agreement, and is a common practice in Europe.
3. The South African government has approved generic versions of Taxol, a US government invention for treating cancer.

As co-chairman of the US/South Africa Binational Commission (BNC) you have authorized a wide range of trade pressures against South Africa, much of which is documented in a February 5, 1999 report to the Congress by the US Department of State. Despite increasing criticism of the US bilateral pressures on South Africa, here and internationally, your office has authorized new trade pressures against South Africa on April 30, 1999. http://www.cptech.org/ip/health/sa/sa301-ap99.html”

The USTR April 30, 1999 announcement of a Special 301 out-of-cycle review of trade pressures against South Africa ignored every shred of information that has been provided to your office by public health groups. Indeed, this most recent announcement is basically a recycled version of the February 16, 1999 submissions by the Pharmaceutical Research and Manufactures Association (PhRMA), the trade association that represents giant drug companies like Bristol-Myers Squibb, Glaxo, Pfizer, and Johnson and Johnson that are trying to stop South Africa from implementing policies to cut costs for pharmaceuticals in South Africa.

It is shocking that the US government is adopting such an aggressive trade policy on behalf of US pharmaceutical companies, when all of sub-Saharan Africa is confronted with a public health crisis of historical dimensions. The US Surgeon General, Dr. David Satcher, recently wrote in the Journal of the America Medical Association that “HIV/AIDS can be likened to the plague that decimated the population of Europe in the 14th century.” Dr. Satcher says that “in many southern African countries, HIV/AIDS has become an unprecedented emergency, with 20% to 26% of people between the ages of 15 and 49 infected.” This is a here-and-now emergency. It is not a hypothetical or potential emergency. These people will die without access to pharmaceutical drugs.

Your response to this emergency should be to find ways to save lives. But look what you are doing.

-You are aggressively seeking the repeal of legislation in South Africa that would permit that country to do what nations in Europe do, use parallel imports to buy drugs at the best world price. South Africa wants to use market forces to cut drug costs. You are pushing to protect pharmaceutical companies from global competition, thereby forcing the South Africa people to pay premiums to buy drugs.

-You are punishing South Africa for even speaking out in favor of compulsory licensing of HIV/AIDS and other essential medicines. The April 30, 1999 report on South Africa complains that:

During the past year, South African representatives have led a faction of nations in the World Health Organization (WHO) in calling for a reduction in the level of protection provided for pharmaceuticals in TRIPS.

In fact, everything South Africa is seeking to do is legal under the WTO/TRIPS agreement, so this and countless other statements by US government officials are bald lies. But regardless, the exercise of free speech in international forums is an astonishing basis for trade sanctions. As an elected official, indeed, as a human, how would you act if 20 percent of all sexually active young people in the United States were infected with a fatal disease, and a foreign country was trying to prevent you from purchasing drugs on the global market to save money, and was preventing you from licensing firms to manufacture life saving medicines? Would you simply show up at the World Health Assembly and docilely applaud the actions of that country? Even if that foreign country was engaged in a relentless public relations campaign to label every legal action as a form of piracy or lawlessness? At what point would you have the guts to tell the world the truth, and to speak out on behalf of millions of infected young men and women?

-You are punishing South Africa for giving approval to generic versions of Taxol, a cancer drug that was invented by the US government. There are aspects of the US government complaint about Taxol that are absurd, on technical grounds, such as the insistence that South Africa extend longer periods of data exclusivity than are required in the United States. But the larger issue is more basic. Why on earth should Vice President Al Gore or any other US government employee seek to prevent global competition for Taxol, a life saving cancer drug that was invented and developed by the US National Institutes of Health? Taxol was in NIH sponsored Phase III trials before the Bush Administration gave BMS exclusive rights to use NIH research for drug approvals. What is the moral basis for extending the BMS monopoly on Taxol in a country that is so poor?

As the Vice President of the United States you are in a position to do much good or much harm in the world. US voters will soon be asked to determine if you should be the next President of the United States. Please explain why they should choose you.


James Love
Consumer Project on Technology
Washington, DC

Dr. Bernard Pécoul
Project Director
Access to Essential Drugs
Médecins Sans Frontières
Geneva, Switerland

Joelle Tanguy
Executive Director
Doctors Without
Borders/Medecins Sans
Frontieres USA

Eric Sawyer
Executive Director
HIV/AIDS Human Rights Project

Kim Nichols
Development Director
African Services Committee,

Bas van der Heide
Health Action International

Beryl Leach
Africa Program Coordinator
Health Action International

Lori Wallach
Global Trade Watch
Washington, DC

Professor Richard Laing
Associate Professor,
Department of International
Health, Boston University

Robert Weissman
Co-Director, Essential Action
Washington, DC

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Senior Editor
POZ Magazine

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Director of Research
Institute for Agriculture and

Axel Delmotte
Act Up – Paris

Professor Patrick Bond
University of the
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Clarence Mini, MD
Treatment Action Campaign
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Province, South Africa

Ellen ‘t Hoen
International Drug Policy
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Aetna Professor of Public
John F. Kennedy School of
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Editor and publisher
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Dr.Mira Shiva
All India Drug Action Network
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The Malaria Project, CSRL
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Emeritus Fellow
UK Cochrane Centre
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AVVA Frontera Gran Sabana
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Indigenous Peoples’
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United Food and Commercial
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Centre for Interdisciplinary
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University of Hertfordshire
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University of the
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Peter McLaverty
Senior Lecturer
University of Luton
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Toine Pieters
Medical Historian, School of
Amsterdam, the Netherlands

Daniel Querol
Managua, Nicaragua

Dr. Ernst von Weizsaecker
Member of the Federal
Parliament (Bundestag), for
the ruling SPD

Daniel J. Koenig, Ph.D.
University of Victoria
Victoria, British Columbia,

Ms. Diana Smith
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Dashiell Love
Olympia WA, USA

Joe Goozeff
Randwick, N.S.W. Australia

Cherrel Africa
Cape Town Democracy Centre
Institute for Democracy in SA
South Africa

Arnold Ward
GeneEthics Network and South
Australian Genetic Food
Information Network
Adelaide, South Australia,

Pierre Chirac

Michael R. Pitula
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Etienne Vernet
Campaign Coordinator on
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Harvard School of Public

Val Dusek
Associate Prof. of Philosophy
University of NH
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Rev. Douglas B. Hunt
Washington & UN Representative
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George Salzman
Physics Dept
Univ of Massachusetts
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Phoebe Barnard (PhD)
National Coordinator
Namibian Biodiversity Program
Windhoek, Namibia

Mara Bird
Center for International
Studies, University of
Southern California
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of America

Sid Shniad
Research Director
Telecommunications Workers
Vancouver, British Columbia,

Uri Strauss
Neil Young Institute
Vancouver, British Columbia,

Jesse Vorst
Professor of Economics
University of Manitoba
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Michael Ash
PhD Candidate
Dept. of Economics, UC
Berkeley, California, USA

Gladys Schmitz
SSND (School Sister of Notre
Mankato, MN, USA

Yash Tandon
International South Group
Harare, Zimbabwe

Angus Kerr
Durban, Kwazulu-Natal, South
Jaroen Compeerapap
Resident fellow
International Economic Law and
Dispute Settlement, Erasmus
Rotterdam, The Netherlands

Elaine Bernard
Executive Director
Harvard Trade Union Program
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Daniel Querol

Ann C. Davidson
Davidson Library Services
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Stephen Morey
Monash University
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Roy J. Kaye
Lynnwood, WA U.S.A.

Ken Orzel
Pompano Beach, Fl USA

David Hoos, M.D. M.P.H.
AIDS Institute, NY State
Department of Health
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Mark Raijmakers
Programme coordinator
Wemos Foundation
Amsterdam, the Netherlands

Kate O’Connell

Patrice Newell
The Elmswood Press

Jef Keighley,
National Representative
Canadian Auto Workers
New Westminster, B.C., Canada

John Lamperti
Dartmouth College
Hanover, NH, USA

David Banta
Senior Researcher
Netherlands Organization for
Applied Scientific Research
Leiden, The Netherlands

Sarah Sexton/Larry
Hildyard/Tracey Clunies Ross
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P Marc Schwartz
Waumandee, Wisc, USA

Francisco Arroyo G.D.
Coordinador de Programas
Centro de Investigación y
Capacitación Rural A.C.
Cd. de México, México

Gabriela C. Flora
Program Associate in
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Institute for Agriculture and
Trade Policy
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Rev. Des McGillicuddy
Justice & Peace Officer
Mill Hill Missionaries
London, England

Margarita Florez
Executive Director
Centro Debate y Acción

Laura Maxwell Stuart
Programme Officer
South African NGO Coalition
Johannesburg, South Africa

Kerry Irish
South African National NGO
Johannesburg, Gauteng, South

Martin Rall
Johannesburg, South Africa

Ryan Hunter
Center for Environmental
Public Advocacy
Ponicka Huta, Slovakia

Juraj Zamkovsky
Friends of the Earth Slovakia
Ponicka Huta, Slovakia

Michael Niemann
Associate Professor of
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Trinity College
Hartford, CT

Norberto A. Stuart
Brooklyn, N.Y.

Geoffrey Schniewind
Brooklyn, N.Y.

Victoria S. Cashman
Middletown, Ohio, USA

Clive Swan
Kagiso GIS & IT Solutions
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Co. Wicklow, Republic of

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Society of St Columban
(Columban Fathers)
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Al Stern
Senior Art Director
Common Health/Adient
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Hilgartner & Associates
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States of America

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SA citizen living in Texas
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Anton Prenneis
Highland, N.Y.

Amy Ferber
Highland, N.Y.

Alexander Rau
Cornell University, University
of Oxford (England)
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Dr. Ayesha Imam
Baobab for Women’s Human
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Stephen Ball
Seattle, Washington, USA

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Alameda, CA, USA

Michael Pease
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The Pennsylvania State
State College, PA, USA

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Cork, Ireland

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Doctoral Candidate
Department of Communication,
UC San Diego
San Francisco, CA USA

Dale T. McKinley
South African Communist Party
Head Office
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South Africa

David Longjohn Stanton
Boalt-Harvard Law School
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Mahomet, Illinois, USA

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David Gofstein
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Alan Berkman, MD
Medical Specialist
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Behavioral Studies, Columbia
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San Jose, CA, USA

Ernst Mayer
Assistant Professor
Dept. of Mechanical &
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Canyon Lake, TX USA

Faye Powell
Professor, Social Sciences
Portland State University
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Edgar F. Starr
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Fred Turner
Ph.D. Candidate
University of California, San
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Liz Hosken
Gaia Foundation
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Associate Professor
The Catholic University of
Washington, DC USA

Geraldine Gomez
Goleta, CA, U.S.A.

Gordon Irlam
San Francisco, CA, USA
Madras, Tamil Nadu, India

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Los Angeles, CA U.S.A.

Ismael Galve-Roperh
Dept. of Biochemistry and
Molecular Biology I
School of Biology, Complutense
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James M Wright, MD, PhD,
Associate Professor
University of British Columbia
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Jean Grossholtz
South Hadley, MA

James W. Sanders
Chief Technical Officer
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Jim Strichartz
Law Offices of James L.
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Lehman College of CUNY.

Joel Lexchin MD
Emergency Physician
Toronto General Hospital
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Lexington, KY, USA

John Andrew
Professor and chair of History
Franklin & Marshall College
Lancaster, PA USA

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Director of Professional
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Arlington, WA USA

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GIS Technical Specialist
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Development Director
African Services Committee,
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Subang Jaya, Selangor,

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San Francisco State University
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Newsletter editor
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Professor Emerita,Rutgers
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Student of Law
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Encino, CA, USA

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Professor of Law
U. Miami School of Law
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Maryland Cooperative Extension
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Idasa Publishing,
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Roman Catholic priest
Washington Province of the
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United Kingdon

Nicholas Sammond
University of California, San
San Francisco, CA, USA

Pam Raby
Albany, OR, US

Perry Papka
Institute of Social and
Economic Research, University
of Alaska-Anchorage
Anchorage, AK

Peter Schachte
The University of Melbourne
Parkville, Victoria, Australia

Philip Heede
Alleroed, Denmark

J. G. Krishnayya
Executive Director
Systems Research Institute

Richard Crawford
Lecturer in Information Age
Univ. of Calif, Davis
Davis, CA, USA

Richard Gerace
Falmouth, Massachusetts

Robert M. Akscyn
Knowledge Systems
Export, PA, USA

Robert Braunwart
Seattle, Wash., U.S.A.

Robert E. van Patten, Ph.D.,
Bellbrook, OH USA

Anne-Sophie Robilliard
Research Analyst
Washington, DC, USA

Roland D. Kelso
Catholic Church
Ninomiya, Kanagawa-ken Japan

Ron Regan Jr
Somerville, MA, 02145 USA

Russell Hoover
American Book Review