Don’t commend theft of AIDS drug patents

Imagine if Congress sponsored a resolution praising a foreign government — which recently seized power in a military coup — for stealing from U.S. companies and deliberately undermining the fight against AIDS.

Amazingly, that’s exactly what’s happening. The military government of Thailand, which came to power in a coup last September, is actively stealing patented medicine from the very companies that have developed the leading cures for AIDS.

Now, in a staggering display of cluelessness, Rep. Tom Allen (D-Maine) and Sen. Sherrod Brown (D-Ohio) have sponsored a resolution praising the Thai government for its theft and urging the United States not to enforce intellectual property standards.

Apparently, Allen and Brown think that Thailand is playing the role of Robin Hood — providing medication to AIDS victims by stealing property rights from the companies that develop cures. Bill Clinton thinks so too. In May, he expressed his support for Thailand’s decision.

That is criminally naïve.

The Thai population is suffering from an AIDS epidemic. The U.N. estimates that nearly 600,000 Thais are afflicted. But the government is more interested in using this crisis to steal patents and develop its own drug business than providing Thai patients with the effective cures.

In fact, the Thai government recently rejected an offer from two U.S. drug companies, which proposed to sell two of the world’s leading AIDS medications, Kaletra and Efavirenz, at cut-rate prices.

The Thai government also refused to accept an offer for free — that’s right, free — generic Efavirenz from The Global Fund.

Instead, the Thai government decided to manufacture its own knockoffs. It ignored the licenses for these drugs and tasked its own generic pharmaceutical company, the Government Pharmaceutical Organization (GPO), to manufacture clones.

Never mind the fact that manufacturing the drugs actually costs more than buying them through legal channels — or accepting them for free. Clearly, this decision was about enriching cronies in the GPO, not helping Thai AIDS patients.

As justification for its theft, the Thai government pointed to a World Trade Organization arrangement called TRIPS — the Agreement on Trade-Related Aspects of Intellectual Property Rights. TRIPS allows some governments to apply for “compulsory patents” in the case of health emergencies.

Of course, there was no emergency here because Thailand already had free access to the drugs it needed. The government’s actions are particularly egregious because its official manufacturer, GPO, has repeatedly failed to comply with the quality and safety standards of the World Health Organization. In July 2005, it emerged that inferior GPO products have actually caused drug-resistant cases of AIDS to increase.

But setting aside these safety concerns, Thailand’s actions threaten to upset the economic incentives that allow western firms to produce novel cures — like AIDS drugs — in the first place.

It takes about $800 million and more than a decade of research to bring a drug from its initial discovery through the FDA approval process and finally to patients. Without the period of sales exclusivity guaranteed by a patent, it would be impossible to recoup this investment — or even to attract the venture capital needed to fund the initial research.
Without patent protections, the drug industry as we know it would collapse, and development of new drugs would be significantly curtailed.

By urging our government to let other nations seize licenses to manufacture American drugs, Brown and Allen would slaughter the goose that lays the golden eggs of medical innovation. Already, other nations like Brazil are following suit and have begun stealing cures. If this trend grows, we can say goodbye to the next AIDS cure. That’s not something our Congress should commend.

Pipes is president and CEO of the Pacific Research Institute, which is partially funded by the pharmaceutical industry, and an adviser on healthcare to GOP presidential candidate Rudy Giuliani.