Clinton’s Global AIDS Fight May Be Hurt by U.S. Trade Initiative

Secretary of State Hillary Clinton is championing a U.S.-led global effort to thwart HIV/AIDS, even as the Obama administration pursues trade policies that critics warn will curtail access to life-saving drugs.

Clinton says pharmaceutical advances, particularly drugs that prevent mother-to-newborn HIV transmission, and falling prices for treatments make it possible to “change the course of this pandemic and usher in an AIDS-free generation.”

At the same time, the U.S. trade representative is negotiating an Asia-Pacific trade agreement -- which President Barack Obama touted at the recent Asian summit -- that includes enhanced patent protection for pharmaceutical companies. Those provisions would make it harder for people in Trans-Pacific Partnership, or TPP, nations to get new generic drugs, according to lawmakers and public health advocates.

Generics lower costs and enable more people to get treatments. Without access to new and forthcoming generic drugs, it would be harder to meet the AIDS goals that Clinton laid out.

“We have to reduce the cost of expensive, monopolized AIDS medicines and the proposals coming from USTR are not helpful in that regard,” said Peter Maybarduk, the Access to Medicines Program director at Public Citizen, a Washington-based consumer advocacy group. “They’ll keep the cost of AIDS drugs in the Asia-Pacific high for some time.”

Photographer: Andrew Harrer/Bloomberg

Hillary Clinton, U.S. secretary of state, speaks during a news conference highlighting the efforts of the Obama Administration on HIV/AIDS issues in Washington, D.C. Close

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Photographer: Andrew Harrer/Bloomberg

Hillary Clinton, U.S. secretary of state, speaks during a news conference highlighting the efforts of the Obama Administration on HIV/AIDS issues in Washington, D.C.

Policy Tensions

A trade office spokeswoman disputed that assessment. The TPP intellectual property proposals “are designed to promote greater certainty for innovators, generic manufacturers and patients,” Nkenge Harmon said in an e-mail.

“We are engaging in the TPP negotiations with the intention of increasing the quality, effectiveness, transparency, and predictability of patent systems for the benefit of medical innovators, generic pharmaceutical manufacturers and the public,” Harmon said.

The disagreement highlights the tension within an administration that has prioritized both global health and economic growth. It wants to double exports over five years ending in 2015.

Protecting intellectual property is a crucial part of that economic mission, said Robert Hormats, the State Department’s undersecretary for economic, energy and agricultural affairs. The issue of pirated intellectual property is “enormous” for the U.S. pharmaceutical industry, he said in an Aug. 23 interview.

Intellectual property protection is “a critical 21st-century issue,” Hormats said. “If you get it chipped away at over time, you destroy our competitive advantage.”

Intellectual Property

The Trans-Pacific Partnership will draw the U.S. and eight other countries -- Australia, Brunei, Chile, Malaysia, Peru, New Zealand, Singapore and Vietnam -- into a regional trade group that the U.S. wants to expand in the Asia-Pacific region.

The trade agreement would let countries get “innovative and generic medicines” more quickly through a “TPP access window,” according to the U.S. trade office. That provision would give pharmaceutical companies additional and stronger monopolies for starting the process of registering their brand- name drugs in TPP markets within a certain time frame of registering the same drug in the U.S.

In return for moving their new drugs into those markets more quickly, pharmaceutical companies would benefit from potentially unlimited patent extensions. Under U.S. law, companies can extend a 20-year patent for a maximum of 14 years to offset time lost in the registration process.

Drug ‘Monopolies’

The provisions the U.S. trade representative is suggesting, according to documents posted on its website and on advocacy groups’ websites, would also force countries to go through further clinical trials to test generic drugs -- instead of using companies’ existing data, the usual and much cheaper approval procedure for generics. The trade office measures would also curb the ability of governments, companies and civil society groups to challenge patents before they are granted, something they currently do to accelerate access to cheaper medicines.

“We’re really talking about monopolies,” said Brook K. Baker, a law professor at Northeastern University in Boston, who has studied the TPP provisions. “These are efforts to strengthen and lengthen monopoly rights. Trade negotiations are about easing access; intellectual property is about limiting trade.”

Health advocates say they can’t simply rely on the generic drugs available now. “As improvements are made, drugs have fewer side effects or are more effective,” said Sharonann Lynch, Doctors Without Borders’ HIV/AIDS policy adviser. “We need to have those.”

Access Issues

Lynch said it was ironic that access to AIDS drugs may tighten in Asia just as scientists have learned how to use them to more effectively combat HIV/AIDS, which has killed 30 million people worldwide.

Recent research from the National Institutes of Health now makes it possible for the babies of infected mothers to be born without the human immunodeficiency virus, for far fewer teenagers or adults to be stricken by HIV/AIDS, and for more accessible treatment to prevent virus transmission, Clinton said Nov. 8 in a speech at the medical research center in Bethesda, Maryland.

She called on other countries to join the U.S. in a plan to eliminate new infections in children by 2015. Last year, the U.S. helped prevent 114,000 babies from being born with HIV, she said.

‘AIDS-Free Generation’

“Creating an AIDS-free generation has never been a policy priority for the United States government -- until today,” Clinton said. “Our efforts in global health are another pillar of our leadership. They advance our national interests, making other countries more stable and the United States more secure.”

Health advocates hailed the announcement. “Her speech could be the foundation for the U.S. administration to lead the world to end the AIDS crisis,” said Matthew Kavanagh, director of U.S. advocacy for Health Global Access Project, a Washington- based group.

Thirty-four million people worldwide live with HIV, which causes AIDS, a progressive failure of the immune system. “AIDS is still an incurable disease,” Clinton said, “but it no longer has to be a death sentence.”

The ability to create generic drugs after the expiration of brand-name patents by companies such as Abbott (ABT) Park, Illinois- based Abbott Laboratories has been central to that success.

Under current international practice, which allows for more flexibility that the TPP would give, Thailand and Brazil hastened the introduction of the generic AIDS drug efavirenz, or EFV, based on a brand-name drug by Bristol-Myers Squibb Co. (BMY) of New York and Merck & Co. Inc. (MRK) of Whitehouse Station, N.J., according to Judit Rius, U.S. manager of Doctors Without Borders’ Campaign for Access to Essential Medicines.

Falling Costs

These cheaper drugs have been “a game changer for us and anyone who cares about treatment in the developing world,” said Sophie Delaunay, the executive director of Doctors Without Borders in the U.S. Generics account for 80 to 90 percent of the drugs used by her organization and the U.S. government’s main HIV/AIDS program, she said.

The President’s Emergency Plan for AIDS Relief, known as Pepfar, founded by President George W. Bush and overseen by the State Department, spent almost $1,100 a year to treat an HIV/AIDS patient in 2003, Clinton said. “Today, it’s $335 and falling,” thanks also to bulk purchasing and other savings, she said.

“Continuing to drive down these costs is a challenge for all of us,” Clinton said.

Clinton Foundation

Her husband, former President Bill Clinton, is also working to increase access to HIV/AIDS treatment, in part by lowering the cost of antiretroviral and other drugs. The William J. Clinton Foundation reports that it has negotiated drug price reductions with eight suppliers, including Pfizer Inc. (PFE) of New York and Mylan Inc. of Canonsburg, Pennsylvania, covering 40 drug formulations. Two million people worldwide are receiving HIV treatments purchased by the foundation program under such agreements, the group says on its website.

Cost is a key issue in getting AIDS drugs to the people who need them. Baker said the TPP “access window” may be irrelevant for many people in poor nations such as Vietnam, which has a large Pepfar program. Even if the TPP speeds the availability of the latest brand-name drugs, people can’t afford them, he said.

“Income in Vietnam is a fraction of what it is here, and yet we’re allowing the same protections for drug companies as we do here,” Baker said.

Supporting Innovation

Sean Flynn, associate director of the Program on Information Justice and Intellectual Property at American University in Washington, says the trade office’s initiative “defines ‘access’ without regard to affordability, and therefore its ultimate effect will be to raise, not lower, excessive medicine prices in poor countries.”

When asked if Pepfar officials share the advocates’ concerns, spokesman Thomas Walsh said by e-mail that the Obama administration has shown it’s “committed to use trade policy tools to reduce barriers to access to medicines, while also supporting innovation and the development of new medicines.”

Representative Henry Waxman, a California Democrat, and four other Democratic lawmakers wrote U.S. Trade Representative Ron Kirk on Oct. 19 to express concern that the TPP “could limit, rather than expand, access to medicines in poor countries.” Harmon of the trade office provided no public response to issues raised in the letter. Trade officials continue to “engage and consult” with lawmakers on the issues they raised, she said.

The Waxman letter said the TPP could lead to higher costs for the U.S. as the Pepfar program tries to reach its treatment goals “or could result in removing patients from treatment.”

The lawmakers urged Kirk to include provisions -- contained in recently passed free trade agreements with Peru, Colombia and Panama -- that are aimed at ensuring that developing countries are able to achieve “an appropriate balance between fostering innovation in, and promoting access to, life-saving medicine.”

To contact the reporter on this story: Nicole Gaouette in Washington at ngaouette@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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