...Delicate Balance Of Intellectual Property And Access Economics Essay Health is a human right and intellectual property must not become overemphasized at the expense of human life. There is a delicate balance between the human rights of HIV/AIDS sufferers and the economic, political, and human rights of corporate citizens to protect intellectual property within the pharmaceutical industry. This essay intends to answer the six questions related to the In-Depth Integrative Case 1.2 and highlight the global rights conflict of between a developing country’s fight to confront the AIDS epidemic and intellectual property protection. Delicate Balance Of Intellectual Property And Access To Medication Introduction When the South African Medicines Act was introduced it quickly resulted in battle lines being drawn between patent rights and public health. While all parties acknowledged the scope of the AIDS crisis, how to go about solving the problem became the subject of significant moral and legal debate (Halbert, 2012). Case Study Review In the case study Pharmaceutical companies, intellectual property, and the global AIDS epidemic, there are a number of questions to review. First, do pharmaceutical companies have responsibility to distribute drugs for free or at low cost in developing countries? What are the arguments for and against such an approach? There are socio-economic responsibilities of businesses and pharmaceutical companies have responsibility to distribute drugs for free...
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...| Pharmaceutical companies | Research Paper | | Daren Smith | 5/21/2012 | | Abstract There is a lot of discussion about pharmaceutical companies, intellectual property, and the global AIDS epidemic. Do pharmaceutical companies have a responsibility to distribute drugs for free or low cost in developing countries? Why is intellectual property such a big deal? What impact would South Africa’s decision to levy duties on drugs in the country have on the international distribution of drugs? Was the change that provided patent protection for pharmaceutical companies an appropriate change or a dangerous precedent? Was it necessary to relax intellectual property rules in order to ensure that adequate supplies of AIDs medications would be available for distribution in the developing world? What role to multi-national corporations have in providing funding or other assistance to international organizations such as the Global Fund? All these questions have many arguments for and against but the right answers probably lie somewhere in between. Having and providing access to affordable medication is one of the greatest challenges we face in today’s world. Many people see that pharmaceutical companies are irresponsible. The evidence is in the high prices individuals have to pay for medications. Although I don’t care for higher priced medications I do believe in the right for a business, or individual, to make money. To come up with medications it takes...
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...Case Study #1 “Pharmaceutical Companies, Intellectual Property, and the Global AIDS Epidemic” Questions for Review: 1. Do pharmaceutical companies have a responsibility to distribute drugs for free or at low cost in developing countries? What are the main arguments for and against such an approach? What are the advantages and disadvantages of giving drugs for free versus offering them at low no-profit prices? -I don’t necessarily think that they have the “responsibility” to do so but I think that they should want to as there are millions dying and suffering tremendously from this epidemic. Pharmaceutical companies make billions and billions of dollars a year, I feel that they should want to help people who can’t help themselves. It is not fair for them to suffer and die because they don’t have the money to treat themselves. -Arguments for: Devastating amounts of people are dying and suffering from this disease and are not able to afford proper treatments. Activists and organization believe that there shouldn’t be a price on life and that treatment should be available to these less fortunate people. -Arguments Against: It argues that they will not make enough profit. The price of research and development is outrageous and they worry that the decrease of profits will not be able to recover from the other expenses. -Giving the drug away for free could potentially hurt the supplier and it could also start corruption. If it is given for free there is no telling who...
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...Western Drug Companies and the AIDS Epidemic in South Africa In December 1997, the government of South Africa passed a law that authorized two controversial practices. One, called parallel importing, allowed importers in South Africa to purchase drugs from the cheapest source available, regardless of whether the patent holders had given their approval or not. Thus South Africa asserted its right to import “generic versions” of drugs that are still patent protected. The government did this because it claimed to be unable to afford the high cost of medicines that were patent protected. The other practice, called compulsory licensing, permitted the South African government to license local companies to produce cheaper versions of drugs whose patents are held by foreign companies, irrespective of whether the patent holder agreed. The law seemed to be in violation of international agreements to protect property rights, including a World Trade Organization agreement on patents to which South Africa is a signatory. South Africa, however, insisted that the law was necessary given its own health crisis and the high cost of patented medicines. By 1997, South Africa was wrestling with an AIDS crisis of enormous proportions. It was estimated that over 3 million of the country's 45 million people were infected with the virus at the time, more than in any other country. However, although the AIDS epidemic in South Africa was seen as primary reason for the new law, the law itself was applied...
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...Western Drug Companies and the AIDS Epidemic in South Africa In December 1997, the government of South Africa passed a law that authorized two controversial practices. One, called parallel importing, allowed importers in South Africa to purchase drugs from the cheapest source available, regardless of whether the patent holders had given their approval or not. Thus South Africa asserted its right to import “generic versions” of drugs that are still patent protected. The government did this because it claimed to be unable to afford the high cost of medicines that were patent protected. The other practice, called compulsory licensing, permitted the South African government to license local companies to produce cheaper versions of drugs whose patents are held by foreign companies, irrespective of whether the patent holder agreed. The law seemed to be in violation of international agreements to protect property rights, including a World Trade Organization agreement on patents to which South Africa is a signatory. South Africa, however, insisted that the law was necessary given its own health crisis and the high cost of patented medicines. By 1997, South Africa was wrestling with an AIDS crisis of enormous proportions. It was estimated that over 3 million of the country's 45 million people were infected with the virus at the time, more than in any other country. However, although the AIDS epidemic in South Africa was seen as primary reason for the new law, the law itself was applied...
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...World Market Strategies for Drugs to Fight Aids Jérôme Dumoulin, Yves-Antoine Flori, Philippe Vinard, Thomas Borel Key words: AIDS; drugs; price; developing countries. Abstract Faced with a situation where the market is unstable and the political context is crucial, we propose a three-part analysis. In the first part, an overview of the chronology of the main events shows that the evolution of the price of ARVs is interlinked with numerous issues of pharmaceutical patent rights. In the second part, we analyse the positions of stakeholders: how they behave in the market and influence market regulations. In the third part, we propose three scenarios which are both simplified interpretations of stakeholders’ strategies and options for the future. The first scenario is the status quo, where prices are high. The second scenario is driven by multinational companies who work to enlarge the markets by price differentiation and product diversification. The third scenario is driven by International Organisations which achieve a political consensus to enlarge access to ARV drugs through broader international financing and a systematic opening of the market to generics. Résumé Face à une situation de marché instable où le contexte politique est primordial, nous proposons une analyse en trois parties. Dans la première partie une esquisse de la chronologie des événements montre que l’évolution des prix des 214 Economics of A I DS and Access to H I V/A I DS Care… ARV est...
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...Licensing under TRIPS in Response to the AIDS Crisis in Developing Countries Professor Hans Henrik Lidgard Professor Jeffery Atik This paper can be downloaded without charge from the Social Science Research Network (SSRN) electronic library at: http://ssrn.com/abstract=794228 FACILITATING COMPULSORY LICENSING UNDER TRIPS IN RESPONSE TO THE AIDS CRISIS IN DEVELOPING COUNTRIES Hans Henrik Lidgard and Jeffery Atik1 Abstract The AIDS crisis in the developing world has become a priority for international collaboration. The challenge is to find a balance between the acknowledged need to protect large investments expended in developing new medicines and the goal of providing essential medicines to poor countries. Patent protection must prevent undue infringement yet at the same time allow solutions to humanitarian needs. Is compulsory licensing a way out? TRIPS originally restricted compulsory manufacturing licenses to the country experiencing a public health emergency – which was of little utility to countries lacking manufacturing capacity. The Doha agreement effectively permits twinned compulsory licensing – a distribution and use license in countries experiencing a public health emergency and a manufacturing-for-export license in countries possessing appropriate manufacturing capacity. These changes make possible, at least in principle, a greater source of supply of generic pharmaceuticals for use in those least developed countries confronting the AIDS crisis. It is still early to evaluate...
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...Student Name : Singh, R. : Hariram, E. : Marimuthu, V.K. Student Number : 20054057 : 20101233 : 19852274 Assignment Title : The Global Pharmaceutical Industry. Date : 10 March 2012 Programme : BTECH-MANAGEMENT IV Question 1 Identify the main environmental forces currently affecting the global pharmaceutical industry? PESTEL analysis of the global pharmaceutical industry: Political * Governments set stringent regulation and is a powerful purchaser. * Governments around the world focus on pharmaceuticals as a politically easy target in their efforts to control rising health care expenditure. * Inter-country pricing disparities. Economic * European free trade agreements. * Deregulation of market to allow foreign drugs to compete. Social * Ageing population puts pressure on healthcare systems. * Epidemic of chronic diseases. * Rising consumer expectations. * Payers choosing generic drugs for first-line treatment of common ailments. Technological * Increase productivity, decrease costs and develop new treatment modalities to enhance profitability. * Impact of Internet on traditional business models. * Impact of genetic research on industry. Environmental * Industry operations are becoming more stringent with increasing standards and requirements for environmental protection. Legal * Rigorous regulatory scrutiny governed by legislation. * Legislation enacted to set a...
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...1948 to 1994. Due to colonization, whites had ruled South Africa for several centuries, which resulted in the creation of a system that was constructed to serve as a legal framework for continued economic and political dominance by people of European descent (WHO 2003: Antiretroviral Therapy). The apartheid era came to an end as a consequence of both inner and global pressure and South Africa’s new democratic government. The new government claims that improving the access to health care is a main priority noting, “emphasis should be placed on reaching … the most vulnerable” (Department of Health 1997:13). Giving access to health care is becoming an even greater challenge. South Africa was, and is still facing an exploding HIV/AIDS epidemic that, if anything, is highly associated with health care demands. Today, there are more than 5.3 million people living with HIV/AIDS in South Africa, this accounts for more than 21.5% of the entire population (CIA World Fact book: 2006). This paper aims to understand how the health care sector has dealt with the challenges faced in dealing with immense inequalities and a growing epidemic in the context of globalization. Furthermore, it will become evident that South Africa has, in some ways, addressed these challenges effectively but these challenges are facing a great developmental trap. Therefore, simple strategies that could offer potential benefits to South Africa in light of these challenges will be examined. For the sake of clarity...
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... Yet, an inevitable tension exists between the need for pharmaceutical companies to profit from their patented inventions and the desire to provide access for impoverished persons. Developing nations have attempted to resolve this tension through the issuance of patent compulsory licensesFauthorizations for government-approved generic copies1Fso that those in need of the n Assistant Professor of Business Law, School of Business, University of Connecticut. This article received the Holmes-Cardozo Award for Outstanding Submitted Conference Paper as well as the Ralph J. Bunche Best Paper Award at the Academy of Legal Studies in Business Annual Meeting, Indianapolis, IN, August 2007. Our thanks for comments and support go to Jayashree Watal, Peter Yu, Douglas Lippoldt, and the other participants at the University of Connecticut’s Center for International Business Education and Research Conference, ‘‘The Impact of Intellectual Property Rights on Innovation, Knowledge Diffusion, and Foreign Direct Investment in the Global Economy,’’ Storrs, CT, May 2007. Additional thanks to Anthony Kwasnica and Larry Cata-Backer for helpful comments. nn Associate Professor of Business Law, Smeal College of Business, The Pennsylvania State University. My research was supported by funding from the 2007 Smeal Competitive Research Grants Program. 1 The term ‘‘compulsory license’’ can refer to any compelled relaxation of an intellectual property owner’s right to exclude in exchange for a licensee’s...
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...Chapter FIVE gLOBALIZATION AND SOCIETY OBJECTIVES • To identify problems in evaluating the activities of MNEs • To evaluate the major economic impacts of MNEs on home and host countries • To establish the foundations for responsible behavior • To discuss some key issues of globalization and society—ethics and bribery, the environment, pharmaceuticals, and labor issues • To examine corporate responses to globalization Chapter Overview Globalization has become a major socioeconomic force and topic of debate in the twenty-first century. While Chapter One examines the forces and criticisms associated with the globalization process, Chapter Five focuses upon the impact of foreign direct investment on home and host countries. Following an explanation of the balance-of-payments effects of FDI, a series of ethical issues concerning the social responsibilities of MNEs is explored. The cultural and legal foundations of ethical behavior are examined, and the challenges of global warming, pharmaceutical sales, and child labor are highlighted. The chapter concludes with a brief discussion of the need for corporate codes of ethics. Chapter Outline OPENING CASE: ENVIRONMENTAL CHALLENGES FOR NEWMONT MINING IN INDONESIA [See Map 5.1.] This case illustrates the effects of the changing and conflicting attitudes of the national and local Indonesian governments toward foreign direct investment. Headquartered in Denver, Colorado, Newmont Mining is the...
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... CASE TEACHING NOTES The Global Pharmaceutical Industry Sarah Holland (Manchester Business School) and Bernardo Bátiz-Lazo (London South Bank University) 1. Introduction The case describes how the prescription pharmaceutical industry has changed since its modern beginnings in the early 1950s. The various forces affecting the competitive environment of the industry are discussed in terms of origins, immediate past and immediate future (2004 onwards). As a result, the note provides insights into the evolution of barriers to enter and exit the industry for prescription pharmaceuticals, while aiming to help students to recognise how to set boundaries for an industry. This is a detailed industry note on the “ethical” pharmaceutical industry which provides an opportunity to analyse key success factors of major players. The note centres on a descriptive overview of the predominant issues in the three major Triad market areas: the US, Europe and Japan (although major issues in emerging markets are also mentioned). The note covers the overall industry environment with in-depth discussion of the driving forces in the industry such as globalisation (in particular global regulatory issues, changing world demographics and worldwide pricing disparities); development of new technology; the importance of time to market; and amalgamations. The case also examines issues around corporate social responsibility. 2. Position of the Case The pharmaceutical industry case study lends itself...
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...Preservation of Traditional Medicines The people of Canada have been fortunate to be able to experience a somewhat free health care system, yet there are still many problems to be addressed with this system. For example, one issue would be to understand why Indigenous people and communities have limited access to health care. This is true especially in the northern and more isolated communities. However the people of these communities have survived through thousands of years with the use of natural, traditional medicines grown on the land. The knowledge of traditional medicines shared by elders and Indigenous people of Canada has been overlooked by the health care system, Canadian government and the general population of Canada. This is the direct result of exploitation of the land that produces these traditional medicines leading to the loss of healing plants, and knowledge and culture for Indigenous peoples of Canada. It is important to protect and preserve the Canadian landscape so medicine plants can thrive, the Indigenous cultures and knowledge can live on and communities can continue to be independent without relying on a health care system that may already be failing them. Much of history that is taught in the Ontario education system starts at the dawn of colonialism and is then seen through the eyes of the colonizer. However, to understand such traditional medicines and the power that the land holds, one must go back to the beginning of creation. There are many...
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...Topics in Economic Analysis & Policy Volume 5, Issue 1 2005 Article 16 Price Discrimination and Smuggling of AIDS Drugs Richard A. Hornbeck∗ ∗ MIT, hornbeck@mit.edu Copyright c 2005 by the authors. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher, bepress, which has been given certain exclusive rights by the author. Topics in Economic Analysis & Policy is one of The B.E. Journals in Economic Analysis & Policy, produced by The Berkeley Electronic Press (bepress). http://www.bepress.com/bejeap. Price Discrimination and Smuggling of AIDS Drugs∗ Richard A. Hornbeck Abstract Patent-holding pharmaceutical companies are shown to be imperfectly able to charge differential prices for AIDS drugs due to the potential for black market exchange. Thus, greater segmentation in the international market through additional barriers to smuggling would induce firms to charge lower prices for AIDS drugs in poorer countries. Without these additional barriers, widespread drug distribution through mandated lower prices or weakened patent protection in the developing world would result in smuggling, undercutting demand in developed markets and reducing firms’ research incentives. By contrast, further market segmentation would allow policy makers to go beyond the induced price cuts and remove...
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...Emerging market report 2007 Disclaimer PricewaterhouseCoopers has exercised professional care and diligence in the collection and processing of the information in this report. However, the data used in the preparation of this report (and on which the report is based) was provided by third-party sources. This report is intended to be of general interest only and does not constitute professional advice. PricewaterhouseCoopers makes no representations or warranties with respect to the accuracy of this report. PricewaterhouseCoopers shall not be liable to any user of this report or to any other person or entity for any inaccuracy of information contained in this report or for any errors or omissions in its content, regardless of the cause of such inaccuracy, error or omission. Furthermore, to the extent permitted by law, PricewaterhouseCoopers, its members, employees and agents accept no liability and disclaim all responsibility for the consequences of you or anyone else acting, or refraining from acting, in relying upon the information contained in this report or for any decision based on it, or for any consequential, special, incidental or punitive damages to any person or entity for any matter relating to this report even if advised of the possibility of such damages. The member firms of the PricewaterhouseCoopers network (www.pwc. com) provide industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders...
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