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Giant trade deal will not drive up cost of meds: Govt

Giant trade deal will not drive up cost of meds: Govt - Featured Image

Australians will be shielded from any increase in the cost of government-subsidised medicines under the terms of a massive trade deal covering 40 per cent of the global economy, Trade Minister Andrew Robb has promised.

Negotiators from 12 nations including Australia, the United States, Japan, Canada, Vietnam and Mexico concluded talks on the controversial Trans Pacific Partnership agreement after the US agreed to an Australian compromise to protect the Pharmaceutical Benefits Scheme in the face of demands for an extension of data protection for biologic medicines.

AMA officials and other health campaigners had raised concerns that intellectual property provisions proposed during the course of negotiations would have forced up the price of prescription medicines, costing consumers and the Government billions of dollars, and possibly allowed corporations to block public health measures such as anti-smoking laws.

But Trade and Investment Minster Andrew Robb said the final deal recognised Australia’s existing medicines regime and included carve-outs to protect health and environmental policy from action taken under investor-state dispute settlement (ISDS) provisions.

“Importantly, the TPP will not require any changes to Australia’s intellectual property laws or policies, whether in copyright, pharmaceutical patents or enforcement,” Mr Robb said. “Australia’s five years of data protection for biological medicines will remain unchanged. The TPP will not increase the price of medicines in Australia.”

The US had been pushing for at least eight years of data exclusivity for developers of biologic medicines, which are derived from biological sources such as human cells, blood, proteins and antibodies, and are used to treat diseases including cancer and rheumatoid arthritis.

Australian law currently provides for a five-year period of data exclusivity, and the extra years were potentially worth billions to pharmaceutical companies by delaying the entrance of lower-cost rivals the while adding hundreds of millions to the cost of the PBS.

The issue threatened to derail the deal, but US negotiators accepted an Australian counter-proposal to accept the five-year protection period where it exists while giving countries the option to opt for eight years if they so choose.

Prime Minister Malcolm Turnbull hailed the signing of the trade a “very big win”.

Public health campaigner Professor Mike Daube said the provision in the deal preventing tobacco companies from suing countries for anti-tobacco laws was “a quite remarkable and historic development”.

“It’s a huge achievement for public health, and possibly the biggest international setback for the tobacco industry that we have ever seen,” he said. “Tobacco has rightly been singled out as the pariah industry.”

There had been fears that tobacco and alcohol producers would use ISDS provisions to try and prevent governments from implementing public health measures – tobacco companies are already using ISDS provisions in Australia’s trade agreement with Hong Kong to challenge the legality of tobacco plain packaging laws.

The Government has expressed confidence that the finalised deal will prevent this, but intellectual property law expert Professor Matthew Rimmer sounded a more cautious note.

“Drug companies, junk food and soda companies, and alcohol manufacturers could still challenge government policy and regulation,” Professor Rimmer told Fairfax Media. “There is concern that the general defences for public health policy are limited.”

A major gripe of critics has been the secrecy surrounding the negotiations, which Professor Rimmer said had not served public health policy well.

Among those concerned about the health implications of the completed TPP is medical charity Medicins Sans Frontieres, which warned it would limit the access of people in developing countries to vital drugs.

The charity said millions relied on the ability of pharmaceutical companies in places like India to manufacture drugs coming off patent for a fraction of the cost of name brand producers, and the precedent set by the trade deal would impede this.

“The big losers in the TPP are patients and treatment providers in developing countries,” US Manager of MSF’s Access campaign Judit Rius Sanjuan told Fairfax Media. “Although the text has improved over the initial demands, the TPP will still go down in history as the worst trade agreement for access to medicines in developing countries, which will be forced to change their laws to incorporate abusive intellectual property protections for pharmaceutical companies.”

Adrian Rollins