	Background

By way of providing context for our examination of U.S. trade policy as it  relates to TPA guidance and the Doha Declaration on TRIPS and Public  Health, the following is an overview of ongoing U.S. government efforts to  address the wider issue of access to medicine and public health both  related and unrelated to IP, as well as how the WTO first became involved  in public health issues, and the origin of IP and public health in TPA. Patents are considered to be especially valuable for  innovations in pharmaceuticals. The United States Has a Narrower Interpretation of the Doha Declaration Than Some Other WTO Members

To help address public health problems affecting many developing  countries, WTO members adopted the Doha Declaration (reprinted in full  below) to stress the importance of implementing the TRIPS agreement in a  manner supportive of public health. The United States interprets the declaration as a political  statement recognizing public health crises and affirming the importance of  IP protection that neither changes existing TRIPS obligations nor creates  new obligations, and does not assign public health greater priority than IP  protection. Significantly, the declaration clarifies certain flexibilities  explicit in TRIPS that allow WTO members to address public health crises. Some  developing countries, however, believe these flexibilities provide broad  discretion to ensure access to medicines when IP regulations present  barriers to addressing not only health issues, but also social welfare. 2. We recognize that intellectual property protection is important for the development of  new medicines. USTR Has Maintained Its Pursuit of High IP Standards and Made Some Allowances for Doha Flexibilities in Negotiating FTAs

In negotiating FTAs, USTR said it balances respect for the Doha  Declaration with its other two IP negotiating objectives in TPA by  consistently promoting high standards of IP protection similar to U.S. law,  while making allowances for the two specific flexibilities mentioned in the  declaration. However, USTR has continued to  pursue other pharmaceutical-related IP provisions that it does not see as  relevant or contrary to the Doha Declaration in all of its FTAs, such as  data exclusivity, patent term extensions, and patent linkage. Reactions to  USTR’s approach have been mixed. Finally, certain Members of Congress have expressed  concern over the pharmaceutical-related IP provisions in FTAs with  developing countries, and this concern was recently addressed through a  bipartisan compromise between Congress and the administration. The Trade Act of 2002, which  granted the President Trade Promotion Authority (TPA), contains  guidance from Congress on U.S. negotiating objectives for trade  agreements, including three goals on IP rights:1.  to further promote adequate and effective protection of IP rights,  including through ensuring that the provisions of any multilateral or  bilateral trade agreement governing IP rights that is entered into by the  United States reflect a standard of protection similar to that found in  United States law;  2.  to secure fair, equitable, and nondiscriminatory market access  opportunities for United States persons that rely upon IP protection;  and  3.  to respect the Doha Declaration on the TRIPS Agreement and Public  Health, adopted by the World Trade Organization (WTO). These NGOs, academics, and generic  pharmaceutical producers believe that these provisions limit generic  competition, thereby maintaining high prices for pharmaceutical products,  ultimately impairing access to medicines. Although U.S. agencies generally support USTR’s  negotiations approach, interagency input on U.S. trade negotiations has  not addressed the public health implications of IP pharmaceutical  provisions negotiated under TPA and has been primarily technical in  nature. Within the formal private  sector advisory system, two public health representatives were recently  added to two private sector Industry Trade Advisory Committees (ITACs)  after USTR had concluded nine trade agreements. The Departments of Health and Human Services and State Endorse the View that IP Protection Supports Access to Medicine

HHS officials told us they support the USTR position concerning the Doha  Declaration and agree with USTR’s view that strong IP protection  promotes innovation and access to medicines. In order to evaluate the extent of formal and informal IP and public health  input into USTR’s trade agreement negotiations, we examined the formal  interagency advisory process, the formal industry advisory committee  process, and several informal means for providing input to USTR.
Why GAO Did This Study

The WTO Agreement on Trade-Related Intellectual Property (TRIPS) requires all 151 World Trade Organization (WTO) members to provide baseline protections, including 20-year patents for innovative pharmaceuticals. The Trade Act of 2002 granting Trade Promotion Authority (TPA) to the President outlined three negotiating objectives related to intellectual property (IP). The first two aim to strengthen IP rights and enforcement abroad. The third calls for respect of the WTO Doha Declaration on TRIPS and Public Health, which addresses access by developing countries to patented medicines, particularly in epidemic and emergency situations. This report (1) describes the Declaration and its interpretation by the United States and other nations; (2) analyzes how U. S. Trade Representative (USTR) has balanced respect for the Doha Declaration with the other two IP objectives in negotiating free trade agreements; and (3) evaluates the extent of public health input by agencies and the private sector. We reviewed official WTO and U.S. government documents, interviewed U.S. and foreign government officials, and obtained private sector views.

What GAO Found

The 2001 Doha Declaration on TRIPS and Public Health was adopted by WTO members to stress the importance of implementing the TRIPS Agreement in a manner supportive of public health. The U.S. interprets the Declaration as a political statement that recognizes the severity of public health crises while affirming the importance of IP protection. It maintains that the Declaration neither changes existing TRIPS obligations, nor creates new rights and does not assigns public health greater priority than IP protection. U. S. Trade Representative (USTR) says the Declaration clarifies flexibilities already in TRIPS, including the flexibility to compulsorily license patents under certain circumstances. USTR recognizes these as being allowed for WTO members, including those facing public health crises, but only in a fashion that will not unduly harm patent holders. Some developing countries assert they provide broad discretion to ensure access to medicines when IP regulations present barriers to affordable care. USTR balances respect for the Doha Declaration with TPA's other two IP negotiating objectives by actively promoting high levels of IP protection for pharmaceuticals while making targeted allowances for developing country partners. USTR believes that this longstanding U.S. pursuit of high IP protections for pharmaceuticals creates incentives for investment in research and development of new treatments, ultimately enhancing public health. With regard to the TPA objective of respecting the Doha Declaration, USTR's key policy change was to not insist upon two provisions it sees as relevant to the Declaration in FTAs with developing country trading partners. Otherwise, USTR has continued to pursue other pharmaceutical related IP protections that it does not consider related to the Doha Declaration. Reactions to USTR's record are mixed. The pharmaceutical industry considers these types of FTA provisions critical for preserving incentives for research and innovation. However, some academics, experts, nongovernmental organizations (NGOs), and generic producers have expressed concerns that these provisions may delay entry by cheaper generic products. In response to similar concerns in Congress, a bipartisan agreement was reached with the Administration to revise four recent FTA's prior to their submission for Congressional approval. U.S. interagency and private sector input into trade negotiations related to public health have remained limited since Congress enacted TPA. The Department of Health and Human Services (HHS) and other agencies generally endorse USTR's view that strong IP protection promotes public health and access to medicines, and interagency input has been primarily technical in nature. Within the formal private sector trade advisory system, a public health representative was recently added to 2 of the 16 private sector advisory committees, but not until USTR had concluded nine trade agreements. USTR did obtain some public health views through other formal and informal means during this period.