CAP lauds Health Minister for statement on Trans-Pacific Partnership Agreement

We laud the Government of Malaysia and the Health Minister, Datuk Seri Liow Tiong Lai, for their concern over the potential impact of the Trans-Pacific Partnership Agreement (TPPA) on public health in Malaysia.

According to The Sun Daily (6 August 2012), Liow categorically asserted Malaysia’s disagreement with intellectual property (IP) proposals to the TPPA negotiations between Malaysia and eight other countries in the Asia-Pacific to extend patent protection for pharmaceuticals as being unfair for reducing the ability of Malaysians to obtain affordable medical treatment.

Liow said “We are against the patent extension” and stressed that the agreement would in effect make healthcare less affordable to the public and be detrimental to the local medical industry. Liow also stressed that a foreign company should not be given the power to sue a government due to its policies.

The TPPA, also known as the Trans-Pacific Strategic Economic Partnership Agreement, is a USA-led free trade agreement (FTA) that aims to further liberalise the economies and create a free trade area of the Asia-Pacific.  In addition to the USA and Malaysia, the other countries involved in the negotiations are Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam.

Besides the patent term extensions, there are a number of other proposals in the TPPA IP chapter, which if accepted, would also make medicines more expensive for longer in Malaysia.

Malaysia already provides strong IP protection that gives adequate protection to pharmaceutical companies. Therefore there is no need for Malaysia to agree to even stronger IP provisions in the TPPA, especially since they have been shown to increase medicine prices in other countries which introduced them.

Another proposal for the TPPA that would adversely affect access to affordable medical treatment is the ‘Transparency and Procedural Fairness for Healthcare Technologies’ Annex.1  The provisions proposed will restrict medicine pricing programmes and require that appeals be allowed to determine whether medicine ‘reimbursement rates’ “appropriately recognize the value” of pharmaceutical patents.

In Australia, such provisions appear to have led to costlier medicines.2  If accepted, such proposals would undermine the Malaysian government’s ability to set affordable medicine prices. The USA proposal is contrary to practices in the USA itself, and raises the bar higher than current medicine pricing programmes in the country.

Other Ministers have taken a similar position to Liow’s. For example when asked by the Committee’s Chair, how the Malaysian Government can ensure that trade agreements do not affect provision of generic medicines, particularly for the treatment of HIV/AIDS, Malaysian Attorney-General Tan Sri Abdul Gani told the United Nations Committee on the Rights of the Child that free trade agreements are TRIPS-plus and Malaysia would not negotiate on this issue. He also stated that “generic drugs should not be restricted in any manner,” as generics are cheaper than patented medicines.3

Peru’s Minister of Foreign Commerce and Tourism José Luis Silva publically said that in the TPPA negotiations ‘We will not go one centimetre more’4 than the current Peru-US free trade agreement (which does not have patent term extensions or linkage).

In free trade agreement negotiations with the European Union where similar intellectual property provisions were being negotiated, India’s Minister of Commerce and Industry flatly refused to agree to data exclusivity saying that “There is no question that we will accept data exclusivity in any (free trade) agreement with any country”.5

In addition to the above, Liow had also remarked on the controversial investor-state dispute system (ISDS) proposed for the TPPA. The ISDS allows foreign investors to sue governments directly at an international tribunal for enacting or implementing laws, regulations, policies or programmes including for public health, but which an investor sees as having infringed upon an investment or expected profits. As Liow stressed in his statement, “a company should not be given the power to sue a government due to its policies”.

ISDS cases in the past have successfully challenged public interest measures including for health, such as banning dangerous chemicals and preventing toxic waste from contaminating the water supply. Tobacco companies are also currently using ISDS to sue governments for billions of dollars for their tobacco control measures.

By rejecting ISDS in the TPPA, it will greatly help to preserve Malaysia’s ability to implement tobacco control and other health policies, as Australia has done in its rejection of ISDS in the TPPA.

We welcome Liow’s statements over the matter of patent extension and ISDS. We hope the Minister can maintain his strong stand in rejecting provisions that may adversely impact the health of Malaysians.

As the above discussion makes clear, there are many other proposals submitted for the TPPA negotiations that need careful – and public, we must add – scrutiny for their impact – in the near and longer future – on the welfare, wellbeing and interests of the Malaysian public.

Any and all proposals that adversely affect public health, access to medicines and the space available for our regulators to act in the interests of the public should be opposed and rejected.

Letter to the Editor, 13 August 2012