Tobacco companies liberally use bilateral agreement between countries to defeat any law that works against their interests

“The present global health crisis is not primarily one of disease, but of governance…” noted Ilona Kickbusch in a January-February issue of the Canadian Journal of Public Health.

The Lancet – University of Solo Commission of Global Governance for Health report published on February 11, 2014 in The Lancet journal validates this observation and explains how the current global inequities negatively affect the health of people in the developing countries. It brings to the fore the issue of how globalisation has influenced some of the important determinants of health beyond the control of even the governments.

The report highlights seven policy interventions where the existing system of global governance has “failed to promote or protect health or address health inequities.”

The seven interventions are financial crisis and austerity measures, intellectual property, investment treaties, food, corporate activity, migration and armed violence.

There are numerous examples to show how the restrictive global governance system affects the health of people, particularly the poor people in developing countries.

For instance, despite the global food production standing at 120 per cent of the world’s dietary needs, about 820 million people across the world are “chronically hungry” due to lack of access to safe food. One in six children in these countries is underweight, and malnutrition causes more than one third of deaths in children aged below five years. The difference in life expectancy between the highest-ranking and lowest-ranking countries is as much as 21 years, the report states.

But there have been instances when policy interventions by some countries have successfully averted or reduced health inequities.

India’s decision last year to issue a compulsory licence to Natco Pharma Ltd to manufacture a generic version of Bayer’s Sorafenib cancer drug is one of the examples cited by the report. India’s bold decision helped cut the cost of the drug to patients from $5,000 a month to just $160 a month — a drastic 97 per cent reduction in cost! Natco was required to pay Bayer, the patent holder, a royalty of 6-7 per cent of the generic price.

The U.S. had acted similarly way back in 2001 to manufacture drugs against anthrax, and Brazil in the case of an AIDS drug. Today, more than 90 per cent of HIV drugs by volume consumed by people in the low-income and middle-income countries are indeed very low-cost generics manufactured almost exclusively in India.

This became possible following the 2001 Doha Declaration on TRIPS (Trade Related Aspects of Intellectual Property Rights) and Public Health where it was agreed by all the WTO member countries that “TRIPS does not and should not prevent members from taking measures to protect public health.”

The Sorafenib case was a “flashpoint in a running global political contest” of how certain health-related knowledge is produced and who stands to gain. Despite patents assuring profits to the manufacturer, only 10 per cent of research funding is channelled to meet the health needs of 90 per cent of people in the world. But the tide is turning and development of drug for neglected diseases like TB, malaria, to name a few, is becoming a reality.

Arm-twisting

That there are ways by which developing countries are arm-twisted by countries that own intellectual property rights despite the Doha Declaration becomes eminently clear in the case of bilateral trade agreements between two countries. More than pharmaceutical companies, the tobacco companies use the bilateral trade agreements to their advantage to force the developing countries to implement more restrictive and tougher conditions at the cost of public health.

Bilateral agreements usually incorporate investor-State dispute-settlement provisions wherein companies can legally challenge national regulations.

The Lancet report cites the case of Uruguay that was almost forced to concede and change its law on graphic pictorial warning on tobacco products. In 2010, when Uruguay enacted the law, Philip Morris challenged it, not in Uruguay courts but at the International Centre for Settlement of Investment Disputes (ICSID).

And the case was taken to court by the company in Switzerland with the express intent of using the bilateral agreement between Switzerland and Uruguay to achieve its end.

Just as Uruguay was about to capitulate to the demand of the company, the counterweight of the global tobacco control community came into play. The case is now being fought at ICSID.

It is interesting to note that Philip Morris has lodged a similar case against Australia for the plain-packaging of cigarette packets by using the Hong Kong-Australia bilateral agreement.

Besides the rich countries and profit-minded companies located there, the actions and interventions of even the international institutions have only created and even exacerbated health problems. After all, the policies of institutions like the IMF and World Bank are dictated by a handful of rich countries.

The conditioned loans provided by these financial institutions, as the name suggests, come with a big catch — among other initiatives, privatisation of health care programmes is one of them. This has an immediate negative effect on people, particularly the poor.

One has to look no further than Ireland, Portugal, Spain and Greece to understand how in the recent past these institutions ended up driving economic crises in these countries the moment they accepted financial aid. Sub-Saharan countries suffered earlier.

Ireland, which steered clear of financial aid, dealt with the problem more pragmatically and without jeopardising the health initiatives.