How will access to medicines be affected by the TPP?
One of many causes for concern around the TPP is its potential effect on access to medicines.
The Pharmaceutical Benefits Scheme (PBS) decides what medicines the Australian government buys and subsidises for use by the public. Because the PBS purchases in bulk and makes its decisions in the interests of the Australia public, we pay far less for medicines than we otherwise would.
A leaked negotiating text shows what the US is demanding on behalf of its big drug companies (known as “Big Pharma”) and how the benefits Australian’s enjoy under the PBS are threatened by the TPP. Although the PBS will not be dismantled, under the leaked text the PBS would:
- not be able to negotiate a bulk discount for medicines
- have to give detailed reasons to the drug companies about every purchasing decision
- give pharmaceutical companies the right to appeal the PBS’s decisions
- publish the identities of all decision-makers around the purchasing of medicines.
If adopted, this text would strengthen Big Pharma’s leverage over our PBS. The drug companies’ would gain new rights and opportunities to lobby PBS decision makers and challenge their credentials, demand reasons if the PBS rejects their ‘expert’ reports and data, and pressure its decisions by constant threats of appeal. The goal of the big pharmaceutical companies is to influence the PBS’s criteria and decisions in their favour at the expense of affordability for the public. If the leaked text is adopted then government would have to massively increase the health budget, reduce the availability of subsidised drugs, or increase the price paid by ordinary Australian’s.
Affordability of medical devices
Medical devices like heart valves, replacement hip joints and lenses for cataract operations are all now being brought under the PBS, so the same problems will apply as with medicines.
One reason why life-saving drugs are affordable for ordinary people — in Australia and overseas — is the availability of “generic” alternatives to branded pharmaceuticals. Generics are identical to their branded equivalents, but cost only a fraction of the price. Their availability helps the PBS keep the price it pays for medicines down.
Generics can only be sold in Australia where no local patent has been granted, where that patent has expired, or a licence has been issued. Another leaked negotiating text from February 2011 threatens our ability to access generic medicines:
Patents on medications could in effect be extended, as pharmaceutical companies would be able to claim additional patents on medications where they discover an alternative use for them, or make a minor modification. This would apply even if the modification were clinically insignificant. It would effectively mean the original product would be withheld from the generic market even though its patent had expired.
The life-time of patents could be extended to take into account the time taken for a new medicine to be approved as safe.
Our government body that ensures that medicines are safe for Australian’s would be forced to investigate whether the drugs they are approving have patents on them or not. This is called “patent linkage”, and it would delay the approval of generics even though drug patenting has nothing to do with drug safety.
Big pharmaceutical companies would be able to prevent generic manufacturers from using original safety testing data for longer, meaning that the registration of generic medicines is postponed.
Every delay in the availability of generic medicines means more money for big pharmaceutical companies, and higher prices for kiwis.
Patenting of medical techniques
The leaked February 2011 text would require the Australian government to allow companies to secure patents on “diagnostic, therapeutic, and surgical methods for the treatment of humans or animals.” The idea is deeply unethical as it would mean either higher costs for medical treatment or that many Australian’s were denied access to life-saving medical techniques.
If Australia signs up to the TPP, we’ll be putting our tabacco law’s at risk.
This is because a leaked TPP text shows that Australia’s negotiators seem willing to give more rights to big overseas companies, including the right to sue the government for making decisions which significantly hurt their investment. This process is called Investor-State Dispute Settlement and it takes place in secretive offshore arbitration tribunals, bypassing Australia’s courts. Anti-smoking measures taken by our government could be challenged by the tobacco companies if we sign the TPP.
If you think this sounds far-fetched, it’s not — our government is currently being sued by Philip Morris for our plain packaging policy under an old international agreement between Australia and Hong Kong. Even though our highest court has ruled in favour of plain packaging, the government still faces international lawsuit away from the eyes of the public, and could end up paying hundreds of millions of dollars to big tobacco for trying to protect the health of its citizens.
It isn’t just plain packaging laws that will face problems if the TPP negotiations are completed. Other policies that could fall foul of the rules include:
– banning the use of terms like ‘mild’, ‘smooth’, ‘fine’;
– controlling the use of flavours that disguise the foul taste of tobacco;
– reducing the nicotine content of tobacco products; and
– capping the number of tobacco retail outlets.
Many different chapters of the TPP would impact on tobacco policies, for example:
– intellectual property laws could be strengthened in favour of big tobacco companies, making it easier for them to claim that tobacco control policies infringe their trademarks;
– advertisers, duty free stores, retailers, and other parts of the tobacco supply chain would also have special rights, even if they were operating by Internet from offshore; and
– new “transparency” and “regulatory coherence” rules would give tobacco companies much more influence over government decisions on tobacco control.
Alcohol abuse is a big problem in Australia. Part of the solution is setting rules around the sale of alcohol — for example, a minimum price per unit of alcohol, and banning advertising and sponsorship by alcohol companies.
As with tobacco, a TPP will put the Australian government at risk of law suits from overseas companies for trying to reduce the damage caused by alcohol abuse. This could see the government paying millions of taxpayer dollars to overseas companies in compensation, or backing down from policies that protect Australians.
The government will also face pressure to allow imports of products that meet the alcohol product standards in other TPP countries, even when they are inconsistent with our own.
That already happens: under another agreement (the CER) New Zealand is bound to recognise Australia’s regulatory standards. The New Zealand government had to back down in 2012 on its intention to cap the alcohol content of RTDs popular with underage drinkers — it could not have stopped Australian RTDs, with a higher legal alcohol limit, from being sold in NZ unless it changed the CER rules. Under the TPP we risk the same thing, but with all 12 negotiating countries. This would have the same effect as watering down our regulations to the country with the lowest standards.
As with tobacco, the government risks being bound to increased “transparency” obligations around its decision-making process for alcohol policy. In practice, this means giving alcohol companies more say in what the government does to protect New Zealanders from alcohol abuse.
Does the TPP sound like something Australia should be a part of?
Tell the government what you think by sending them an open letter.
A video of Dr Deborah Gleeson talking about the TPPs possible effects on health, see more videos here
If interested you can view the Australian department for foreign affairs and trade’s position here (link)