The Spirit of TRIPS and the Importation of Medicines Made under Compulsory License after the August 2003 TRIPS Council Agreement

Fayerman, Jessica J. | January 1, 2004

The Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement has changed prospects for access to necessary medications in the developing world. The use of compulsory licensing for pharmaceutical products embodied in Article 31 of TRIPS has been a contentious issue. Prior to 2003, countries with no manufacturing capacity of their own were not allowed to import medicines made under compulsory license, rendering the protections of Article 31 of little use to them. The 2003 Motta Agreement changed this. This expansion of the compulsory licensing power is both an impractical solution and it dilutes the premises upon which TRIPS was originally based, and there are other mechanisms for insuring access to necessary medicines in the developing world.

The Motta Agreement contains a number of provisions designed to ensure that importation of medicines made under compulsory license is not undertaken capriciously, including adequate remuneration and efforts to avoid the “grey market” problem. Compulsory licensing as embodied in the Motta Agreement, however, is an inadequate solution. Amir Attaran cautions that it was an extremely rarely-used practice even before the importation debate. The temporary nature of the Agreement will also invoke even more lengthy negotiations. More importantly, allowing compulsory licensing inherently dilutes the importance of intellectual property protection envisioned by TRIPS. Alternatives discussed in the literature such as price discrimination, pooled procurement plans, and even a variation on the US Orphan Drug Act are more viable solutions.