Medicines account for a major proportion of health costs, especially in the developing world, where it is estimated that one third of the population is unable to receive or purchase essential medicines on a regular basis. Most trade in medicines takes place between wealthy countries, with the developing nations accounting for only 17 per cent of imports and 6 per cent of exports. Access depends on affordable prices and on rational selection and use of drugs. Prices, which are most affected by globalization, have direct implications, especially for developing countries, where 50 to 95 per cent of drugs are paid by the patients themselves.

The sale of the same goods to different buyers at different prices, so-called differential pricing, aims to improve affordability of drugs while generating revenue for the pharmaceutical industry. This has reduced the cost in low-income countries of many antiretroviral (ARV) HIV/AIDS therapies by up to 90 per cent, even though they continue to be sold at market price in developed countries. Other means to increase affordability include generic substitution, promotion of competition and the use of safeguards compatible with the World Trade Organization's (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). Parallel importation and compulsory licensing are recognized as TRIPS public health safeguards against a patent holder charging excessively high prices in a particular market. TRIPS also extends the transition period, until 2016, in which least developed countries do not have to enforce or grant patents on pharmaceutical products.

While developing countries have several international trade law provisions on purchasing medicines at affordable prices for public health needs, they do not take advantage of the flexibilities built into the TRIPS Agreement to overcome patent barriers, which allow them to acquire medicines for high-priority diseases, particularly HIV/AIDS. One condition for issuing a compulsory license is that the patent holder receives adequate remuneration. However, TRIPS does not define what "adequate" means, giving countries some leeway and leaving them free to use either very strict or more flexible criteria for patentability. Applying flexible criteria of novelty and inventiveness enables the issuance of patents for formulations or isomers of known drugs, thus allowing pharmaceutical companies to apply for additional patents and expand the duration of protection beyond the original patent period, therefore making it possible for the originating companies to postpone generic competition. However, actually using this flexibility in order to facilitate access to medicines depends on national standards and administrative procedures.

Thailand and Brazil are at the forefront with regard to making available affordable drugs to fight HIV/AIDS. Thailand focuses on producing and selling generic ARVs at the lowest possible price, while Brazil is providing free ARV-treatment in its public health facilities. For example, when the Brazilian Government began producing generic AIDS drugs in 2000, prices dropped. Also AIDS triple-combination therapy, which costs $10,000 per patient per year in industrialized countries, can be obtained from an Indian generic drug company called Cipla for less than $200 per year.

Several newer AIDS drugs and formulations of existing AIDS drugs are urgently needed in developing countries. However, pharmaceutical companies are choosing not to sell them in those regions and no generic versions are available. There is a new formulation of the ARV-combination therapy lopinavir/ritonavir that does not require refrigeration, which would be useful in Africa, where temperatures are high and electricity supplies irregular, although Medecins Sans Frontieres (MSF) says it is not at all available there. Gilead Sciences' brand-name drug tenofovir, which has significantly fewer side effects than some older ARVs, was added to the World Health Organization's list of pre-qualified medicines recommended for use by UN agencies in developing countries. However, it is also not available in Africa, although it can be an effective second-line ARV, according to Ellen 'tHoen, MSF Director of Policy and Advocacy, as most AIDS patients eventually need to switch to second-line treatment because of side effects and drug resistance. According to MSF, while the company has announced a price of $208 per person per year in 97 countries, tenofovir is only registered in 10. Many developing countries cannot pay the normal price for this drug; in Brazil, for example, it is $2,600 per patient per year, which is the price for just one of three drugs in combination treatment.

TRIPS is a framework agreement to be operationalized through national laws that contains flexibility and safeguards. Such safeguards can only be used when incorporated in the national law, therefore it is important that countries design and enact legislation that allows the protection of the pubic health interest. It is also necessary that national trademark laws do not hinder pro-public health measures, such as generic prescription, generic substitution and/or requirements for a drug label to include the generic name. The most important safeguards are compulsory licensing, parallel importation and provisions for early working, often referred to as "Bolar provision", which allows testing and regulatory approval of the drug's generic versions before its patents expires, thus giving producers time to prepare for the production and sale of a generic drug as soon as its patent expires. This provision facilitates generic competition.

Parallel importation refers to the importation and resale in a country, without the consent of the patent holder, of a patented product that has been legally marketed in the exporting country, thus allowing one to "shop around" for a good price and enabling competition. The TRIPS Agreement states that such trade cannot be challenged under the WTO dispute settlement mechanism, leaving countries the freedom to choose whether or not to allow parallel importation.

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A compulsory license allows the use of an invention without the permission of the patent holder, such as allowing the production and sale of generics before the patent expiration, thereby increasing opportunities for competition. The Government, which grants the patent, retains the right to limit that privilege, if necessary. Many countries, including developed ones, have provisions for compulsory licenses in their national laws. The TRIPS Agreement specifies conditions that are to be imposed by Governments when issuing a compulsory license, which should be non-exclusive and non-assignable, and include case-by-case decision, trying to first obtain a voluntary license and adequate remuneration to the patent holder predominantly for the supply of the domestic market.

Paediatric Essential Medicines The World Health Organization (WHO) and the United Nations Children's Fund (UNICEF) jointly held on 9 and 10 August 2006 in Geneva the first international Expert Consultation on Paediatric Essential Medicines, where they delivered a plan to boost access to essential medicines for children. More than 20 countries, non-governmental organizations and regulatory agencies participated. A top priority resulting from the meeting is to dramatically expand access to child-focused formulations, such as fixed dose combinations (several pills in one), which are crucial for children's correct use of medicines and adherence to treatment. The plan also calls for the improvement of medicines and prescribing guidelines for infant and childcare needs. Other priorities include respiratory infections, neonatal care and palliative care for end-stage AIDS, HIV/tuberculosis co-infection and other opportunistic infections, as well as improved electronic access to the latest WHO drug information. High priority will be given on ensuring a holistic approach to childcare and treatment, including addressing quality of life issues, such as producing painless remedies over injections, better tasting medications and investigating new mini-tablet presentations. Emphasis will be placed on considering the climate zone requirements linked to distribution and use whenever new product formulations are made. For example, chewable or soluble powders are preferred over syrups, which do not require refrigeration and are less bulky to transport. WHO will consider several children's medicines for inclusion in the WHO Essential Medicines List in March 2007.