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Home Publications Blogs CEPR Blog Top Secret Trade Deal WikiLeaked: It Is What We Expected

Top Secret Trade Deal WikiLeaked: It Is What We Expected

Friday, 15 November 2013 11:15

WikiLeaks once again provided a valuable public service, releasing a working draft of the Trans-Pacific Partnership’s (TPP) chapter on intellectual property. The chapter has many of the provisions that critics had feared.

Specifically, there are several provisions that will increase protectionism in the prescription drug market, pushing up prices in the countries that sign the agreement. There are also provisions that would strengthen copyright protection, increasing the responsibility of third parties to assist copyright holders in enforcing their copyrights.

The greater protection for prescription drugs takes a variety of forms. For example, there is wording that would require countries to allow patents for new combinations of existing drugs. This has been a hotly contested issue internationally.

India’s Supreme Court recently upheld a decision to withhold a patent for the cancer drug Glivec. This drug, which sells for as much as $100,000 for a year’s dosage in the United States, is a combination of previously approved drugs. On this basis India refused to award a patent. As a result, Indian patients can get a generic version that costs around $2,000 a year.

The TPP also provides for stronger and longer protection for test data used to establish a drug’s safety and effectiveness. If this gets into law, patients in many countries will likely have to wait longer before having access to generic versions of drugs.

The US proposed language for the TPP that would require countries to issue patents for medical procedures. This means that a surgeon who has developed a creative way to carry through a particular operation – or was at least able to get a patent issued — would be able to sue other doctors for doing similar operations.

There are also numerous provisions strengthening rules on trademarks and copyrights. The most important provisions with respect to the latter are probably the sections that could lead intermediaries to be held liable for unintentional copyright infringement. For example, a website host could possibly be held liable for infringement if a person had posted video or written material that was subject to copyright protection.

The direction of this chapter is to take commerce 180 degrees in the opposite direction of free trade. It is all about increasing protectionism – and in almost every single dispute the US takes the strongest protectionist position possible. And, as the economics textbooks tell us, protectionism leads to higher prices, economic distortions and waste and corruption.

While the whole thrust of the chapter is to increase protections, the statement of objectives does include the following somewhat inspiring statement (opposed by the United States):

The protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations.

[And to] support each Party’s right to protect public health, including by facilitating timely access to affordable medicines.

This is nice wording. Together with a couple of dollars it should buy you a cup of coffee.

Comments (2)Add Comment
written by Robert Sadin, November 15, 2013 2:45
Dean— You and Yves Smith have been invaluable ...essential. And that is only one chapter out of 29!!!

The loyalists are a pretty sorry crew at this moment. The worst is probably Krugman...who seems determined to never mention a word about this abomination. Does it come up on MSNBC? not very much if at all.

Keep it up!!!!
And then there's Chagas disease
written by Mike the Mad Biologist, November 18, 2013 1:55
As a side note of the drug patenting, the U.S. is trying to prevent drugs that would treat Chagas disease from patent exemption–pretty despicable


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