Free Trade Deal Threatens Medicines

Date: 19 December 2003

Australia's major health, welfare and consumer groups today issued a joint statement of concern that US free trade negotiators are pursuing back-door changes to Australia's patent protections that could limit
access to generic drugs - leading to higher prices for Australian medicines.

Professor Peter Sainsbury, the President of the Public Health Association of Australia, said:

"Despite assurances from the Minister for Trade, Mark Vaile, that Australia's Pharmaceutical Benefits Scheme (PBS) is not up for grabs in the free trade negotiations, there are worrying signs that prices for medicines could still rise as a result of the US-AUST Free Trade Agreement negotiations that are due to recommence early in the new
year.

"The Minister's statements as well as those by the leading US negotiator Ralph Ives and the Australian negotiator Stephen Deady are very carefully worded to rule out changes that would directly affect the PBS."

"However they have not ruled out changes to Australia's patent protection regulations which could have virtually the same effect."

"Recent research by the Australia Institute shows that changes to Australia's patent protection regulations could severely limit competition from cheaper generic drug producers against the expensive products of American drug companies."

"Such changes could lead to a $1 billion rise in the overall cost of medicines to Australian consumers."

"It is time for the Government to specifically rule out the possibility of a rise in Australian medicine prices as a result of the US-Aust Free Trade deal."

"The Public Health Association has today joined with the Australian Consumers' Association, the Australian Council of Social Service, the Doctors' Reform Society and other major health, welfare and consumer groups to issue a joint statement of concern."

"We call for the Free Trade Agreement negotiations to specifically exclude from discussion patent protection regulations and the rules relating to the provision of generic medicines in Australia, as well as the Pharmaceutical Benefits Scheme."

JOINT STATEMENT ON MEDICINES - AUSTRALIA-US FREE TRADE AGREEMENT

December 2003

Major Australian health, welfare and consumer groups call for the Australia-United States Free Trade Agreement to exclude any consideration of changes that would either directly or indirectly undermine price controls for Australian medicines. Accordingly, we call
for the Free Trade Agreement to exclude from discussion patent protection regulations and rules relating to the provision of generic medicines in Australia, as well as the Pharmaceutical Benefits Scheme.

While we welcome the assurances of the Australian Trade Minister that the Government is not prepared to adjust the policy which delivers affordable medicines to all Australians through the Pharmaceutical Benefits Scheme (PBS), it is clear that the US is still pushing hard for Australians to contribute more to the already massive profits of American drug companies.

The new Medicare Bill just passed by the US Congress specifically requires the Bush administration to report to Congress on progress towards opening up Australia's drug pricing system.

US Lead Negotiator Ralph Ives recently stated that: "... in terms of the PBS we, like most issues, like every issue, we discussed the issue. There are different ways of presenting a particular position to another government. I'd rather not get into how we did it in the PBS. We made very clear the US objectives for the PBS for Australian consideration."

Australia's Pharmaceutical Benefits Scheme (PBS) has been described as the best drug pricing system in the world because it delivers value for money prescription drugs for individual consumers and for the Australian taxpayer.

For this reason the PBS has been the target of sustained attack by elements within the drugs industry who are afraid that other countries will follow Australia's lead.

The US is now demanding that changes be made to Australian patent protection regulation which would severely limit competition from cheaper generic drug producers against the expensive products of American drug companies.

A recent Australia Institute report concluded that if the American multinationals succeed in changing Australian patent laws then Australians can expect to pay $1 billion more a year for medicines.

Australia cannot afford to sacrifice equity and risk a significant growth in PBS expenditure by curtailing the supply of cheap and effective generic medicines and allowing expensive brand name American drugs to wash through the market with little competition.

Without the supply of generic medicines Australian consumers - who are already being burdened by increasing PBS co-payments - will pay more for essential medicines. This will further disadvantage people who are sick or poor, older people and Indigenous Australians.

Signatories to the Statement (and spokespeople)

Alcohol and Other Drugs Council of Australia

Anglicare Australia (Russell Rollason, 0418 149 203)

Australian Association of Social Workers (Ian Rentsch 0419630892)

Australian Consumers Association (Martyn Goddard, 0411 788076)

Australian Council of Social Service (Sue Ham, ph 0417 582 975)

Australian Injecting & Illicit Drug Users League (AIVL)

Australian Nursing Federation (Jill Iliffe, 0419 576590)

Australian Pensioners & Superannuants Federation

Australian Tinnitus Association (NSW) Ltd

Brotherhood of St Laurence

Council of Social Service of NSW

Deafness Forum of Australia

Doctors Reform Society (Tim Woodruff, 0401 042619)

Immigrant Women's Speakout Association of NSW

Meniere's Support Group of Victoria Inc

Meniere's Support Group (Tas) Inc.

Mental Health Association of NSW

National Aboriginal Community Controlled Health Organisation (Dea
Delaney Thiele, 0417 046 692)

National Council of Single Mothers and Their Children

National Ethnic Disability Alliance

People With Disability Australia Inc

Physical Disability Council of Australia

Public Health Association of Australia (Peter Sainsbury, 0404 014
261)

SANE Australia

South Australian Council of Social Service

Tasmanian Council of Social Service

For further information

Contact:	Professor Peter Sainsbury, President of the Public Health
Contact Mobile:	0404 014 261

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