Letter to Condoleezza Rice, Secretary of State and Ambassador Susan Schwab, United States Trade Representative
December 29, 2006

Honorable Condoleezza Rice, Secretary of State
U.S. Department of State
2201 C Street NW
Washington, DC 20520

Ambassador Susan Schwab, United States Trade Representative
600 17th Street, N.W.
Washington, DC 20508
United States of America

New York, December 29, 2006

Dear Secretary Rice and Ambassador Schwab:

I am writing to express Doctors Without Borders/Médecins Sans Frontières (MSF)'s concern that the United States Department of State and the United States Trade Representative have intervened in the decision by the government of Thailand to issue a compulsory license on patents for the AIDS drug efavirenz, and to explain why the US government should refrain from such actions.

The US government is reportedly asking the Thai government to engage in prior negotiation with patent owners before issuing compulsory licenses. Not only is this not required under the World Trade Organization (WTO) rules when the compulsory license is for government use, it is not required under US law. What the WTO does require is that Thailand "promptly" notify the patent owner when it issues a compulsory license. Thailand has clearly done this. The US government should not be overseeing the management of Thailand's dealing with the patent owners as long as Thailand abides by its WTO TRIPS obligations.

In 2001, the United States government and every other member of the World Trade Organization (WTO) announced the signing of the Doha Declaration on TRIPS (Trade-related Aspects of Intellectual Property Rights) and Public Health. This historic agreement said:

We agree that the TRIPS Agreement does not and should not prevent members from taking measures to protect public health. Accordingly, while reiterating our commitment to the TRIPS Agreement, we affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO members' right to protect public health and, in particular, to promote access to medicines for all. In this connection, we reaffirm the right of WTO members to use, to the full, the provisions in the TRIPS Agreement, which provide flexibility for this purpose.

Thailand is obviously trying to do exactly what the Doha Declaration promised it could. Respecting Thailand's decision to exercise its right under the Doha declaration is a matter of urgent concern for Thai patients in need of affordable AIDS treatment.

The drug efavirenz, which is recommended by the World Health Organization (WHO) for HIV/AIDS treatment, is currently patent protected in Thailand, and the monopolistic situation has affected both supply and affordability in the country. The price the patent holder Merck charges in Thailand (1,400 baht/month – US $39) is double of what Indian generic manufacturers charge for the drug (650 baht/month – US $18). In addition, on several occasions, Merck has been unable to supply the drug in Thailand. It is estimated that at least 12,000 people in Thailand currently need efavirenz, but that due to cost and supply difficulties, the number receiving the drug is significantly lower.

MSF has worked in Thailand since 1976. The organization began providing ARV treatment to people with HIV/AIDS in 2000 and we have witnessed the development of the Thai AIDS treatment program. Generic production is the cornerstone of Thailand's universal HIV/AIDS treatment program. Before generic production, the cost of standard HIV/AIDS treatment in Thailand was over 33,330 baht per patient per month (US $924), and only 3,000 people were getting treatment. In 2002, Thailand launched a generic version of HIV/AIDS triple therapy, resulting in an 18-fold drop in the cost of treatment. Thanks to this, over 85,000 people with HIV/AIDS are today receiving treatment. UNAIDS reports that Thailand is the only Southeast Asian country to have over half of the total number of people on AIDS treatment who need it.

Both the WHO (in August 2005) and the World Bank (in August 2006) have predicted dramatically rising drug costs in Thailand due to the fact that patients need to switch to newer and more expensive drugs in cases of resistance and toxicity. Both organizations recommend the use of public health safeguards enshrined in the Doha Declaration on TRIPS and Public Health.

Issuing and executing a compulsory license, allowing both importation and local production, will increase supply and affordability of efavirenz to the benefit of Thai patients. Creating a competitive generics market for efavirenz and other newer AIDS drugs that are patented in Thailand and other markets is critical to maintaining patients under treatment as natural resistance to first-line ARV therapy increases, as well as to scaling up ARV treatment.

Thailand's decision will have important consequences, not only for Thailand, but for any developing country that needs to obtain low-cost generic products. If Thailand follows through and begins to buy from generic suppliers, it will create a larger global market for generic products, stimulate competition, and lower prices everywhere for the newer products. While the benefits of expanded generic competition are widely appreciated, many developing countries have been reluctant to issue compulsory licenses because of fears that the United States government will oppose such actions and exert pressure.

We ask that the United States government refrain from any opposition or interference with the Thai efforts to use WTO flexibilities to buy generic AIDS medicines -- including pressuring or otherwise seeking to persuade Thailand to engage in negotiations with Merck rather than proceed to execute the compulsory license it has issued.

Sincerely,

Nicolas de Torrente
Executive Director
Doctors Without Borders/Médecins Sans Frontières (MSF-USA)

Paul Cawthorne
Head of Mission, MSF-Thailand