Transfer Pricing Associates

South Africa: affordable vs. innovative medicines

post Thursday January 23, 2014

Tags: ip, policy, south africa

Pillen - hartvorm

South Africa faces a moment of truth. The South African Trade and Industry Minister Rob Davies is currently crafting the South Africa National Intellectual Property Policy and this lighted up the debate about access to drugs and affordable medicines.

IP protection is needed because it ensures that new products, such as life changing drugs, can be developed. It is a tough dilemma because, on the one hand we want affordable medicines for the citizens and on the other hand protection is needed to stimulate innovation to develop new medicines for the future.

A hard decision has to be made by the policymakers. They need to choose between shoring up the protections that encourage the development of medicines that enhance and extend life, or sabotaging innovation through weakening the patent system.

The drug companies umbrella body, the Innovative Pharmaceutical Association of South Africa (IPASA), chose a Washington-based, lobbying firm called Public Affairs Engagement (PAE) to lead the charge against the draft IP policy in South Africa. The plan was to launch a campaign throughout Africa an d Europe to strengthen the patent protection for crucial drugs.

In September 2013 the South African Trade and Industry Ministry published some key features of the draft IP policy in the government gazette. Two key features are patent protection for drugs and a substantive patent review system. 

South Africa has the highest number of HIV infected people in the world. Since 1995, the death rate from HIV/AIDS had decline with 85 percent because of, among others, innovative drugs. This shows the importance of these drugs. For this and also for other diseases it is essential that new medicines can be developed in the future to improve the quality of life of people.

India implemented its patent law in 2005 and hoped that innovation activities would increase. The patent law was one of the commitments it needed to fulfill in order to access the World Trade Organization (WTO). India adopted stronger intellectual property rules that would grant the international pharmaceutical industry greater protection and control India’s generic industry. But now, only two companies are doing research in India and investment funds have dropped. Investors need to have confidence in the locational decisions and assurance of intellectual property rights before they decide to enter the market.

South Africa can learn from this when modeling their own IP policy. They have to choose between progress and hope for new medicines or for weakening the patent system which most likely will result in more affordable medicines but fewer innovation in life changing medicines in the future. 

Source: IP Watchdog, IP Watch and Financial Times
Image courtesy of Nixxphotography /
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