Intellectual Property Watch

9 December 2005

Peru’s Acceptance Of IP Terms Led To Trade Pact With US

By Martin Vaughan for Intellectual Property Watch

Washington, DC-An agreement by Peru to accept United States demands on protecting intellectual property rights, including protections for pharmaceutical test data found in other US free trade agreements, paved the way for a final deal on a US-Peru free trade pact.

US Trade Representative Rob Portman and Peruvian Minister of Foreign Trade Alfredo Ferrero Diez Canseco announced the conclusion of US-Peru negotiations in Washington on 7 December, after two days of round-the-clock negotiations.

A senior US trade official said Peru had agreed to enforce restrictions on the use of pharmaceutical test data for name-brand drugs for five years after the drug is registered, and for ten years for agrochemicals.

The data protection language in the agreement is the same as what has been included in other US free trade agreements like the Central America Free Trade Agreement, the official said. It goes beyond what is required by the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights, because the TRIPS agreement does not specify a period for protecting test data, among other things.

Peru and other Andean countries had long resisted that provision. Colombia and Ecuador broke off negotiations in November - in part because of differences with the US on intellectual property - and said they would try again to conclude the talks after the New Year. Peru, whose President Alejandro Toledo was eager to conclude a deal with the United States before Peru’s presidential elections early next year, chose to continue negotiating with the US on its own.

The US data protection proposals have been a stumbling block for Colombia in the negotiations. An advisor to the Colombian Health Ministry who had been involved in negotiations, Luis Guillermo Restrepo Velez, publicly resigned his post 2 December. In a letter, Velez said his resignation was to protest Colombia’s abandoning the Andean proposal on intellectual property, which offered three years of data protection, and embracing the US text.

James Love, Director of the Consumer Project on Technology, a non-governmental group that advocates for cheaper medicines, said the Peru agreement is an example of how insistence on strict intellectual property protections in poor countries hurts the US image abroad. He noted that Peru’s small economy would not provide a large market for US pharmaceutical firms. “We give up a lot of goodwill to give Pfizer what is essentially a rounding error on their balance sheet,” he said.

US officials contend that without such protections, drug companies may not launch innovative medicines in developing countries.

A US trade official said in a conference call with reporters that the agreement includes language sought by Peru that underscores the importance of traditional knowledge and biodiversity. But the language also makes clear that “there are broader trade rules governing these considerations,” the official said.