Government strategies

This section provides an overview of conformity and resistance to the new strategic environment on the part of the case study countries and their generic drug sectors. These responses are characterized in some areas by common circumstances and capacities and in others by policy variance or different relative strengths of national economies and pharmaceutical sectors. It is worth noting that, in the terminology of the World Bank, we consider in this volume mainly lower- and upper-middle-income countries (an exception being high-income South Korea) whose typically high economic growth in the last two decades has granted them a degree of international political clout. They are also countries with technological capabilities and pharmaceutical sectors of some significance, and are therefore not completely dependent on foreign sources of essential and other medicines, as is the case with most low- and many lower-middle-income economies.

The majority of the case study countries have individually or collectively sought, by the use of TRIPS flexibilities and other mechanisms available in multilateral fora, to resist the impact of the global IPR regime on their ability to produce or import generics. Their powers of resistance are, of course, limited by their political and economic power, and their policy responses and approaches vary accordingly. It is fair to say, however, that several policies that challenge the norms, rules and basic political economy of the global IPR regime have attained legitimacy as a result of the application of human rights and public goods discourses to the field of health (Williams, 2012).

Yet, successes in changing the rules of the game that characterize the strategic environment—as with the Doha Declaration of 2001—have been tempered by failures and conformity to yet other TRIPS-plus IPR rules and instruments. Even countries such as Brazil and India, which have been most successful in insulating their populations from the negative effects of the IPR regime, have proven susceptible to pressures to conform to the wider system.

Clearly, government policy has an impact on local generics sectors, in terms of providing a legal environment and the conditions under which MNCs and patented drugs enter national markets. Generic firms are also important actors in their own right. This volume and other studies have shown that the generic sectors in the Global South are very different in terms of size, range of medicines produced, orientation to export markets and the extent to which they support domestic health needs (Kaplan and Laing, 2005). Differences are apparent in terms of firms embarking on innovation, and in capacities for the production of APIs. Many countries, having generic sectors with only basic capabilities, concentrate on reformulations and packaging of basic essential drugs (Correa, 2011; see also Kaplan and Laing, 2005).

The capacity of domestic pharmaceutical companies and the size and weight of national markets also shape the ability of governments to resist external pressures (Yu, 2008). In particular, this is an acute problem in countries with little or no manufacturing, as rules for compulsory licensing for imports and parallel importation are complex and intimidating. This creates dependence and vulnerability with respect to drug supply and very limited space for strategies of resistance.

The case study countries have all contributed to the new political economy of pharmaceuticals presaged by TRIPS. In doing so, they have taken into account health needs and crises (especially HIV/AIDS) and strategies for economic and scientific-technological development. Responses to the wider strategic environment do not reflect passivity in relation to the structural and relational power of those agents which have assiduously promoted the global IPR regime, though resistance in areas such as IPR enforcement has been weak, at least until recently (Yu, 2011). In fact, there are multiple instances of willing adoption and enforcement of TRIPS-compliant standards or other market exclusivities. Pakistan, South Korea, Malaysia (with some exceptions) and Turkey are 'TRIPS-maximalist' actors, favouring a strong version of the regime with little use of flexibilities. Yet, when one considers the diversity of policy responses across our case study countries (and in the wider LMIC community), particular strategic actions and policy responses often appear ambiguous or contradictory. A country such as Malaysia may at one juncture enact a compulsory licence for an HIV/AIDS medication, as it did in 2003-2004, but also participate in the negotiations for the Trans Pacific Partnership Agreement. Malaysia is also engaged in FTA negotiations with both the US (as of 2011) and the EU, where measures to forgo the right to such licences are on the agenda (Godwin, 2011). Other instances of similar schizophrenic policy can be found in Indonesia, and even in China and India.

It is clear from many instances of conformity and alignment that domestic politics weigh heavily, as do the strategic preferences of local generic sectors towards national IPR standards. Thus, external pressures—as described, for example, in Deere's (2009) analysis of the US Special 301 Report process—do not always explain conformity and alignment with the global IPR regime. In this volume, we find examples of domestic sources of 'TRIPS maximalism' in Turkey, China, Brazil (though not in relation to medicines), and increasingly in India. Here we explore contradictory strategic and policy responses across our case study countries with the aim of imposing some conceptual and analytic clarity upon the diverse signals and strategies present.

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