A lot of drug companies are getting increasingly nervous about the ability of developing countries to override their patent rights in the interest of public health. In the past year, both Brazil and Thailand issued compulsory licenses for Efavirenz, a drug used to treat people infected with HIV/AIDS. Thailand overrode Merck & Co.'s patent on Efavirenz in December 2006. Brazil overrode it in May 2007.
The countries acted under Article 31 of the WTO's IP treaty, the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs).
The drug companies are one reason why so few countries have ratified Article 31bis. "They are lobbying a lot," says Elizabeth Haanes, an international drug patent attorney at Sterne, Kessler, Goldstein & Fox in Washington, D.C.
The companies are worried that the countries will divert drugs from the poor people who need them and resell them in more developed countries, thus harming patentees' full-price sales in those markets. Companies are also concerned that if drug prices are slashed in foreign countries this will generate political pressure in the U.S. to cut prices here, too.