http://www.ft.com/cms/s/0/85f21278-eb97-11dc-9493-0000779fd2ac.html
Europe must use its head on academic research
By Bruno van Pottelsberghe
Financial Times - Leaders & Letters
Published: March 7 2008
The European Union summit next week is set to decide that the main policies of the much-maligned Lisbon strategy, which aims to make Europe the world's most innovative region, should be carried through until 2010.
And why not? Though average growth is sluggish, the EU has created almost 6.5m jobs in the past two years and 5m more are expected by 2009. Average unemployment is expected to fall to below 7 per cent this year, the lowest since the mid-1980s. The Lisbon benchmark of getting 70 per cent of the adult population into work by 2010, which escaped the EU's recent purge of targets, no longer looks impossible.
[ONE MUST SERIOUSLY QUESTION WHETHER THE JOB GROWTH HAS BEEN IN THE GOVERNMENTAL SECTOR]
So far, so good. But one vital Lisbon policy area is going backwards: research and development.
As the European Commission itself concedes, the proportion of the EU's gross domestic product spent on R&D has actually dropped since the Lisbon strategy was launched. After flatlining for two decades, research spend fell from nearly 2 per cent in 2000 to 1.85 per cent in 2006, thus moving the EU further away from its target of 3 per cent (recently trimmed to 2.6 per cent) by 2010. But what is a target for overall R&D spending worth? Missing the target is bad enough. But publicly missing the wrong target is perverse.
Europe's spend is well below the US's 2.5 per cent and Japan's score of more than 3 per cent. China has engineered a dramatic increase, from nearly nil 10 years ago to 1.5 per cent in 2006. Of course, there are big differences between EU member states. Finland and Sweden leapfrogged the 3 per cent target several years ago. But the vast majority of EU countries spend well below 2 per cent of their GDP on R&D. Does this matter? Yes and no.
No EU member state fulfils the original commitment that governments should finance one third of investment in R&D, or the equivalent of 1 per cent of GDP. Many have reduced their support over the past 10 years, including the UK, Germany, France and the Netherlands. This matters. EU governments should increase their spend and honour their promise. Failure to do so ultimately means lower growth.
As for business, spending varies widely between countries, but these variations are to a great extent attributable to differences in technological specialisation. If a country specialises in information and communication technologies (such as Finland) one would expect a higher R&D intensity than for a country specialising in finance (eg Luxembourg) or tourism. Thus measuring EU countries' private R&D spend against a common benchmark makes little sense. Also, governments cannot decree business spending from on high: it does not respond to policymakers' targets.
What, then, should the EU and governments do to get business to invest more in research? When industrial specialisation is taken into account, only Sweden and the US outperform other countries. According to a Bruegel policy brief ( Europe's R&D: Missing the Wrong Targets ), two factors may explain this and point to what the EU's policy focus should be.
For the US, its large, homogeneous market radically improves the expected return on research activities and hence fosters business R&D spending. Europe does not benefit from such a scale effect despite its larger size because its market is still highly fragmented.
Market size may explain the US R&D spend, but it does not explain the Swedish case. One clue: Sweden has a very high level of spending on academic research, the highest as a percentage of GDP in the whole Organisation for Economic Co-operation and Development area. This strong emphasis on academic research is a stimulus for business R&D: universities generate new ideas, then business is attracted in to develop them, individually or in clusters, foreign or local. The European countries with the highest academic R&D intensities are also those with the highest business R&D intensities.
True, the EU has recognised the need for free movement of knowledge, the "fifth freedom", and has pushed for a new European Institute of Innovation and Technology. Both initiatives may bear fruit in time. But the bottom line is that the EU needs now to adopt a common European patent - under discussion for 30 frustrating years - and spend more, and more wisely, on academic research. These two steps would do more for the success of the Lisbon strategy - and for the EU's credibility - than maintaining top-down targets for business spend on R&D.
The writer is a senior fellow at Bruegel, the Brussels-based think-tank and professor at Université Libre de Bruxelles
Copyright The Financial Times Limited 2008
Sunday, March 9, 2008
Europe Must Use Its Head On Academic Research
Saturday, March 8, 2008
Thai Health Activists Are Misled To Believe Their Government is 'Licensed' to Steal Private Drug Patents From Foreign Investors Pursuant To WTO Law!!
Letter to Editor from Thai Network of People Living with HIV/AIDS, concerning "Bangkok's Drug War, Round Two"
Thu, 6 Mar 2008
Dear Editor,
I am one of the 'packhounds' that you accuse of spreading scare stories in your editorial (Bangkok's Drug War, Round Two) of 27 February 2008. My organization, which consists of people living with HIV/AIDS in Thailand, supports access to necessary drugs for all Thais, not just the rich minority that can pay the prices charged by pharmaceutical companies enjoying monopoly patents.
[THE THAI GOVERNMENT HAS THE LEGAL & POLITICAL RIGHT TO DEVELOP AN HIV/AIDS UNIVERSAL ACCESS TO MEDICINES PROGRAM AT ITS OWN EXPENSE. BUT IT DOES NOT HAVE THE RIGHT TO DEMAND FINANCIAL SUPPORT FROM FOREIGN INVESTORS; OTHERWISE IT RISKS TRIGGERING CAPITAL FLIGHT].
Your article is sadly misinformed. What you call the 'loophole' of compulsory licensing (which is what has kept some of my friends alive) is in fact a piece of international law that was heavily negotiated and agreed by all member countries of the WTO.
[THIS IS NOT TRUE. THERE WAS NEVER A CONSENSUS ON THE SCOPE OF THE COMPULSORY LICENSING PROVISIONS WHICH HAS BEEN EXPLOITED BY FOREIGN GOVERNMENTS AT THE INSISTENCE AND ENCOURAGEMENT OF ACADEMICIANS AND NGOS].
The Thai government did not 'seize' patents; it used the same legal right that many other countries have used, including the United States, whose threats of trade sanctions so worry the new Thai Minister of Public Health.
[WHEN HAS THE UNITED STATES ACTUALLY ISSUED A DE JURE COMPULSORY LICENSE?? PLEASE DO NOT RELY ON THE MISLEADING INFORMATION PROVIDED BY KEI'S JAMIE LOVE].
You claim that the need for access to life-saving HIV, heart disease and cancer drugs is not a clear emergency in Thailand. Cancel the free distribution of drugs made possible through compulsory licences and thousands of Thai will be dead in weeks. The emergency is clear enough to them.
[WITH THIS RATIONALE, ANY DISEASE THAT INFLICTS A SUBPORTION OF A POPULATION WILL BE DESIGNATED AS AN 'EPIDEMIC' UNDER THE EVOLVING WORLD HEALTH ORGANIZATION STANDARDS AND THEN DECLARED A 'HEALTH EMERGENCY' FOR PURPOSES OF TRIPS!!]
And you claim that 'the other side of the argument' is 'missing'. Given the intense lobbying of the new Minister by what you call 'Big Pharma', supported by the US government and enjoying far richer resources than my organization can muster, this is hard to swallow.
[PHARMA COMPANIES HAVE LEGAL ECONOMIC RIGHTS TO DEFEND THEIR EXCLUSIVE PRIVATE PROPERTY, AN ECONOMIC ASSET AGAINST GOVERNMENT EXPROPRIATION. WHY IS IT WRONG FOR THEM TO PROTECT THEIR PRIVATE INTERESTS???]
It took my organization and our allies (in the government, the media, and academia, as well as in other NGOs) a long, long time to get our government to exercise its legal right to compulsory licensing.
Please do not misrepresent our case, bully our government or call us names.
Virat Purahong,
The chairperson of Thai Network of People Living with HIV/AIDS (TNP+)
494 Soi Nakornthai 11
Ladproa 101 Road,
Klongjan, Bangkapi
Bangkok, Thailand 10240
Tel (66)2377-5065 Fax (66) 2377-9719
E-mail : tnpth@thaiplus.net
A One-Side Argument Will NOT Ensure the Health of the Thai People
http://online.wsj.com/article/SB120406606358794697.html?mod=opinion_main_europe_asia
Bangkok's Drug War, Round Two
THE WALL STREET JOURNAL ASIA
February 27, 2008
Thailand's military government may be gone, but its war on drug patents is still very much alive. Just ask the new Health Minister, Chaiya Sasomsup, who is thinking about restoring intellectual property rights to their rightful owners -- the pharmaceutical companies.
Mr. Chaiya, who took office this month, is trying to clean up the mess bequeathed by his predecessor, Mongkol na Songkhla. Citing a World Trade Organization loophole, Dr. Mongkol seized patents on Merck's HIV/AIDS drug Efavirenz in 2006. In 2007, he took another HIV/AIDS patent -- Abbott Laboratory's Kaletra -- and Sanofi-Aventis's patent for a heart drug, Plavix. His last act before leaving office last month was to sign an order to seize four cancer drug patents: two from Novartis, one from Sanofi-Aventis, and one from Roche.
Mr. Chaiya is worried both about Thai patients' access to new drugs and trade sanctions against Thailand for seizing patents. Fair enough: The WTO provision Dr. Mongkol used specifies patent seizures are allowed only after "efforts to obtain authorization from the right holder on reasonable commercial terms and conditions," or in cases of "national emergency." It's unclear that Thailand's actions fit either circumstance.
But woe be to Mr. Chaiya to utter such heresy in Thailand, where nonprofit groups such as Oxfam 
What's missing here is the other side of the argument.
Many drug companies tier their pricing, charging developed countries more and developing countries such as Thailand, less. Thailand also faces a range of delivery problems that raise the ultimate cost of drugs to consumers, including high taxes on imports. Not least, seizing patents also puts patients at risk of importing nonbranded, lower-quality drugs.
Mr. Chaiya's job is to look after the health of the Thai people, not the political motivations of NGOs. It's clear what serves Thais best: drug companies that are incentivized, through the profit motive, to research and develop new drugs.
Thai Government Commissions Two-Week 'Study' To Find Country-Wide Cancer Health Emergency: Seeks To Justify Compulsory Licenses
http://nationmultimedia.com/2008/03/03/national/national_30067110.php
No cancellation of CL for cancer drugs : Chaiya
by Pongphon Sarnsamak
The Nation.
March 3, 2008
"The use of compulsory licensing must be continued alongside the negotiation with pharmaceutical companies to reduce the price of drug products," he said.
The Health Ministry has to retain compulsory licensing as an important tool to help give patients access to livesaving drugs. But the drugs, upon which compulsory licensing was imposed by his predecessor, Dr Mongkol Na Songkla, had not yet been approved by the previous Cabinet, he said.
Moreover, the Ministry of Commerce had informed him that the compulsory licensing of cancer drugs would affect Thailand's international trade, particularly with the United States, which may designate a country as a "Priority Foreign Country" if it has an adverse impact on relevant US products.
This was the reason why the Health Ministry earlier announced a revision of the compulsory licensing enforcement for cancer drugs.
The drugs for which compulsory licensing was imposed on January 4 are docetaxel, sold as Taxotere by Sanofi Aventis; erlotinib, sold as Tarceva by Roche; and letrozole, sold as Femara by Novartis. All are expensive and the poor could not afford for treatment.
"Some information and the process of the recent imposition of compulsory licensing for cancer drugs was not legal because it was not imposed by Cabinet resolution," he said.
To implement compulsory licensing and not affect international trade, Chaiya had assigned the National Health Security Office, the National Cancer Institute and health experts to calculate the total number of patients suffering from leukaemia and breast, lung and gastric cancer, which would help the ministry estimate the budget for imported drugs.
A study is now in process and is expected to conclude in the next two weeks. The results will then be submitted to the Cabinet for a decision on this controversial issue.
However, he said it is the duty of the Minister of Commerce to make the decision to revoke or retain compulsory licensing.
Government Pharmaceutical Organisation chairman, Vichai Chokewiwat said the recent imposition of compulsory licensing for cancer drugs could not be revoked by the Ministry of Commerce because the 1992 Patent Law's Article 51 allows any Ministry to announce compulsory licensing for the noncommercial use without approval by the Ministry of Commerce.
He said if the government makes a decision to cancel the recent compulsory licensing it would violate the constitution and the National Health Security Office Act, which appoints the government to provide cheap drugs and effective treatment for patients.
