The TRIPS agreement and the Health Impact Fund

Introduction

This article is intended to complement the intellectual property (IP) debate and its connection to accessibility of medicines for the global poor with an inside into ethical philosophy.

The right to property has since a long time dominated the globe and its economic system. Under the, in 1994 introduced,Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) by the WTO, IP became internationally recognized and regularized as to obey the laws of property and this way the neoliberal trade rationale. Conclusively, the pharmaceutical industry is free and encouraged to put patents on their (life-saving) medicines and prevent the production of cheap generics in developing countries that generally cannot afford patented medicines from developed countries. Thus, the presented dilemma is one of the right to property on the one hand and the right to health on the other. The following problem statement results: From a philosophical ethics view, is the TRIPS agreement a morally right act?

This paper will firstly present a short argument for why we need to consider health as a global issue and how international institutions are involved in and responsible for global inequalities. Secondly, taking philosophical insights from Aristotle, Kant, Bentham and Levinas the paper will shed light on the discussion from different angles and hopefully result in a better understanding of the root causes of the dilemma and offer a possible and more ethical solution. Specifically, these philosophers will be consulted to relate to the idea by Thomas Pogge to implement a global fund for medicines, the Health Impact Fund (HIF).

The intention is to present the HIF as an ethical solution to current patent regulations, to create a more just and accessible health system. This fund is based on the idea of a pay-for-performance mechanism (Pogge, 2011). Given a product is registered with the HIF, it is obligated to sell everywhere at the price of production cost and thus guarantee a broader access to these medicines. To cover costs for R&D and incentivize continued business, financial compensation is given by the HIF, however, the specific amount is determined by a medicine’s impact.

After having consulted the philosopher’s arguments, in the conclusion the reader will find a summarized argument. What follows, is a short personal remark on the topic.

Globalization and Health

So much has already been said about the effects of globalization. The increased interconnectedness of formerly only nationally or regionally perceived phenomena is one of the most salient ones. However, the great impact the TRIPS agreement has on global health has not yet been successfully placed on the global agenda.

Ostergaard, Sweeney (2002) and Pogge (2005) point out that health is not a one-dimensional concern but cause and product of various interdependent phenomena. Low life expectancy, social exclusion and poverty can all be fitted in one equation with ill health. This equation, then, is conditioned by international developments and regulations as well as transnational developments of pollution and environmental degradation. The argument that poor development of a country can be explained only by national failure is no longer a strongly credible one (LaFollette, 2003; Pogge 2005). Too entrenched are global developments that we could possiblydeny economic inequalities are not part of a global dependency phenomenon. Pogge (2005) for example strongly doubts there is any moral justification for 995 million people in the affluent parts of the world are morally right to inhibit 81% of the world’s wealth. This cannot even be right if one argued, this generation has nothing to do anymore with historical events that created the current world order.

Yet, it is the global institutional order that still sustains and even fosters inequalities worldwide. It is international regulations that allow wealthier countries to apply protectionist measures and continuously disadvantage the poor (Sen, 2002). Recognizing the power of the international governments, also means it could possibly used to alleviate these inequalities.Consistently recognizing health as a global public good and part of the commons would be a first step for new hands-on regulations for a transnational health care.

However, asfound in Abbott’s (2002) analysis about the impact of the TRIPS agreement on public health, global responses to emerged public health concerns are poor. For example, the creation of the Global Fund by the United Nations as an attempt to react to developing countries’ worries about unequal access to medicines, only counts with little financial funds and is not a structural solution.Equally, global institutions such as the IMF, the World Bank or the WHO do not and partly do not want to adequately respond to the needs of developing countries (Abbott, 2002).

The TRIPS Agreement –a Good Habit for the Virtuous Man?

'The good must be something final and self-sufficient.' With these words introduces Aristotle the reader to idea of one and only one final end, which is the chief good towards which we need to strive. Yet, there are ends that constitute that one final end. For the field that interests us here, it is health, the original purpose/end of medicine. Health, however, is chosen as a means to reachthe final good, which is happiness (Eudemonia^[1] ), something never chosen for the sake of something else.

Then, to find this happiness is to find pleasure inone's virtuous actions. But only a just man can receive pleasure from a just act. However, it comes to the fore in Aristotle's writings that not every man has the predisposition to become a just man. Birth or genetics can predetermine one's good fortune. Critical might here be the question if Aristotle would have perceived disadvantaged countries as a kind of plebeian underclass (as opposed to the idea of aristocracy) to whom the concept of virtue is not accessible. As still 80% of global income variability is predetermined by a person’s birth country and class(Pogge, 2011), this argument seems valid. However, for the sake of progressive thinking we shall assume here that this is not the case.

He further states that legislators are able to form good citizens by establishing habits. Now, the question about habit and legislation is of great interest to our case. If it is true that virtuous behavior can be nurtured by habit, can we argue the other way around? Or at least, can we argue that the lack of these created habits does encourage non-virtuous behavior? If so, we should analyze which behavior is encouraged by the legislation at hand and which by the proposed HIF.

The TRIPS protects the intellectual property of every person that has the right to protection under the WTO's legislation. If now, a company introduces a new medicine against for example river blindness and it is patented and thus secured against the production of cheap generics that could destroy the market for their medicine. One might perceive this procedure as institutionalized honesty; it is the honesty to guarantee a person the benefits of one's effort. The WTO states: ‘Profits generated under patent protection are a reward for risk-taking and innovation (…) by the patent-holding company.’ (Abbott, 2002). Yet, it seems that this institutionalized habit comes at the expense of another even more important virtue, namely justice. Is not the person developing the medicine in a developed countryalready far more gifted through his socioeconomic context and historically conditioned development status than the sick person from a developing country that cannot afford the medicine in the end?

Now the argument could direct us in the opposite direction. Is not virtuous also to act just, friendly and generously? In our case, is it a moral obligation of virtue to help the disadvantaged to get access to health?The idea of the HIF might present a solution to this dilemma. Intellectual property rights are equally secured and the fund can guarantee an honest compensation. Negative externalities such as unequal access to the medicine are avoided.

The habit created by the mechanisms of the HIF can this way far more likely lead to the creation of good citizens. As Aristotle describes it, it is about becoming just by doing just acts and that way transforming by habit what was given by nature; transforming the man capable of being just into a just man.

Further, Aristotle speaks of training for moral excellence, a training directed towards feeling pleasure in doing virtuous acts and pain if the contrary occurs. A global institution such as the HIF might be considered part of such training as what is important is that ‘(...) we must act according to the right rule (...)' (Aristotle, 2003). To internationally determine these right rules seems to one of the greatest challenges of today.

To develop a medicine that increases the health impact as best as it possibly can, is a possible rule potentially, or at least theoretically, achieved by the HIF. Generally, the creation of a good medicine will be rewarded by society and financially compensated by all stakeholders. Although the financial compensation might be a wrong incentive in the first place, so did also the little boy in Aristotle's example learn to truly love playing chess by the initial enticement of sweets.

The Health Impact Fund – A Better Way to Reach Happiness?

Equally Jeremy Bentham's ethics are concerned with the power of pleasure and pain. However, for him, actions are not directly valued by their intrinsic virtuous value but by the amount of pleasure or pain they produce for every person.Bentham´s ‘hedonistic calculus’ implies an ethics that proclaims: ‘the end justifies the means’ (Bentham, 1996).

In this sense, one might easily refer to the argument of TRIPS advocates. The introduction of patent laws serves as a motivation to encourage the production of innovative and good medicines as it offers great financial compensation. R&D of medicines is a risky and cost-intensive business, thus the common argument is only promising financial return might trigger the intention to undertake this venture (Pogge, 2011). Further, advocates claim that the production and final sale of generics is a moral crime and IPR are a moral necessity (Pogge, 2011).

They might even be right if we intend to apply Bentham’s way of reasoning. With the current incentive structure in place, pharmaceutical companies might decrease their R&D efforts if cheap generics would be permitted. Patents are a way for developed countries to secure domestic employment and guarantee sales in oversea markets for IPR medicines (Ostergaard & Sweeney, 2011& Abbott, 2002). This way, the consequence of the permitting the production of generics would signify a decrease in the overall occurrence of innovation due to a lost financial incentive. Although many (poor) people receive pleasure from available generics, the pain experienced by humanity in the long run (see Bentham’s law of fecundity) when medicines are not further developed would clearly outweigh a system without patents.

Yet, even the positive outcome of possibly continued R&D through the mechanisms of the TRIPS agreement entails negative consequences that should convince us that the WTO did not decide on the bases of Bentham’s hedonistic principle. In the way, the system currently works, diseases such as malaria or diarrhea are given less research attention than diseases prevalent in developed countries as for example profitable ‘medicines’ to reduce wage.Banerjee, Hollis and Pogge (2010) further found that a common strategy in the pharmaceutical industry is the development of maintenance drugs that are generally more profitable on the market as they have to be consumed (and thus purchased) continuously. Additionally, producers are driven to invest high resources into marketing to distribute their medicines.

In the end, it is the dependent consumers, and that is mostly the consumers in developing countries, that have to carry the burden of a wrongly incentivized industry. The efforts of the pharmaceutical industry should result in global health and thus the greatest utility for the greatest number of people. It should here also be mentioned that Bentham only agrees to honor values as long as they are not detrimental to themselves (Pettit, 1991). In this case, the intrinsic value for pharmaceutical actors should be global health, however, the actions motivated by the WTO are not fully promoting health, but rather provoke greater health disparities. As values are expressed through actions, for global health, we should consider a different strategy.

Whenwe consider the idea of the HIF which aims at the creation of equal access of everyone to the best available medicines, we might discover a greater utility for all people and more consistency in values.From Thomas Pogge’s perspective the HIF serves humanity firstly morally and secondly financially. Morally in the way that it advocates the best for the greatest number of people and financially as he speculates that, boldly put, a healthy humanity is a productive one and serves the prosperity of humanity as a whole.

The mechanisms of the fund would guarantee that costs for R&D (the pain) are equally distributed over all participating countries and thus reduced as much as possible. Pleasure, on the contrary, is increased by cheaper access to medicines for every person, the impact incentive would lead to an increased security in the quality of a medicine and IPR would still be respected without having to deal with costly marketing strategies.

Argued in a utilitarian manner, the HIF is an ethical richer alternative to the TRIPS agreement on medicines. Additionally and in contrast to Aristotle’s perspective, every one person has the value of one in the consideration of number of people that suffer or derive pleasure from a certain action. That is to say the pain felt by a poor Kenyan prostitute with HIV has an equal value to the equation as the foreign affairs minister of Germany suffering from the same virus. With the HIF, medicine for this disease could be equally available to and almost equally affordable for both parties.

The Right to Health – A Universal Law?

Kant´s thoughts are motivated by the ‘categorical imperative’ and thus a rationale motivated no longer by its outcome (see consequentialism) but its actual intention. Seeing consequences as a means to guide moral behavior is too dependent on empirical ways of thinking and cannot possibly be a method to define a moral law which should be universally applicable (Kant, 1998). Kant, in turn, proposes to evaluate moral behavior by the use of hypothetical questions. For our case, it is interesting to look at his first and second formulation of the categorical imperative: (1) Act only according to that maxim whereby you can at the same time will that it should become a universal law without contradiction. (2) Act in such a way that you treat humanity, whether in your own person or in the person of any other, never merely as a means to an end, but always at the same time as an end.

Considering the TRIPS agreement, how would Kant´s imperative look like? You shall not make use of other people’s ideas without their permission? Or, you shall not profit from an existing medicine’s benefit if you cannot compensate the producer financially? The question is if this kind of imperative can be universally valid if we consider that numerous poor people die annually of curable or preventable diseases. The answer is of course dependent on the moral standards one has, but the fact that health disparities are undoubtedly connected to wealth disparities is one without dispute.

Yet, there might be other categorical imperatives that give a clearer response. We might say: you shall not make profit of the suffering of others. Or:every human being has a basic right to health and that is the best available treatment as stated in the article 25 of the Universal Declaration of Human Rights (World Health Organization, 2008). Or, how Kant says it: It is impossible for anyone to will that not assisting people in need becomes a universal law as it ‘(…) would rob himself of all hope of the assistance he wishes for himself.’ (Kant, 1998).This way, the current TRIPS regulations cannot possibly account for Kant’s first formulation as any pharmacists could not possibly will to be universal to his case. The universal law should, taking the idea of Rawl’s veil of ignorance, be the best option for oneself without knowing which position one possibly holds in society.

As argued beforehand, the TRIPS regulations do ‘clash’ with these statements as pharmaceutical efforts only partly contribute to actual health outcomes and the incentive to help a personis mostly financially motivated and limited (Pogge, 2011). Kant’s second formulation clearly judges such a behavior as morally wrong as global health for pharmaceutical companies often only serves as a means to reach their personal ends, financial compensation. Are they to consider a healthy humanityto be their end, their actions needed to be motivated with a different system.

For Kant, it is important that the individual is a free, autonomous being and that any action he commits, should follow from his own will. It is the freedom of the individual to ask: what ought I to do? What is my moral duty? As already mentioned in Kant’s first formulation, the individual must will, which is to be understood as an independent will, that his actions become a universal law. As the HIF is meant to work as a voluntary institution, innovators are free to register their products with the HIF and thus not obliged by any international legislation. But as well it is the idea to grant a free will to those who could possibly afford new medicines and free themselves from a disabling disease.

Empathy as the Right Way to Global Health?

The philosophy presented by Levinas (n.d.) is one strictly based on Christian values and a belief in empathy, specifically he refers to the idea of recognizing the face of the Other^[2]. Yet, Levinas does not refer to a mere visual perception of the Other, but to the act of truly seeing the Other and understanding him as part of a shared humanity. Most importantly, it is the obligation to take responsibility for him, which should, however, not to be confused with Bentham's concept of consequentialism. Levinas philosophy goes beyond a rational calculation of utility; he understands the Other as an implicit obligation to conduct a morally right life.

As far as we considered the idea of the HIF, it seems to incorporate the idea of institutionalization of empathy. Although, monetary aspects are still a great incentive in this model, it is based on the idea of alleviating the burden of the poor and accepting health as a global commons. The mere accession of a country to the HIF would demonstrate an awareness of the need to act and to take responsibility for not just one’s own country but humanity as part of ourselves.

For Levinas, people that profit from the WTO's current patent regulations in the field of medicine are probably one of the least responsible people. Their failure to recognize the suffering they could prevent, support and sustain is missing out on their most important obligation, the responsibility for the Other. They not only fail to assist where they could, they also actively impede others to do so. The allowance for cheap generics could already provide for many sick people in poor countries, without greatly compromising the gains pharmaceutical companies realize in developed countries. Although the TRIPS agreement considers the access to medicines a problem, only few attempts have been made to grant developing countries exceptions, not to talk of structural solutions.

It might be reasonable to argue that Levinas could find a source to the problem in the increasing alienation of poor and rich. Not directly seeing the face of the ill might incline many people working in the pharmaceutical industry to forget about a moral obligation to help. It may also be argued that Western society fosters inequality already by design. A sense of responsibility has been carefully undermined by various institutions that foster a perceived disempowerment by the system. Given the powerful laws by the WTO, there is seemingly little space for pharmaceutical companies to demand agency or assume personal responsibility.

However, this is exactly the contrary of what Levinas expects from his philosophy: '(...) it is always I who am responsible and I who support the universe, whatever happens next.' (Levinas, n.d.). A root cause for the deviating behavior of pharmaceutical companies and the WTO might derive from the lack of any followed moral culture, for Levinas the Bible is an essential hermeneutic for a moral life.

What makes the HIF as an institution so powerful is the understanding of a shared humanity, the recognition of global health as a common good. It takes the responsibility to care for everyone’s health irrespective of financial means and guarantees the people the best service it is able to provide. The institutional level might be a bit more abstract than the philosophy of Levinas envisioned but it may be argued that global times also need global measures and that a more empathetic system can and should be globally enforced.

Conclusion

Having looked at different ethical perspectives, it became clear that the current debate should not be one of access to a Human Right versus the protection of intellectual property such as Ostergaard and Sweeney put it (2011). The right to the protection of intellectual property seems at current times an unchangeably desired principle. However, both IPR and the right to health could be achieved by the creation of a global health fund that regulates compensation for medicines by evaluating its impact, not sales numbers.

Virtue ethics, consequentialism, the categorical imperative and Levina’s philosophy of responsibility all recognize the moral pitfallsthe current IPR regulations suffer from. The TRIPS agreement fosters a wrong system of habits away from virtuous principles, the consequences of a prolonged organization of patented medicines by the WTO are detrimental to health as a global good, the institutionalized inability to help sick people with affordable medicines and the lack of institutional empathy are all ethical arguments that clearly reject the WTO’s way of treating humanity.

The HIF is an alternative that grants innovators their deserved compensation and stands for a more ethical approach to take care of humankind. It is an institution whose values are based on justice and the idea to transmit that value to society. This way the IMF, although not the only possible solution, is a valid ethical and feasible option, that does neither compromise the right to property nor the right to health.

Personal remark

This paper is not meant to advocate for the HIF as the most ethical solution of all times to the problem of global health, but it is a feasible approach and in every aspect it is ethically preferable alternative to the incentive structure by the WTO.

As is argued in the philosophical analysis part, the HIF is for every considered aspect an ethically preferable concept to the way the WTO currently regulates the distribution of medicines. If the HIF is to be established, and I do hope so, it will make an important step towards a more empathetic society. Yet, I believe that the institutionalization of a moral standard could possibly lead to the loss of understanding of why it has initially been established. For this reason, it will be essential to accompany the implementation of the HIF with educational measures to align societal values with such actions as the introduction of the HIF. If alignment results successful, society and institutions will work in a mutually reinforcing way and create as well as sustain a culture of empathy and responsibility for the other.

To implement the HIF, it will take a lot of energy and time to convince a system so dominated by values of individualistic societies. Although, the ethical arguments are perfectly convincing for me, it has proven to be not as convincing for legislators. This way, only if independent parties or an established governmental opposition pressures the WTO, the HIF is to become a tangible future. Convincing at least will be the financial solution of the HIF to public health costs.

Bibliography

Course Literature:

Aristotle, Nicomachean Ethics, Book I (7-8) and II. Text from Stephen Darwall (ed.), Virtue Ethics, Blackwell, 2003, pp7-25.

Jeremy Bentham, An Introduction to the Principles of Morals and Legislation (J.H. Burns and H.L.A. Hart, Oxford University Press, 1996).

Kant, I., Groundwork for the Metaphysics of Morals. Translated by Mary Gregor (Cambridge, Cambridge University Press, 1998), pp2-3, 31-39.

Korsgard, C.M., ´The right to lie: Kant on dealing with Evil´, Philosophy and Public Affairs, vol 15 (1986), pp325-337, 349.

LaFollete, H. (2003). World Hunger. Blackwell Companion to Applied Ethics.

Levinas, E. (n.d). Ethics and Infinity.

Philip Pettit, Consequentialism (Peter Singer, ed., A Companion to Ethics, Oxford, Blackwell, 1991), pp95-107.

Additional literature:

Abbott, F.M. (2002). The Doha Declaration on the TRIPS Agreement and Public Health: Lighting a Dark Corner at the WTO. Journal of International Economic Law, 469-505.

Banerjee, A., Hollis, A., & Pogge, T. (2010). The Health Impact Fund: incentives for improving access to medicines. Lancet 2010, 375, 166-169.

Ostergaard, R. L., & Sweeney, S. E. (2011). Give Me Property or Give Me Death: Reconciling Intellectual Property Rights and the Right to Health. Journal of Human Rights, 10 (3), 339-357.

Pogge, T. (2005). World Poverty and Human Rights. Ethics and International Affairs, 19 (1).

Pogge, T. (2011). Getting the Incentives Right: The Health Impact Fund. Retrieved from Friedrich Ebert Stiftung website: http://healthimpactfund.com/wp-content/uploads/2012/11/HIFeuropaPapierFES.pdf

Sen, A. (2002). How to judge globalism. The American Prospect, 13 (1). Retrieved from http://www2.econ.uu.nl/users/marrewijk/pdf/ihs/geo/sen%202000%20judge%20glob.pdf

World Health Organization (2008). The Right to Health. Fact Sheet No. 31. Office of the United Nations High Commissioner for Human Rights.

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^[1] To translate Eudamonia with happiness as such is a discussed translation, to talk about a flourishing life is sometimes preferred.

^[2] The Other as intentionallywritten capitalized as Levinas emphasizes the Other as more than just any other person, but the Other with whom we share one humanity.