David Dean Ellis LL.M MBA BA
The creation of the Universal Declaration of Human Rights (UDHR) by the United Nations General Assembly in 1948 represents one of the most important developments in the history of Human Rights. This document is significant not only in the tenets expressed within its thirty articles but also its overwhelming support and acceptance by nations around the world. With the later additions of the International Covenant on Economic, Social and Cultural Rights (ICESCR) and the International Covenant on Social and Political Rights (ICSPR), the UDHR laid the foundation of principles which would form the basis for further Human Rights regimes around the world and the incorporation of these principles into many of the national constitutions and laws.
The geo-political landscape since the signing of the Declaration document in 1948 however has changed dramatically. The authors of this document at the time of conception could not have realized the extent to which economic and social forces would change the nature of the very same principles which they took for granted as “Universal”. A United Nations special report in 1949 from the Department of Economic Affairs in the United Nations painted a rather dismal view of the economic reality which faced the world after the devastation of World War two and the backdrop under which the Universal declaration of Human rights was authored.
The massive changes made to the geo political climate however in the succeeding decades and the rise of corporate interests, in particular Trans-National corporations (TNC’s) has created an environment in which the very same tenets which the authors of this document took for granted as being clear and absolute; have become the subject of much debate. A World bank report on Human Rights and Economics in 2012 makes distinctions between economists who are committed to the development of socially just economies but skeptical of being able to achieve this goal through established economic policies and mainstream economists which take into consideration the reality of restricted resources and the politics of capitalism. Human Rights regimes therefore have now become merely an ideal of what “should” happen in a socially just and progressive world and not what actually is the case, despite the fact that the majority of the principles enshrined in these regimes have been included in international and domestic laws.
Economics therefore in today’s world plays a very big role in the Human rights equation. The rise of corporations which rival the gross domestic product of most nations and their emergence as international players in world markets affords them the power and control to be either an effective ally in the preservation of Human Rights or a very troublesome offender as they are not subject to treaty obligations like state actors.
Nowhere is this phenomenon more important or evident as in the Healthcare Industry whose top earner, Johnson and Johnson received 74 billion US dollars in 2015. It is important to note here that this figure is more than half of the projected expenditure which the United Kingdom has allotted for the entire country for 2017. Corporate influence therefore is very important in the consideration of any human rights regime and in the field of health care this fact assumes a very unique character.
An examination of Articles 3 and 25 of the Declaration of human rights reveal that the authors conceived of a world where everyone “should” have access to adequate medical care and attention in the interest of the preservation of human life.
In brief, article 3 of the UDHR states that everyone has the right to life which in this context means that every “patient” suffering from some life threatening disease should theoretically have access to medicines, if available to preserve life. Article 25 states individuals have the right to an adequate living standard to facilitate to “his” health and well being which includes food clothing and shelter and medical care. Paragraph two states that motherhood and childhood are entitled to special care and assistance.
The reality of these principles in the modern world however is sobering when considering the fact that almost all the world’s research and development of medical devices and pharmaceuticals are developed by large corporations whose principle goal is profit maximization and survival in a competitive business environment. A 2015 profile of the Biopharmaceutical Research Industry reveals that the average time taken to develop a drug for market is ten years with a total of 52.2 billion dollars being spent on drug research in 2014 alone. In addition, the costs of development in the year 1979 which totaled 179 million USD was dwarfed in the earlier years of the 21st century with totals amounting to 2.6 billion USD.
For-profit Corporations exist to make money for their shareholders. This raison d’etre is often conflicted with the public interests when it comes to health care, as profit maximization in this realm directly affects access to medicines and medical remedies.
This is particularly important considering that the lawful right to health constitutes one of the indicators which the World Health Organization uses to measure governments commitments to improving access to essential medical assistance. In the developing world, access to medical care and pharmaceuticals is restricted largely by the overwhelming costs of procuring these products. This situation is exacerbated by the fact that 60 countries do not recognize the right to health in their local laws and so by and large individuals who can afford to pay for care receive it while others who can’t are vulnerable to even the most basic diseases.
intends to explore the efficacy of articles 3 and 25 of the UDHR and the
related laws which have developed from these principles in the modern world. It
will also examine the legal strategies which have been used to quell the
profiteering of multinational healthcare corporations at the expense of human
life and dignity and the response of these corporations in the face of growing
legal actions and regulations. Finally, this paper will suggest the possible
remedies to this war of interests primarily in the form of international
incentive schemes for research and development into less profitable and often
neglected areas of medicines, co-operative strategies between corporations and
local governments in the creation of licenses for local companies seeking to
produce generic forms of medications and the creation of an international
protocol and licensing agreements for Drug and Biotechnology companies seeking
to expand their businesses to the developing world.
A review of literature concerning Article 3 and 25 of the Universal declaration of Human Rights and their relevance to the corporate interests of Medical and Pharmaceutical companies must needs begin with an examination of the rationale behind these principles and why they were included in the final draft of the UDHR as well as the ambiguities which render them inadequate for use as foundations for the development of regulation concerning the health industry.
The devastation of the second World war which saw
the flagrant abuse of human rights on the basis of fascist and supremacist
ideologies were sufficiently horrifying to the world that a general consensus
was reached among the United Nations that such a conflict should never be
allowed to repeat itself in human history. The death toll from the conflict
created in part by Nazi Germany’s flagrant disregard for the lives of
individuals created an environment where the world was forced to re-evaluate
its position on the subject of the right to life and liberty.
The right to life (Article 3)
The exact wording of article 3 of the UDHR states,
“Everyone has the right to life, liberty and security of person.”
It is significant however that there are numerous qualifiers and arguments which can be wrought out of this seemingly simple statement. For the purpose of this paper, the right to life is defined within the context of the right to survive as opposed to the right to keep one’s life especially in jurisdictions where the death penalty has been instituted. The distinction here being a more naturalistic definition as opposed to a clinical or legal denotation.
Internationally this tenet has been included in the framework of many important charters.
The International Covenant on Civil and political Rights in article 6 states categorically that every human being has an inherent right to life
The Convention on the Rights of the Child in article 6 is less straightforward and makes a holistic declaration that the child’s right to life and development should be protected to the maximum extent by state parties. This however does raise the question of what constitutes the word “child” and if there is no specific definition in the convention, does the practice of medically induced abortion in state parties constitute a breech of the convention.
The convention on the rights of persons with disabilities in article 10 specifically states that every human being has a “inherent” right to life and prevails upon state parties to,
“take all necessary measures to ensure its effective enjoyment by persons with disabilities on an equal basis with others”
This definition seems to deviate from other conventions as it seems to relate more to the standard of living of persons with disabilities as opposed to the right to exist which suggest a broadening of the definition for special cases.
Illustrations of the promulgation of this tenet in a regional context can be seen in the following:
The European Convention on human rights states clearly in Article 2,
“Everyone’s right to life shall be protected by law. No one shall be deprived of his life intentionally save in the execution of a sentence of a court following his conviction of a crime for which this penalty is provided by law.”
The wording here presents an interesting topic as it clarifies that life is to be protected by law and taken away as a matter of law suggesting that life is to be regarded within the context of a legal framework.
Similarly, the African Charter on Human and Peoples’ rights states in Article 4 of its charter,
“Every human being shall be entitled to respect for his life and the integrity of his person”
once again raising the question as to what constitutes “respect for life” and “integrity of person”.
At the national level the right to life has been incorporated into many constitutions with similar problems of denotation and connotation. Most notably, the Turkish Constitution in article 17 which states that the right to life belongs to everyone except in the following circumstances:
- Legitimate self defense.
- As a result of a weapon permitted by law as in the case of police or authorized action.
- The quelling of riot and insurrection.
- The execution of orders by an authorized body in the event of martial law and states of emergencies.
In a national handbook, targeted at public authorities, the Ministry of Justice for the UK government outlined what it considered to be exceptions to Article two of the European Convention, that being
- In the instance of self defense.
- In the instance of lawful arrest and detention.
- In the instance of stopping a riot and or other public disorder.
The guidebook goes on to explain the responsibility
of public authorities to safeguard the lives of members of the public in the
events of known or suspected threats to the lives of individuals raising the
question as to whether potential reversible illness could in fact be a threat
to an individual’s life and as such; is there a legal obligation to protect the
individual from such illness. The right to life therefore represents an ever
increasing challenge both in interpretation and implementation as it becomes
diluted from the UDHR into regional and national law because of the number of
gray areas and exceptions. Despite this barrier a number of conventions have
included this basic right within their charters.
It is these gray areas and vagueness of language which demonstrates why it is virtually impossible to set hard and fast rules of how corporate enterprises should be made to operate under different conditions and situations.
What is of importance here also is whether under
these legislative guidelines international regional and national bodies should
be obligated to protect the lives of their citizens by direct intervention into
the affairs of corporations with regards to access to medicines and medical
care for if they are obligated to protect life by law then surely diseases are
a threat to life and therefore come under these tenets. This is the view
expressed by the World Health
Organization (WHO) in their fact sheet of 2012 which impresses upon states the
need for accountability in developing administrative policy and political and
judicial mechanisms to ensure that citizens receive access to life saving
medicines especially in the cases where there is a prevalence of HIV victims.
Additionally, The European Commission in combination with United Nations AIDS program in a 2008 document on AIDS and access to medicines affirms that the right to health is a fundamental part of human rights to life and dignity. The document goes on to state that,
“…people living with HIV, access to treatment not only keeps them alive and healthy but also enables them to avoid transmitting HIV to their sexual partners and to their infants.”
This conflating of the right to life and the right to health is further expanded in a study of the Department of Medicines, Policy and Standard of the World Health Organization which examined the viability of court cases being brought against companies and states on the subject of access to medicines based on the premise of a right to health in general. The study found that out of the 71 cases analyzed, 59 of them could legitimately be enforced through the courts with the majority coming from Central and Latin America. The study goes on to state that success in these cases was mainly linked to constitutional provisions by the state parties and that success factors included links made between the right to health and the right to life.
An examination of Article 25 and the UDHR will further illustrate the problem of definitions.
Article 25 of the UDHR which states categorically that “everyone” has the right to a “standard of living adequate for the health and well-being of himself and of his family” inclusive of medical attention and social services and also that motherhood and childcare are entitled to special care and assistance irrespective of whether the child has been born in or out of wedlock presents an even greater problem of interpretation on the surface. Specifically, there seems to be three problems embodied in this statement,
- Definitions of terms such as what constitutes “adequate” standard of living and the extent to which “special care and assistance” can run.
- Traditional and cultural complexities relating to ideas of marriage and the rights and legitimacy of children born out of wedlock in certain parts of the world.
- The ability to provide this “right” to everyone on a global scale when factoring the exponential increase in the world’s population.
Claude and Issel describe the complexities involved in the initial drafting of this article in 1947 as a problem of definitions and intent. They offer a phrase by phrase commentary on the drafting of this part of the UDHR document which include the complexities involved in determining first of all the placing of the terms “adequate care” as the responsibility of the state as opposed to the provision of social security and social insurance which the Soviet envoy to the draft had suggested.
In addition, the concept of
“well-being…including…medical care” became an issue in draft as the right to
health did not necessarily imply the right to medical attention barring the
inclusion of social insurance and social security programs.
The essence of these debates is reflected in article 11 of the International Covenant on Economic, Social and Cultural Rights which recognizes the right of everyone to an adequate standard of living in the first paragraph and continues in the second paragraph to assert recognition for everyone to be free from hunger which is very optimistic in its outlook, but hardly pragmatic.
This is of particular importance as the Office of
the United Nations High Commissioner for Human Rights recognizes that states do
have resource constraints which prevent the full realization of the article and
operates on the basis of “progressive realization” 
which briefly defined is the state’s commitment to the full realization of the
ideas enshrined in this article at a later date when resources permit.
Convention on the Rights of the Child in article 27,
the International convention on the protection of the rights of all Migrant
workers and Members of their families
in Article 43, the Convention on the Elimination of all forms of Discrimination
against Women in Article 14
and the Convention on the rights of persons with Disabilities
in Article 28 all echo sentiments derived from article 25 with the proviso and
acknowledgement that states may not have the resources to actualize all the
concerns and rights expressed in their charters. As such these articles may be
effectively the expression of a commitment to “try” to enable these freedoms
more than a realistic expectation.
This is of
particular importance when considering the concepts of health care provisions
as the cost associated with the provision of medicines and medical aid on a
grand scale are very often prohibitive of the original intention of these
Pogge, provides some statistics in his report to UNESCO of the reality of the situation concerning the undertaking of the provision of “an adequate standard of living”. It states,
“some 799 million human beings are undernourished, 1000 million lack access to safe water, 2400 million lack access to basic sanitation…880 million lack access to basic health services”
It should be noted that this report reflects the
situation in 2004 and by all accounts represents what he considers a worsening
The report also
makes a distinction between legal rights which are created and imposed through
supranational, national and subnational legal systems and moral rights whose
validity is independent of any and all governmental bodies; which he believes
is the standard by which the legitimacy of governments are judged.
This kind of argument however raises the question
as to how and when rights should be classed as moral or legal and should all
“moral rights” automatically become legal especially in countries with limited
resources and cultural backgrounds where this argument is not applicable. In addition, can medical care and access to
medicines be classified as either a moral or a legal right when the majority of
medicines and medical equipment are developed through investments into research
by private corporations who also being legal entities have the right to secure
a profit from their investments in capital.
are wholly dependent on the situation within which they exist. The concept of a
accepted moral right seems more dependent on the jurisdiction where it falls
and on extraneous factors such as access to resources. Within the context of
Health services however, this is certainly the case especially when balancing the
interests of corporate investments and the provisions underlying human rights
The problem of worldwide provision of health care
The health industry represents a gray area in the divide between Human Rights regulation and the interests of corporate undertakings. While it is an established fact that businesses on the whole exist for the purpose of making profit in particular for their owners, the concern regarding this interest and its cost to human life and wellbeing particularly in the Health Care Industry where access is usually functionally restricted to those who can pay for products and services creates more than just a philosophical problem.
This is exactly
the position advanced by Troiller et al in a study on drug development for
neglected diseases. The study which analyzed the outcomes of pharmaceutical
research and development over a 25-year span reported the introduction of 1393
new chemical entities to the world market between 1975 and 1999, only 16 of
which targeted tropical diseases.
This imbalance is explained by the authors as the result of costs associated
with the low return of investment and the risks associated with the investment
in drug development for diseases which affect the developing world
The study goes on to suggest that private sector
research obligations should be explored and public sector non-profit research
options be promoted but stops short of offering any legal remedies which might
benefit the situation.
Lysaght refers to the “commodification” of health as one of the phenomena of growing consumer insecurities about the uncertainties of the present and future of medical care. This view however represents an oversimplification of the factors which drive the producers of medicines to produce products specifically for the developed world as well as the impact of customer demand on the choices made by researchers in the field. It also does not take into consideration the influence of class and economic dynamics on the production and supply of medicines and medical devices.
In 2012, a special report from the World Health Organization (WHO) in partnership with the World Intellectual Property Office (WIPO) and the World Trade Organization (WTO) documented what it saw as a troubling trend in the preferential research and development of drugs for diseases affecting the developed world. The report referred to this phenomenon as a market failure and classified three types of diseases as an overlay to the current economic trend. The first of these classes were for diseases affecting both developed and developing countries such as Influenza and Hepatitis B and non communicable diseases such as Heart diseases and diabetes. The second included diseases which affected predominantly developing countries but which were present in both. Examples included HIV/AIDS and Tuberculosis (TB). The final category included diseases which were to be found overwhelmingly in developing countries and were of low incidence or simply absent from developed countries. Examples included African Sleeping Sickness (Trypanosomiasis) and African River Blindness (Onchocerciasis).
The last two categories were considered by the
report to be neglected diseases due to the lack of research and development
done on them. Clearly this trend in global research and development
demonstrates to a large extent the effect of economic forces on the decisions
of Corporations when deciding which medicines to focus on.
It is interesting however that this report did not focus on the causes of this troubling industrial trend. While it is obvious that economics plays a part in the decisions of Biotechnology companies, the role of regulation and laws which can substantially affect a corporation’s ability to maximize profit is also of importance in examining this issue.
An example can be seen in a document guide put forward by the United States Department of Health Food and Drug Administration (FDA) to the local health industry on the development of treatments for Neglected Diseases of the developing World in 2014. This documents states,
“the regulatory pathways and internal review standards for approval of drugs for NTDs are the same as for approval of drugs for diseases endemic in the United States.”
This requirement by the FDA creates two problems for drug companies. First, the problem arises as to whether little known diseases in a world which is “developing” require the time and attention of large companies which can be focused on finding treatments for more “popular” and therefore more profit viable diseases. Second, there is the problem of justifying the expense required for the production and the approval of drug treatments for a market which may not be financially capable to cover these costs especially in light of the human rights concerns and the emergence of recent case law in which pharmaceutical and Biotech firms patent rights have not been upheld in developing nations.
The document goes on to state, “we are committed to exercising our regulatory
authorities to facilitate access to therapies that can help reduce morbidity
and mortality associated with NTDs. (21 CFR 314.105(c)).” This regulation gives the FDA considerable latitude
in deciding the data requirements and evidence needed for the approval of drugs
in the developing world regardless of where they were developed. The divide between corporate interests and Human
The division between Corporate interests and Human Rights obligations is a multi faceted subject which cannot be delineated from World economic trends. The antagonists on both sides of this argument however have become polarized as demonstrated by the increasing amount of litigation concerning access to medicines.
Brennan et al. for instance suggests a four pillar approach for social justice groups and non-governmental organizations seeking to improve access to medicines by arguing against the “barriers” placed by intellectual property rights of corporations as a means of creating such access. This study which analyzed a number of relevant success court cases on the bases of the arguments provided by human rights lawyers and the relevant language contained in the summary judgments advises human rights activists to,
- Use Human rights arguments in domestic court cases that deal with intellectual property laws.
- Articulate the norms of the United Nations human rights system.
- Use human rights arguments to secure greater pharmaceutical corporate accountability.
- Use health related rights to organize multilateral alliances which could be used to oppose free trade agreements.
A more positive and less confrontational outlook is presented by the Access to Medicine Foundation in association with the Ministry of Foreign affairs of the Netherlands in their 2016 index of the top 20 Biomedical producers around the world. These companies’ performance in the areas of providing access to medicines was compared against a frame work of 83 metrics to measure performance relating to 51 “high burden” diseases in 107 countries.
The findings reported moderate progress in the pharmaceutical industry’s efforts to improve access to medicine, waiving of property rights in the poorest countries and the granting of special licenses to manufacturers to produce generic versions of drugs for developing nations.
A slightly more balanced view of the situation of corporate responsibility for access to medicine is taken by Leisinger, who refers to the shareholder versus stakeholder argument as being one where human rights organizations such as Oxfam occupy one half of the divide and the financial analysts of health industry corporations the other. He suggests that consensus on this issue and progress towards increasing access to medicine can only result when members on both sides of the argument relinquish their polarized positions on the issue. He goes on to suggest that the effect of polarization effectively creates barriers to possible solutions and understanding between both parties. As an example he notes that while organizations such as Oxfam hold the narrative that patent rights are more than generous to Bio-medical corporations, they tend to ignore the prohibitive costs of research and regulation associated with bringing a drug or a device to market. On the opposite side Leisinger refers to the need for corporate social responsibility (CSR) as a companion to increasing shareholder profits in a modern society as a necessity to good business practice and governance.
A quite opposite view on the subject of CSR is presented by Klaus Leisberger who comments that the responsibility to feed the poor and to provide health care to the sick is not the “mandate” of Health care corporations and beyond their abilities. He suggests that most private enterprises can do little more than contribute to shared global problems. 
This view is supported by a 2001 study conducted by the Organization for Economic Cooperation and Development which divides the Pharmaceutical industry in particular into a two tiered structure comprising the largest manufacturing producers of drugs who compete with each other on the basis of innovation and whose major costs are taken up with Marketing, and Research and Development respectively and the large majority of licensed manufacturers of generic drugs which compete on the basis of price and conduct little to no research and development on their own. The study asserts that the majority of the cost associated with bringing a new drug to market has to do with the fact that the entire product life cycle of a drug is heavily regulated from the research phase to the market introduction phase. In addition, all aspects of the supply chain are also well regulated and this increases the overall cost to bring a product to market.
Statistics provided by the study indicate that the world’s largest manufacturer of medicines, Merck which has a market capitalization of 152 billion USD received only 34.7% profit to equity ratio in 1998 which is sobering considering the costs and efforts required to produce medicines and bring them to market.
Being selective in choosing which products to develop therefore has become a matter of necessity for survival in an increasingly competitive and regulated industry. The realities of market economics often present a tangible barrier to many companies playing a greater role in increasing access to medicines. Solutions to this divide are not easy to formulate and as Leisinger has suggested will only be actualized when both sides of the argument become less polarized and forge a genuine partnership to deal with this problem.
Key Aims and Research Methodology
There is a substantial body of work concerning the subject of Human rights. This work spans from research done on selective articles and their impact on International law as well as historical and social bases for the articles included in the UDHR. Research into the Medical and Pharmaceutical industry however has been largely done from either a clinical perspective detailing advancements in the industry or from the perspective of the policy of various bodies implemented at global, regional and national levels.
It seems counter-intuitive to consider that these two subject areas do not connect in any meaningful way since the expressed and popular reason for medical research concerns the preservation of Human health mentioned in the UDHR.
Considerations of the corporate impact of human rights policies and regulation on the profits of these companies and the business decisions publicized in the international news media is usually met with reactions spanning from a lack of sympathy stemming from public perception of Pharmaceutical companies as being profiteering and overly wealthy to outright hostility at what some Human rights activist see as a corporate war against the poor.
This paper intends to focus on the
salient aspects of how human rights activities can and
anddoes impact on the choices of Medical
Research and technology in sometimes undesirable and unfortunate ways and also
the responses of both side of this war of interests to each other. It cross references
the two interests as parameters which interact with one another and inevitably
creates a direct correlation between the actions and responses between the two.
Far from being a simple statistical examination of these individual units the
approach taken was “why” and “how” these parameters have become polarized and
the solutions to this problem.
For this paper, a total of 130 journal articles were consulted. The papers were taken from online journals such as Lancet and Biomed and were obtained using search parameters tailored for the specific section under examination. As an example the discussion section relating to the the profit strategies of Biomedical corporations used the same search parameter of the heading of that section.
Articles were chosen and classed based on their relevance to the topic under examination first and then based on how contemporary they were. Excluding legal cases and statutes, only articles written within the last generation (30 years) were included as references.
Relevance to the topic was determined by inputting the documents into the MAXQDA software to ascertain word matches based on headings and sentence structure and then saved for further reading. At final count only 70 articles were included as actual references within the paper with the other articles being used as guidance in the development of arguments and the topics to be examined within the actual document.
The statutes and cases used in this
paper were first of all discovered within the articles explored themselves but
where necessary searches were made inside West Law’s library for specific cases
to highlight particular points. The dicta in Guth V Loft
–this needs a reference for instance
as a means of illustrating Delaware’s commitment to the fiduciary’s duty of
directors was obtained from the reading of the case.
Finally, compilation of all the reference material was arranged in the Zotero software for easy access. The URL’s were stored in the database for future consideration even when the material accessed was not used directly.
From the analysis made three key aims of research of this paper became clear:
- Examination of both the Human Rights perspective on Access to medicines and the Biomedical perspective concerning their right to profit from their investments and protection of their patent rights.
- Examination of the trans-national legal order and the effectiveness of its role in refereeing the situation between the two opposing interests.
- Possible solutions both within the current international framework and co-operative strategies which can be used to ameliorate the situation.
An examination of the division between the interests of Human rights organizations and large biomedical firms represents more of a “cold war” scenario between the two opposing groups. Currently, there exists a polarity between the two groups with each camp proposing various legal and ethical arguments to support their positions. The strategies employed however are worthy of examination in order to expose the true scope of the problem.
Profit Strategies of Biotechnology and Pharmaceutical Industry.
The importance of Biomedical and Pharmaceutical Corporations to society is undisputed. The contributions which these organizations make to promoting and maintaining the public health interests through innovation and advancements in procedural techniques has been well documented by the World Health Organization.  There is however a darker side to the industry where profit driven executives seeking to comply with their fiduciary duties attempt to maximize the value of transactions to appease shareholders’ value often at the expense of wider social interests including public health. Leisinger describes a situation whereby drug companies in particular maximize their profits by “charging what the markets can bear”. The actual strategies used by company executives to achieve an adequate return on investments however are less straightforward and sometimes are more insidious. In particular, the strategies can be broken down into three main areas:
- Courting medical offices and physicians to promote their products.
- Neglect of the developing world and concentrating on the products demanded by more affluent societies.
- Patent enforcement as a means of securing returns on investment.
The courting of Medical Offices
Marketing and promotion is without a doubt a huge expenditure for Biomedical firms seeking to attract clients and investment. A research study conducted by the Pew Charitable Trusts reported that the pharmaceutical industry spent more than 27 billion USD on drug promotion with more than $24 billion of that sum spent on promotions to physicians and a little over $3 billion spent on direct marketing to consumers.  In addition, data from the Institute of Policy Innovation indicates the growth of advertising promotion from a total of $700 million in 2001 to $4.3 billion dollars in 2006 due to the loosening of consumer advertising regulations.  By far the greatest expenditure on promotion however has gone to the establishment of relationships between the pharmaceutical industry and members of the medical fraternity. Some of the techniques for accomplishing this has been;
- Face to face meetings with practicing physician through medical representatives employed by Biomedical firms. As of 2012 Pew Charity research puts the number of medical representatives employed in the US alone at 72, 000.
- Providing free samples, gifts and grants for research to physicians willing to subscribe to their products.
- Donations made to continuing education courses for doctors and academic institutions. Medical device and Pharmaceutical companies accounted for 32% of the total funding for medical courses within the US in 2011.
- Special grants to Health advocacy organizations as an incentive for promoting their product lines.
The overall effect of all this promotional activity according to Moynihan is a “sense of obligation which is in direct conflict with the “doctors primary obligation to their patients.” The economic results have been a concomitant increase in the US retail prescription spending from year to year. Also the US costs for prescription drugs alone in 2010 amounted to $259 billion whereas by comparison the advertisement spending on the same was only $4.3 billion.
Concentration on products for the developed world at the expense of the developing world.
Pharmaceutical and Biomedical corporation face substantial challenges when deciding which drugs to bring to market. The economics of these decisions revolve around whether the investment treats a global disease which has appeal to markets in both the developed and developing world and therefore a high return on investment or whether the treatment or medicine targets a “neglected” disease which primarily affects low income areas of the globe and offer a low return on investment due mainly to the market’s inability to pay for the medicine. Given these choices most directors and officers of these firms choose the former as a path to the development of drugs and therapies.
This however has significant impacts on the distribution of medicines and therapies around the globe. A published report by Médecins Sans Frontières states that people in developing nations make up about 80% of the global population account for only 20% of the worldwide medicine sales. The report also found that 10% of global expenditure in medicine was directed towards creating products for diseases which impacted developing countries.  Smith et. Al draw a strong link between poverty and health citing that people from low and middle income countries who subsist on less than $1 US a day are five times more likely to die before reaching age five and two and a half times more likely to die between the ages of 15 to 59. The specific background surrounding these statistics however have a lot to do with poor sanitation and hygiene, failing health policy and lack of access to technological advancements needed to prolong life as well as the lack of access to medicines.
Regardless of the background Troiller et. al report that drug development outcomes over the last 25 years leading up to 2001 reveal that only 15 new drugs were developed which were indicated for diseases like tuberculosis which affected the developing world. In comparison 179 new drugs in the same period were developed for treatment of Cardiovascular diseases which has a more detrimental impact on members of the developed world. 
This disparity is further highlighted by a world bank study which estimated that the elimination of communicable diseases which primarily affect the developing world would effectively remove the mortality gap between the richest 20% of the world population and the poorest 20%. 
The Use of Patent Enforcement as a tool to increasing profitability.
Patent Rights in the Biomedical and Pharmaceutical industry traditionally have been the cornerstone of innovation and motivation for inventors and researchers to develop new techniques and treatments for common ailments. This mainstay in international law has been crucial in ensuring that developers receive a just return on their investments in time and research. The World Trade Organization (WTO) requires all of its 144 members, which accounts for 90% of global trade to sign up to the agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). The TRIPS convention specifies minimum standards for the protection of intellectual property rights and requires its members to comply in protecting these rights.
In actual operation however these protections have had a debilitating effect on the provision of medicines to the developing world. Kapczynski makes the point that whereas patents are a temporary monopoly given to a developer for the purpose of promoting innovation in an industry, no one knows how strong a patent should be in years (10-20) to accomplish this goal. In addition, she contends that patents cannot create profit for the developer where the market is incapable of providing that profit. As an illustration to this point she notes that only 13 of the 1393 drugsapproved between 1975 and 1999 bore specific relevance to diseases which affected the developing world. A fact that underscores the reality that the patent system does have a rather negative impact on developing nations.
Another unfortunate side effect of the economics surrounding the patenting of prescribed medications is the imbalance created when drug manufacturers choose to concentrate on lifestyle drugs for ailments such as baldness over diseases which affect the majority of the world’s population. This race to patent the next blockbuster lifestyle drug for the developed world underscores drug manufacturers neglect of research which would benefit the developing world.
It is also the underlying reason behind some of the recent actions by the pharmaceutical industries which have met with unmitigated resistance by the public.
In 1997 the South African Government seeking to deal with the HIV/AIDS epidemic which was sweeping their nation and the high cost of patented drugs chose to pass the Medicines and Related Substances Act in 1997 which effectively allowed the country to parallel import cheaper medicines from other countries as well as to take advantage of cheaper generic alternatives. This initiated an action in which over 40 pharmaceutical companies attempted to take the South African Government to court in order to have the law overturned as a means of protecting their patent rights.
The result of this action was a public outcry against the drug companies by human rights organizations and the public at large claiming insensitivity on the part of the drug companies to human rights.
On the same issue Brazil’s fight against AIDS also prompted a government program which was supposed to provide free AIDS treatment for those in need. This was only made possible through the government’s decisions to produce generic versions of the drugs locally. It is significant however that although the result of this program was the reduction of the death rate from AIDS in Brazil by 50%, they were still sued by the WTO and the pharmaceutical companies because the produced generic drugs were protected by patents.
Drug companies therefore have a major public relations problem with regard to defending their patent rights and this problem is significant enough to defeat most arguments put forward concerning cost to market concerns. The scandals of greed and and corruption which plague the industry also do not help with the image of these companies.
An example can be seen in a 1996 case involving the Nigerian government and the drug manufacturer Pfizer. 
facts of the cases against Pfizerinvolved
the administering of the drug Trovan to 233 Nigerian children during an
outbreak of meningitis in that country in 1996. The drug which was approved for
use in adults in the US was used as an experiment in Nigeria in order to
ascertain its effectiveness in children. The results were that 196 of the 233
children who were injected with the drug died as a result with the 37 surviving
children suffering from side effects such as deafness and loss of sight.
Pfizer’s defense rested on the fact that it had gotten consent to test the drug
from the parents of the deceased children and that the drug trials were a
response to a humanitarian crisis which was affecting the country at the time.
The families and the Nigerian government in turn
the drug company for
$7 billion USD.
In a more recent case involving the former CEO of Turing Pharmaceuticals Martin Shkreli, the price of Daraprim, a cheap and readily available drug used in HIV treatment to treat toxoplasmosis was raised by 5,500%; from $13.50 a pill to $750.00. This sparked national outrage and condemnation in the US with congressional hearings on the matter being held throughout 2016.
The effects of human rights arguments against corporate interests.
Challenges to Patent rights
The number of
Human rights arguments levelled against Bio-medical firms have been met with
large support from the governments of developing nations and the public at
large. Any search on the internet with search parameters on “Bio-medical firms
and Human Rights” reveals scores of scholarly articles on the subject
condemning what is perceived to be the immorality and greed of producers of
drugs and therapies. Social justice groups and authors such as Brennan et.al
have written articles prescribing means by which governments and human rights
organization may defeat patent rights of drug companies through a variety of
means. They base their research on the observation of a number of
of the argument presented by Sonderholm
turned into a syllogism will serve to summarize the legal position of Human rights organizations and
social justice groups on the matter
(X) deprives people of their human rights to health.
Depriving people of their human rights
is bad . Therefore
(X) is bad.
Supplementing (X) here for the patent rights of companies, it becomes very simple to see the position adopted by many social justice groups. The argument however is simplistic in that it does not take into consideration the complexities which come into the process of bringing a drug to market or the indirect damage done to the same groups for which protection is sought by this action.
Guha and Salgado outline the negative impacts of challenges to the patent rights of the major drug companies which include,
- Reduction in overall Research and Development budgets particularly on drugs relevant to the developing world in anticipation that patent rights to these drugs will not be upheld, which only harms patients in the developing world in the long run.
- Curtailments in Brand-Specific Research and Development upon the market entry of their generic alternative. This in effect reduces the likelihood that a specific branded compound will receive subsequent iterations to increase its effectiveness.
- Declining further promotion of a branded drug on the basis that promoting a compound will have the subsequent effect of promoting its generic alternative and competitor. The overall result is a decrease in the share capital for both the branded and the generic version of the compound which constitutes waste on the market.
- Loss of goodwill and public relations harm to Branded drug companies particularly when they prevail in patent infringement suits against their cheaper generic counterparts. This is because patients now have to pay more for the same drug regardless of whether the drug was a copy of the original brand.
The situation becomes more complicated when one considers the differences in patent law application in the developed world as opposed to developing nations. The United States which supports the patent rights of manufacturers of drugs and is home to the world’s leading drug companies and lobbyists contains consumers who pay the highest amount for drugs. This has the effect through the law of economics of keeping the prices down for other nations who are less developed; specifically because human rights organizations make it difficult for drug companies to obtain the required patent protections, sue for compulsory licensing in these countries and encourage the production and dissemination of the generic alternatives. 
The result of this trend is inevitable. People choose to buy these drugs and their generic alternatives in low priced developing nations, re-enter the US market with these drugs and sell them at a substantial profit. Tiered pricing on the part of the drug companies in the US and compulsory licensing through law to local manufacturers in developing nations therefore is definitely not in their interests.
Regulation as a barrier to true partnership
Regulation in the drug and Pharmaceutical industry is and has always been necessary for the protection of the public at large. Briefly stated regulation is necessary as,
- A means of protecting against the abuse by retailers of pharmaceutical products and medical therapies in the forms of price gouging and other unscrupulous practices.
- A means of protecting against serious injury or death which can result from the misuse of medication.
- As a means of standardizing the flow of information about a product or therapy to consumers.
The effect of increased regulation however has been detrimental to the pharmaceutical industry in particular in a number of ways. A study by Sood et al. taken from 19 developed OECD countries from 1992 to 2004 revealed a number of results which suggests that over-regulation is indeed harmful to the revenue streams of the Pharmaceutical industry and affect the way they are able to function and operate. The results of the study reveal:
- Regulations in the form of Global budget controls, prescribing budgets of physicians, direct pricing controls, profit controls, the encouragement and substitution of generic drugs, therapeutic reference pricing, and economic evaluations as a group have a definite negative economic impact on the revenues of pharmaceutical companies.
- Direct pricing controls as a unit have the greatest negative impact on revenue streams followed by economic evaluations and budget control restrictions.
- The number of of regulations enacted through national governments during the period under study increased in direct proportion to the negative impact on revenues suggesting a direct correlation between the two values.
This restrictive regulation and its negative impacts is also aided by more generous forms of legislation on the side of the generic drug manufacturers. An example of this can be seen in the Hatch-Waxman Act which facilitates the process by which generic drugs may gain approval from the US Food and Drug Administration (FDA). The act requires that a manufacturer of a generic alternative need only file an abbreviated new drug application to establish bioequivalence to the existing branded compound which has gone through clinical trials.
Once this has been established the generic alternative can evade clinical trials by reference to the available evidence from the established manufacturers trials.
drug manufacturers has been an overall reduction in R&D budgets. The
specific reasons for this however has been as Guha et al has suggested; that
pharmaceutical companies tend to finance most R&D projects through internal
financing such as cash flow and profits as opposed to external financing like
Clearly this has ramifications for not only the drugs relevant to the developing world which do not yield significant profits to maintain a healthy R&D budget for those projects.
This presents a significant barrier to partnership with non-governmental agencies pushing for legislation against these companies. In a competitive environment, where introduction to market and maximization of profit over the entire life of the product cycle are major determinants for the survival of companies; regulation and the proponents are seen as the antagonists to the smooth functioning of business enterprises as seen by the following quote from Gilead Sciences vice president in 2014,
“Two sincere requests…Let’s not fold to advocacy pressure in 2014. Let’s hold our position whatever competitors do or whatever the headlines.”
Using Corporate social responsibility Arguments as a means of coercing corporate compliance
The subjects of Corporate Social Responsibility (CSR) and Corporate Accountability have traditionally been a matter left up to the Corporate Boards to decide. Corporate responsibility as seen through the eyes of Social Justice Activists however is an area which requires clarification as to what activities can be mandated and which activities should be voluntary.
Attempts to control CSR with regards the general public have largely met with mixed results. In 2003, a document on the Norms and Responsibilities of Transnational Corporations and other business Enterprises with Regards to Human rights was submitted by a subcommittee of experts working with the United Nations. The document outlined proposed mandatory obligations which may be imposed upon corporations by law but was rejected by the UN for not having legal standing.
A succeeding effort by Paul Hunt in 2008, titled “Human Rights Guidelines for Pharmaceutical Companies in Relation to Access to medicine” which placed access to medicine and care as a shared responsibility between public and private stakeholders met with a similar fate and was never endorsed by the Human rights council.
Finally, a third attempt in the “UN Guiding Principles on Business and Human rights” was made by UN sanctioned researcher John Ruggie, which in fact was accepted and endorsed by the UN but took the position of, as the title suggests “guidelines” as opposed to mandatory obligations placed upon corporations.
This of course presented a rather disappointing outcome for human rights activists who were of the position that CSR and corporate accountability should be a matter of mandate especially in the area of access to medicines and medical care.
Ironically, however all the agitation on the part of social justice groups in this sphere have given Pharmaceutical companies a rather powerful weapon in disarming arguments about corporate greed.
Every Palmer and Howick, Moynihan, and Schafer all make references to Pharmaceutical “donations” to medical universities and research centers which skew the results of what is supposed to be evidenced based medicine. Every-Palmer and Howick point to biases in the choices of Hypotheses tested, manipulation of study designs and selective publication as evidence that impartiality in clinical testing of medical entries is indeed being influenced by pharmaceutical agents and companies.
The ethics of this situation is as Moynihan
explains in “direct conflict with doctors’ primary obligation to patients” ,
as it constitutes a situation whereby “the politician is being required to
count his own vote”. 
Specific Legal issues involved with this debate
Director’s Fiduciary duties
The traditional tenets of a director’s fiduciary duty states that directors should act in a manner which maximizes the benefit for their shareholders. This axiom is grounded on the principles of loyalty, a duty of care and the mandate to act in good faith and in the best interests of the corporation.
Hirsch however, suggests that where the Biomedical industry is concerned, the traditional corporate view has been split into two camps comprising Shareholder interest versus stakeholder interests with shareholder interests being the more traditional of the two.
In addition, he suggests that adherence to the traditional model of corporate governance may be detrimental to public health and society as the interests of shareholders quite often do not align with the interests of the end patients who use the corporation’s products.
Alternatively, this may indicate a failure on the part of the national governments and not necessarily on the part of drug companies, however the fact that the majority of drug companies are reducing funding to the development and manufacture of tropical disease medication as a matter of business strategy to increase profits suggests bias on the part of the Board of Directors of these companies.
This presents a complication of interests between directors’’ legal obligation to remain “loyal” to the best interests of their shareholders and to maintain a standard of care for the management of the company and its finances and their moral public duty as corporate citizens. Under Delaware State code for example directors are required by law to always act in the best interests of the owners of the corporation and section 102 (b) (7) provides that Directors cannot be protected from liability if found to have acted in bad faith or against the corporation’s interests. The dicta of Guth v Loft established that a director’s responsibility is
““A public policy, existing through the years and derived from a profound knowledge of human characteristics”
When viewed from those lens, the situation literally becomes a choice where a director of a bio-medical or Pharmaceutical company must as a matter of his fiduciary duty by law choose the business option which brings the most value to the company’s shareholders which in this particular case means the abandonment or neglect of less profitable enterprises such as using corporation finances to research and develop drug options for developing world.
Human Rights interpretation
The UDHR makes it clear that everyone has a right to life and that everyone has a right to Health. The myriad conventions adopted from this document suggests that state actors have an inherent responsibility to protect the lives and the health of their citizens from threats.
This begs the question: If illness is a threat to life and health of their citizens, don’t state actors have the responsibility to protect their citizens in anyway they can from those threats above all else?
This is exactly the argument used by Human rights lawyers in domestic courts in attempts to defeat IP laws particularly in developing nations as a means of delivering medicines in the form of generic substitutes to the population. The essence of this debate can be seen from the dicta of a Chilean court decision in favor of human rights in 2013,
“In many cases, the discussion is about how much time a person has left to live…one could maintain that if private or public resources do not cover the cost of expensive medicines, there is nothing left to discuss. Is this [lack of access] constitutionally tolerable only so that we might improve the judicial protection of patent rights?”
The Problematic nature of Pharmaceutical Transnational Corporations
Attempting to use regulation and human rights in a bid to control the profiteering activities of Bio-medical companies becomes even more challenging when facing companies which are trans-national in reach and have budgets and supply chains which span across continents. The barriers are manifold but can be grouped into the following headings:
- The Multi-national nature of these companies makes them subject to many different laws. Like their industry counterparts large pharmaceutical and biomedical producers usually have diverse operations and processes spread out in different jurisdictions which make it difficult and quite often expensive to bring actions against them. A case in point can be observed with the drug company Pfizer whose head office is based in New York, with the bulk of its manufacturing and its global treasury and finance services taking place in Ireland. Its research and development however takes place in the US and UK with over six hundred subsidiaries in different countries. An analysis of Pfizer on the basis of legal and economic parameters would reveal the following: Pfizer is a Delaware corporation, which is advantageous for their rules concerning corporate self interest and governance, their financial services is located in Ireland which provides them with an advantageous tax rate. And its subsidiaries are spread in many different jurisdictions with differing legal systems making actions against them subject to different rules and restrictions.
- Like their industry counterparts Biomedical Companies invest heavily in these different jurisdictions making it inconvenient for national governments to regulate them. In continuing the example given, Pfizer’s investment into the economy of Ireland for instance currently exceeds 7 billion USD which is an investment which smaller developing countries cannot afford to lose. The leverage here is purely economic and like other TNC’s, governments are often reluctant to enact legislation to restrict the activities of these companies and risk having them relocate their activities to more favorable jurisdictions.
- Trans-national Pharmaceutical Corporations (TNPC’s) by their very nature are not sovereign states and therefore cannot sign treaties on international law. This fact makes for an interesting and cumbersome process whereby the public at large must rely on local government and their judiciaries to enforce the mandates as prescribed by international treaties, especially on the subject of human rights.  Unfortunately, however different state actors will act in their own self interests and are quite often corrupt leading to selective and unequal enforcement of human rights obligations under these treaties. In addition, attempts to harmonize the registration rules for the products of these companies have met with unexpected negative effects. The International Conference on Harmonization created in 1990 for example which attempts to harmonize the regulation pathways between Europe, Japan and the US, has introduced the two important guidelines; the Good Manufacturing Practice (GMP) and the Good Clinical Practice GCP guidelines. These guidelines however have had the negative effects of raising the cost of registration of products to market and have in the long run advantaged larger manufacturers with the resources to sustain such stringent regulation. They have also had the effect of amplifying the problem of neglected diseases since the stakes involved in bringing a drug to market and the expectation of a positive return on investments have grown in these countries. 
- Transnational corporations are adaptable to the legal environment. Attempts to advantage generic drug manufacturers over their more powerful counterparts in the pharmaceutical sector have been marginal at best owing largely to a system of strategic mergers and acquisitions by large manufacturers who have seen the benefit of simply acquiring smaller generic firms and establishing generic arms of their own in order to gain a footprint in that sector. Examples can be seen in Merck’s merging with Schering Plough in order to improve their supply chain to developing nations, Pfizer’s Wyeth acquisition which gave the company access to more patents on vaccines and drugs which were under the Wyeth portfolio. 
Other companies such as Johnson and Johnson and Novartis which were drug manufacturers have chosen the road of diversification into consumer oriented products and medical devices and diagnostic machine production. 
Both of these strategies are less of a survival strategy as they are a re-routing of power since both strategies lead the consumer straight back to their core business which is the consumption of pharmaceutical products.
Regulation and legislation therefore have not only forced the TNPC’s to adapt but have actually made them stronger. This is to be anticipated as the business world by and large remains more flexible and amenable to change than the Trans-national legal order. It is for this reason solutions which require a more positive and co-operative approach to regulating these industries are needed.
The effect of Transnational legal systems (TLS) on Access to medicines
Transnational legal systems have traditionally provided a sense of order with regard to the regular functioning of human rights as well as trading rules between nation states. As of the last 30 years however, with the development of more complex business models and more health crises this sense of order has become disturbed by conflicting legal regimes.
With regards to the question of access to medicines the conflict arises between the question of respecting patent integrity, a position supported by organizations such as the World Trade Organization, and the World Intellectual Property Organization and the interests of the human rights of the millions of people who suffer in the developing world from completely treatable diseases were it not for lack of access to essential medicines; a position often supported by the World Health Organization and the United Nations Human Rights Council. 
The arguments on both sides of this confrontation are legally and socially valid in that patent integrity and the resulting profit which comes from it as protected by international law is seen as one of the main drivers of Research and development into medicines and therapies which is a benefit to the society.
Alternatively, to deny access to medicine to the world’s developing nations on the basis of a legal principle is directly harmful to society both in the cases of the millions of people who die as a result of it and also in the sense that the foundation of social morality and justice is rooted in a collective acknowledgement of the distress of others who share the human condition. To ignore the suffering of others therefore is destructive to the essence of what it means to be human.
Helfer provides a four phased model of the development of this TLS confrontation from the early 1990’s which saw the establishment of Intellectual Property laws in various jurisdictions which were highly aligned but unsettled in their application. The overarching international Intellectual property regulation at the time was the Paris Convention first adopted in 1883. This convention harmonized procedures relating to priority, registration and licensing but did not require the member states to recognize product or process patents for medicines.
During the mid 1990’s-2000 however Pharmaceutical companies, worried about the infringement of their patent rights especially in developing nations lobbied for an expansion of IP rights protection. This resulted in the incorporation of IP into the World Trade Organization under the Trade Related Intellectual Property Rights Agreement (TRIPS) which came into force on January 1st 1995. This development forced the signatories of this convention to also sign into the TRIPS agreement recognizing a solidifying patent protection throughout the organization.
This allowed Pharmaceutical companies and the firms representing them to file direct complaints against countries who were not honoring the TRIPS protocols and also to negotiate further bilateral treaties that required pharmaceutical patent protections which exceeded the trips agreement because of the precedent set by the WTO.
The period following the year 2000 to the present date saw a rise in activism on the part of human rights advocates, NGO’s and nations in the developing world against what they saw as unfair restrictions of the TRIPS and related agreements which were negatively impacting the poorest regions of the world by blocking access to medicines and endangering public health.
Their arguments levied on the international, regional and domestic levels were integral in defeating the lawsuits levied against Brazil and South Africa.
It is in this time frame, the battle of the legal systems concerning Human rights and Intellectual property systems came to a head.
Present situation concerning the Transnational legal system
created between the Human Rights vs the Intellectual Property legal systems has
shifted from the international spectrum and now battles are being waged in the
domestic courts. After the success of Human rights advocates in the case of
South Africa versus the US and the conglomeration of pharmaceutical companies,
a coalition of Human Rights NGO’s sought reform and clarification that
did not in fact intend to interfere with national policies to promote access to
In the Doha round of the WTO trade negotiations in 2004, it was held that
nations may use flexibility in the TRIPS agreement to promote access of
medicines to their populations in response to national health emergencies and
the least developed countries were given a waiver to defer IP protection for
pharmaceutical products for another ten years.
Domestic litigation however remains a battleground of interpretation for most drug manufacturers in pursuing IP protection.
In Sankalp Rehabilitation Trust v. F. Hoffmann-LA Roche for example, the plaintiff a generic drug manufacturer successfully challenged the patent protection on a Hepatitis C medication after two appeals to the India intellectual Property Board. It is significant that the challenge was brought on the basis of obviousness in the light of prior art and the case itself was brought “for the benefit of drug users”.
In Novartis Pharma AG v. Monte Verde SA, drug Manufacturer, Novartis sued the Argentinian drug manufacturer for the use of data which it had collected on its branded drug Gleevec through clinical trials. The company sought exclusive rights to the data on the premise that the Argentinian Government should honor its TRIPS obligations but was denied by the Argentinian appellate court on the grounds that to strictly impose the demands on companies to conduct their own tests would present an obstacle to preserving public health and a barrier to Argentina being able to facilitate and promote the public’s right to health.
The trend therefore seems to favor the precedence of human rights concerns over IP law however this seems to correlate unsurprisingly to the jurisdiction where these cases are heard.
between these legal systems however is demonstrative of a wider social conflict
between social and corporate interests. The solution to this divide requires a
multifaceted approach incorporating both juridical and mediation elements if
progress is to be made.
The polarization of interests already discussed represents a major stumbling block to practical solutions concerning the issue of access to medicines. In brief, both the Human Rights and the Patent Rights sides of the argument view their positions as absolute and ensured by international law.
The unfortunate facts of the situation are that they are both correct in this regard as it concerns the trans-national legal systems and their protections. The strategy to resolve this issue in the past has been to influence the creation and expansion of more laws or the restricting of existing laws to gain advantage. Clearly this has been largely unsuccessful as it has not made much of a difference to the situation concerning access to medicines in the developing world.
The preferred solution may lie more in mediating the interests of both groups as opposed to the constant litigation which places a financial strain on businesses and represents money which could have been put to better use such as providing greater access to much needed medicines.
Specifically, the path of partnership and mediation could be realized in the following ways:
- Priority vouchers for companies who develop new drugs for societies for their more profitable drugs from regulatory authorities.
- Using Public/Private partnerships to co-sponsor research and development for drugs relevant to the developing world.
- The development of a Corporate rating system for companies actively involved in creating solutions for the developing world. This rating system could then be used to to inform users of company products both in the developed and developing world as to which companies are more deserving of patents and more sympathetic to the difficulties encountered by patients in the poorest countries.
- Mandatory clauses in human rights conventions urging states to create local legislation which encourage private companies to contribute to the society.
The Voucher System
The concept of a voucher system for incentivizing drug companies to create new and better drugs for the developing world is by no means a novel idea. Ridley et al. suggest a voucher system which would enable the holder of a voucher to a priority placement for the development of any of its popular blockbuster drugs. In order to obtain the voucher, the company/developer would need to meet the following requirements:
- Treat a neglected disease such as Dengue.
- Receive approval by a regulation authority such as the US FDA
- Be clinically superior to existing treatment options.
- Forgo Patent registration and be open to access.
- Procure a manufacturer for their product.
This would help to incentivize developers to invest in R&D in neglected diseases with the expectation of a return on investment, however it is limiting in terms of its scope. This solution according to Ridley et.al, assumes the benefits of a deferment of one year off the registration of another blockbuster drug would outweigh the benefits of the opportunities presented by registering a patent for drug which treats a neglected disease and establishing a generic arm of the company to distribute the drug at exorbitant prices to the developing world which is an option open to companies.
As an expansion of this suggestion it would be wise to promote the voucher system as a form of equity by granting pharmaceutical developers not only deferment on their next blockbuster drug by widening the scope to include priority licenses for their affiliate generic arms in the developed world to produce these drugs. The expansion of this voucher system would have the following benefits:
- Give advantage to these companies by ensuring control of their product and the economics to be derived from first entry into the markets of developing nations.
- Create marketing and public image opportunities through exposure as being globally socially responsible citizens.
- Create a form of marketable equity which would raise the overall value of a company assuming that the voucher is transferrable.
These benefits would not only satisfy the requirements of most directors in terms of their fiduciary duties to the maximization of shareholder value but would also create a foundation for further discussion on the subject of corporate accountability where both parties’ interests are taken into consideration.
The use of Public/Private co-sponsorship
The incorporation of public sources of sponsorship in the fight to reduce the negative effects associated with neglected tropical diseases is also by no means a novel concept. The alliance of public organizations and private companies has taken shape in many different forms. The Accelerating Access Initiative for example, which promotes access to HIV/AIDS is comprised a conglomerate of Drug companies like Abbott, Boeringer and Gilead in cooperation with international organizations such as UNAIDS, UNICEF, WHO and the World Bank. This co-operative effort seeks to provide access through pricing strategies and the conduct of clinical trials in the developing world. Their efforts have seen an increase in the number of patients receiving treatment from these companies increase by 77% in 2008. A substantial increase from the preceding year with 446,000 being treated in the African continent alone.
Viramune Donation program on the
alliance formed by Boehringer Ingelheim and specific governments in the
developing world relies on donations of the
drug by the company in single does to
deal with the problem of mother-child
transmission of HIV/AIDS.This
strategy has also had marginal success with 1.7 million doses of the single
dose drug nevirapine being made available to 169 programs in 59 countries.
These alliances however only have the power to produce marginal results for the 80% of the world’s population which live below the poverty line and for a certain limited time. Taylor provides an annotated catalogue of the public/private partnerships which have assisted with the problem of access to medicines. In his 2010 report for the Cameron Institute, he reports that the greatest barriers to access to medicine are not drug prices or patents but what he refers to as “on the ground” barriers such as market failure, corruption, non existent health human resources and infrastructure.
He also makes note of biases and gaps in the literature with respect to access to medicines which he based on a review of over 50 articles published between 1992 and 2009. The review revealed a number of recurrent themes which have tilted the debate on access to medicines in an erroneous direction and provided an additional barrier to the concept of partnership. Specifically, the review found that the majority of articles targeted cost of medicines as the major barrier to access to medicines when in fact the evidence suggests that infrastructure in the developing world posed an even greater threat to access with 20% of medicines supplied to government facilities in the least developed countries in 2010 being stolen and resold by staff which would explain the shortages experienced by the dispensaries of these nations.
As a result, a more coordinated and effective approach is warranted if the companies and organizations involved in these partnership are to have a more than just “marginal” effect on the problem. The creation of a new multi-lateral access system made up of all of these partnerships and International Organizations would be more efficient in addressing the problem and would have these additional benefits:
- There would be less redundancy of effort especially in areas as sub-Saharan Africa.
- Division of effort and labor would mean that private organizations could concentrate on the provision of medicines whereas the international organizations in collaboration with local governments could concentrate on upgrading their infrastructure and policies.
- This unified body could assist in regulating biases and corruption on the part of government officials and academics by providing accurate statistics and evidence as to what is actually being done in the field by these private companies.
- There would be no need for the creation of a plethora of new laws by international organizations and less lobbying on the part of interested factions to sway the legal and political environment in their favor.
- The reach of such an organization with the combined strength of these partnerships would be greater.
Development of a corporate rating system.
Like the concept of a voucher system, an international corporate rating system would essentially provide consumers and investors with an idea of how active a company has been in addressing the challenges faced by society. The specific elements of this rating system could be used in collaboration with the voucher system in that companies who do bring new drugs and therapies to market, which are relevant to the developing world and forgo the patenting of these drugs in the interests of preserving human health; would be given a high rating which in turn could be used in their marketing strategies to investors and the public.
The rating designation itself can be seen as a corporation asset which could add value to a company. In a world where social justice concerns have become more prolific in light of the activism of human rights organizations; having a public image of being a socially responsible corporate citizen is in itself a significant intangible asset. Investors and consumers alike are more likely to make choices based on moral and ethical bases on the information they receive in the news media.
In addition, several studies have shown that there is a positive correlation between a company’s social representation and financial performance. Margolis and Walsh for example reviewed 127 empirical studies which explore the relationship between the corporate social performance (CSP) and corporate financial performance (CFP) of companies. The results based on a simple compilation of the findings demonstrated that there was a strong positive correlation between the two variables. The essential benefits of such a rating system could be summarized as follows:
- Sensitizing corporations to the benefits presented by corporate social performance and responsibility.
- Affording corporations who are good corporate social citizens an advantage in terms of a more positive public image for marketing over companies who see profiteering at the expense of public health as a viable business strategy.
- Further sensitizing the public as well as investors as to which companies have strategies which are ethical and socially conscious so as to better inform their choices and as a result make it less desirable for companies engaged in profiteering to continue the practice.
- Provide for a system of reporting which is based on actual fact and evidence as opposed to the biases of overzealous human rights activists or the opinions of paid actors financed by corporations.
Using Human rights agreements as a platform for regulating CSP
The UDHR, the European Convention on Human rights (ECHR) and other related international and regional human rights treaties all require their member states to respect the lives and health of their populations but do not require member states to enact legislation to protect and regulate the activities of their corporate citizens with respect to human rights. The reasons for this may have been two-fold. In the first instance when the major treaties on Human rights were being developed the authors of these documents may well not have imagined a world with corporations spanning continents. The second reason may have a lot to do with the fear of threatening the sovereignty of member states by encroaching into their parliamentary process. In essence many nation states would be less likely to become signatories to agreements which made direct demands with regards to the laws enacted within their territories.
This fact however did not appear to be too much of a concern in the case of the TRIPS agreement formulated under the WTO which required member states to ensure protection of intellectual property within their territories. The WTO still boasts a total of 164 members to date.
Using this precedent, the same could be required under international human rights law to nations who are signatories of the International Covenant on Economic, Social and Cultural Rights (ICESCR) and the International Covenant on Civil and Political Rights (ICCPR). These major international covenants comprise 164 and 169 member states to date with six more members of the ICCPR joined with ratification pending. Amendments made to either or both of these covenants in the way of securing better access to medicines through requiring member states to be socially responsible in their laws would allow for legal mechanisms to be put in place to discourage profiteering and exploitation tactics on the part of corporations which are against the best interests of public health and safety.
It seems counter-intuitive to rely on the decisions of the judiciary on matters pertaining to public health which is a global human rights concern. A framework should be provided at the international, regional and local levels to inform jurists of the limits of the law in this respect specifically to avoid uncertainty on subjects such as access to medicines.
This framework should not be over reaching in its scope but should recommend that all corporate entities transacting business within a particular territory, should to the best of their ability act in the best interest of the public who constitute the market for their products; and that shareholder interests must be reasonably balanced with stakeholder interests. The specifics of this balance to be determined from territory to territory. The benefits of such a framework would include,
- Making use of the legal apparatus already in place internationally.
- Solidify civil and possibly criminal remedies against corporations which do not respect human rights as a general rule.
- Discourage Directors of corporations from price gouging or any other practices which would endanger public health by limiting access to medicines.
Suggestions for further research.
Human Rights as a subject on the whole has received a lot of academic attention. Studies on the effects of corporate interests on access to medicines are also available in abundance. This study examines the complexities of navigating the war of interests presented by business interests and human rights organizations as represented by the two distinct trans-national legal positions of Intellectual Property Rights and Human rights.
These positions need not be polarized and a source of conflict in court rooms around the globe; rather further studies should be conducted which are “article specific” within the two legal regimes with the aim of providing guidance to lawmakers on what to avoid when creating or amending existing laws.
The law theoretically should form a harmonious body of rules which support an ordered society. Studies into where existing laws may actually cause conflict within the society are necessary. This paper shows Articles 3 and 25 of the UDHR when taken at face value do represent the authors’ best intentions for a society founded on care and concerned for others; however, when placed within the context of the rights of patent holders who equally have a right to a fair return on their investments of time and finance, the concept of human rights assumes a different perspective.
Further research on other conflicts
which may impact on human rights should also be undertaken as there is always
the danger of perceiving human rights as an absolute to which there can be no
challenge. This is the view taken by some social justice groups which does
nothing to further the discussion. More balanced and objective views on the
subject which are evidence based are required to ascertain first the entire
scope of the problem and other solutions not considered within this paper.
The Universal Declaration of Human Rights and all the subsequent graft documents which are based on the tenets contained within it represent an optimistic outlook of a society governed by rules based on conscience and law. Unfortunately, it is precisely this outlook which can lead to conflict when two transnational legal regimes seem to contradict each other.
This paper examined the conflict
between two distinct and often polarized interest groups.
That of the Biomedical
and Pharmaceutical corporate developers and also Human Rights Organizations who
support greater access to medicines for the world’s poorest nations. Each of
those opposing factions have a claim to protection under international law.
The transnational legal regimes have in turn always operated to serve the interests of the public. The establishment of a robust system of patent protections in the form of the World Intellectual Property office and more recently the TRIPS agreement under the WTO ensure just returns on investment particularly for pharmaceutical developers who bring much needed drugs to market. Without this incentive it is unlikely that many remedies would have been researched for many of the world’s deadliest diseases. A problem arises however when companies in these essential industries pursue a business strategy which ignores the world’s most vulnerable and poorer markets to concentrate on the development of products which only assist industrialized nations which can afford to maximize the profits for their shareholders.
In such a situation the concept of Human Rights and the application of Article 3 and Article 25 of the UDHR becomes a source of argument, for if human beings are indeed entitled to the right to life and the right to health then surely access to medicines which can be made available to them via the efforts of these companies should be facilitated by any means necessary.
When seen from this perspective the argument becomes one of moral priority which shifts the argument to a position where decisions have to made as to which transnational legal regime has precedence over the other.
This paper however argues that this outlook is inherently false in its perception of the variables at stake, for to insist on access to medicine through compulsory licensing and facilitation of generic alternatives would be to damage the incentives which led to the creation of these drugs in the first place. Similarly, to insist on the respect for patent obligations over human rights concerns is equally damaging to the human condition as millions of lives could be lost. Both positions are inherently self- defeating and are positions which are indefensible in the long run if pursued absolutely.
The establishment of a middle path between the two based on mutual consideration of the others’ interests is essential if there is to be a permanent solution to the problem. Years of lobbying for stronger positions in the international legal community and thousands of research papers on these topics have done little to actually alleviate the suffering of millions of people who still die from preventable illnesses due to lack of medicines.
This paper suggests that the answers may well lie in more co-operative strategies between the two camps and that this should begin with Transnational legal reform aimed at harmonizing the interests of these opposing viewpoints.
This reform however should not take place in isolation but should be accompanied with more proactive social and economic adjustments on the part of pharmaceutical developers and human rights groups.
These adjustments should come in the way of lasting and meaningful partnerships formed which would address the actual problem presented by access to medicines instead of simply addressing the arguments on both sides. It must be understood that the business community has a right to profit from their investments and as such all endeavors should be made worthy of these investments of time and money through benefits such as “voucher systems” and positive rating systems. Similarly, the business community should be made to understand that a certain amount of social responsibility to the public who constitute both the users and market for their products is necessary for without them there would be no business. An attitude therefore which gives back to the public in the form of complimentary access to medicines or funding to organizations whose purpose is the eradication of preventable diseases from the planet should be part of the discussion in all business boardrooms not as a matter of legal mandate but as a matter of better business strategy.
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 Jeanne Whalen, ‘Why the U.S. Pays More Than Other Countries for Drugs: Norway and other state-run health systems drive hard bargains, and are willing to say no to costly therapy.’  see: 5 http://www.wsj.com/articles/why-the-u-spays-more-than-other-countries-for-drugs-1448939481
 Rep. of the Special Representative of the Secretary-General on the Issue of Human Rights and TransnationalCorps. and Other Bus. Enter., U.N. Doc. A/HRC/11/13 (Apr. 22, 2009), available at
 Hunt P (5 May 2009) Report on Mission to GlaxoSmithKline. UN Human Rights Council.
A/HRC/11/12/Add.2. Available: http://www.essex.ac.uk/human_rights_centre/research/rth/
UN%20right%20to%20health%20report%20on%20GSK%20as%20published%20May%202009.pdf.Accessed 25 August 2010
 Susanna Every-Palmer and Jeremy Howick, ‘How evidence-based medicine is failing due to biased trials and selective publication.’  Journal of Evaluation in Clinical Practice (20)
 Arthur Schafer, ‘Why drug-industry funding of university research should be banned’  Winnipeg Free Press. See: https://umanitoba.ca/faculties/arts/departments/philosophy/ethics/media/Why_drug-industry_funding_of_university_research_should_be_banned.pdf
Moynihan ‘Who pays for the pizza? Redefining the relationships between doctors
and drug companies.’  BMJ 326 (1189)  Ibid
 Martin L. Hirsch, ‘Side Effects of Corporate Greed: Pharmaceutical Companies Need a Dose of Corporate Social Responsibility’  J.L. SCI. & TECH. 9 (2)
 Delaware General Corporation Law. Title 8, Chapter 1
 DEL. CODE ANN. tit. 8, § 102(b)(7) (1983 & Supp. 1986)
 Guth v. Loft, Inc., 5 A. 2d 503 (Del. Ch. 1939)
 Brennan et al., ‘A Human Rights Approach to Intellectual Property and Access to Medicines.’  Yale Law School and Yale School of Public Health.
 Gleeson et al., ‘How the transnational pharmaceutical industry pursues its interests through international trade and investment agreements: a case study of the Trans Pacific Partnership’  (Draft paper) Edward Elgar Publishing Ltd.
 Delaware State has a long judicial history of providing a favorable legal environment for the registration of US companies and as such the majority of the largest companies in the US are registered in that state
 US Corporation tax rates average 35% whereas the corporation tax in Ireland is 12.5%
 Gleeson et al., ‘How the transnational pharmaceutical industry pursues its interests through international trade and investment agreements: a case study of the Trans Pacific Partnership’  (Draft paper) Edward Elgar Publishing Ltd.
 Brennan et al., ‘A Human Rights Approach to Intellectual Property and Access to Medicines.’  Yale Law School and Yale School of Public Health.
 Ayelet Berman, ‘The Distributional Effects of Transnational Pharmaceutical Regulation’  Graduate Institute of International and Development Studies. See: http://graduateinstitute.ch/files/live/sites/iheid/files/sites/ctei/shared/CTEI/working_papers/CTEI-2012-01.pdf
 Brian Tempest, ‘The Structural Changes in the Global Pharmaceutical Marketplace and Their Possible Implications for Intellectual Property’  International Centre for Trade and Sustainable Development. See: http://unctad.org/en/Docs/iprs_in2011d1_en.pdf
 Gleeson et al., ‘How the transnational pharmaceutical industry pursues its interests through international trade and investment agreements: a case study of the Trans Pacific Partnership’  (Draft paper) Edward Elgar Publishing Ltd.
 M N Graham Dukes, ‘Accountability of the pharmaceutical industry’  Lancet 4 (360)
 Laurence R. Helfer, ‘Pharmaceutical Patents and the Human Right to Health: The Contested Evolution of the Transnational Legal Order on Access to Medicines’.  Cambridge University Press. See: http://scholarship.law.duke.edu/cgi/viewcontent.cgi?article=6119&context=faculty_scholarship
 Chuan-Feng Wu, ‘Transnational Pharmaceutical Corporations’ Legal and Moral Human Rights Responsibilities in Relation to Access to Medicines’ 
 Laurence R. Helfer, ‘Pharmaceutical Patents and the Human Right to Health: The Contested Evolution of the Transnational Legal Order on Access to Medicines’.  Cambridge University Press. See: http://scholarship.law.duke.edu/cgi/viewcontent.cgi?article=6119&context=faculty_scholarship
 Gleeson et.al ‘How the transnational pharmaceutical industry pursues its interests through international trade and investment agreements: a case study of the Trans Pacific Partnership’  (Transnational Corporations, Alice De Jonge and Roman Tomasic eds.) Edward Elgar Publishing Ltd
 Sankalp Rehabilitation Trust v. F. Hoffmann-LA Roche AG, India, Intellectual Property
Appellate Board, Nov. 2, 2012.
 Novartis Pharma AG v. Monte Verde SA, Argentina, Cámara Federal de Apelaciones
[Federal Jan. 2, 2011, Causa No. 5.619/05.
 Ridley.et al., ‘Developing Drugs for Developing Countries: Linking incentives for essential drugs in developing countries with “blockbuster” drugs in the developed world would help both achieve better population health.’  Health Affairs 25 (2)
 Wayne Taylor, ‘Pharmaceutical Access in Least Developed Countries: on-the-ground barriers and industry successes.’  The Cameron Institute.
 Department of Economic and Social Affairs, United Nations. ‘Social Justice in an Open World.’  New York. See: http://www.un.org/esa/socdev/documents/ifsd/SocialJustice.pdf
 Margolis and Walsh (2003), Mahon and Griffin (1999), Orlitzy et el (2003), Survey from the Economic Intelligence Unit, (BusinessGreen 2008) all substantiate a positive correlation between CSP and CFP
 J.D. Margolis and J.P. Walsh, ‘Misery loves companies: social initiatives by business’  Administrative Science Quarterly 48
 Sumner B. Twiss, ‘History, Human Rights, and Globalization.’  The Journal of Religious Ethics. 32 (1) see: http://www.arch.mcgill.ca/prof/sijpkes/aaresearch-2012/in-extremis-file/references/Globlization-human-rights.pdf
 John Ruggie, ‘Business and Human Rights: The Evolving International Agenda.’  Harvard University. Working Paper No. 38. Cambridge, MA