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Against Monopoly

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Monopoly corrupts. Absolute monopoly corrupts absolutely.





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Let's close down the only source of cheap pharmaceuticals and pick the public pocket

The Washington Post has a business article today entitled "Crackdown targets counterfeit drugs" which leaves out most of the truth link here. There is no mention that some of these drugs are generic and perfectly legal in the country where they are made. And that the US has for some years stopped enforcing imports of such drugs by individuals. That policy seems to have changed now, if this story is to be credited. However the amount of spam from sellers of such drugs doesn't seem to have abated.

The story begins, "In highly orchestrated raids around the world this week, Interpol officers in Europe, drug agents in the United States and task forces from Sweden to Singapore hunted down counterfeit prescription drugs in an effort to stem a rapidly growing criminal business preying on financially pressed consumers looking for bargains.

"The operation, code-named Pangea, is expected to be disclosed Friday in an effort to put fraudulent businesses on notice that police around the world are fighting back against what has become a $28 million industry in the United States alone." That seems like peanuts compared to the cost of such enforcement operations. And no attempt is made to separate the benefit of the drugs for people who otherwise could not afford treatment. Or the incremental loss to others who use them but must now pay the monopolist's price. For context, note that other news articles report a rise in drug prices of 9% in anticipation of the passage of a health care reform bill. The industry is hardly suffering.

Who is picking the public pocket? The article doesn't say, but the Pharmaceutical Research and Manufacturers of America (PhRMA) is probably behind this, though how a global operation was arranged remains an open question. Maybe we'll find out more later today, as the article promises.


Comments

It's important to distinguish between patent-infringement and trademark-infringement, as well as misrepresentation.

My understanding of the measures reported on in the Wash Po is that they're aimed at *fake* medicines; that is products with faked trademarks, or produced by fraudsters culpable of misrepresentation (eg. by producing a drug which is not what it claims to be - many fakes, for example, are simply placebos).

I do not believe they are seizing and holding or destroying generic drugs which do not commit any of the other offences.

Whatever you views on patents (which are fairly obvious from the list on the left), I think this is an unrelated issue.

Julian:

But then you would have depraved...oops, deprived...John Bennett of a good rant about intellectual property, even if the intellectual property is trademarks, originally intended to prevent unfair competition and sometimes intended to prevent consumer confusion. But, hey, an intellectual property destructionist will rant with minimal motivation, so it is unlikely that actual facts will slow them down.

I'm afraid John B. and Julian are both right. In the former's defense, I've read a number of stories lately (though admittedly not the Wash Po article) on Customs seizures of generics based on patent infringement allegations. There's especially been quite a bit of chatter about this on the Indian blogs; many of the generics seized are from India, and get intercepted at European ports. This confiscation policy was originally intended to stem the flow of illegal drugs. But now the major pharmas and their cohorts are allegedly using the system as a method of patent enforcement.
Thanks for the comments, Anon and Gena. On the latter point, the patent seizures do raise an interesting issue - and I can certainly understand the argument that one jurisdiction shouldn't be able to impose laws on other countries where those laws do not apply. As I'm not an IP lawyer I'm unsure what the precendents are here, but I'd imagine this is unusual--and also counterproductive, as it'll just drive producers to use freer ports instead.

However, according to EU customs reports, 93% of seizures last year were for trademark infringement, NOT patent infringement (which only accounted for 6%). So it seems as if the main tale of EU seizures is being ignored, with the patent seizures hyped up somewhat.


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