🚀 go-pugleaf

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Sender: netsource-l@think.service.jp
Reply-To: Hendrik <fqo4@hiz.bc.ca>
Date:  Thu, 25 Nov 1999 23:14:15 +0900
From: Hendrik <fqo4@hiz.bc.ca>
To: Multiple recipients of NETSOURCE-L <netsource-l@think.service.jp>
Subject:  [NS] Illegal and Immoral: Free Trade (4)

CORPORATE RIGHTS VS. HUMAN NEED

For many years, the potential market for baby foods and infant formula
in the "developed" countries has been shrinking because birth rates have
declined. Therefore, to create new demand for their products, baby food
corporations have aggressively sought to "open new markets" in the Third
World.

A key vehicle for "opening new markets" is advertising intended to
convince women that breast-feeding their babies isn't "modern" and
bottle feeding is healthier. Of course the premise of such advertising
is medically false -- breast-feeding provides superior benefits compared
to all synthetic substitutes. (Breast-feeding provides an infant with
significant immunity against disease; it creates a strong emotional bond
between mother and child; it helps prevent breast cancer in the mother,
and more.) Nevertheless, many women are taken in by the false
advertising; as a result, according to the United Nations Children's
Fund (UNICEF), only 44% of infants in the Third World are breast-fed.
(The proportion is even smaller in "developed" countries.)

Chiefly because of this false advertising, according to UNICEF, 1.5
million infants die each year because their mothers unwittingly prepare
infant formula with contaminated water, causing fatal diarrhea.

During the 1970s, a world-wide grass-roots campaign focused attention on
this problem, boycotting products made by Nestle, a major manufacturer
of infant formula.

Partly because of the Nestle boycott, the World Health Organization
(WHO) developed and published a Code on Marketing of Breast-Milk
Substitutes. The WHO code prohibits words like "humanized breastmilk"
and "equivalent to breastmilk." Furthermore, to protect illiterate women
from being duped, the WHO code prohibits pictures on labels "that
idealize the use of bottle feeding."

In 1983, Guatemala passed a law and regulations incorporating the WHO
code. The goal of the Guatemalan government was to encourage new mothers
(1) to breast-feed their infants and (2) to fully understand the threats
to their babies of using infant formula as a substitute for breast milk.
The Guatemalan law prohibited the use of labels that associated infant
formula with a healthy, chubby baby; specifically, the law prohibited
pictures of idealized babies on packages of baby food intended for
children younger than 2 years. Furthermore, the Guatemalan law required
labels to carry a statement that breast-feeding is nutritionally
superior.

The law also prohibited baby food manufacturers from providing free
samples of their products (if a baby starts taking free samples the
mother stops lactating, thus converting mother and infant into
full-time, paying customers). And finally the law prohibited baby food
manufacturers from directly marketing their products to young mothers in
the hospital.

The regulations went into effect in 1988 and all domestic and foreign
manufacturers of baby foods -- with one notable exception -- came into
compliance. Infant deaths attributable to bottle feeding declined, and
UNICEF began highlighting Guatemala as a model for what works.

However, the U.S. baby food manufacturer, Gerber (motto: "Babies Are Our
Business"), objected to Guatemala's new law. Although the Guatemalan
Ministry of Health made numerous attempts to negotiate with Gerber, the
company reportedly continued to market its infant formula directly to
mothers in the hospital, and continued to give free samples to doctors
and day care centers.

Most importantly Gerber refused to remove its trademark picture of a
chubby, smiling baby from its product labels, and it refused to add a
phrase saying breast milk was superior. In sum, Gerber thumbed its nose
at Guatemalan health authorities, who were trying to protect their most
vulnerable citizens, infants, against harm.

In November, 1993 -- ten years after Guatemala passed its law, and five
years after its regulations went into effect -- Gerber lost its final
appeal. A Guatemalan Administrative Tribunal ruled in favor of the
Ministry of Health and it looked as though even Gerber would have to
comply with the Guatemalan law.

But Gerber opened a new line of attack on Guatemala, arguing that the
Guatemalan law was illegal under international statutes because the law
was really an "expropriation of Gerber's trademark." This tactic bought
Gerber some time while the World Trade Organization was being created.
Then in 1995, when the WTO came into being, Gerber dropped its claim
about illegal expropriation of its trademark and began threatening to
challenge Guatemala before a WTO tribunal.

Within a short time, Guatemala realized it was now up against immense
power and the Guatemalan government changed its law to allow Gerber to
have its way. Gerber won without ever having to formally request that
the U.S. take its case to the WTO. Just a few letters containing the WTO
threat were sufficient.

This example illustrates another marvelous feature of the WTO -- the
ease with which small, poor countries can be intimidated by
transnational corporations into "opening their markets." Under WTO
rules, countries must open their markets to foreign corporations and
governments cannot establish, as a precondition of doing business, that
their domestic laws will be respected. In effect, the WTO has given
corporations a powerful new way to challenge the laws of any government
(federal, state or municipal).

Many poor countries, including Guatemala, cannot afford to support a
full-time delegation to monitor the WTO in Geneva, Switzerland. Nor can
they maintain in-house legal expertise on fast-changing WTO rules. They
could legally hire outside counsel and experts to defend themselves
against a WTO challenge but the cost of such a defense would be several
million dollars. Countries that know the ropes in Switzerland and have
money to burn can use procedural ploys that make the WTO a very
expensive arena in which to litigate. For example, one country can
challenge the credentials of another country's delegation, thus
prolonging the proceedings indefinitely. As Ralph Nader's organization,
Public Citizen, has written, "The WTO practice of allowing rich
adversaries to object to the delegations of poor countries undermines
poor countries' meaningful participation in the WTO -- and makes threats
of WTO challenges enormously powerful tools to forestall the adoption of
public health safeguards by poor countries that need them the
most."[1,pg.117]

The pharmaceutical corporations in the U.S. and Europe evidently learned
an important lesson from Gerber's victory over Guatemala. The drug
corporations have launched a campaign of threats against countries that
are trying to make medicines more affordable and accessible to their
citizens. South Africa, Thailand and India are examples.

In 1997, under the leadership of Nelson Mandela, South Africa passed a
Medicines Law which has not yet taken full effect. When all the
provisions of the law are implemented, it will encourage the use of
low-cost generic drugs, and it will prohibit drug companies from paying
bounties to doctors for prescribing particular drugs. The Medicines Law
has two additional provisions that the pharmaceutical corporations find
particularly distasteful:

(1) the law requires drug companies to license their products to other
companies who must then pay a royalty fee to the drug's developer. Such
a law encourages competition in the manufacture of new drugs, thus
making modern drugs available at reduced cost.

(2) The second provision is called "parallel importing" and it allows a
pharmaceutical product to be imported from several different countries
simultaneously, thus taking advantage of the lowest prices available.
For example the antibiotic Amoxicillin costs 50 cents per tablet in
South Africa, 30 cents in New York and only 4 cents in
Zimbabwe.[1,pg.114] South Africa's new law would make Amoxicillin
cheaper and thus more widely available to the people of South Africa,
many of whom are poor.

Transnational pharmaceutical corporations, with assistance from the
Clinton/Gore administration, are now using threats of WTO action to
force South Africa to repeal its Medicines Law. When AIDS activists
protested the Clinton/Gore administration's role in trying to overturn
South Africa's Medicines Law, a "senior Gore advisor" issued a statement
defending Mr. Gore: "Obviously the Vice President's got to stick up for
the commercial interests of U.S. companies."[1,pg.121] Mr. Gore is doing
more than merely sticking up for U.S. corporations. U.S. State
Department memos describe a "full court press," led by Mr. Gore, to
force South Africa to "repeal, suspend, or terminate" its Medicines Law.
As the U.S. sees it, there is simply no choice -- under WTO rules, the
intellectual property rights of corporations have higher priority than
human health; this is, in fact, a correct interpretation of WTO rules.
However, Mr. Gore seems to recognize that his campaign against medical
care for the poor in South Africa might come back to bite him. When
pressed by the group ACT-UP in June 1999, Mr. Gore issued a statement
denying that he was pressuring South Africa.[1,pg.123].

The South Africa case is not unique. In 1992, Thailand established a
Pharmaceutical Review Board which established compulsory licensing for
medicines. A firm with an exclusive patent on a critical medicine was
required to license other companies to manufacture it, with royalties
paid to the patent-holder. This created competition and drove down the
price of critical medicines for the people of Thailand, such as Pfizer's
Flucanazole, used to treat meningitis. After compulsory licensing, the
cost of treatment with Flucanazole dropped from $14 per day to $1 per
day in Thailand. However, the U.S. pressured Thailand relentlessly for 7
years until the Thai Pharmaceutical Review Board was formally abolished.
The U.S. argued successfully that such a Board is illegal under WTO
rules.[1,pg.113] Under WTO rules, corporate intellectual property rights
have higher priority than human health.

For many years, India had a law making it illegal to patent a substance
"intended for use, or capable of being used, as a food or as [a]
medicine or drug."[1,pg.105] A WTO tribunal ruled in 1997 that India's
law is illegal. Using the WTO as a battering ram, the U.S. successfully
pressured India to abandon its prohibition against patenting food and
pharmaceuticals.

Now W.R. Grace has filed for a U.S. patent on a pesticidal byproduct
made >from the Neem tree, which grows only in India. Neem has been used
for centuries in India to make medicines and bio-pesticides. Indeed, the
Neem tree is nicknamed "the village pharmacy." W.R. Grace claims that it
has a new method of producing the pesticides that indigenous people have
produced for hundreds of years. Grace now says it deserves the exclusive
right to sell the products that were developed by indigenous communities
-- and Grace argues that under WTO rules the government of India has an
obligation to enforce Grace's patent rights.[1,pg.110]

It appears that the WTO is a nearly-perfect vehicle for extending
corporate dominance into every corner of the world. But the corporations
are not yet satisfied. The purpose of the WTO meeting in Seattle
November 29-Dec. 3 is to consolidate and extend the WTO's power even
further. To get involved, phone toll-free 1-877-STOPWTO.
==============
[1] Lori Wallach and Michelle Sforza, WHOSE TRADE ORGANIZATION?:
CORPORATE GLOBALIZATION AND THE EROSION OF DEMOCRACY (Washington, D.C.:
Public Citizen, Inc., 1999). ISBN 1582310017; telephone (202) 588-1000.

--

Source:
RACHEL'S ENVIRONMENT & HEALTH WEEKLY #677
Received from <montague@world.std.com>
as e-mail message dated Sat, 20 Nov 1999 16:45:57 -0500 (EST)

Further information:
RACHEL's Environment & Health Weekly is available at this site:
http://www.rachel.org/bulletin/index.cfm?St=3

[...]

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