Malaysia’s entry into the Trans-Pacific Partnership Agreement (TPPA) will not undermine national sovereignty nor lead to price hikes for medicine, International Trade and Industry Minister Datuk Seri Mustapa Mohamed says in an open letter to critics.
In the letter sent to The Malaysian Insider, Mustapa said there have been several“misconceptions” among the public and various non-governmental organisations about the two matters after the full text of the controversial trade pact was released two days ago.
There was argument, he said, that Malaysia’s participation in the TPPA would prevent access for its citizens to affordable medicines because of the clause on patent extension but this allegation was “not accurate”.
“The patent protection for pharmaceutical drugs remains at 20 years, consistent with the WTO trade-related aspects of intellectual property rights (TRIPS) agreement, Only in the event there is an unnecessary delay in patent or marketing approval will the patent period be extended,” the minister said in the letter.
“Let me state clearly that Malaysia’s current process of patent and marketing approval for drugs is efficient and hence the likelihood of patent extension will not arise. Therefore, the allegation that the patents clause will result in the price of medicine increasing because of TPP is not accurate.”
Mustapa said certain conditions under the TPPA would allow Malaysians to have early access to innovative drugs and it would also create a pathway for more affordable generic drugs to be brought into the market early.
“Malaysia has had a pharmaceutical data protection process in place since 2011, where the test data will be protected for a period of five years. The government has agreed to extend similar data protection to biologics products, so as to provide non-discriminatory treatment.
“The test data protection regulation in Malaysia, however, has conditions that must be met by the innovator. For example, the innovator has to apply for registration of pharmaceuticals in Malaysia within 18 months from the date the product obtained its first marketing approval in any other country,” he said, explaining the condition.
Besides that, Mustapa also denied that the Investor-State Dispute Settlement (ISDS) clause in the TPPA would override national sovereignty, adding that the investment chapter in the agreement was meant to provide a conducive environment should there be disputes.
“The investment chapter in the TPPA is not meant to grant foreign investors greater rights but rather to signal a conducive environment for foreign investors and the assurance of having access to arbitration in the event there is a dispute.
“We must also bear in mind that there are many Malaysian companies which operate overseas and they will also require this protection.”
He said the ISDS was not new to Malaysia as it was also found in 74 bilateral investment treaties (BITs) and eight free trade agreements (FTAs) to which the country has signed.
“To date, only two cases have been taken against Malaysia under the ISDS, one of which has been decided in favour of the government and the other was annulled.”
In addition, there were several safeguards listed into the ISDS mechanism in the agreement.
“These include expedited review and dismissal of claims without merit (frivolous claims) and investors will have to pay for the attorney fees and costs for frivolous claims, consolidation of claims arising from same events or circumstances.
“Also, claims cannot be made after more than three years and six months, have pre-requirement to attempt to resolve a claim through consultation and decision not to issue, renew or maintain a subsidy is not an expropriation and tobacco control or any health measure cannot be made under the ISDS elapsed negotiation before elevating IT to a formal tribunal and mechanism.”
TPPA is scheduled to be tabled and debated in Parliament at a special sitting early next year.
Twelve countries – Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore, the US, Vietnam and Malaysia – concluded the TPP negotiations in Atlanta on October 5.
Detractors of the controversial deal say it would cause negative economic growth and have implications on sovereignty as it would remove the country’s control over policymaking.
They also fear that the deal will put the government at risk of being sued if public interest is prioritised over foreign investors.
Former prime minister Tun Dr Mahathir Mohamad described the deal as a “very bad” agreement and expressed concern that it would affect the competitiveness of Malaysian companies. – November 7, 2015.
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- TPP text released confirms deadly impact of access to medicines in Malaysia — Malaysian AIDS Council [5 Nov 2015]
- Trade pact confirms our worst fears, says anti-TPP group [5 Nov 2015]