The Trans-Pacific Partnership would provide large pharmaceutical firms new rights and powers to increase medicine prices and limit consumers’ access to cheaper generic drugs. This would include extensions of monopoly drug patents that would allow drug companies to raise prices for more medicines and even allow monopoly rights over surgical procedures. For people in developing countries involved in the TPP, these rules could be deadly – denying consumers access to HIV/AIDS, tuberculosis and cancer drugs.
The TPP would also establish new rules that could undermine government efforts to contain rising medicine prices in developed countries like the United States. An analysis of the final TPP text shows taxpayer-funded public health programs would be exposed to pharmaceutical company attacks and constrain future policy reforms to reduce prescription drug costs for Americans. The text explicitly binds Medicare to TPP rules that would limit proposed policy changes to tamp down healthcare costs for seniors.
TPP would further empower foreign pharmaceutical corporations to directly attack our domestic patent and drug-pricing laws in foreign tribunals. Already under NAFTA, which does not contain new corporate privileges proposed for the TPP, drug firm Eli Lilly has launched such a case against Canada, demanding $500 million for the government’s enforcement of its own patent standards.
The TPP would also empower foreign corporations to directly challenge domestic toxics, zoning, cigarette and alcohol and other public health and environmental policies, and to demand taxpayer compensation for “expected future profits” they claim were inhibited by such policies. Often initiatives to improve such laws are chilled by the mere filing of such an “investor-state” case. In other instances, countries eliminate the attacked policies. For instance, Canada lifted a ban on a gasoline additive banned in the U.S. as a known human neurotoxin after an investor-state attack by Ethyl Corporation under NAFTA. Canada also paid the firm $13 million and published a formal statement that the chemical was not hazardous.
Cases now underway include:
- In 2008, Uruguay began implementing its obligations under the World Health Organization’s Framework Convention on Tobacco Control, including enhanced tobacco warning labels and requiring plain packaging for cigarettes. In 2010, Australia followed suit. Philip Morris responded by launching “investor-state” challenges against both countries’ tobacco control policies, asking extrajudicial tribunals to order the governments to suspend plain packaging and compensate the corporate tobacco giant for “losses.” Even though Australia’s High Court upheld the country’s plain packaging laws in 2012, Philip Morris continued to use a foreign investor-state tribunal to try to roll back this important public health policy, until the case was dismissed, only after Australia had spent $50 million in legal costs, according to the World Health Organization Director General.
- For years, Renco Group Inc., a company owned by one of the richest men in America, operated a metal smelter in La Oroya, Peru, which became notorious when the site was designated as one of the top 10 most polluted places in the world. Sulfur dioxide concentrations in La Oroya, which greatly exceed international standards and pose severe respiratory risks, doubled in the years after Renco’s acquisition of the complex. Renco’s Peruvian subsidiary promised to install sulfur plants by 2007 as part of a government-mandated environmental remediation program, but it sought (and Peru granted) two extraordinary extensions to complete the project. In December 2010, Renco notified Peru that it would use the U.S.-Peru FTA investor-state system to demand $800 million from the Peruvian government for not granting the corporation a third extension on its unfulfilled environmental commitments.