If the TRIPS agreement is fully operational (after 2005), many countries may have difficulty buying medicines at affordable prices. Today, for example, some countries, such as India, do not offer patent protection for pharmaceuticals and produce generic versions at a fraction of the price of patented products. A Member State in which the price of patented products is high has the possibility of issuing a compulsory licence for import from these countries. The problem is that once countries fully comply with the TRIPS agreement by 2005 at the latest, countries will no longer be able to produce and export cheap generic copies of patented medicines. As a result, sources of new affordable medicines will run out and countries that do not have sufficient production capacity and demand in the market will not be able to issue a compulsory licence for local production or import of these drugs: they will be entirely dependent on expensive patented versions. At the XI Summit of Heads of State and Government of the Group of Fifteen (G-15), held in Jakarta (30-31 May 2001), the Heads of State and Government stressed the urgent need: Fighting the pandemic and endemic diseases such as HIV/AIDS, TUBERCULOSis and malaria, and stated that the implementation of the Convention on Trade-Related Intellectual Property Rights (TRIPS) should in no way prevent developing countries from taking measures such as compulsory licences and parallel imports to ensure access to life-saving medicines at affordable prices, in order to overcome public health and food risks caused by HIV/AIDS and other diseases. They also saw the next special debate in the WTO`s TRIPS COUNCIL as an opportunity to promote a rapprochement of positions in this area. “… for most low-tech developing countries, knowledge of trade, foreign investment and growth indicates that ip protection will have little effect. It is also unlikely that the benefits of intellectual property protection will outweigh the costs in the foreseeable future.
For technologically advanced developing countries, the balance is finer. Dynamic benefits can be achieved through ip protection, but at cost for other sectors and for consumers. 16. However, Section 168 of the Australian Patent Act and Section 55, paragraph 2 of the New Zealand Patent Act allow exports under an agreement with a foreign country to provide products necessary for the defence of that country. Articles 48B (d) and (i) of the UK Patent Act provide for a compulsory licence for a patent whose holder is not the holder of the WTO if, for reasonable reasons, the patent holder does not lay off the patent, meaning that a market for the export of a patented product from the United Kingdom is not delivered. Article 45 G of Argentina`s patent law authorizes the issuance of a compulsory licence that does not apply primarily to domestic markets where necessary to remedy anti-competitive practices or in the event of a health or national security emergency. As Maskus (2003, op. cit.) noted, although overall needs in poor countries are immense, “even though some poor countries have collected their demands for a particular drug in a trade agreement covered by this exception, the scale may still be too low to become attractive to potential suppliers… Since eligible import markets will not be large in very small countries, generic drug manufacturers may not be interested in producing these small quantities and waiting for economies of scale. The agreement also recognises the divergent position of Member States with regard to their relative economic status, administrative capacities and technological base. As in other WTO agreements, developing countries have received special and differentiated treatment, in accordance with Part VI of the agreement, under “provisions