How UK trade policies could help heal global health care inequalities.

Posted on November 25, 2016
Blog 780X439 Ucdayblog

One-third of the world’s population cannot access essential medicines. Ruth Bergan and Natalie Sharples argue that leaders must push for trade deals that drive down the cost of healthcare for the world’s poorest.

This blog first appeared on the Guardian’s ‘Poverty Matters’ site.

Theresa May’s recent visit to India, during which discussions about cooperation over trade in health services were a priority, is a reminder that trade and investment cannot be isolated from other areas of policy.

Key among these is universal health coverage – the provision of quality medical services to all people when they need them, without causing financial hardship. This is a concept that is having its moment: it is championed by everyone from health activists to the World Bank, and is

What is obvious, but perhaps less palatable to some of its advocates, is that achieving universal health coverage requires addressing polices far beyond the health sector. Policies that need to work for universal health coverage include those on water and sanitation, nutrition and education, but also global policies and practices that impede the right to health.

In the context of Brexit, UK trade is one such policy we urgently need to examine. Trade has huge implications for health. This was seen very clearly in the EU’s failed attempt to agree a trade deal with India. When the EU proposed to include stricter patenting rights for companies in the deal, Indian negotiators, the UN and activists all raised serious objections, fearing it would drive a huge increase in the cost of medicines relied on by poor communities across the globe.

Fears about trade rules are well-founded. One third of the world’s population lacks access to essential medicines. New treatments for people living with HIV in middle-income countries can cost between $3,000 (£2,400) and $28,000 per person each year. No surprise that for many people this is out of reach. Inequalities in power between companies and citizens is at the heart of this. Patent protection given to pharmaceutical companies through provisions in trade agreements restricts access to cheaper, generic medicines and pushes up drug prices. In the US, the Food and Drug Administration reports that the cost of a generic drug is 80% to 85% lower than the brand name product.

Similar power distortions are unmistakable in bilateral investment treaties. Like the controversial TTIP and Ceta agreements, these trade deals include a parallel judicial system allowing companies to sue governments at private international tribunals, curbing the ability of states to provide for the right to health for their people, and undermining democracy.

Companies are already using such provisions to challenge government health policy. In 2012, pharmaceutical giant Eli Lilly began legal proceedings against the Canadian government for $500m for invalidating two of its patents. The invalidations were the result of a new national law that required the “utility” of an invention to be demonstrated when the patent was filed – in other words the drug did not do what the inventor said, or implied, it would do when the patent application was made, as was the case with the two contested drugs from Eli Lilly. The company then sued Canada under the Nafta treaty for lost profit and unfair treatment – a lawsuit that is not only intended to challenge the withdrawal of the patents but also Canada’s national law.

While there are no public cases of health companies suing India, UK companies have certainly been using the provisions of UK bilateral investment treaties to challenge other aspects of Indian government policy. Vedanta Mining and Vodafone have both challenged changes to Indian tax law. The companies had used offshore vehicles to buy out Indian companies, neatly avoiding having to pay significant amounts of tax. When India attempted to close the loophole (pdf) that allowed this to happen, the companies used the UK-India treaty to sue the government for “compensation”.

Every day 16,000 children under-five(5.9 million a year) die. The causes of their deaths are largely preventable, meaning these children are not killed by illness, but bad policies. As the Alma Ata – the first international declaration underlining the importance of primary health care – made clear almost 40 years ago, health inequalities within and between countries are “politically, socially and economically unacceptable”. 

Achieving universal health coverage requires training more health workers, improving health information systems and mobilising more domestic financing. It also requires addressing the global causes of poverty and inequality. Trade and investment policies should be first on the list. India has already revised its bilateral investment treaties to limit the range of policies that can be challenged. The UK now has an opportunity to make sure its own trade policy supports the health of people across the world. We must demand that MPs act now to ensure it.

• Natalie Sharples is senior policy advisor at Health Poverty Action