Thursday, August 16, 2012

Potential for billions of dollars in increased health cost if Canada-EU trade deal goes through

With Europe in a financial crisis the question remains how far is Canada willing to go to achieve a deal?

16 Aug. 2012

While negotiators for the proposed Canada-European Union trade deal say that negotiations are in the final stages, serious concerns continue to be raised about some of the provisions expected to be in the agreement. It is reported that negotiators have reached agreement on 3/4s of the text but that there are some serious issues remaining to be addressed.

In particular, Canadian officials say there is a large gap in the negotiations over such issues as investment rules, financial services, and taxation. With Europe in a financial crisis the question remains how far is Canada willing to go to achieve a deal?

A number of commentators suggest the intellectual property chapter of the deal as being particularly difficult.

According to Michael Geist, the University of Ottawa's Canada Research Chair in Internet and E-Commerce Law, the revelation that "provisions from the Anti-Counterfeiting Trade Agreement may sneak their way into CETA generated widespread headlines throughout Europe last month with politicians and activists expressing exasperation at the clumsy attempt to secretly revive an agreement that was roundly rejected by the European Parliament."

"The Canadian opposition to the chapter will come from European demands for patent reforms that could result in billions in additional health care costs due to higher pharmaceutical prices. The pharmaceutical demands are one of Europe's top priorities, but Canada has thus far refused to counter the EU proposals, creating a stalemate that has dragged on for years."

Canada's lead negotiator, Steve Verheul, says that the pharmaceutical industries demands won't be on the table during negotiations in September and October.

While big pharma insists that these reforms are needed to increase research and development investment in Canada, past experience suggests otherwise.

In the 1980s, the industry lobbied for patent reforms while promising to increase spending on research and development in Canada to 10 per cent of total sales by 1996. In reality, investment in drug research and development has declined and is as its lowest level since the 1987 reforms.

According to Geist, "given 25 years of mostly failed targets, the rational approach is to put a freeze on any further reforms at least until the industry lives up to its commitments. But with the agreement shrouded in secrecy - the government has steadfastly rejected calls to release the draft text - it appears that the major health care decision will be made behind closed doors with no public discussion, debate, or access to the official text."

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