CONCERNS REMAIN OVER US FTA WITH PERU

With Peru moving ever closer to agreeing a free trade agreement (FTA) with the US, there has been renewed criticism of the deal from non-governmental organisation (NGO) development bodies. The NGOs are demanding that the US does not apply pressure on Peru to enter commitments that are inconsistent with the needs of the country's large low-income population.

According to United Nations (UN) figures, around 50% of Peru's 28mn population live in poverty. It is feared that the proposed FTA will result in sharp price increases for essential drugs, making them unaffordable for large sections of the country. Furthermore, the president of Peru's national trade association ADIFAN, has been highly critical of a clause in the FTA that will not allow Peruvian firms to obtain "compulsory licenses" for drugs in the event of a national health emergency.

However, Peru's president has pledged to shield the population from sudden price hikes through state involvement, a move criticised by some observers as mere political expediency in light of upcoming elections. Government efforts to support the generics industry, which have included publishing its list of essential medicines by active ingredient rather than brand name, and sourcing HIV/AIDS drugs from generics firms, should also help to keep prices down. Nevertheless, stricter patent laws will drastically affect the supply of cheap locally made copy drugs.