February 23, 2006

The Philippine government is considering new legislation to reform intellectual property (IP) regulations in the country, paving the way for cheaper pharmaceuticals to enter the market. Medicines in the country are too expensive for many consumers due to a traditionally laissez faire approach to pricing. Meanwhile, industry sources allege that an "oligopoly" of multinational drugmakers keep drug prices artificially high.

The proposed changes to IP legislation will permit an increase in the parallel import of drugs, allow research on generic products to begin before patent expiry, and ease the rules regarding the compulsory license of drugs in cases of medical emergency.

However, the Pharmaceutical and Healthcare Association of the Philippines (PHAP) — which represents foreign drug firms operating in the country — is opposing the bill claiming that it infringes upon the rights of its members. PHAP also insists that forcing price cuts would discourage innovation and restrict the development of new drugs. However, the body has admitted that there are problems in the present pricing system that need to be addressed, although not through weakening IP law.

One supporter of the bill, Senator Manuel Roxas, remains unconvinced by the argument, pointing out the multinationals sell the same medicines at lower prices in other countries. Roxas also alleges that products are not priced according to costs but on the maximum the companies can get.