Bush Protects Bayer's Cipro Profits

by Mark Weisbrot

Bayer, the German pharmaceutical giant, has finally reached agreement with the U.S. Department of Health and Human Services over the price at which it would sell its antibiotic Cipro to our government. Cipro is believed to be one of the most effective treatments for the possible strains of anthrax infection that we might confront, and the government has decided to stockpile it.

Since Bayer cut its price from $1.77 to $0.95 per tablet, some see this latest agreement as a victory for the public interest. But that is debatable.

"Relying on just one manufacturer to produce our entire supply of the pharmaceutical is simply not the best way to ensure an adequate supply," Senator Charles Schumer wrote in a letter to Health and Human Services secretary Tommy Thompson. It was pressure from Schumer, as well as from consumer groups, that led to the price cuts.

This pressure caused Thompson to reverse his position of just a week earlier and threaten to buy generics if Bayer didn't cut its price. But why be concerned about patents during a health emergency? The government has the right, under more than one law, to purchase generic drugs. Bayer will not necessarily be able to produce the required stockpile as quickly as it could be obtained if all sources, including the generic ciprofloxacin, were available. Why should we take that risk?

Cipro will still be making a small fortune here, even at the reduced price. Like most drugs, ciprofloxacin is cheap to produce: the generic version in India sells for about 3 cents per pill.

But Thompson's threat to go the generic route was probably not all that serious. The $350 billion pharmaceutical industry is one of the largest corporate campaign contributors, currently favoring Republicans by about than 2 to 1. These people got their money's worth: Bayer, the producer with the patent monopoly, will remain the sole supplier for the U.S. market.

This is especially important to them right now. While millions of Americans are worried about anthrax, the Bush Administration is preparing for a new round of negotiations next month at the World Trade Organization. Remember that last meeting in 1999 that fell apart under clouds of tear gas in Seattle? It has taken nearly two years for the trade ministers to put the pieces back together. And this time, the problem of patents is high on the agenda.

Our government (with some help from other rich country governments and of course the big drug companies) has spent the last decade trying to force poor and middle-income countries to pay patent-protected prices for essential medicines. They have brandished the weapon of economic sanctions, filed lawsuits, and -- most recently -- initiated complaints at the WTO. But they have been losing ground since last year, when the U.S. press discovered that millions of people would have to die in order for these patent rights to be protected.

Among the proposed human sacrifices are 36 million people in developing countries who have HIV or AIDS. This, too, is a health emergency, with thousands dying every day. Many of them could be saved with drugs that generic producers can sell for $350 a year, but cost $10,000 here in the United States.

During the past year the drug companies were shamed into offering some discounts on AIDS medications in poor countries. But for the most part they did everything they could to keep their patent monopolies intact. When the trade ministers meet in Qatar beginning Nov. 9, the developing countries will try to clarify their rights under WTO's TRIPS (Trade-Related aspects of Intellectual Property Rights) agreement. They want to be able to produce or purchase generic essential medicines.

Leading the fight against them will be our own U.S. Trade Representative. Now we can see why the public safety of Americans must take a back seat to patent rights, even in the presence of unknown threats of bio-terrorism. How can our leaders tell the rest of the world that patents are more important than people, if they don't practice what they preach here at home?