"Thai drug manufacturers cannot compete with major players from developed countries, particularly the US. The extension of patent protection that the US has requested will force the Thai medicine industry to come to an end and poor people will face difficulties," said Jakkrit Kuanpoth, a senior law lecturer at Wollongong University in Australia.

Consumers would end up paying more for medicine, he said.

Pharmaceutical production was a major issue in Thai-US free-trade negotiations. The US seeks another five years for data exclusivity on top of the World Trade Organisation's 20-year patent protection, from the day the company first registered to develop a drug.

Despite the stalled trade negotiations, the local medicine industry has been swamped by multinational companies mainly from the US and India, which together now control 70 per cent of the pharmaceutical market here.

According to a Thai Food and Drug Administration report, licensed drug manufacturers here total 166, most of them SMEs.

Jakkrit said the government should provide incentives to the industry, as long as they do not contravene WTO trade rules. That would ensure people could access special formulas at cheaper prices.

"The assistance should be in the form of financial aid for research and development as well as encouragement for them to focus more on patent registration," he said.

The government should also impose compulsory licensing to compel foreign drug manufacturers to allow Thai manufacturers to produce life-saving drugs, he said.

Jakkrit said the Government Pharmaceutical Organisation should also play a more aggressive role in developing a wide variety of local drugs that are more affordable than imported versions, he said.

"The US may claim that they have to spend a lot on research and development but the Thai government should concentrate on balancing the benefits between drug access for the people and intellectual protection for foreign companies," he said.

According to a US study, American manufacturers have to outlay between US$400 million (Bt15 billion) and $900 million a year on R&D to come up with efficient drugs.

Jakkrit pointed out that some of that money was also spent on marketing.

Bunsarin Vanaswas, secretary-general of the Thai Pharmaceutical Manufacturers' Association, expressed concern over the US proposal, saying the government should not accept it.

"If the government agrees with the US, it will have serious repercussions not only for Thai manufacturers but also for the people," he said.

However, the association has not yet assessed what the industry stood to lose from the patent protection. Of the country's drug producers, only 20 are big players who could survive under the extension. The rest are SMEs that would face high risks.

Experts say the government should put intellectual property on the national agenda in a bid to increase indigenous creativity and ensure sustainable growth of the economy.

Under the plan, the government would modernise and enforce IP laws to boost productivity. The educational system would be upgraded as well.

Jakkrit said the government should make IP a high priority.

"The government should put the IP issue in the national plan as Thailand will no longer enjoy an advantage in natural resources," he said.

Placing IP on the national agenda would help increase human-resource efficiency and that is the basic need for social and economic development, he said.

David Llewelyn, director of IP Academy Singapore, said Thailand should modernise its IP laws in keeping with the global trend to set a greater store on IP, and value IP rights more.

"The global community will gradually increase the value of IP. The government should stimulate creativity and innovation and apply those to IP to benefit real life activities," he said.

Including IP in development plans will stimulate economic growth, he said, adding that Thailand will ensure its competitiveness with developed nations if it has an advanced education system to promote IP.

Suzanne Harrison, director of LECG, a leading manager of intellectual assets in the US, said Thailand has to improve its IP laws if it wants to trade outside its market.

"The country has to see that IP laws will be enforced. Then international firms will feel free to invest and transact business with Thailand," she said.

Petchanet Pratruangkrai

The Nation

Singapore