BANGKOK- By standing up to pressure from big pharmaceutical companies over cheap anti-AIDS drugs, Thailand may have created an opening in global trade rules that will permit developing countries to more readily break patents in times of public health emergencies. The fact that the United States government has clarified that Bangkok had not violated any laws under the special provisions of the Trade-Related aspects of Intellectual Property (TRIPS) of the World Trade Organisation (WTO) is significant.

Last week, the U.S. Trade Representative's office (USTR) placed Thailand on a watch list of countries that had, in general, violated intellectual property rights. Thailand first broke the patent on the anti-retroviral (ARV) drug 'Efavirenz' produced by U.S. pharmaceutical company Merck Sharp and Dohme last November, and went on to do the same with 'Kaletra', another anti-HIV/AIDS drug from U.S. pharma major Abbott Laboratories as well as 'Plavis', a blood-thinner made by Sanofi-Aventis, in January.

Noticeably, there was lack of precision in the USTR annual report on intellectual property protection regarding the Thai move to issue a compulsory license (CL) early this year to secure cheaper alternatives for Kaletra, the drug marketed by Abbott, from India. "While the U.S. acknowledges a country's ability to issue such licences in accordance with WTO rules, the lack of transparency and due process exhibited in Thailand represents a serious concern," states the report.

Far more strident in its criticism to scuttle Bangkok's efforts is the language on a pro-pharmaceutical website launched Monday to campaign against Thailand's pro-poor public health policies. "Thailand's actions violate the TRIPS agreement of the WTO," states the website, www.Thailies.com. "WTO members are not allowed to issue compulsory licenses without full and transparent negotiations."

Since then the advantage secured by Thailand in testing -- and winning -- the right to use CLs has earned it praise from a broad section of activists, HIV patients and academics at home and abroad. "Other countries will feel more confident in issuing CLs, rather than threatening to issue them but not doing so due to pressure," says Paul Cawthorne of Medecins Sans Frontieres (MSF), the international humanitarian agency, in an interview.

"This can set a precedent, a new understanding, about what developing countries can do under TRIPS," adds Jacques-chai Chomthongdi, a researcher at Focus on the Global South, a Bangkok-based think tank. "This is to the advantage of developing countries." In fact, the U.S. could not fault Thailand for violating trade rules since Bangkok's policies are compliant with TRIPS, he explained to IPS.

"Thailand has acted within local and WTO laws." Washington's fuzzy, ambiguous language towards Thailand for invoking a CL stands in contrast with the tough stance taken previously to defend brand-name drugs of pharmaceutical corporations when threatened by the special provisions under TRIPS, which permit a developing country to produce or import generics.

These provisions in global free trade, permitting developing countries to break patents in times of a national health crisis, were approved during the WTO ministerial meeting in Doha, in 2001. By the weekend, Thai activists were celebrating the possible ripple effect across the developing world in the wake of Bangkok's quest for cheaper generic drugs. Brazilian President Luiz Inacio Lula da Silva signed a decree Friday in Brasilia to issue a CL for 'Efavirenz'.

The emergence of such a South-South alliance to bring down the prices of life-prolonging drugs through CLs was no surprise for Thai activists like Kannikar Kijtiwatchakul of Free Trade Agreement Watch, a non-governmental organisation campaigning against global corporate agendas. "Brazil learnt from us.

They asked Thailand what it did to issue a compulsory license," she told IPS. "Thailand has been an inspiration and an example for us all on this matter," wrote a public health official in the Brazilian government in a letter to officials at Thailand's public health ministry in early March.

At that time, Bangkok was in the glare of international attention for taking the side of people's lives over corporate profits. "It is time to unite all those who have always defended the use of TRIPS flexibilities, which can be invoked in the name of protecting public health, as in the case of compulsory licenses," added the Working Group on Intellectual Property from the Brazilian Network for the Integration of Peoples in a late-April e-mail to Thai activists.

Thailand's clash with Abbott, which began in January following the government's issuing of a CL for 'Kaletra' , intensified in March when Abbott retaliated by refusing to register seven new drugs in the South-east Asian country. It meant depriving Thais of a new ARV, Aluvia, which is conducive and can be easily stored in tropical climates, an antibiotic, a painkiller and drugs for kidney disease and blood clots.

By early April, faced with growing criticism and Thai reluctance to cave into pressure, Abbott agreed to supply both ARVs to Thailand at a reduced price of 1,000 US dollars for a year's dosage per patient. In exchange, the pharma giant wanted the CL for Kaletra dropped. The Thai public health officials out to capitalise on the frequently debated WTO rule are in step with an impressive record the country has maintained in caring for its citizens with HIV/AIDS and reduce the spread of the killer disease.

Currently, some 90 percent of people who need ARVs are treated through a universal health care scheme. The country has over 600,000 people infected with HIV and has recorded 300,000 deaths due to AIDS. "All CLs have done is to open up a monopolistic market to competition," says Cawthorn of MSF. "Why should the pharmaceutical companies be worried about that?"