A report has found that the Trans-Pacific Partnership (TPP) agreement would be likely to adversely affect the health of the Australian population.
The TPP is a free trade deal being negotiated by countries on the Pacific rim: the US, Australia, Singapore, New Zealand, Chile, Brunei, Canada, Malaysia, Mexico, Peru, Vietnam and Japan. These countries represent about 40% of global GDP.
The report, Negotiating Healthy Trade in Australia, was published in February by the University of New South Wales' Centre for Health Equity Training Research and Evaluation and was co-authored by researchers from UNSW, University of Sydney and La Trobe University.
The report was "necessarily limited" due to the lack of transparency in these negotiations. Since there have been no official releases of the draft text, the reviewers had to rely on leaked copies. Centre for Health Equity Training, Research and Evaluation Director Lynn Kemp said this secrecy was her biggest concern.
“We call on the Government to conduct these trade negotiations with full public transparency,” she said in a March 3 statement. “This is a complex issue, and what might be the right thing in terms of economics may not be appropriate for protecting public health in Australia. Public health concerns must override economic or trade concerns in any area where these priorities may conflict within the TPP.”
The report focused on the potential impacts the TPP could have on the cost of medicines, control of tobacco and alcohol, and food labelling.
It shows that prices are already limiting the use of medicines, even without the TPP. In 2012, 16% of Australians did not fill or skipped a prescription, did not visit a doctor, or did not receive recommended care due to cost.
A 2007 survey of patient behaviour found about 21% bought over-the-counter medicine instead of a prescription, 48% asked their doctor for a cheaper medicine, 18% used a medicine already at home rather than buy a new one, and 6% used someone else's medication. This is despite the Pharmaceutical Benefits Scheme (PBS), which subsidises costs for medicines.
Provisions in the TPP could raise costs for the PBS. The potential impact can be seen from 2005 when the PBS raised co-payments by 21%. A study found a decrease in dispensing of between 3% and 11% for 12 of the 17 medicines that were monitored. There were significantly higher declines in prescription use for concessional patients than general patients.
The Australian government says it will not accept a deal that would adversely affect the PBS. But last year's draft text suggests Australia’s agreement with “evergreening”. That is, granting patents for small variations to existing products even when there is no evidence of extra benefit, thus delaying competition from cheaper generic versions.
Patent term extensions would compensate companies for delays in issuing patents or obtaining marketing approval. In Australia, drug companies can already get up to five-year extensions. TPP drafts indicate the US wanted extensions for a wider range of patents. The 2013 Review of Pharmaceutical Patents found that patent term extensions already cost Australian taxpayers more than $200 million a year.
The annex on “Transparency and Procedural Fairness for Healthcare Technologies”, leaked in 2011, would restrict the ability of the PBS to regulate medicine prices and ensure value for money. This was rejected by most negotiating countries. In 2013, leaks revealed that Australia and Japan had worked with the US on a revised proposal that still contained “considerable risks”.
The most controversial aspect of the TPP is the Investor-State Dispute Settelement which would allow corporations to sue a government in secret international tribunals over laws and regulations that reduce their expected profits. This could be used against laws to protect public health, such as Australia's tobacco plain packaging laws. Philip Morris is already using an existing free trade agreement with Hong Kong to sue Australia over these laws.
Rules about “indirect expropriation” — depriving an investor of property, which can include “intellectual property” such as trademarks — and “fair and equitable treatment” would support, for example, Philip Morris's claims that the Australian government has expropriated its intellectual property by stopping it from displaying trademarks on tobacco packaging.
Provisions in the chapters on Regulatory Coherence and Transparency require governments to extend “stakeholder input” into policy-making. Rather than allowing greater public input, this means greater input for corporations.
The chapter on Cross-border Services could affect policies such as bans on advertising, and licensing of retailers and distributors.
In 2013, the Malaysian government proposed excluding tobacco from the TPP. However, according to the report, the Australian government is seemingly not supporting this.
The chapter on Technical Barriers to Trade (TBT) would limit proposed health warning labels for alcohol.
Food labelling with health information is also under attack, an important issue considering heart disease is the leading cause of death of Australians. In 2011, 14.6% of all deaths were due to ischaemic heart disease. In 2012, 5.1% of Australians had diabetes and 63% of Australians over 18 years were overweight or obese. Australia is ranked seventh in the world for rate of obesity with more than one-in-four adults now obese. Obesity cost the health system about $2 billion in 2008.
The TBT chapter might limit labelling of processed foods to provide information to consumers. Thailand tried to implement “traffic light” labelling of snack foods. This means showing how much fat, salt, sugar and so on is in a product via colour-coding red for high, amber for medium or green for low. The moves was abandoned after other countries complained it contravened the World Trade Organisation's TBT agreement.
The report recommended that an independent health impact study be conducted when the final text of the TPP is made publicly available, and before it is signed by the Australian government.