When you need a life-saving drug, the price shouldn’t depend on which country you live in. But for millions of people in low- and middle-income countries, the cost of medicine is locked in by a global rulebook written decades ago: the TRIPS Agreement is a World Trade Organization treaty that sets minimum standards for intellectual property protection, including 20-year patents on pharmaceuticals. Also known as the Trade-Related Aspects of Intellectual Property Rights Agreement, it came into force in 1995 and reshaped how medicines are made, sold, and accessed worldwide.
What TRIPS Changed for Generic Drugs
Before TRIPS, many developing countries didn’t patent drugs at all. India, for example, allowed companies to make generic versions using different manufacturing methods - even if the original drug was patented elsewhere. This kept prices low. A 1995 WHO survey found only 23 of 102 developing countries granted product patents for medicines. By 2010, that number jumped to 147. Why? Because TRIPS forced every WTO member - from Brazil to Bangladesh - to adopt strict patent rules.
The agreement requires all members to grant patents for at least 20 years from the filing date. That means even if a drug was invented in the U.S. in 2005, no one else can legally make it until 2025 - no matter how many people need it. And it’s not just patents. TRIPS also introduced data exclusivity, which blocks generic manufacturers from using the original company’s clinical trial data to get approval. Even after the patent expires, this can delay generics by 5 to 10 years.
The result? Prices skyrocketed. A 2001 study in the Journal of the American Medical Association found that patented drugs in developing countries cost, on average, over 200% more after TRIPS was enforced. In South Africa, when the government tried to import cheaper HIV drugs in 1998, 40 pharmaceutical companies sued. It took global protests and media pressure just to get them to drop the case.
Compulsory Licensing: The Legal Loophole
TRIPS isn’t completely rigid. Article 31 lets governments issue compulsory licenses - legal permissions for someone else to produce a patented drug without the company’s consent. This is meant for emergencies: pandemics, HIV outbreaks, or when a medicine is unaffordable.
Thailand used it in 2006 to make generic versions of HIV and heart drugs. Brazil did the same for antiretrovirals. Both faced intense pressure from the U.S. and drug companies. But they held. The problem? TRIPS says these licenses must be used mostly for the domestic market. So if a country doesn’t have a drug factory, it can’t import generics made in another country under a similar license.
That changed in 2005 with the so-called “Paragraph 6 Solution.” It allowed countries without manufacturing capacity to import generics made under compulsory license. Sounds fair, right? In practice, it was a nightmare. The paperwork was complex. Few countries knew how to use it. By 2016, only one shipment of malaria medicine had ever been sent under this rule. Canada and Rwanda were the only two countries to fully use it - and even then, only after years of legal maneuvering.
TRIPS Plus: The Hidden Rules
TRIPS is just the baseline. Wealthier nations have been slipping in stricter rules through trade deals - what experts call “TRIPS Plus.” The U.S., EU, and Switzerland now routinely demand extra protections in bilateral agreements. These include:
- Extending patent terms beyond 20 years
- Imposing 8-10 years of data exclusivity (TRIPS only suggests 5)
- Banning compulsory licensing for certain diseases
- Forcing “patent linkage” - where drug regulators must check patent status before approving generics
A 2020 U.S. International Trade Commission report found that 85% of U.S. free trade agreements included TRIPS Plus provisions. The EU-Vietnam deal, signed in 2020, gave 8 years of data exclusivity - two years longer than TRIPS allows. These aren’t just technicalities. They’re barriers that delay generics by years, keeping prices high.
Who Wins? Who Loses?
The pharmaceutical industry argues that strong patents drive innovation. They point out that 73% of new medicines approved since 2000 came from companies in countries with strict IP laws. But here’s the catch: most of those drugs aren’t for the diseases killing millions in poor countries. Between 1975 and 1997, only 13 of 1,223 new drugs were developed for tropical diseases like sleeping sickness or leishmaniasis.
Meanwhile, the people who need these drugs most are priced out. The Global Fund reported that in 2000, treating HIV cost $10,000 per patient per year. By 2019, that dropped to $75 - thanks entirely to generic competition in countries that fought for access. But newer treatments, like those for hepatitis C or cancer, still cost $300-$600 per year because patents haven’t expired - or because TRIPS Plus rules block generics.
India’s transition to product patents in 2005 is a case study. Before, it was the “pharmacy of the developing world,” making 80% of the world’s generic HIV drugs. After 2005, prices for patented cancer drugs jumped 300-500%, according to a Lancet Oncology study. The country still makes generics - but only for drugs where patents have expired or don’t exist.
The COVID-19 Waiver and What It Means
In October 2020, India and South Africa proposed a temporary waiver of TRIPS for vaccines, tests, and treatments related to COVID-19. Over 100 countries supported it. The EU, U.S., and Switzerland resisted. It took over a year of global pressure before the WTO agreed to a partial waiver in June 2022.
It wasn’t perfect. The waiver only covered vaccines - not treatments or diagnostics. It was limited to developing countries. And it didn’t force companies to share technology. Still, it was historic. It was the first time the WTO modified TRIPS to prioritize public health over patents.
But the fight isn’t over. The same countries that blocked the waiver now push TRIPS Plus in new trade deals. Meanwhile, the Medicines Patent Pool - a UN-backed initiative - has negotiated licenses for 16 HIV drugs, 6 hepatitis C treatments, and 4 TB medicines. As of 2022, those deals reached 17.4 million people. That’s progress. But it’s a patchwork solution, not a system change.
The Real Cost of Patents
When a drug is patented, the company has a monopoly. That means they set the price. In the U.S., a single dose of insulin can cost $250. In Nigeria, it’s $10 - because it’s generic. The difference isn’t production cost. It’s patent law.
Between 1995 and 2015, the WTO-UNDP TRIPS Trust Fund spent $28.7 million helping 102 countries implement the agreement. But almost no money went to help them use the flexibilities - like compulsory licensing - to protect public health. That’s like giving someone a lock and then refusing to give them the key.
And the result? A 2015 World Bank analysis found that countries implementing TRIPS without public health safeguards saw a 15-20% drop in generic medicine availability within five years. That’s not a side effect. It’s the design.
What’s Next?
There are two paths ahead. One leads to more TRIPS Plus deals, tighter patent controls, and continued delays in generic access. The other leads to reform: expanding compulsory licensing, eliminating data exclusivity, and letting countries import generics freely.
The Medicines Patent Pool shows what’s possible when collaboration replaces control. But it’s not enough. The system still prioritizes profit over people. Until the rules change, millions will keep dying because the medicine they need is locked behind a patent - not because it doesn’t exist, but because the law says it can’t be made.
Does TRIPS allow countries to make generic drugs?
Yes, but with major restrictions. TRIPS permits compulsory licensing - allowing governments to authorize generic production without the patent holder’s permission - but only under strict conditions. The license must be non-exclusive, limited to the domestic market, and issued after attempts to negotiate a voluntary license fail. Only in emergencies can these rules be bypassed, and even then, cross-border trade is heavily limited.
Why do generic drugs cost so much in poor countries?
They don’t - if they’re allowed to be made. The high cost comes from patent laws that block generic production. Even after patents expire, data exclusivity and patent linkage rules prevent regulators from approving generics. In many countries, local manufacturers lack the legal or technical capacity to challenge these barriers. The result? Patented drugs remain expensive, while cheaper generics are delayed or banned.
What’s the difference between a patent and data exclusivity?
A patent gives the original company exclusive rights to make and sell the drug for 20 years. Data exclusivity is different: it blocks generic makers from using the original company’s clinical trial data to prove their version is safe and effective. Even if the patent expires, data exclusivity can delay generic entry for 5-10 more years. It’s a legal loophole that extends monopolies without a patent.
Can a country import generics made under compulsory license from another country?
Only under very limited conditions. The 2005 “Paragraph 6 Solution” allows it, but the process is complex. The importing country must prove it lacks manufacturing capacity, the exporting country must issue its own compulsory license, and both must follow strict reporting rules. Only one shipment of medicine - malaria drugs from Canada to Rwanda - has ever been sent this way. Most countries can’t or won’t navigate the bureaucracy.
Is TRIPS the reason new medicines aren’t developed for poor countries?
Not directly - but it reinforces the problem. The pharmaceutical industry focuses on profitable markets. Between 1975 and 1997, only 13 of over 1,200 new drugs were for tropical diseases. TRIPS doesn’t cause this, but it locks in a system where patents are only valuable if the market can pay. Poor countries can’t afford to fund R&D, so companies don’t invest. TRIPS makes it harder to fix that gap by blocking generic production.
What happened after the COVID-19 TRIPS waiver?
The June 2022 waiver allowed developing countries to produce and export COVID-19 vaccines without patent permission. But it was narrow: it only covered vaccines, not treatments or diagnostics. It didn’t require technology sharing. And it was temporary. While it set a precedent, it didn’t change the core rules of TRIPS. The same countries that blocked it are now pushing stronger patent rules in new trade deals.
