Intellectual Property Laws Are Necessary to Drive Growth

Article excerpt

BYLINE: Franklin Cudjoe

Conventional wisdom holds that where South Africa goes, other African nations eventually follow, and this has generally been a good thing: over the last two decades South Africa's successful transition to democracy, economic expansion, and progress fighting disease have all foreshadowed similar achievements elsewhere.

Now another wave of change is under way, driven by new technologies and innovative businesses, with the potential to raise millions more out of poverty.

That's why it's disturbing to think South Africa might lead the continent in the wrong direction by weakening the intellectual property protections that underpin our economic development.

Most readers will have heard about the recent controversy surrounding pharmaceutical industry lobbying against South Africa's proposed National Policy on Intellectual Property. Leaked documents rarely cast a flattering light on their subjects, and this case is no exception. But when the South African health minister starts throwing around words like "satanic", he puts himself in company with Iran's Ayatollahs and the late Hugo Chavez, who both vilified their enemies as evil incarnate. Surely we can do better.

The South African government is right to be concerned about the availability of HIV drugs, which is a heavy focus in the draft policy: despite some good news, including a one-third drop in new infections from 2004 to 2012, millions still do not have access to antiretroviral treatments - and millions more across the continent will need new drugs as the virus continues to mutate, forming drug-resistant strains.

That's why it's dangerously short-sighted to weaken Intellectual Property (IP) laws as this policy would do. Each new drug takes around R11 billion and 12 years to develop, and threatening drug makers with compulsory licenses - which would allow another company to cheaply reproduce the original drug at any time - jeopardises investment into future drug research.

Meanwhile, recent studies suggest ARV-resistant HIV is on the rise in east Africa, where the drugs first became available. Last year ARV shortages in South Africa also raised questions about the ability of generic firms to provide a steady supply of HIV drugs, further increasing the risk of drug resistance. And it's not just HIV: the rise of multidrug-resistant tuberculosis also requires powerful new drugs backed by formidable research efforts.

However, the IP issue goes beyond health care, as weak IP laws also threaten to undermine Africa's broader development. Simply put, IP is the key to moving beyond commodity-based economies.

Like many African countries, South Africa has benefited from abundant natural resource wealth, with extractive industries contributing around 6 percent of total GDP, similar to Ghana, where they contribute around 8 percent. …