“Is development best facilitated nationally or through regional cooperation and harmonization: The Case of Biotechnology

1. “Is development best facilitated nationally or through regional cooperation and harmonization: The Case of Biotechnology” Carlos Alberto Primo Braga John Anthony Daly Nancy Adele Johnson

2. The global biotechnology innovation system currently does not fully apply the technology to the most pressing global needs, especially as they pertain to the needs of development.

3. Society could do better by: • improving the institutions that transfer biotech innovations from the strong R&D systems of the North to the South where they are needed; and • building biotechnology capacity in developing nations.

4. Some Observations of the Impact of Harmonization on Development A network of international treaties has encouraged harmonization; A system of multinational organizations provides services which also encourage harmonization; A number of regional organizations further harmonize IPRs among the countries which they serve; and While there has been considerable harmonization of IPR systems among countries, there remains wide variation among nations.

5. In the case of biotechnology, the current status of the various debates around TRIPS make it unlikely that the maximalist agenda of harmonization can be further advanced at the WTO level.

6. We conclude that the jury is still out on the importance of harmonization of IPRs as a tool for development.

7. Disadvantages of Harmonization There are those who feel poor countries should create IPR systems to maximize the application of existing technology rather than to stimulate innovation. Innovating countries seek harmonization for commercial reasons rather than the public good The AIDS controversy has shown that in some cases there is a strong moral argument against a harmonized IPR system, and exceptions should be made.

8. Disadvantages of Harmonization Strengthening IPR systems has improved biotechnology application to the problems of poverty only where other factors are in place, and those factors may well be more important than the IPR. In biotechnology, there are culturally-based, deeply held values that may militate against harmonization of biotechnology IPRs across cultures.

9. Advantages of Harmonization As the European Union-Japan-United States enthusiasm for their trilateral harmonization shows, harmonization pays off for the big three. Harmonization probably raises the quality of IPR systems towards a high international standard. OECD countries have expended significant efforts toward improving their systems, while the least developed countries have few IPR experts and little IPR experience; the LDCs may therefore benefit from the knowledge and experience of the OECD countries. Harmonized IPRs help attract biotechnology investment into developing countries, which is a critical factor in the transfer of the technology.

10. Advantages of Harmonization The TRIPS agreement and related harmonization approaches are helping to open the world to trade involving biotechnology, which has significant benefits. Efforts such as the creation of regional IPR organizations (which provide efficiencies of scale among other benefits), the creation of an international knowledge base and dialog on IPRs, and of international technical assistance agencies serving the South's IPR community all tend to produce harmonization as a side product.

11. Advantages of Harmonization Harmonization helps provide incentives for innovators in the North to seek wider applications of their innovations and to innovate for a wider regional or global market. Harmonization may provide some incentives to innovators in the South to commercialize the biotechnology, and to seek wider markets for their innovations.

12. We leave unanswered whether the advantages outweigh the disadvantages.

13. Even if the advantages outweigh the disadvantage, we warn that harmonization of IPRs is only a small part of the job of institution building that needs to be done!