A Hodges Research Grant from the College of Law supported this research, as did David Davis, my research assistant. I am also grateful for the comments received at the seminar held at the Boston University School of Law for this issue of the Journal.

1 WORLD HEALTH ORG., CHOOSING INTERVENTIONS THAT ARE COST EFFECTIVE, available at http://www.who.int/choice/en/ (last visited Apr. 6, 2006).

2 Evans, David B. et al., Time to Reassess Strategies for Improving Health in Developing Countries, 331 BRIT. MED. J. 1133, 1135 (2005)CrossRefGoogle ScholarPubMed.

3 Edejer, Tessa Tan-Torres et al., Cost Effectiveness Analysis of Strategies for Child Health in Developing Countries, 331 BRIT. MED. J. 1177 (2005)CrossRefGoogle ScholarPubMed.

4 Hogan, Daniel R. et al., Cost Effectiveness Analysis of Strategies to Combat HIV/AIDS in Developing Countries, 331 BRIT. MED. J. 1431 (2005)CrossRefGoogle ScholarPubMed. The most cost effective interventions are mass media campaigns for safer sex, peer education and treatment of sex workers, prevention of mother to child transmission (PMCT), treatment of sexually transmitted infections, voluntary counseling and testing, and ARV therapy. Id. at Tables 3 & 4.

5 Critics such as Amir Attaran question whether patents are important barriers to essential medicines. Attaran, Amir & Gillespie-White, Lee, Do Patents for Antiretroviral Drugs Constrain Access to AIDS Treatment in Africa?, 286 JAMA 1886 (2001)CrossRefGoogle ScholarPubMed; see also Attaran, Amir, How Do Patents and Economic Policies Affect Access to Essential Medicines in Developing Countries?; Poverty, Not Patent Policies More Often Inhibits Access to Essential Medicines in the Developing World, HEALTH AFF. 155 (Nov./Dec. 1994)Google Scholar. One cannot have it both ways; if patents are indeed unimportant in developing countries, then the drug industry wouldn't be hurt by giving up those patent rents. For a more expansive rebuttal to Attaran's more nuanced position, see Outterson, Kevin, Pharmaceutical Arbitrage: Balancing Access and Innovation in International Prescription Drug Markets, 5 YALE J. HEALTH POL’Y L. & ETHICS 193, 255-58 (2005)Google ScholarPubMed [hereinafter Pharmaceutical Arbitrage].

6 Outterson, supra note 5, at 253-55 (demonstrating a differential pricing ratio exceeding 30:1 on 1st line ARVs, and a ratio of 264:1 on Ciprofloxacin).

7 Outterson, Kevin, The Vanishing Public Domain: Antibiotic Resistance, Pharmaceutical Innovation and Intellectual Property Law, 67 U. PITT. L. REV. 67, 86-89 (2005)Google Scholar [hereinafter Outterson, Vanishing Public Domain].

8 Outterson, supra note 5, at 253. When generic AIDS drugs were introduced in Malaysia in 2004, the prices dropped by 90%. Meraiah Foley, WHO Urges Nations to Bypass Patent Laws, NEWSDAY, Sept. 22, 2005. When generic AIDS drugs were introduced in Malaysia in 2004, the prices dropped by 90%. Id.

9 Under conditions of robust competition, generic pricing should approach marginal cost pricing.

10 The official World Bank definition of high-income country is: “High-income country. A country having an annual gross national product (GNP) per capita equivalent to $9,361 or greater in 1998. Most high-income countries have an industrial economy. There are currently about 29 high-income countries in the world with populations of one million people or more. Their combined population is about 0.9 billion, less than one-sixth of the world's population. In 2003, the cutoff for high-income countries was adjusted to $9,206 or more.” World Bank Group, DEPweb, http://www.worldbank.org/depweb/english/modules/glossary.html#h (last visited Apr. 5, 2006).

11 See id.; see also ANDRÉS DE FRANCISCO, THE 10/90 REPORT ON HEALTH RESEARCH: 2001-2002, 91-92 (Sheila Davey ed., Global Forum for Health Research, 2002) (discussing neglected and very neglected diseases).

12 World Health Organization, 59th World Health Assembly, PUBLIC HEALTH, INNOVATION, ESSENTIAL HEALTH RESEARCH AND INTELLECTUAL PROPERTY RIGHTS: TOWARDS A GLOBAL STRATEGY AND PLAN OF ACTION (Agenda Item 11.11; A59/A/Conf.Paper No.8) (May 27, 2006) (hereinafter WHO GLOBAL R&D RESOLUTION).

13 E.g., DE FRANCISCO, supra note 11; Pécoul, Bernard et al., Access to Essential Drugs in Poor Countries: A Lost Battle?, 281 JAMA 361 (1999)CrossRefGoogle ScholarPubMed; Ridley, David B. et al., Developing Drugs For Developing Countries, 25 HEALTH AFF. 313 (2006)CrossRefGoogle ScholarPubMed; COMMISSION ON HEALTH RESEARCH FOR DEVELOPMENT, HEALTH RESEARCH: ESSENTIAL LINK TO EQUITY IN DEVELOPMENT 3 (Commission on Health Research for Development ed., Oxford University Press, 1990)Google Scholar. The WHO GLOBAL R&D RESOLUTION was not limited to tropical or neglected diseases, although it does focus on “diseases and conditions disproportionately affecting developing countries.” WHO GLOBAL R&D RESOLUTION, supra note 12. The case studies in this article concern AIDS and cervical cancer, both of which disproportionately affect people in developing countries.

14 For a voluntary Merck program to address onchocerciasis, see Sturchio, Jeffrey L. & Colatrella, Brenda D., Successful Public-Private Partnerships in Global Health: Lessons from the MECTIZAN Donation Program, in THE ECONOMICS OF ESSENTIAL MEDICINES 255 (Granville, Brigitte ed., Royal Institute of International Affairs, 2002)Google Scholar.

15 MÉDECINS SANS FRONTIÈRES, FATAL IMBALANCE: THE CRISIS IN RESEARCH AND DEVELOPMENT FOR DRUGS FOR NEGLECTED DISEASES 11 (Médecins Sans Frontières Access to Essential Medicines Campaign, Sept. 2001), available at http://www.msf.org/source/access/2001/fatal/fatalshort.pdf.

16 The Drugs for Neglected Diseases Initiative, founded by a group of seven organizations, focuses research and development efforts on 3 truly neglected diseases -- visceral leishmaniasis (Kalaazar), Human African Trypanosomiasis (Sleeping Sickness), and American Trypanosomiasis (Chagas disease). See DNDi: Drugs for Neglected Diseases Initiative, http://www.dndi.org (last visited Apr. 18, 2006).

17 Non-communicable disease accounted for 47% of the global burden of disease in 2001. World Health Org., WHO GLOBAL STRATEGY ON DIET, PHYSICAL ACTIVITY AND HEALTH 2 (May 2004), available at http://www.who.int/dietphysicalactivity/strategy/eb11344/strategy_english_web.pdf. Cardiovascular disease (CVD) and cancer (malignant neoplasms) are the first and second most common causes of death respectively in developing countries. World Health Org., WORLD HEALTH REPORT 2003 81 (2003), available at http://www.who.int/whr/2003/en/whr03_en.pdf. “In 1998, non-communicable diseases were responsible for 59% of total global mortality and 43% of the global burden of disease. Importantly, 78% of NCD [non-communicable disease] deaths were borne by low- and middle-income countries, as was 85% of the NCD burden of disease … nearly 50% of deaths worldwide were due to CVD, diabetes, cancer and chronic lung disease.” STEPHEN LEEDER ET AL., A RACE AGAINST TIME: THE CHALLENGE OF CARDIOVASCULAR DISEASE IN DEVELOPING ECONOMIES 13-14 (2004).

18 Herein, the term global disease refers to conditions for which a therapeutic market exists in high-income countries, and the condition is also endemic to the low or middle income world. The definition of global disease is not static. Malaria was once a global disease, but is now largely eradicated in high-income countries, rendering it potentially neglected were it not for research for military and tourist markets. Tuberculosis remains a significant condition in OECD markets, even though its disease burden falls heavily on the poor. For a fuller discussion on global diseases in this context, see Condon, Bradly & Sinha, Tapen, Global Diseases, Global Patents and Differential Treatment in WTO Law: Criteria for Suspending Patent Obligations in Developing Countries, NW. J. INT’L L. & BUS. 1, 25-28 (2005)Google Scholar; Outterson, supra note 5, at 244-250.

19 The graph depicts DALYs lost due to various conditions in men aged 15 and above in 2002. JUDITH MACKAAY & GEORGE A. MENSAH, WORLD HEALTH ORG. & CENTER FOR DISEASE CONTROL (CDC), ATLAS OF HEART DISEASE AND STROKE 46 (2004).

20 Depicting DALYs lost due to these conditions in women aged 15 and above in 2002. Id. at 47.

21 Some observers claim that the incentive deficit in these countries is the lack of adequate IP laws. See, e.g., Sykes, Alan O., TRIPS, Pharmaceuticals, Developing Countries, and the Doha “Solution,” 3 CHI. J. INT’L L. 47, 58-62 (2002)Google Scholar. As I have argued elsewhere at length, it is the poverty of the people, rather than the lack of IP laws, which makes the collection of pharmaceutical patent rents problematic in these countries. See Outterson, Pharmaceutical Arbitrage, supra note 5, at § I.D.4.viii (arguing that global and neglected diseases do not require additional IP laws in developing countries).

22 Many early AIDS-related drugs qualified for orphan drug status in the United States when the expected U.S. market was fewer than 200,000 persons. Salbu, Steven R., AIDS and Drug Policy: In Search of a Policy, 71 WASH. U. L.Q. 691, 703-707 (1993)Google ScholarPubMed (noting that the FDA designated AZT as an orphan drug in 1987 and half of AIDS drugs as of August 1991 were designated as orphans). North America and Western Europe account for less than two million of the thirty-four to forty-six million people living with HIV/AIDS in 2003. UNAIDS/WORLD HEALTH ORG., AIDS EPIDEMIC UPDATE 37 (2003), available at http://www.who.int/hiv/pub/epidemiology/en/epiupdate2003_III_en.pdf [hereinafter AIDS EPIDEMIC UPDATE].

23 Danaei, Goodarz et al., Causes of Cancer in the World: A Comparative Risk Assessment of Nine Behavioral and Environmental Risk Factors, 366 The Lancet 1784, 1787 (Table 2) (Nov. 19, 2005)CrossRefGoogle ScholarPubMed. See Ruth Mayne, United Nations Dev. Programme, Regionalism, Bilateralism, and “TRIP Plus” Agreements: The Threat to Developing Countries 21 (2005), http://hdr.undp.org/docs/publications/background_papers/2005/HDR2005_Mayne_Ruth_18.pdf.

24 Shibuya, K et al., Global and Regional Estimates of Cancer Mortality and Incidence by Site: II. Results for the Global Burden of Disease 2000, 2 BMC CANCER 37 (2002)CrossRefGoogle Scholar (table 7, excluding regions AMRO A, EURO A, and EURO B1).

25 Danaei et al., supra note 23, at 1789 (Figure 2).

26 Id.

27 Id.

28 Kevin Outterson, Fair Followers: Expanding Access to Generic Pharmaceuticals for Low- Income Populations, in THE POWER OF PILLS (P. Illingworth & J. Clare, eds.) (forthcoming 2006) [hereinafter Outterson, Fair Followers]; Outterson, The Vanishing Public Domain, supra 7, at 89-92 (2005); Outterson, Pharmaceutical Arbitrage, supra note 5, at 197, 217-19, 222-30; and the sources cited therein.

29 These issues have been discussed at significant length in Outterson, Pharmaceutical Arbitrage, supra note 5, at 231-35, 261-68, 284-90.

30 Outterson, Pharmaceutical Arbitrage, supra 5, at 268-71; Outterson, Kevin, Counterfeit Drugs: The Good, the Bad, and the Ugly, 16 ALBANY L. J. SCI. & TECH. (forthcoming 2006)Google Scholar.

31 WORLD HEALTH ORG., COUNTERFEIT MEDICINES, FACT SHEET NO. 275 (2006), available at http://www.who.int/mediacentre/factsheets/fs275/en/.

32 See generally KATHERINE EBAN, DANGEROUS DOSES: HOW COUNTERFEITERS ARE CONTAMINATING AMERICA's DRUG SUPPLY (Harcourt 2005).

33 Outterson, Pharmaceutical Arbitrage, supra note 5, at 268-71.

34 See Harper, Dianne M. et al., Efficacy of a Bivalent L1 Virus-like Particle Vaccine in Prevention of Infection With Human Papillomavirus Types 16 and 18 in Young Women: A Randomised Controlled Trial, 364 THE LANCET 1757, 1757 (2004)CrossRefGoogle Scholar (estimating 470,000 as of 2004); Christopher P. Crum, Editorial, The Beginning of the End for Cervical Cancer?, 347 NEW ENG. J. MED. 1703, 1703 (2002)CrossRefGoogle Scholar (estimating 450,000 as of 2002).

35 See Danaei et al., supra note 23, at 1787 (Table 2)(234,728); Blumenthal, Paul D. & Gaffikin, Lynne, Cervical Cancer Prevention: Making Programs More Appropriate and Pragmatic, 294 JAMA 2225, 2225 (2005)CrossRefGoogle ScholarPubMed (more than 230,000).

36 There were 218,064 deaths in low- and middle-income countries compared to 234,728 deaths worldwide. Danaei et al., supra note 23, at 1787 tbl.2. The GlaxoSmithKline (GSK) study noted that “almost 80% of the cases occur in developing countries.” Harper et al., supra note 34, at 1757. The difference derives from GSK using “developing countries” rather than “low- and middleincome countries.”

37 See MAYNE, supra note 23, at 26 (estimates of GSK's global market for ARVs).

38 Gardiner Harris, U.S. Approves Use of Vaccine for Cervical Cancer, NY TIMES, June 9, 2006.

39 Koutsky, Laura A. et al., A Controlled Trial of a Human Papillomavirus Type 16 Vaccine, 347 NEW ENG. J. MED. 1645, 1649 (2002)CrossRefGoogle ScholarPubMed.

40 Press Release, Merck, Merck's Investigational Vaccine GARDASIL™ Prevented 100 Percent of Cervical Pre-cancers and Non-invasive Cervical Cancers Associated with HPV Types 16 and 18 in New Clinical Study (Oct. 6, 2005), available at http://www.merck.com/newsroom/press_releases/research_and_development/2005_1006.html.

41 Harper et al., supra note 34, at 1760 tbl.1 (somewhat less than half of the study participants were in Brazil).

42 US FDA Vaccines and Related Biological Products Advisory Committee, May 18, 2006.

43 Harris, supra note 38.

44 Harper et al., supra note 34, at 1764.

45 Goldie, Sue J. et al., Projected Clinical Benefits and Cost-Effectiveness of a Human Papillomavirus 16/18 Vaccine, 96 J. NAT’L CANCER INST. 604, 608-609 (2004)CrossRefGoogle ScholarPubMed, available at http://jncicancerspectrum.oxfordjournals.org/cgi/reprint/jnci;96/8/604.pdf.

46 The model identifies ‘vaccination costs’ of US$377 (base case), with a range of US$188 to US$565, but Table 1 does not identify how much is allocated to the “three brief clinic visits, surveillance and education costs” and how much derives from the cost of the vaccine itself. Id. at 607 tbl 1. The model assumes 100% coverage of all 12-year old females in the U.S., a market of almost two million girls per year. See U.S. CENSUS BUREAU, ANNUAL ESTIMATES OF THE POPULATION BY SELECTED AGE GROUPS AND SEX FOR THE UNITED STATES: APRIL 1, 2000 TO JULY 1, 2004 tbl.2 (2005), available at http://www.census.gov/popest/national/asrh/NC-EST2004-sa.html.

47 Goldie et al., supra note 45, at 609 tbl.3, 613 n.14.

48 Id.

49 Taking the US$1000 as an upper limit, and subtracting the US$377 base case. If costs of the vaccine itself are already included in the base case, the upper limit would be somewhat higher.

50 Ben Hirschler, Glaxo Says Cervarix to Transform the Vaccine Business, REUTERS, May 27, 2005, available at http://www.signonsandiego.com/news/business/biotech/20050527-0200-healthglaxo-vaccines.html. See MAYNE, supra note 23, at 21.

51 HNP Summary Profile, http://devdata.worldbank.org/hnpstats/HNPSummary/groupData/GetShowData.asp?sCtry=HIC (last visited May 9, 2006) (2002 data).

52 Merck's vaccine was granted FDA on June 8, 2006. Harris, supra note 38.

53 The exchange rate on Nov. 28, 2005 was 1 GBP = 1.72 USD. One can find the current exchange rate at http://www.xe.com (the author used http://www.xe.com to deduce the figure in the text using the relevant exchange rate on Nov. 28, 2005).

54 Harris, supra note 38; see also Panel Backs Vaccine for Cervical Cancer, New York Times, May 19, 2006.

55 Patrick Brill-Edwards, Gardasil Human Papillomavirus (Types 6, 11, 16, 18) Recombinant Vaccine 10, 14, 61-66 (April 19, 2006) (final briefing document filed by Merck to the US FDA for the May 18, 2006 meeting of the FDA Vaccines and Related Biological Products Advisory Committee).

56 HNP Summary Profile, http://devdata.worldbank.org/hnpstats/HNPSummary/groupData/GetShowData.asp?sCtry=LMY (last visited May 9, 2006) (2002 data).

57 Kevin Outterson, HPV Vaccines to Prevent Cervical Cancer: Do Patients or Shareholders Come First? (working paper) (June 10, 2006).

58 Outterson, Kevin, NONRIVAL ACCESS TO PHARMACEUTICAL KNOWLEDGE, Global Forum 8, WHO/United Nations Global Forum for Health Research conference on the Millennial Development Agenda (Mexico City) (presented Nov. 18, 2004)Google Scholar. This calculation assumes a global market for Cervarix of £1 billion per year, with 10% falling in low- and medium-income countries. See MAYNE, supra note 23, at 21. The R&D cost recovery percentage is estimated using the 17% number touted by PhRMA, which probably represents an upper limit estimate. Patrica Barry, Drug Profits vs. Research, AARP BULLETIN (June 2002), available at http://www.carlmcmillan.com/drug_profits_vs.htm.

59 PATH Press Release, Path tp Pave the Way for Cervical Cancer Vaccines in the Developing World (June 5, 2006), available at http://www.path.org/news/pr060606-cervical_cancer_vaccine.php.

60 Outterson, The Vanishing Public Domain, supra note 7, at § III.A.1.d.

61 Michael Barbaro, Digene to Adapt Cancer Test For Use in Developing World, WASH. POST, Feb. 18, 2004, at E 05.

62 DEP't OF HEALTH AND HUMAN SERV., CTR. FOR DISEASE CONTROL & PREVENTION, DIV. OF STD PREVENTION, PREVENTION OF GENITAL HPV INFECTION AND SEQUELAE: REPORT OF AN EXTERNAL CONSULTANTS’ MEETING, available at http://www.cdc.gov/nchstp/dstd/Reports_Publications/HPVSupplement%20.pdf cited in Harper et al., supra note 34 at 1764 n. 38 (2004). See also Goldie, Sue J. et al., Policy Analysis of Cervical Cancer Screening Strategies in Low-Resource Settings: Clinical Benefits and Cost-Effectiveness, 285 JAMA 3107–3115 (2001)CrossRefGoogle ScholarPubMed.

63 Sue J. Goldie et al., supra note 45, at 604 n.4, 612.

64 Barbaro, supra note 61, at E 05.

65 DIGENE CORPORATION 2005 ANNUAL REPORT (2005), http://ccbn.mobular.net/ccbn/7/1155/1214/print/print.pdf.

66 United Nations Millenium Declaration, G.A. Res. 55/2, U.N. GAOR, 55th Sess., 8th plen. Mtg., U.N. Doc. A/Res/55/L.2 (Sept. 18, 2000).

67 Outterson, Pharmaceutical Arbitrage, supra note 5, at 250-52.

68 HNP Summary Profile (2002 data), available at http://devdata.worldbank.org/hnpstats/HNPSummary/groupData/GetShowData.asp?sCtry=LIC.

69 See Barton Gellman, An Unequal Calculus of Life and Death; As Millions Perished in Pandemic, Firms Debated Access to Drugs, WASH. POST, Dec. 27, 2000, at A1.

70 MÉDECINS SANS FRONTIÈRES`, SURMOUNTING CHALLENGES: PROCUREMENT OF ANTIRETROVIRAL MEDICINES IN LOW- AND MIDDLE-INCOME COUNTRIES (2003), http://www.accessmed-msf.org/documents/procurementreport.pdf (report prepared by MSF at the request of the WHO).

71 See Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, art. 27.1, Legal Instruments–Results of the Uruguay Round vol. 31, 33 I.L.M. 81 (1994) [hereinafter TRIPS or TRIPS Agreement]. The United States implemented the WTO agreements in the Uruguay Round Agreements Act, Pub. L. No. 103-465, 108 Stat. 4809 (1994).

72 This narrative has been told by many. See, e.g., Outterson, Pharmaceutical Arbitrage, supra note 5, at 250-58.

73 MÉDECINS SANS FRONTIÈRES, UNTANGLING THE WEB OF PRICE REDUCTIONS: A PRICING GUIDE FOR THE PURCHASE OF ARV's FOR DEVELOPING COUNTRIES (8th Ed., June 2005), available at http://www.accessmed-msf.org/documents/untanglingtheweb%208.pdf [hereinafter MSF, PRICING GUIDE]; Boelaert, Marleen et al., Letter to the Editor, 287 JAMA 840, 840 (2002)CrossRefGoogle Scholar (“This impressive discount offered by the companies to developing countries was not merely due to public outcry, but mostly as a response to competition by generic drugs.”).

74 See generally Hogan et al., supra note 4. The most cost effective interventions are mass media campaigns for safer sex, peer education and treatment of sex workers, prevention of mother to child transmission (PMCT), treatment of sexually transmitted infections, voluntary counseling and testing, and ARV therapy. Id. at Tables 3 & 4.

75 Id. at Table A (supplement).

76 See MSF, PRICING GUIDE, supra note 73, at Table A (supplement) n. 5.

77 Outterson, Vanishing Public Domain, supra note 7, at 74-75.

78 A recommended second-line regime is TDF+ddI+LPV/r. MEDECINS SANS FRONTIERES, EUROPEAN PARLIAMENT COMMITTEE ON INTERNATIONAL TRADE HEARING ON TRIPS AND ACCESS TO MEDICINES 6 (Jan. 2005), available at http://europapoort.eerstekamer.nl/cgibin/as.cgi/0345000/c/start/file=/9345000/1/j9vvgy6i0ydh7th/vgbwr4k8ocw2/f=/vgz6mnudecs3.pdf. [hereinafter HEARING]. Second-line treatments also are important in conservation of resistance, and there is no FDC available for second-line treatment as a result of the patents; see Kulwichit, Wanla, First-line and Second-line Antiretroviral Therapy, 364 THE LANCET 329, 329-330 (2004)CrossRefGoogle Scholar, available at http://www.thelancet.com/journal/vol364/iss9431/full/llan.364.9431.analysis_and_interpretation.30311.1.

79 HEARING, supra note 78, at 5-6 (second-line treatment in low income countries costs about US$3,950 per year, and as high as US$ 5,000 per year). Kumarasamy, N., Comment, Generic Antiretroviral Drugs – Will They Be The Answer to HIV in the Developing World?, 364 THE LANCET (July 3, 2004)CrossRefGoogle ScholarPubMed, available at http://www.accessmedmsf.org/documents/Lancet2JulycommentaryFDC.pdf. See also MSF, PRICING GUIDE, supra note 73 at 9.

80 WORLD HEALTH ORG., 3 X 5 PROGRESS REPORT (Dec. 2004), http://www.who.int/3by5/ProgressReportfinal.pdf.

81 GLAXOSMITHKLINE PLC, 2003 ANNUAL REPORT 61-63, available at http://www.gsk.com/investors/reps03/annual_report2003.pdf.

82 Id.

83 Id.

84 Id.

85 Id.

86 Assuming that 75% of the International sales are to Canada, Australia, Japan and other high-income countries (i.e., low- and middle-income global HAART sales by GSK of approximately £38.75 million per year). At an exchange rate of 1 GBP = 1.72 USD, and again assuming 17% of sales are reinvested into R&D, the annual buy-out price until patent expiration is just US$11.3 million per year. As a rough test of the Canada assumption, I checked IMS data for all sales of ARVs in the Canadian market in 2004 for all companies. The total for the year ending October 2004 was US$130 million. (IMS Data, Canada, series J5C1, J5C2 and J5C3). If GSK's ARV market share in Canada is 40%, then GSK's Canadian sales were approximately £30 million in 2004, about 20% of the “International” total. See id.

87 The budget for the 2004 Bangkok Conference was US$17 million. Press Release, Communications Department, XV International AIDS Conference (July 16, 2004), available at http://www.kaisernetwork.org/health_cast/uploaded_files/ias_pressrelease.pdf.

88 Tee Shiao Eek, Making Treatment Affordable, STAR ONLINE (Malaysia), July 3, 2005, available at http://202.186.86.35/health/story.asp?file=/2005/7/3/health/11352481&sec=health

89 WORLD HEALTH ORG., “3 X 5” PROGRESS REPORT 49 (Dec. 2004), available at http://www.who.int/3by5/pr_en.pdf.

90 The Diflucan® Partnership Programme, http://www.diflucanpartnership.com (last visited May 9, 2006).

91 See AEGiS-TAGline: Stern Words For Pfizer, http://www.aegis.com/pubs/tag/2004/TAG041107-04.html (last visited May 9, 2006).

92 Press Release, The International Partnership for Microbicides, IPM Signs Drug Licensing Agreements with Merck and Bristol-Myers Squibb (Oct. 31, 2005), available at http://www.ipmmicrobicides.org/.

93 See Justin Gillis, AIDS Gel on a Faster Track; Merck, Bristol to License Drugs for Use in Poor Countries, WASH. POST, Nov. 1, 2005, at A04.

94 Outterson, Pharmaceutical Arbitrage, supra note 5, at 223-30.

95 See Bicanic, Tihana et al., Antiretroviral Roll-Out Access To Treatment for Cryptococcal Meningitis, 5 THE LANCET INFECTIOUS DISEASES 530, 530 (Sept. 2005)CrossRefGoogle ScholarPubMed (“a system that relies on philanthropic initiatives by the pharmaceutical industry and the pressure of lobby groups cannot result in sustainable access to medicines.”).

96 The Fourth Ministerial Conference was held in 2001. As of June 1, 2006, no country had provided notice of intent to export under the Paragraph 6 statement. See Trips and Public Health, WORLD TRADE ORG., available at http://www.wto.int/english/tratop_e/trips_e/public_health_e.htm.

97 Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States.

98 These issues of over-inclusion and under-inclusion are discussed at greater length in Outterson, Pharmaceutical Arbitrage, supra note 5, at § I.D.4.iii.

99 Dana Gelb Safran et al., Prescription Drug Coverage And Seniors: Findings From a 2003 National Survey, HEALTH AFFAIRS, Apr. 19, 2005, at W5-160.

100 Outterson, Pharmaceutical Arbitrage, supra note 5, at 206-216.

101 Within the U.S. market, internal diversion is illegal in many cases. See, e.g., Heather Won Tesoriero & Gary Fields, FBI, FDA Investigates Big Drug Wholesaler, WALL ST. J., Sept. 19, 2003, at B1 (reporting alleged diversion from discounted hospital markets to higher-priced secondary markets).

102 For an expanded discussion on this reference approval idea, see Outterson, Pharmaceutical Arbitrage, supra note 5, at 236-38.

103 An expanded version of the buy-out price analysis, together with discussion of the literature and alternative models, may be found in Outterson, Fair Followers, supra note 28, at § 5.3.

104 See Lanjouw, Jean .O. & Jack, William, Trading Up: How Much Should Poor Countries Pay to Support Pharmaceutical Innovation?, 4 CTR. FOR GLOBAL DEVELOPMENT 1–8 (2004)Google Scholar, available at http://www.cgdev.org/content/publications/detail/2842/.

105 Outterson, Pharmaceutical Arbitrage, supra note 5, at 220-22.

106 Ganslandt, Mattias et al., Developing and Distributing Essential Medicines to Poor Countries: The DEFEND Proposal, 24 WORLD ECON. 779–795 (2001)CrossRefGoogle Scholar.