Venezuelans to Debate Patenting Laws after Revelation that Companies Conspired in Firing of Radical Minister

Mérida, September 14th 2011 (Venezuelanalysis.com) – Revolutionary Eduardo Saman was replaced as commerce minister following pharmaceutical companies’ efforts to protect old patent legislation and their profits. The information, which came out in a US embassy cable released by Wikileaks, has prompted renewed public debate in Venezuela on the medicine patency issue.

In the cable, written by the US embassy in Caracas on 11 February 2010 and titled, “Draft Intellectual Property Legislation has an Uncertain Future”, the embassy narrates a conversation it had with the Venezuelan Medicine Chamber (CAVAME). CAVAME expressed its worries about possible nationalisations in the industry, and talked about how it had drafted reform proposals to the Intellectual Property Law to counter proposals made by then Commerce Minister Eduardo Saman.

Though the cable does not refer to removing Saman from his post in any way, Saman was in fact replaced two days after it was written, and has not since been given any other government positions. President Hugo Chavez announced that Richard Canaan would replace him.

The firing of Saman, who has been a revolutionary activist since his student days, is well known for his serious stance against price and product speculation and hoarding, and is popular among the worker movement because he worked for worker control in factories such as La Gaviota, came as a surprise to the Venezuelan left.

The US embassy, in the cable, described Saman as a “commerce minister…who also [at the time] heads the Consumer Protection Agency (INDEPABIS), is a former pharmacist and avowed Marxist who has never believed in intellectual property or markets”.

Saman also proposed the formation of a “radical socialist current” within the United Socialist Party of Venezuela (PSUV) in November last year, as a way to have an organised force within the PSUV to counter the “fifth column” or the bureaucratic “enemy within” the party.

CAVEME’s “Alternate” Proposal

According to the cable, CAVEME’s legal consultant Fernando Allende said the intellectual property reform drafted by Saman had “no chance” of being passed, and CAVEME wrote and proposed its own legislation in “Chavista language” to Venezuelan government officials in order to undermine Saman’s project.

However, Allende was apparently not concerned about Saman’s proposal being passed because it would “discredit” the Venezuelan government, and would impact Venezuela’s campaign to join regional integration organisation, Mercosur, and he felt confident Chavez would “pull Saman back before the National Assembly elections in September 2010, “like a dog on a leash”.

The cable reveals that CAVEME drafted its alternative proposal with the help of Hildegard Rondon, the “well-connected mother-in-law of PDVSA President Rafael Ramirez”.

“Allende explained that CAVEME has been careful to avoid open confrontation with the [Venezuelan government] over patents because Venezuela is a large pharmaceutical market and patented products represent a fraction of total sales,” the cable said.

CAVEME representatives told the US embassy that they expected to have another profitable year in Venezuela (in 2010) in a market that is worth over US$ 6 billion. Patented medicine only accounts for US$ 100 million of that.

Saman’s Proposal Aimed to Counter High Costs of Medicines

In an interview with Ultimas Noticias on 11 September this year, Saman explained some of the issues related to patents. With the Autonomous Service of Intellectual Property (SAPI), Saman investigated Viagra, found eight different brands of “Sildenafil”, whose active ingredient is Viagra, and following that investigation its price fell to 25% of what it was before.

“That explains what a patent is, the laboratory assigns whatever price it feels like for twenty years. After that case we started to revise all the other patents,” Saman said in the interview.

SAPI discovered that there were requests for patents for medicine that had “insignificant modifications”, Saman said. “They were requesting new patents in order to extend their current ones for twenty more years.”

He explained his proposal, “The characterising principle of the project was that patents would be considered concessions and not property titles. Doing this, we would be complying with the [World Trade Organisation regulations], because we were actually going to award patents, and it’s not true that international agreements would be violated. This is surely what [CAVEME] told the president [of Venezuela], that it was a crazy project”.

The main difference between a concession and a property title is that a concession can be revoked when conditions aren’t complied with, whereas property titles would require expropriations. Concessions, Saman explained, are a way of “impeding the abuse that corporations currently carry out with their medicine”. 

Yesterday the president of SAPI, Jose Villalba announced that the organisation, which is attached to the commerce ministry, will promote a “process of discussion and presentation of proposals for the project to reform the Intellectual Property Law, with the participation of the …people”.

Villalba said SAPI would publish three proposals, written by different sectors of society, on its website for debate.

Referring to Saman’s interview, Villalba said that Saman’s proposal hadn’t come out of discussion and “we believe in the legislating people”.