Health

The investor-to-state dispute settlement (ISDS) provisions proposed in trade agreements give pharmaceutical corporations the right to sue governments for compensation if domestic laws negatively affect future earnings on their intellectual property or investments, and even if these laws are in accordance with public interests. Better access to medicines or preventing unsafe or ineffective medicines from entering the market could prove problematic.

Major US, Canadian and French pharmaceutical companies have recently challenged pro-public health measures through ISDS disputes brought under ISDS provisions.

Chemical corporations have also used ISDS in numerous occasions to challenge national bans on hazardous substances.

Most well-known cases include:

• Ethyl (US) vs. Canada: following Canada’s ban on the toxic petrol additive MMT, the US producer sued for US$201 million in compensation. In 1998, Canada agreed in a settlement to pay US$13 million and withdrew the ban (NAFTA invoked).

• Philip Morris Asia (Hong Kong) vs. Australia: When Australia introduced plain packaging for all tobacco products in 2011, Philip Morris sued Australia before an arbitral tribunal. In its December 2015 decision, the tribunal dismissed the case, albeit on legal grounds only. Australia spent A$24 million in legal costs but Philip Morris only paid half, leaving the Australian taxpayers to pay the other half. As a consequence of this case, countries ranging from Namibia, Togo to New Zealand decided to wait to introduce their own plain packaging for tobacco products. (Australia-Hong Kong BIT invoked)

• Dow Chemical (US) vs. Canada: the chemical corporation initiated a dispute for losses it alleged were caused by a Quebec provincial ban on lawn pesticides containing the active ingredient 2,4-D, classified as a possible carcinogen and one of the ingredients in Agent Orange, the herbicide widely used during the Vietnam war. In a settlement in 2011, the ban was sustained but Quebec was required to state that “products containing 2,4-D do not pose an unacceptable risk to human health or the environment provided that the instructions on their label are followed.” (NAFTA invoked.)

Photo: Aqua Mechanical / CC BY 2.0

(March 2020)

Global Justice Now | 24-Apr-2017
A new briefing has outlined the likely elements of a UK-US trade deal and argues that it would contain more extreme forms of all the controversial elements of the deal that was being negotiated between the EU and the USA.
Tech Dirt | 21-Apr-2017
ISDS is an attempt to remove the risk of investment from companies, and place it squarely on the public’s shoulders, without any quid pro quo.
AGEFI | 13-Apr-2017
Le géant bâlois est accusé d’avoir "menacé" le ministère colombien du Commerce et de l’Industrie de recourir à un tribunal d’arbitrage international.
Public Eye | 12-Apr-2017
Confidential documents obtained by Public Eye show that Novartis has threatened Colombia with international investment arbitration under its BIT with Switzerland to avoid the issuance of a compulsory license
IA Reporter | 5-Apr-2017
Ukraine has settled a dispute with American pharmaceutical company Gilead Sciences Inc., following the company’s pursuit of legal remedies in both domestic courts and via investment arbitration.
Public Citizen | 1-Apr-2017
Novartis battle against Colombian Government highlights the threats to public health posed by the outrageous investor-state dispute settlement regime and bad “trade” deals.
Lexology | 27-Mar-2017
The Tribunal found that Eli Lilly had failed to demonstrate that the promise doctrine constitutes a fundamental or dramatic change in the utility requirement under Canadian patent law or that the promise doctrine is arbitrary and/or discriminatory.
Tech Dirt | 22-Mar-2017
Just the fact that the Canadian government had to go through this massive and expensive process for many years just for rejecting two bad patents should show why ISDS provisions are such a problem.
Politico | 20-Mar-2017
Canada has prevailed over pharmaceutical giant Eli Lilly in a long-running investor-state dispute the drug company filed under NAFTA’s investment chapter.
IELP Blog | 12-Mar-2017
A dissent sends the message: beware, if one other arbitrator had gone the way that Born did, we would have won.