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Brazil and Compulsory Licenses

Tags InterventionismMonopoly and Competition

As I've noted previously, there is nothing necessarily unlibertarian about the feds issuing a compulsory license of a patent, since this merely takes back some of the monopoly right it should not have granted in the first place. (See Condemning Patents and Patents, Prescription Drugs, and Price Controls.)

Now "Brazil decided to break the patent on the HIV drug Storcrin (the brand name for efavirenz), becoming the second country to challenge the pharmaceutical industry in seeking a drastic reductions in drug costs. Brazil's President signed a compulsory license for efavirenz to purchase from generic suppliers under provisions permitted by World Trade Organization rules."

What is funny is the language used to describe compulsory licenses—Brazil decided to "break" the patent. It's reminiscent of the Orwellian language used to describe countries' efforts to "fight" inflation—as if they are not the cause of it. The patent Brazil decided to "break" is a patent granted by Brazil itself. That is, Brazil grants a monopoly privilege to some patent holder, and then decides to retract it. That's "breaking" something?


Stephan Kinsella

Stephan Kinsella is an attorney in Houston, director of the Center for the Study of Innovative Freedom, and editor of Libertarian Papers.