"These protectionist measures [...] guarantee to US pharmaceutical
   corporations huge profits on drugs that are priced far beyond the
   reach of taxpayers who fund the research, let alone the bulk of the
   world's population. "Basic biomedical research has long been
   heavily subsidized by United States taxpayers," the _New York
   Times_ business pages observe, and "high-tech pharmaceuticals owe
   their origin largely to these investments and to Government
   scientists," funded by billions of taxpayer dollars [..]

   "But drugs created through genetic engineering and other state
   subsidy are priced beyond the reach of those who pay for their
   development.  Protection of "intellectual property" is designed to
   guarantee monopoly profits to the publicly-subsidized corporations,
   not to benefit those who pay; and the South must be denied the
   right to produce drugs, seeds, and other necessities at a fraction
   of the cost.

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22 Chomsky/Z: Year 501 (part II), Part Response 7 of 7
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The following article by Noam Chomsky appeared in: 

     Z Magazine, July-August 1992 

and is reprinted here with the magazine's permission. 

================================================================= 

Year 501: World Orders Old and New: Part II (PART 8 of 8; 13KB) 
=============================================================== 

6. Reshaping Industrial Policy 
------------------------------------------------------------ 

The economic managers of the 1980s not only left the US with a 
legacy of unprecedented debt, but also with the lowest rate of 
net private investment of any major industrial economy.  In 
1989-90, the US fell behind Japan in the absolute level of 
industrial investment, with a population twice as large.  The US 
position in traditional high-tech industry also declined 
severely. <<<NB: Wachtel, _op. cit._, "afterword"; John Zysman, 
"US power, trade and technology," _International Affairs_ 
(London), Jan. 1991.>>> 

For forty years, US industrial policy has been based on the 
Pentagon system, which provided a regular stimulus to high 
technology production and a state-guaranteed market to cushion 
management decisions.  With Soviet power a reality, it was always 
possible to concoct "missile gaps," "windows of vulnerability," 
and other threats to our existence when needed.  These forms of 
massive state intervention in the economy provided the US with a 
comfortable lead in the advanced sectors of technology.  But the 
pretexts are now gone, and new devices are needed. 

At the same time, the cutting edge is shifting towards other 
areas, notably biotechnology.  Like other competitive sectors of 
the economy, the pharmaceutical and health industries and 
agribusiness have always benefited from a crucial state-organized 
subsidy for research, development, and marketing.  These areas 
are now gaining a greater role in planning for the years ahead. 
In the early postwar years, research would "spin off" electronics 
and computer firms, creating new opportunities for enrichment for 
engineers, scientists and entrepeneurs.  Today, biotech firms are 
springing up around the same research institutions, by rather 
similar mechanisms. 

The US National Institutes of Health are engaged in what the 
_Wall Street Journal_ calls "the biggest race for property 
since the great land rush of 1889," in this case, "staking U.S. 
patent claims to thousands of pieces of genetic material -- DNA 
-- that NIH scientists are certain are fragments of unknown 
genes." The purpose, the NIH explains, is to ensure that US 
corporations dominate the biotechnology business, which the 
government expects "to be generating annual revenue of $50 
billion by the year 2000," and vastly more beyond.  A recent 
patent for a basic human blood cell could allow a California 
company to "corner the market for a broad array of life-saving 
technologies," to cite merely one example.  The biotech business 
took off after a 1980 Supreme Court decision granting a patent 
for an oil-dissolving microorganism developed through genetic 
engineering, the _Journal_ observes. 

The prospects are considered to be expansive.  To convey a sense 
of the prospects, one researcher remarks that some way down the 
road, parents might even have to pay royalties for having 
children.  Medical procedures such as bone-marrow transplants and 
gene-based therapies will also be protected by patent.  The same 
could be true of engineered animals, seeds, and other organisms. 
We are now speaking of control of the essentials of life.  By 
comparison, electronics deals with mere 
conveniences. <<<NB: Michael Waldholz and Hilary Stout, "Rights 
to 
Life," _WSJ_, April 7, 1992.>>> 

These developments give new urgency to the US demand for 
increased protection for "intellectual property" -- crucially 
including patents -- at the ongoing GATT negotiations.  These 
protectionist measures are needed to ensure that US corporations 
dominate the health and agricultural industries, thus controlling 
the essentials for human life; and to guarantee to US 
pharmaceutical corporations huge profits on drugs that are priced 
far beyond the reach of taxpayers who fund the research, let 
alone the bulk of the world's population. "Basic biomedical 
research has long been heavily subsidized by United States 
taxpayers," the _New York Times_ business pages observe, and 
"high-tech pharmaceuticals owe their origin largely to these 
investments and to Government scientists," funded by billions of 
taxpayer dollars for the National Institutes of Health and for 
University research.  But drugs created through genetic 
engineering and other state subsidy are priced beyond the reach 
of those who pay for their development.  Protection of 
"intellectual property" is designed to guarantee monopoly profits 
to the publicly-subsidized corporations, not to benefit those who 
pay; and the South must be denied the right to produce drugs, 
seeds, and other necessities at a fraction of the cost. 

On similar grounds, the US has refused to sign a treaty on 
preserving the world's biological species.  The Assistant 
Secretary of State for the Environment, Curtis Bohlen, said that 
the treaty "fails to give adequate patent protection to American 
companies that transfer biotechnology to developing companies," 
and "tries to regulate genetically engineered materials, a 
competitive area in which the United States leads," the _New 
York Times_ reports. <<<NB: Fazlur Rahman, _NYT_, April 26; 
William Stevens, _NYT_, May 24, 1992.>>>