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Tax and Spend: U.N.'s Rx for New World Medical Order

A member of a World Health Organization (WHO) panel of experts that is pondering new global taxes on e-mails, alcohol, tobacco, airline travel and consumer bank transactions, has charged that she was given only selective information at group meetings, that deliberations were rushed and that group was "manipulated" by the international pharmaceuticals industry.

All of her charges were strongly denied by the head of WHO's Expert Working Group on Research and Development Financing (EWG), a 25-member panel of medical experts, academics and health care bureaucrats which is due to present a 98-page report in Geneva on Monday, after 14 months of deliberations on "new and innovative sources of funding" to reshape the global medical industry.

A copy of the executive summary of the report was obtained by Fox News on January 15 — the same day, as it happens, that the EWG's dissident member first aired her charges in a letter to members of WHO's 34-member supervisory Executive Board.

The executive summary first revealed the possibility of a multibillion-dollar "indirect consumer tax" as one means of financing an epic shift of drug-making research, development and manufacturing capabilities to the developing world that is the central aim of WHO's fund-raising strategy.

Fox News has obtained a copy of the full EWG report, Research and Development: Coordination and Financing, in advance of its publication Monday, which lays out in greater detail the working group's proposals for fund-raising. These include not only indirect consumer taxes but also greater donations by wealthy governments as a percentage of gross domestic product, voluntary individual payments tied to such things as individual mobile phone use, health care lotteries, new commitments from charitable and philanthropic organizations, and the possible diversion of current philanthropic giving from developed-world causes into developing world health care.

The report lays out, and generally endorses, a number of public-private partnerships in the developing world with some of the world's biggest pharmaceutical firms. But it also raises the idea of a tax on pharma-profits from low-income countries that could raise as much as $160 million a year.

The report labels that tax idea a "particularly attractive" option for funding health research and development, and says that revenues from it would "rise considerably if the profits from one or more high income countries was included."

One dissident member of the working group, Cecilia Lopez Montano — a federal senator of Colombia and former national environmental minister — insisted that working sessions of the group she attended were truncated, that her suggestions of looking critically at intellectual patent rights held by Big Pharma companies were ignored, and that neither she nor "the majority of the members of the group" actually participated in the findings "in a full manner."

In a telephone interview on Thursday with Fox News, Lopez Montano declared that she did not "understand, if we are talking about getting cheaper medicines for poor people, how we could discuss this without talking about intellectual property rights."

Frustrated, she says, she walked out of the group's last working session in December 2009, and did not return.

"The only comment I would make for public consumption is that her allegations are completely unfounded," replied the EWG chairperson, Sir George Alleyne, to an email query by Fox News about the incident. A tropical medicine specialist from Barbados who served as a onetime U.N. Secretary-General's special envoy for HIV/AIDS in the Caribbean, Alleyne wrote that "to my knowledge, not a single member of the group has associated himself or herself with her comments."

The tempest created by Lopez Montano's accusations is liable to fade quickly as people around the world — especially Americans, who are far and away the world's biggest funders of medical research and development — absorb the variety of the EWG's revenue ideas and the full extent of WHO's ambitions to reshape the international health care industry in favor of research and development for the "neglected" diseases of developing countries.

The full EWG report lays out in some detail a battery of other possible consumer taxes on citizens of rich countries for such things as alcohol and tobacco use, weapons sales, and airline travel, to create a burgeoning medical R&D industry spread across the developing world.

Click here for the full report.

A 5 percent to 10 percent increase in alcohol taxes in developing countries, it notes, could raise anywhere from $5.5 billion to $11 billion per year.

It also cites approvingly a 0.38 percent Brazilian tax on bills paid online and unspecified "major withdrawals" that was raising an estimated $20 billion a year before it was revoked. "There is scope globally for expansion of bank transaction taxes," the report notes.

The Internet or "digital" tax offered up as an example by the EWG would amount to 1 cent per 100 emails, yielding a conservative $3 billion a year. It "might be appealing to politicians and consumers, who will accept a low tax across a broad base with an altruistic purpose." But almost in the same breath, the document observes a complication, that "introducing a new tax or expanding an existing tax may require legal changes, nationally and internationally, and ongoing regulation to ensure compliance."

Getting mobile phone users to sign up for a voluntary medical fee per call could yield anywhere from $280 million to $1.8 billion, depending on the tax bite and the consumer enthusiasm for the idea, while a voluntary fee tied to airline ticket purchase, the document says, could raise nearly $1 billion.

The report estimates WHO would raise $7.4 billion a year if donor nations hiked their percentage of GNP targeted on the new health care model. But the report still holds out hope for substantially more money if "donors diverted current financial support" from medical research that meets their own current requirements to WHO's agenda.

After itemizing all those potential sources of new money, however, the report suggests that only a "balance" of options be selected, which it projects would amount — again, conservatively — to about $4.6 billion a year. That would "nearly triple current research and development funding for neglected diseases in developing countries."

How would all the money be channeled? Mainly, it appears, through institutions that in many of cases have close ties with WHO.

The report that will be released Monday suggests that a global blossoming of developing-world research networks, many of which appear to be rapidly sprouting up in tandem with WHO's efforts to create new ways of financing them, could be "coordinated" via an "effective global health governance structure" by WHO itself — an organization whose 34-member executive board is made up largely of non-elected health bureaucrats from around the world.

Funding for the burgeoning medical research industry would be dispensed by a not-yet-created "global health research and innovation, coordination and funding mechanism."

The new money-dispensing machine would ladle out funds for "new drugs, vaccines, diagnostics and intervention for the poor, as well as medical research in low- and middle-income countries, new centers for the collection and analysis of research and development data, and new authority to distribute research assignments among public and private entities.

Its estimated cost, in the early stages: anywhere from $3 billion to $15 billion per year.

Many of the new parts of the proposed medical industry network in developing countries would also appear, according to the report, to be fostered by WHO itself, with collaboration from other parts of the United Nations' system of funds, programs, agencies and other institutions.

The report singles out favorably, for example, a new and fast-growing group of research institutions known as the African Network for Drug Discovery and Innovation (ANDI), launched in 2008. ANDI was created under the auspices of an institution known as TDR, a tropical disease research program that is part of WHO, and is now jointly sponsored by WHO, UNICEF, the United Nations Development Program, and the World Bank (also a U.N. institution).

According to the EWG report, networks like ANDI, which could involve a welter of local public and private financing, government participation, international agencies and global pharmaceutical firms, could not only coordinate regional research policy in such areas as traditional African medicine, but also fund-raise, allocate funds between different developing countries in Africa, and work to harmonize local medical regulations.

It would all be, as the report puts it: "a multi-level, multi-party, multi-purpose partnership for global health governance, a platform coordinated by WHO and supported by high-level political commitment and policy coherence."

Not by coincidence, new health research networks like ANDI cropped up in 2008 — at about the same time that WHO's legislative World Heath Assembly adopted a global strategy and plan of action that mandated the organization, as the EWG report puts it, to "play a strategic, central role in the relations between public health and innovation and intellectual property."

Among other things, that meant driving the global health-care agenda "to promote a new approach to innovation and access to medicines, which would encourage needs-driven rather than market-driven research." The aim: "to target diseases that disproportionately affect people in developing countries."

Behind that new direction is the U.N. organization's belief, evidently shared by many medical researchers, that medical research and development in rich countries aims to cure the ailments of their rich citizens, while the diseases that afflict poor nations, like malaria, tuberculosis and HIV/AIDS, are "neglected." Even when the medicines are appropriate, the EWG report relates, they are too expensive.

"In 56 of the 58 countries in which the bottom billion [poorest people] live, virtually every person has at least one neglected tropical disease," the report states. It adds that "95% of the 33 million people living with HIV are in low- and middle-income countries (68% in sub-Saharan Africa), and 27% of new cases and 31% of registered deaths from tuberculosis were in Africa."

Only a massive shift in research and development capacity to low- and medium-income countries — fueled by funds from rich ones — will correct that imbalance, the report, and the WHO strategic plan, argue.

The EWG report maintains that argument even as it also reveals that poor countries are increasingly afflicted with the same non-communicable diseases as rich ones: cancer, cardiovascular ailments, diabetes. Indeed, the report cites a projection that $84 billion in lost income will result between 2006 and 2015 in 23 low- and middle-income countries as a result of heart disease, stroke and diabetes alone."

Regardless of the afflictions, the WHO remedy remains "the production of new knowledge, especially through the investments in research and development." Especially under the many-faceted initiatives of WHO.

George Russell is executive editor of Fox News.