This report focuses on the relationship between intellectual property rights (IPRs) provisions pursued through international and U.S. trade policy and access to medicines. Patents, a form of IPR, constitute the most common method by which governments encourage research and development (R&D) in order to find treatments and cures for diseases and other illnesses. A patent is a legal, exclusive right granted for the invention of a new product, process, organism, design, or plant that allows the right holder to exclude others from making, using, or selling the protected invention for a period of 20 years. By granting a temporary, exclusive right to the market for the protected product, a patent enables the right holder to generate profits to recover the costs for investment in R&D and to invest in future innovations. However, some express concerns that patents enable right holders to price drugs at levels that greatly surpass marginal costs of R&D and production, raising questions about the role of patents in affecting access to medicines and public health. IPR protection and enforcement have evolved from an area primarily of national concern to an area of international trade policy. The World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) established minimum standards for IPR protection and enforcement. Countries have advanced IPR protection and enforcement efforts through multilateral, regional, and bilateral free trade agreements (FTAs) and unilateral trade policies. Congress makes and shapes U.S. trade policy by passing statutory authorities that authorize trade programs, governing trade policy in a range of issue areas, setting trade negotiating objectives into law, engaging in consultations with the Executive Branch on trade negotiations, and conducting oversight hearings on U.S. trade policy and programs. Within Congress, there has been significant interest in promoting and protecting IPRs through trade policy for economic, health and safety, and national security reasons. IPR-based industries are viewed as an important contributor to U.S. innovation, productivity, economic growth, employment, and international trade. Advocates of a strong international IPR regime claim that counterfeiting and piracy inflict billions of dollars of revenue and trade losses annually on U.S. IPR-based industries. Some policymakers also have expressed concern about the health and safety implications of counterfeit goods, including pharmaceutical drugs. In addition, there is concern that trade in IPR-infringing products may feed into cross-border organized criminal networks. The Office of the U.S. Trade Representative (USTR) considers the protection and enforcement of international IPR standards to be a high priority for U.S. trade policy. As such, the USTR has pursued strong IPR regimes by participating in multilateral, regional and bilateral FTAs, as well as through unilateral trade policy tools, namely the Special 301 process and the Generalized System of Preferences (GSP). IPR provisions in trade policies are among the range of social, economic, and political factors that may affect public health. While patents may provide incentives for innovation, their granting of market exclusivities and impact on prices raise questions about the affordability of medicines, particularly for (but not limited to) low-income countries and their populations. Through their possible impact on innovation and drug prices, patents may affect the ability of countries to provide medicines to their populations and for populations in general to access medicines. For some observers, this may represent a conflict between free market and public health policies. While the commercialization of public health may promote innovation and efficiency, the laws of supply and demand may cause some people to be "priced out" of a given market. According to the World Health Organization (WHO), about one-third of the world's population, primarily residing in poorer parts of Africa and Asia, lacks regular access to essential medicines. Infectious diseases are major contributors of illness, death, and poverty in the developing world. At the end of 2008, an estimated 33.4 million people were living with HIV/AIDS, with about two-thirds of them in Sub-Saharan Africa. Other infectious diseases, such as tuberculosis, malaria, and influenza, present critical global health challenges as well. Over one billion people, primarily among the world's poorest, also are afflicted with neglected tropical diseases, which largely are infectious parasitic diseases prevalent in "impoverished" environments. With the global economic crisis, access to medicines may deteriorate. In 2000, the United Nations established eight Millennium Development Goals (MDGs), to which the United States is a signatory, in an effort to end poverty by year 2015. One of the U.N. targets is to achieve universal access to treatment for HIV/AIDS by 2010 and to have halted and reversed the spread of HIV/AIDS, malaria, and other major diseases by 2015. While prevention is key to combating infectious diseases, access to treatment is also critical to controlling epidemics. As such, another MDG target is to cooperate with pharmaceutical companies to provide access to affordable essential drugs in developing countries. Access to medicines has improved dramatically over the past couple of decades. For example, of the approximately 9.5 million people in need of treatment for HIV/AIDS in 2008 in low- and middle-income countries, 42% had access, compared to 33% in 2007. Although access to medicines is an important goal and is the focus of the discussion at hand, some public health professionals caution that "over-access" also can be a problem. Proponents of this view assert that that the availability of medicines due to lower prices may promote misuse, leading to the faster onset of drug resistance and shorter duration of the drug's usefulness. There is ongoing debate within Congress about the impact that IPR provisions in international and U.S. trade policies may have on access to medicines and public health. At the center of the debate is the question of how to balance providing long-term incentives for innovation through patents and addressing the short-term need to provide affordable access to medicines. The debate over the role of patents and trade policy in affecting access to medicines often has been framed as one in which high-income, developed countries and innovator ("brand name") pharmaceutical companies are pitted against low-income, developing countries and global health advocates. However, the number of stakeholders is more diverse, and includes middle-income, industrializing countries, and generic drug manufacturers. In addition, there is debate within the governments of countries about how to balance advancing economic interests and public health outcomes through trade policy. The debate over IPRs and access to medicines represents one component of a broader debate over the relationship between international trade policy and global public health. Over time, these two arenas have shown increasing overlap. In some cases, the linkages have been clear. For instance, international trade in goods that contain dangerous pathogens or counterfeit substances presents clear threats to public health. In other cases, as in the debate at hand, the linkages may not be so clear-cutting, or trade issues may only form one component of the public health issue. The global pharmaceutical industry is classified as a high-technology industry by the Organization for Economic Cooperation and Development (OECD). As a high-technology manufacturing industry, the pharmaceutical industry spends a high proportion of its revenues on R&D, which can lead to innovative solutions to treat global health problems. The pharmaceutical industry is heavily reliant on protection of intellectual property rights, specifically patents. Patents are the most common way for governments to encourage R&D and to foster innovation. A patent is a time-limited, legal, exclusive right granted for the invention of new products, processes, organisms, designs, and plants that allows the right holder to exclude others from making, using, or selling the protected invention for a period of 20 years. A patent does not necessarily provide the right holder with the "right to sell" the protected invention, as the right holder may need to comply with other regulatory laws. For example, pharmaceutical drugs generally also must be reviewed by a regulatory body (in the case of the United States, the Food and Drug Administration, FDA) for other considerations, such as health and safety, before it may be sold to consumers. By granting time-limited, exclusive monopolies on the market for a product, patents generate above-market financial returns that are believed to enable pharmaceutical inventors to recoup the costs of R&D and to invest in future innovations. By some estimates, the cost to drug researchers and manufacturers for creating a single new medicine is upwards of $800 million. Pointing to the high costs and uncertainty associated with R&D, supporters of patents argue that they are important for innovation in medicine by allowing right holders to recoup the costs of R&D, earn profits, and invest in future R&D. Proponents maintain that financial incentives for innovation may be even more critical now with the global economic downturn. Some fear that tighter credit markets may compel pharmaceutical companies to reduce current R&D spending. For example, the World Intellectual Property Organization (WIPO) reported a drop of 4.5% in international patent filings in 2009. Others are skeptical of the reportedly high estimates of the costs of R&D in the creation of new medicines. Some critics argue that PhRMA's cost estimate includes both the actual expenditures and the economic opportunity costs of developing new drugs. They also contend that a growing proportion of the financial returns generated from patented drugs is not directed toward new innovations, but rather to commercial marketing and political lobbying activities. Additionally, pharmaceutical companies often use publicly-funded research to develop drugs for commercialization. For instance, in the United States, the National Institutes of Health (NIH) and the Centers for Disease Control (CDC) provide funding for health-related research. In general, the public sector funds R&D that is focused on basic scientific research. Pharmaceutical companies then build on this research to develop products that are patentable and commercially marketable.