Negotiators from the US and several developing countries are nearing a compromise on the issue which has divided the WTO for almost two years.

“We are optimistic of finding a solution,” Fazil Ismail, chief WTO representative of South Africa told the Financial Times.

Developing countries - four-fifths of the WTO's membership – see the resolution of the medicines dispute, coupled with looser restrictions on farm trade, as a test of rich nations' pledges to make Doha a "development" round.

If they all accept the plan in time, it will be submitted to a meeting of the WTO's ruling general council next week, where broader support will be sought.

Boost

Resolving the dispute would boost next month's meeting of trade ministers from the WTO's 146 members in Cancun, Mexico, which will seek to expedite the Doha round.

When the Doha round was launched in late 2001, governments pledged to prevent WTO patent-protection rules stopping poor countries from having access to medicines used to treat serious health problems such as HIV/Aids, the FT said.

The US last year rejected a draft agreement aimed at breaking the deadlock after objections from members of its pharmaceuticals.

US drug companies argued that compulsory licencing of medicines by poor countries without manufacturing capacity would enable generic drugs producers in countries such as Brazil and India to flood the market with cheap versions of their patented products, the FT reported.

The compromise would see the US accept last year’s draft agreement.

Still, as many as 30 developed and developing countries have assured America they would not seek any commercial advantages from the relaxation.