US WTO spokesman Keith Rockwell said there was no deal on Friday, adding that more consultations are required.

Earlier, diplomats from Kenya and South Africa, among a core group of five nations trying to break a stubborn deadlock with the United States, showed some optimism. But talks are likely to continue

Criticism

No envoy has explained why talks are failing so far, but aid agencies Oxfam and Medecins Sans Frontieres criticised the last draft proposal for imposing too many restrictions and not helping those in need.

"I think this is a last-ditch effort to get the US to sign the agreement … which is a travesty …  but it will be presented as this wonderful thing for development," Celine Charveriat, of Oxfam, told reporters.

It "is a travesty … but it will be presented as this wonderful thing for development"

Celine Charveriat
Oxfam

Some Indian drugs firms, leading suppliers of generics to developing countries, were equally critical of the latest proposal.

“The policy is riddled with barriers which will make generic drugs more expensive than necessary,” said Secretary General of the Indian Pharmaceutical Alliance, Dilip Shah.

The problem

Ensuring poorer states unable to manufacture medicines can import cheap generic drugs is vital for beating major killer diseases.

But it means setting aside patents owned by big multinational firms that are protected by trade rules.
  
Victims of curable diseases in developing countries, mainly in Africa, stand to gain the most from any deal. 
  
Disagreement

The problem has been casting a long shadow over global free trade talks since their launch in 2001.

Last December the United States blocked an accord that was backed by all the other 146 WTO members.

Washington is concerned that Brazilian and Indian generic producers will flood the market with cheaper versions of patented medicines.

Under pressure from profitable US pharmaceutical groups, Washington last year was worried that relaxing patents would also lead to companies not investing in research for future drug development.
  
US position
   
Peter Allgeier, US deputy trade representative, told reporters he would not comment on specific aspects of attempts to resolve the issue, saying only: "We are working very hard."

But it is widely believed that the US will push for more assurances it will not have to relax patents on non-infectious diseases and will push for generic medicine companies “to act in good faith” and not for commercial gain.
  
The chairman of the WTO's council on trade-related aspects of intellectual property rights drafted the latest statement to try to allay US fears which is under discussion by Brazil, India, the United States, Kenya and South Africa. 

However, negotiations are likely to continue as the US administration is known to want to remove the issue from the next WTO talks in Cancun, Mexico, beginning 10 September.