Another reason to challenge drug development cost claims
Quote of note:
The patents, of course, are believed to be necessary to give inventors a fixed monopoly time in a marketplace to recoup costs on research and development (R&D). Yet, again, data demonstrate that such costs are recouped well in advance of the 20-year patents that the US Trade Representative is pushing on poor countries through bilateral and regional trade agreements [12].
And the R&D claim ignores the fact that most AIDS drugs were produced through public financing (even through the clinical trials stages), and 85% of the basic and applied research for the top five selling drugs on the market were produced through taxpayer funding [13].
Go to the linked page to get the endnoted references.
US AIDS CZAR UNDERMINES WHO INITIATIVE
Sanjay Basu
In May 2003, at its annual World Health Assembly, the World Health Organisation (WHO) announced a modest proposal: that it would provide the technical and organisational support to provide 3 million people in poor countries with antiretroviral treatment by the year 2005.
This "3-by-5 initiative" was minor in one sense, in that it would provide treatment to only about 5 percent of those in need. But in another sense, it was a major step forward, particularly because the WHO proposed a novel manner of delivering the anti-HIV medicines: combining the drugs into a "fixed-dose regimen", a combination pill containing three drugs in one capsule, allowing an infected person to take only one pill twice per day for a complete HIV-treatment regimen. Fixed-dose combinations are cheaper and easier to take than the existing HIV treatment protocol; taking two fixed-dose combination pills a day for a year costs $140 per patient, compared to about $600 per year for the normal regimen of six pills per day [1].
Previous excuses used to deny patients in poor countries access to antiretrovirals centred around two common arguments: that poor persons could not adhere to complex medication regimens and would therefore improperly take the drugs leading to drug-resistant forms of HIV, and that the infrastructure in poor countries is insufficient to support complex HIV care [2, 3].
Yet those who continue to state these excuses are almost universally unfamiliar with the public health and biomedical data accumulated over the last several years, which definitively demonstrates that in the most resource-poor settings - including the poorest place in the western hemisphere (the central plateau of Haiti) and the slums of southern Africa (such as the Khayelitsha township in South Africa) - antiretroviral treatment has been delivered with higher adherence, extraordinary success rates and no evidence of drug resistance [4-9]. The success of these interventions has resulted in the exportation of these models throughout the world - and physicians everywhere are now waiting for the necessary medications to arrive.
The WHO's generic combination pill would have improved and simplified treatment to the point where these models would have been even easier to adopt in most resource-poor settings.
Why had a combination pill not been designed before? Because HIV treatment requires a number of different types of medications, and these types are patented by different companies in the US and UK. Ideal combination pills could not be produced when one company owned the patent to a necessary chemical and another company owned the patent to a secondary component.
The patents, of course, are believed to be necessary to give inventors a fixed monopoly time in a marketplace to recoup costs on research and development (R&D). Yet, again, data demonstrate that such costs are recouped well in advance of the 20-year patents that the US Trade Representative is pushing on poor countries through bilateral and regional trade agreements [12].
And the R&D claim ignores the fact that most AIDS drugs were produced through public financing (even through the clinical trials stages), and 85% of the basic and applied research for the top five selling drugs on the market were produced through taxpayer funding [13].
According to the industry's own tax records (obtained from the Securities and Exchange Commission), Merck last year spent 13% of its revenue on marketing and only
5% on R&D, Pfizer spent 35% on marketing and only 15% on R&D, and the industry overall spent 27% on marketing and 11% on R&D [14].
Meanwhile, all of sub-Saharan Africa constitutes only 1.3% of the pharmaceutical market, so as one former pharmaceutical executive put it, allowing generics to enter this market would result in a profit loss to the patent-based industry equivalent to "about three days fluctuation in exchange rates" [15, 16].
But the drug industry's fight for monopoly patent rights in this market and middle-income country markets is serious, as the growing inequality in poor countries under the context of neoliberalism increases the market-share for more expensive patent-based drugs among the elite [17].
With all of this data accumulating, it would seem self-evident that the WHO's move to make a generic combination pill would not face much opposition. In reality, the new US AIDS "Czar", Randall Tobias, the former CEO of Eli Lilly, has almost totally undermined the WHO plan.
While he and the White House initially pledged to support the initiative, no monies have flowed to date, and Tobias appears to be waiting until the program completely collapses from financial instability [18].
Ironically, when President Bush claimed to pledge $15 billion to global AIDS efforts during the State of the Union Address last year (none of which has actually been apportioned to date), he quoted the price of the WHO generic pill as a basis for claiming that the US would support drug treatment for HIV-infected persons, since such treatment has become more affordable [19]. It now appears that the US will only pay if US patent-based pharmaceutical manufacturers are given the money - an effective subsidy of an already heavily-subsidized industry that is taxed at only one-third of the rate of other equivalent industries [13, 18].
While the pharmaceutical industry has been lobbying the White House throughout this week to undermine the WHO initiative, Tobias has publicly stated that his concerns are not about the industry's interests, but about the safety of generics and the prospect that cheaper AIDS drugs would be smuggled illegally into Northern countries. "We need to have principles," he told the US Congress this week, "standards by which the purchase decisions can be made" [1].
The WHO has taken care of the safety standards concern by inspecting and making a list of "approved" generics whose safety standards meet international guidelines [20]. But the US Department of Health and Human Sciences has now convened a conference in Botswana on March 29 that will question the WHO's approval process, drawing in "experts" from the patent-based industry to claim that the process every major academic public health expert in the field has supported is somehow inadequate and unsafe [18].
The smuggling claim is more complex; while the company GlaxoSmithKline did have a shipment of AIDS drugs diverted from Sierra Leone early last year, it was later found that the shipment was partly still in Europe and simply mis-warehoused by GSK, and that the smuggling of the rest of the drugs took over a year for GSK to discover [21].
Indian generic manufacturers have been shipping drugs for over two decades without a single case of "diversion", and the fact that generics create new formulations and new pill shapes, colours and boxes makes it easier for customs officials to detect any form of diversion, as they would for any other type of illegal smuggling [22]. The EU has passed a customs regulation to assist in preventing any future diversion; while the US could do the same. Taking care of the problem this way would ironically undermine Mr. Tobias' own arguments.
It appears clear that Randall Tobias' agenda is not driven by data or rational thought, but by the industry whose combined soft- and hard-money campaign donations top the list of contributors in the US election cycle [23].
Shining a light on the Czar's activity may begin to expose his practices to scrutiny and - as was done when he and the US Trade Representative tried to undermine a WTO accord for generic drug procurement earlier this year - may prevent disintegration of an important public health initiative [24].
* Sanjay Basu is at the Yale University School of Medicine.
http://omega.med.yale.edu/~sb493/ Please send comments to [email protected]
* Visit the Advocacy and Campaigns section of Pambazuka News to read more about the March 29 meeting in Botswana where activists fear that generic medicine treatment will be discredited.
