Access To Medicines Project

The New York Times

To the Editor:

Re “Puppets in Congress” (editorial, Nov. 17):

The fact that statements ghostwritten for lawmakers by drug company lobbyists were not aimed at changing the contents of the House health care bill should provide no comfort to the public.

The pharmaceutical industry had already gotten the additional protections it wanted for biologic drugs added to the legislation months before the vote. It grants brand-name biologics a 12-year marketing monopoly, more than double what conventional drugs receive, even though the industry’s own numbers show that they cost about the same to develop.

Even worse, the bill also includes a loophole that would allow companies to make minor modifications to the drugs just before the protection period ends and receive a new monopoly. This could block price-lowering generic competition indefinitely.

The Obama administration, a bipartisan group in Congress, the Federal Trade Commission and most consumer groups opposed extended monopolies for biologics. This raises the question of why they are in the bill. Could it have to do with the more than $110 million pharmaceutical companies spent lobbying Congress so far this year?

Sarah Rimmington
Washington, Nov. 18, 2009

The writer is an attorney with the Access to Medicines Project of Essential Action.

During this week's Meeting of the South American Union of Nations (UNASUR) in Guayaquil and Quito Ecudaor, UNASUR Health Ministers announced their strong support for Ecuador's new policy of licensing patents to improve access to medicines.

Speaking for the delegates, Peruvian Health Minister Oscar Ugarte Ubillús said Ecuador's decision is an "exercise of sovereignty, a positive act, in accordance with international rules, for which the UNASUR ministers and officers of Health offer our support." Ministers from Argentina, Paraguay, Bolivia, Brazil, Venezuela and Chile each spoke in turn in support of Ecuador's policy.

The ministers also discussed the advantages of block negotiating for better AH1N1 vaccine access.

So far the news stories on this subject are all in Spanish. Stories from Voice of America and El Nuevo Empresario (Guayaquil) are available below.
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IP-Watch
By Catherine Saez

Since Ecuadorean President Rafael Correa signed a decree on 23 October allowing compulsory licences, the national intellectual property office has been working on a mechanism for issuing those licences, which should be studied case by case, according to the national decree.

Referring to Article 31 of the World Trade Organization (WTO) Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, the Ecuadorean constitution, and the WTO Doha Declaration on TRIPS and Public Health, Correa declared access to essential medicines of public interest to the Ecuadorean population.

Ecuador’s intellectual property office is currently working on legislation for issuing compulsory licences that will be TRIPS-consistent and will respect all of Ecuador’s obligations as a member of the WTO, an Ecuadorean official in Geneva told Intellectual Property Watch.

Patently-O Patent Law Blog
by Dennis Crouch

Under the TRIPS agreement member Nations can force compulsory patent licenses at their discretion. The 2001 Doha declaration clarifies this point: "Each member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted."pic-76.jpg

In October 2009, Ecuador's president issued a decree that allows its Ministry of Public Health to issue compulsory licenses based on public interests such as access and costs. According to IP Watch, the government is now "working on a mechanism for issuing those licenses" on a case-by-case basis. [Link]

Spinning this decision, Access-to-Medicines advocate Peter Maybarduk indicated that the US is the world leader in compulsory licensing:

"Many countries have used compulsory licenses to promote public interests and remedy anti-competitive practices in a variety of sectors. Today, the United States is perhaps the most frequent user of compulsory licensing; including the government use of defense technologies, and judicially-issued licenses to remedy anti-competitive practices in information technology and biotechnology, among others. Canada routinely issued compulsory licenses during the 1960s and 70s to develop its national pharmaceutical industry. In recent years, a number of countries have issued compulsory licenses to improve access to medicines, including Thailand, Malaysia, Eritrea, Mozambique and Indonesia, among others.

In 2007, Brazil issued a compulsory license for the HIV/AIDS medicine efavirenz. Brazil has provided treatment to hundreds of thousands of people living with HIV/AIDS and saved well over US$1 billion through its combined medicines strategy of domestic production, importation, negotiation and compulsory licensing."

Major pharmaceutical companies have reportedly agreed to work with the government in collecting royalty payments. The same report indicates that Ecuador plans to obtain drugs both through local manufacture and imports. Prior to TRIPS, more than four-dozen countries categorically refused to grant patent rights on pharmaceuticals.

FOR IMMEDIATE RELEASE

Following are comments from representatives of consumer, health and medical student groups, following the wholesale addition of the brand-name industry backed Eshoo-Barton-Inslee approach to generic biologic drugs by House Republican party leadership in their health care amendment, “The Affordable Health Care for America Act,” released today:


“It’s disappointing that the Republican Party which purports to be the party of free markets has decided to lend its support to a pro-monopoly, anti-competition, anti-innovation biogenerics proposal.” Robert Weissman, President, Public Citizen, (202) 588-1000, rweissman@citizen.org


"Today, it is unfortunately apparent that across party lines, special interest politics rather than evidence-based policies have prevailed. The democrats’ provisions on lifesaving biologic medicines—accepted verbatim by the Republicans today-- contradicts the major objectives of health reform—to contain health care costs and expand access to health care." Laura Musselwhite, medical student, Duke University, and member of www.AffordableMedsNow.org campaign of the American Medical Student Association (AMSA) and Universities Allied for Essential Medicines (UAEM), 336-908-6635, laura.musselwhite@gmail.com


"The Republican health care bill allows insurance companies to continue to deny people coverage for pre-existing conditions. Of course they whole-heartedly approve of the Eshoo biologic drugs amendment -- in both cases, it's corporate profit over human life. Your own personal death panel becomes the size of your bank account." Jane Hamsher, co-founder, Public Option Please (POP), (202) 248- 3155, firedoglake@gmail.com Join POP in the fight for affordable biologic medicines at http://publicoptionplease.com/home/.


“It looks like the only thing the Democrats and Republicans agree on relating to health care reform is the adoption of a generic biologic drugs proposal that will perversely block price-lowering generic competition. Unfortunately, this kind of bipartisanship will keep affordable versions of drugs like Roche-Genentech’s $48,000 per year blockbuster cancer treatment Herceptin out of American patients’ hands for far too long, or perhaps forever.” Sarah Rimmington, Attorney, Essential Action, Access to Medicines Project, (202) 422-2687, srimmington@essentialinformation.org Essential Action is a member of the www.AffordableMedsNow.org campaign.


"Perhaps we'd have greater bipartisan attention paid to access to affordable medicines for patients if the American people could afford to match the $1 million a day Pharma is spending on lobbying Congress. Members of Congress need to look at the evidence and fix the flawed provisions supported by Representative Eshoo and others to allow a true pathway for generic biologics." Ethan Guillen, Executive Director, Universities Allied for Essential Medicines, (775) 287-2553, ethan.guillen@essentialmedicine.org UAEM is a member of the www.AffordableMedsNow.org campaign.


"These days Washington, DC is a one party town, when it comes to influence from big Pharma. The Republicans had a chance to demonstrate that competition can protect consumers and businesses. Instead they opted for highly regulatory barriers to competition." James Love, director, Knowledge Ecology International (KEI) (202) 361-3040, james.love@keionline.org KEI is a member of the www.AffordableMedsNow.org campaign.


"At a time when we are hoping to reform health care by bringing costs down and improving patients' access to treatment and care, I am disappointed to see GOP leaders adopt Rep. Eshoo's language for biologic drugs. This language will in effect extend pharmaceutical companies' high monopoly pricing via prolonged periods of market exclusivity, and paradoxically stifle innovation by enabling easy renewal of these long monopolies." Saira Alimohamed, student, Alpert Medical School of Brown University, and Chair of the Global Health Committee, American Medical Student Association (AMSA). (443) 803-7403 or Saira@brown.edu or Global.Chair@amsa.org AMSA is a member of the www.AffordableMedsNow.org campaign.


“I am shocked at the ability of the pharmaceutical industry to buy what it wants from Congress. The inclusion of a biogenerics proposal that will in fact block most generic biologic drugs from coming to market in the Republican healthcare bill underscores how policy-making in Washington these days is less about patient's needs, and more about serving the interests of the pharmaceutical industry.” Malini Aisola, Senior Research Advisor, Knowledge Ecology International, (202) 332-2670, malini.aisola@keionline.org KEI is a member of the www.AffordableMedsNow.org campaign.


"These most recent developments in health care 'reform' are extremely troubling. I am very worried for the future of America's healthcare system if the only productive compromise our representatives can make is to throw in this same biogenerics proposal, with its same lack of foresight or concern for patients' rights." Eric Emilio-Gerrit Butter, student, UNC Gillings School of Global Public Health, Duke Institute for Genome Science and Policy, and member of Universities Allied for Essential Medicines (UAEM), (607) 759-5959, egbutter@gmail.com UAEM is a member of the www.AffordableMedsNow.org campaign.

The Huffington Post
By Jane Hamsher

As a three-time breast cancer survivor, I have a strong personal stake in health care reform. So when students from the American Medical Students Association wrote us at PublicOptionPlease.com and told me about their campaign to keep biologic "drugs of the future" available and affordable, I was eager to help.

Incredible developments have been made in recent years with these "high tech" drugs made from living cells, which now represent 25% of all new drugs and 50% of all important drugs approved. But I know from personal experience that they can be prohibitively expensive, even for people like me who are fully insured. Senator Sherrod Brown has been a powerful advocate for making sure that one day they will be available in generic form:

All too often, the pricetag for this type of drug is simply too high for the patient who needs it. For instance, annual treatment for breast cancer with the brandname biologic drug Herceptin costs $48,000. Even if you are lucky enough to have health insurance and you are paying 20 percent copay, that is $9,600 a year. More than 192,000 American women will be diagnosed with breast cancer in 2009. How are they going to afford that kind of drug?

Senator Brown and Congressman Henry Waxman proposed legislation that would make these drugs available in generic form after giving companies a 5 year monopoly to recoup their costs. Sadly, they lost out to legislation offered by Rep. Anna Eshoo in the House and Senator Kay Hagen in the Senate, which was much more generous to pharmaceutical companies at the expense of those who badly need these drugs.

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On October 26, Ecuadorean President Rafael Correa announced a bold new national access to medicines policy through decree no. 118, declaring access to priority medicines a matter of public interest, and establishing procedures for issuing compulsory licenses. Such licenses would authorize price-lowering competition with expensive patented drugs.

Many news articles, in Spanish, English and French, reported on the decree, as well as on subsequent comments and analyses by the patent office, national and international pharmaceutical companies, and observers. Unfortunately, several inaccuracies circled the globe through some of these reports. Essential Action has produced a fact sheet to correct a few of the most commonly repeated inaccuracies.

Download a .pdf version of the Ecuador fact sheet here: EcuadorCLPolicyClarifications.pdf

The fact sheet is also available in the continuation of this post.

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Daily Kos
by slinkerwink (Noelle Bell)

This diary rebuts the Huffington Post article by Rep. Eshoo, in which she defends her biologics amendment which allows pharmaceutical companies to have 12 years' exclusivity, which would bar generic biologics [or follow-on biologics FOBs] from entering the marketplace.

Biotechnology products cost billions of dollars to develop, test and bring to market, and in order to ensure that competitors aren't immediately allowed to free-ride on the costly safety and efficacy data produced by innovators, some period of 'data exclusivity' is necessary to allow some period of time to recoup the investment in developing the drug. Without such a 'data exclusivity' period, there would be no reason to invest in new biologics. We would see the flow of research funds going to traditional pharmaceuticals, medical devices, semiconductors, green technology or other more promising innovations.

The House and Senate health care bills include a data exclusivity period of 12 years, which is the same amount of time that all drugs enjoy on the market under patent protection, which prevents any competition. I believe the 12-year data exclusivity period preserves the existing incentives for investment in these life-saving products.


She claims that the 12 years' exclusivity for PhRMA is needed because it encourages these pharmaceutical companies to keep investing billions of dollars in these drugs through innovation. However, the Federal Trade Commission has said otherwise about that claim for the need of exclusivity for twelve years, as seen here below:

Pioneer biologic manufacturers nevertheless have suggested that Congress institute a period of 12 to 14 years of branded exclusivity that would begin once a pioneer biologic was approved by the FDA. During this period, the FDA would be prohibited from approving an FOB product that would compete with the pioneer biologic drug. This branded exclusivity would be in addition to, and would run concurrent with, a biologic drug’s existing patent protection. The economic model put forth by pioneer drug manufacturers to justify this period is based on the average time required to recoup the investment to develop and commercialize atypical biologic drug (referred to as the “Nature model”).

Congress has implemented exclusivity provisions in the past to encourage the development of new and innovative drug products when the drug molecule is in the public domain, and therefore not patentable. The Hatch-Waxman Act provides a five-year exclusivity period to incentivize the development of new chemical entities and it provides a three-year exclusivity period for new clinical investigations of small-molecule drugs. In other instances, Congress has implemented an exclusivity period when market-based pricing has not provided sufficient incentive to develop drug products for children or small patient populations. Central to each of these exclusivities is a public policy trade-off: a restriction oncompetition is provided in return for the development of a new drug product or new use of an existing product.

A 12- to 14-year exclusivity period departs sharply from this basic trade-off, because it does not spur the creation of a new biologic drug or indication. The drug has already been incentivized through patent protection and market-based pricing. The potential harm posed by such a period is that firms will direct scarce R&D dollars toward developing low-risk clinical and safety data for drug products with proven mechanisms of action rather than toward new inventions to address unmet medical needs. Thus, a new 12- to 14-year exclusivity period imperils the efficiency benefits of a FOB approval process in the firstplace, and it risks over-investment in well-tilled areas.

Basically what the FTC is saying that the longer timeframe of 12 years' exclusivity for PhRMA actually discourages innovation and investment in new biologics. It allows PhRMA to sit there and recoup their investment on drugs like Herceptin. In the July 14th hearing before the Energy and Commerce Committee, Larry McNeely, the Health Care Advocate for U.S. PIRG, stated the reasons for the opposition to the Eshoo amendment and uses Herceptin as an example of which PhRMA continues to profit off rather handsomely in the five-year period of its exclusivity:

On average it costs $1.2 billion to take a biologic drug to market, and companies like Genentech should be rewarded for that investment. Genentech should profit from bringing a product to market that saves lives. In fact, they have recouped their development costs and much more, earning $5.5 billion from 2003-2008 alone.

But there’s a catch. Herceptin’s patent protections, the legal mechanism that protects intellectual property in most industries, expired in 2005. The available evidence, namely Genentech’s enormous annual profits, suggests that the patents on the drug provided an ample incentive for the important research that Genentech did on this drug.

Yet today, without a pathway for follow-on biologics, Genentech continues to enjoy monopoly pricing power. They have certainly made the most of it, charging $48,000 a year wholesale for the Herceptin treatment. Some reports have indicated that some consumers paying twice that amount or more. But under current law, it’s unlikely that a generic company will introduce a cheaper version of the drug anytime soon, and Genentech recognizes that.

On n November 1, 2009 Essential Action and some of its partners in the AffordableMedsNow.org campaign released a memo responding to a October 30 op-ed by Representative Anna Eshoo which appeared in The Hill and on The Huffington Post.

You can read the memo on progressive blog FireDogLake.com, or in the continuation of this post.

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On October 26, 2009 Ecuador’s President Rafael Correa declared access to priority medicines affecting the health of the Ecuadorean population to be a matter of public interest. Under Andean Community law, the declaration opens the door to competition of generic medicines with patented brand-name drugs, through use of an internationally recognized legal mechanism called compulsory licensing. The declaration could lead to government policies that expand access to medicines.

Download a .pdf version of the Essential Action backgrounder on Ecuador's Presidential Declaration on compulsory licensing here: EcuadorPresidentialdeclarationbackgrounder.pdf

Download a .doc version of the backgrounder here: EcuadorPresidentialdeclarationbackgrounder.doc

You can read a text version of the backgrounder in the continuation of this post.
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