Global Campaign Vows to Fight MNC Drug Monopoly

by Marwaan Macan-Markar
Published at IPS Inter Press Service News Agency

BANGKOK, Nov 26 (IPS) – Public health and HIV/AIDS activists from the developing world are seeking to break the monopoly over drugs held by pharmaceutical giants through a new global campaign designed to influence international debate over the issue.

Formulated at the end of a three-day meeting, last week, which brought some 200 participants from 20 countries to the Thai capital, the campaign seeks ‘’a new way out of the current patent system; one that will encourage innovation of new drugs and access for all,’’ says Kannikar Kijtiwatchakul, an organiser of the International Conference on Compulsory Licensing: Innovation and Access for All. ‘’What we have now is innovation controlled by the pharmaceutical industry that lets them have a monopoly on drugs.’’

The conference participants — who came from countries such as Brazil, India, Indonesia, Malaysia, China, Cambodia, the United States and hosts Thailand — have a meeting at the World Health Organisation (WHO) in January 2008 as the first target of the new campaign.

At that meeting the Geneva-based health agency’s executive board may receive a draft of a plan to find a compromise between the demands of big pharma, which produces patent-brand drugs, and the world’s poor, who have little or no access to the available life-saving medication due to high prices.

The proposed plan is being drafted by the WHO’s Intergovernmental Working Group on Public Health, Innovation and Intellectual Property (IGWG), which held a second round of discussions in early November. ‘’Our campaign wants to add to the IGWG’s work, because we want to get our views heard at the January meeting,’’ Kannikar told IPS.

‘’At the heart of the plan is finding an optimal way to boost research and development of affordable healthcare products so people, particularly in the developing countries, can receive treatment for diseases, with an emphasis on neglected conditions including tuberculosis, malaria and HIV/AIDS,’’ states a background note by Intellectual Property Watch, a Geneva-based on-line publication, distributed at the conference.

Papers presented at the conference justified the need for such a shift, given that the pharmaceutical multi-national corporations (MNCs) have contributed marginally towards developing new drugs to help the world’s poor. ‘’Only 10 percent of the total global investment in pharmaceutical research was directed towards neglected diseases affecting 90 percent of the world’s population,’’ noted Jakkrit Kuanpoth, from the law faculty of the University of Wollongong in Sydney, Australia.

As revealing were the numbers presented in a paper by Dr. Mira Shiva, from the non-governmental Health Action International. Shiva said that between 1975 and 2004, there were 1,556 new active ingredients for drugs developed by the pharma giants but only 18 were for tropical diseases.

‘’The drug companies don’t do some of the innovation that is most important to developing countries with respect to neglected tropical diseases,’’ Brook Baker, professor of law at Northeastern University, in Boston, in the U.S., told IPS. ‘’They put their research where they make the most money, from rich people in rich countries. That is where they earn over 90 percent of their research and development dollars.’’

‘’There should be a new innovation reward system. Developing countries can and should pay something for innovation, but they should only be asked to pay for innovation that is most appropriate for themselves,’’ he added.

The activists are bracing for a counter campaign from the pharmaceutical industry, which presides over an estimated 650 billion US dollar global market, of which all of southern Asia and south-east Asia account for only a 1.3 percent share.

Events in Thailand reflect this challenge, since the South-east Asian country has emerged as a leader in the developing world to take advantage of global trading rules to secure cheaper, generic drugs for public health emergencies such as HIV/AIDS.

Over the past year, Bangkok has used provisions available under the trade related intellectual property rights (TRIPS) to issue compulsory licences (CL) to break the patents for three drugs, two to prolong the life of people with HIV and a blood-thinner for heart patients. The right for developing countries to grant CLs or pursue parallel imports of generic drugs were approved by at a World Trade Organisation (WTO) ministerial meeting in Doha, in 2001.

It has consequently enabled some 10,000 Thais living with HIV who need second-line anti-retroviral (ARVs) drug to live in hope of receiving affordable medication. Currently, an estimated 140,000 Thais receive the first-line of ARVs. The country is one that has been among the worst hit since the pandemic began in the region, with over 600,000 infected with HIV at present and some 300,000 having died due to AIDS over past two decades.

But as full-page advertisments that appeared in Thai and English-language newspapers on Friday made clear, the powerful pharmaceutical industry has other interests at heart. ‘’New drug discoveries help doctors save lives’’ announced one advertisement to justify why big pharma should continue to enjoy its monopoly in the drugs market.

The advertisement placed by the pro-pharma lobby is the latest in a string of measures aimed at forcing Thailand to give up its right to issue CLs. The U.S. pharma MNC Abbott Laboratories has also struck back by withdrawing seven new drugs it had introduced into the market, including a second-line ARV that can be easily stored in tropical climates.

Even the U.S. government has retaliated against Bangkok, revealing Washington’s interest in protecting its pharmaceutical industry. The Office of the United States Trade Representative has placed Thailand on the ‘Priority Watch List’ for intellectual property violations and also terminated duty free trade privileges that this country enjoyed.

‘’There is absolute double standards being applied here by the U.S. This is complete hypocrisy because there is no fuss made when compulsory licenses are issued in the U.S.,’’ Robert Weissman, director of Essential Action, a Washington D.C.-based corporate accountability organisation, told IPS. ‘’The U.S. government has an automatic right to use any patent without any prior negotiations. There are many different ways in which we do compulsory licensing.’’

‘’It is very important that a country’s behaviour be judged according to international law,’’ adds Dr. William Aldis, coordinator for health policy and research at the WHO’s South-east Asia regional office, located in New Delhi. ‘’Thailand’s is within the provisions of TRIPS. It is not violating any laws.’’

Drug Group’s Campaign Slammed by Activists

Newspaper Ads are Half-truths, Say Critics
by Apiradee Treerutkuarkul and AFP
Published at Bangkok Post

Health and consumer rights protection activists yesterday slammed the pharmaceutical industry for running adverts which mislead the public about the high cost of drugs. The statement is a reaction to full-page ads in several local newspapers.

The reaction came one day after the industry, represented by the Pharmaceutical Research and Manufacturers Association (PRreMA), ran the ads that blame the high cost of drugs on improper regulations.

The ads, ”Stop Taxing Medicine”, appeared in several newspapers.

The activists said the ads contained half-truths about high drug costs.

”They are trying to give a false impression that the high prices of pharmaceutical products are the result of inappropriate regulations,” said Jakkrit Kuanpot, an academic at Wollongong University in Australia.

”This information distorts the fact _ how much they pay for such marketing strategy compared to research and development?

”And they did not even mention the high profits they get from selling expensive drugs.”

It was said the ads, which will run in a series, have been taken in revenge by the industry for being bypassed in a three-day conference on compulsory licensing (CL), which ended yesterday. The event focused on CL and access for all.

Brook Baker, a law professor at Northeastern University’s programme for human rights and global economy, said the pharmaceutical industry always uses this marketing tactic to mislead the public on the issue of compulsory licensing in order to monopolise the market.

Similar ads were also published in Brazil and Indonesia when the state policy on compulsory licensing was announced.

Nimit Tienudom, an activist with the Aids Access Foundation, said the medicine tax, mentioned in the ads, was only a half-truth.

”At present pharmaceutical products sold to hospitals are exempt from the tax system, whereas similar products sold to private pharmaceutical companies are listed for value-added tax of 7%,” he said.

He said activists had long petitioned for a review from the Ministry of Finance on the tax system for medicinal products.

PReMA’s ads carried a statement which said the death rate caused by heart diseases, tuberculosis, cancer, ulcers and others had decreased over the past 40 years due to new medicines.

Mr Nimit, however, said the statement was not necessarily true as Thailand has used the same old medicine for treating tuberculosis for more than 30 years, despite the risk of drug resistance.

In addition, major diseases that caused the highest deaths in Thailand were still cancer, cardiovascular and heart diseases.

Vichai Chokewiwat, the chairman of the board of the Government Pharmaceutical Organisation, said he would wait for another two series of advertisements expected to be published this week.

”If there is any information that causes damage to the government and generic medicines listed for compulsory licensing, I may take legal action against them,” he said.

Apart from buying advertising in selected newspapers, the PReMA will also have a special press interview with Ronald Cass, the former dean of Boston University’s School of Law, on CL experiences and country economy.

Foreign activists have hailed the government’s CL policy, saying Thailand was leading the way in providing medical care to those who cannot afford expensive drugs.

”We are all looking to Thailand as a beacon that has shown us the way forward for a sustainable way to make medicines available and affordable,” said Robert Weissman, a director of the Washington-based Essential Action.

Thai Generic Drugs Scheme a ‘Beacon’ for Poor: Activists

by AFP

BANGKOK (AFP) — The Thai government’s drive to suspend patents to produce low-cost medicines is a “beacon” for other developing nations seeking to provide treatments to the poor, activists said Friday.

Thailand has locked horns with pharmaceutical companies over so-called compulsory licenses, which temporarily suspend patent protections and allow production of cheaper generic drugs.

Activists at a three-day meeting in Bangkok hailed the government’s efforts, saying the kingdom was leading the way in providing medical care to those who cannot afford expensive drugs.

“We are all looking to Thailand as a beacon that has shown us the way forward for a sustainable way to make medicines available and affordable,” said Robert Weissman, a director of Washington-based Essential Action.

Pharmaceutical companies have derided Thailand’s campaign as an infringement on their intellectual property rights, warning that lost profits would make it harder to finance research for medical innovations.

The companies have also complained that Thailand should have first consulted them before issuing the compulsory licenses, under the rules of World Trade Organisation.

Brook Baker, a professor of law at Northeastern University in Boston, insisted Thailand faced no such legal requirement.

“Under international law, it’s completely lawful for Thailand to do what it has done,” Baker told a press conference.

Other developing countries, notably Brazil, have also begun following Thailand’s path in issuing compulsory licenses.

“The experience in Thailand was very inspiring for Brazil,” said Carlos Passareli, spokesman for the country’s Ministry of Public Health.

“If Thailand had not taken the lead in this process for compulsory licensing, it would be very difficult for countries like Brazil,” he told reporters here.

Thailand has so far suspended patents for the blockbuster heart drug Plavix and the AIDS medicines Kaletra and Efavirenz, and has already begun importing cheaper versions from India, a major source of generic drugs.

The health ministry says it may also suspend patents of four cancer-fighting drugs.

Op-ed: Big Pharma Must Stop Frightening the Public

by Robert Weissman
Published at Bangkok Post

In the shadow of a major International Conference on Compulsory Licensing: Innovation and Access for All, the brand-name pharmaceutical industry through its Pharmaceutical Research and Manufacturers Association of Thailand (PReMA) is touting the vital role that brand-name companies play in introducing new, innovative drugs to the market. The not-so-subtle subtext is that Thailand’s recent compulsory licences threaten the innovation process.

The simple and direct response to this allegation is that the Thai compulsory licences have preserved the brand-name companies’ effective market in Thailand.

The licences do not apply to the private sector, which provides care to the upper-income Thais and medical tourists who can afford expensive brand-name drug prices.

The licences enable generic competition only in the public sector, where the lower prices are enabling the Thai public health sector to expand use of important medicines dramatically, and in one case to provide treatment with a drug that was too expensive for the Thai public system to provide to patients at all.

But the broader claims made by PReMA deserve greater scrutiny.

The world desperately needs new healthcare innovations, and brand-name companies make some contribution. But it is nowhere near as significant as the brand-name companies claim. It turns out the patent system is quite inefficient at spurring important health research, and that the brand-name companies are quite inefficient at conducting research and development (R&D).

It is now familiar that the patent system fails to generate R&D for ”neglected diseases” _ diseases that primarily affect developing countries and for which little or no treatments exist.

The patent-based research system yields the exact results one would expect: corporations invest very little to treat such diseases. This is not because the companies, or their executives, are good or bad. It is because the buying power of developing countries is too small to incentivise such research.

But the innovation failures of brand-name Pharma _ widely recognised on Wall Street, which is downgrading the value of Pharma stocks precisely for this reason _ are far more profound than the neglected disease story.

First, Pharma does not spend very much of its revenue on R&D. Although manufacturing costs are very low, the industry spends only 17.5% of its revenues on research, according to its own data.

Other estimates suggest actual expenditures on research are considerably less. The research that is undertaken is yielding fewer innovative products. R&D pipelines are running dry _ the issue that troubles Wall Street.

The new products that Pharma does help bring to market are driven by marketing priorities rather than health needs. It is not only with regard to neglected diseases that the patent system fails to deliver needs-driven products.

Of the important new drugs that do make it to market, public research institutions play a key role.

The US National Institutes of Health has concluded that government investment has been crucial to most breakthrough drugs.

Of course, as vital as innovation is, it is only meaningful if the resulting products are accessible to people who need them.

Big Pharma is increasingly seeking to defend a single, very high global price for its drugs. That means these drugs will be unaffordable to the vast majority of people in Thailand _ or to the public health service _ and throughout the developing world.

The best solution to high prices is compulsory licensing, which immediately introduces generic competition, and can drive drug prices down close to what it costs to make them.

The brand-name price of Aids drugs before competition was more than 100 times more expensive than the lowest price generics now available. As a result of generic competition, tens of thousands of people with HIV/Aids in Thailand, and millions worldwide, have gained access to life-saving medicines.

Without price-lowering generic competition, almost none of these people would be on treatment _ meaning they would die from a treatable disease.

Similarly, brand-name prices on the heart disease drug Clopidogrel were 70 times higher than the generic versions now available under the recently issued Thai compulsory licence.

At the International Conference on Compulsory Licensing: Innovation and Access for All, public health experts and advocates around the world have celebrated Thailand for its leading role in issuing compulsory licences, and making vital medicines more affordable for people in Thailand and around the world.

It is not acceptable, nor sustainable, to maintain an R&D system that both does so poorly at generating products to meet priority health needs and that prices the important therapies it does develop out of reach of the vast majority of the world’s population.

It is important that middle-income countries make fair share contributions to R&D. But the world can and must find ways to support R&D that do not result in the rationing of life-saving medicines in developing countries, and denial of life-saving treatment to people simply because they are poor.

Discussions are now under way at the World Health Organisation to explore ways to advance both innovation and access objectives.

The crucial idea is that research and development should not be funded by high prices on drugs.

Robert Weissman is the director of Essential Action, a Washington, DC-based organisation that promotes access to medicines.

Taipei Times Letter: Commentator has ties to Big Pharma

by Robert Weissman
Published at Taipei Times

Jeremiah Norris, the author of a recent article published in your paper, works for the Hudson Institute, which is described in his bio as a think tank (“WHO: Long on agenda, but short on the facts,” Nov. 4, page 8). This think tank is funded by pharmaceutical giants including Eli Lilly, Merck, Pfizer and the Pharmaceutical Research and Manufacturers of America, and its output regularly reflects the views of its corporate sponsors.

Norris’ ill-conceived rant suggests it is health infrastructure, not drug prices, that matters in developing countries.

The reality, however, is that both factors are vital.

If AIDS drugs in developing countries still cost US$10,000 a year per person — as they did at the beginning of the decade and before the introduction of effective generic drugs led to a 99 percent drop in prices — mass treatment of people with AIDS in the developing world would be impossible.

Even with the massive infrastructure problems that beset developing countries, lowered prices for AIDS drugs has made it possible for more than 2 million people with AIDS to receive treatment — and live rather than die.

Norris goes so far as to assert, against all evidence, that the system creates incentives for research and development into “neglected diseases,” which predominantly affect people in developing countries. In this, his position is even more knee-jerk than the Hudson Institute’s pharmaceutical industry funders. The brand-name industry is at least willing to concede the need for mechanisms to supplement patents.

Many public health advocates hope for something more far-reaching: that drug developers be generously compensated, but by mechanisms other than ultra-high drug prices.

Norris’ fantastic claims notwithstanding, no one, least of all the WHO, says the agency should be placed in charge of global research and development.

But public health advocates do believe we can and must find ways to support R&D that do not result in the rationing of life-saving medicines in developing countries and the denial of life-saving treatment to people simply because they are poor.

Norris’ article can be found here.

Report Finds Significant Industry Affiliation in IGWG ‘NGO’ Comments

by Kaitlin Mara for Intellectual Property Watch
Published at Intellectual Property Watch

As negotiators gather at the United Nations this week in Geneva to seek ways to boost innovation on neglected diseases disproportionately affecting poor people, a new study was released showing that commentators at the negotiation’s public hearing came primarily from organisations affiliated in some way with the pharmaceutical or biotechnology industries.

The study, released on 7 November, was conducted by US nongovernmental group Essential Action via survey. Commentators registered as an ‘NGO’, ‘Civil Society Group’, or ‘International Organization’ and were asked whether their group accepts donations from for-profit corporations or trade associations, and then asked for details regarding specific companies, amounts donated, and stated purpose of donations. Essential Action also independently researched funding sources and affiliations of
commentators who did not respond to the survey.

The results of the study were released during the World Health Organization Intergovernmental Working Group on Public Health, Innovation and Intellectual Property (IGWG), which is meeting from 5 to 10 November.

Overall in the study, Essential Action found twenty-two of the comments submitted by NGO/Civil Society groups were from organisations that had either received money from pharmaceutical corporations or had representatives from the industry on their board of directors. The level of involvement ranged from fairly minimal – the Colorado Chapter of the National Association of Hispanic Nurses, for instance, had accepted funding for its 2007 conference from several pharmaceutical and biotechnology firms -to fairly in-depth – the Alliance for Health Education and Development, for instance is headed by a former health care industry lobbyist. An additional thirteen trade associations with overt ties to the pharmaceutical industry joined in the IGWG comments. Only eight organisations listed as NGOs showed no ties with industry, though there were also eight academics with no apparent industry ties who commented.

Reactions to Essential Action’s survey were also mixed. Essential Action suggested that ties to industry are a helpful way to assess the value of comments from contributors: clearly those with a strong financial stake in the IGWG outcome are more subject to bias.

Among survey respondents who said they did not accept donations from for-profit corporations, there was some agreement with EA’s position. Thomas Pogge from Incentives for Global Health noted that it “was clear from many… contributions” that industry donations were being accepted and thanked Essential Action for its record-keeping. There was also disagreement, notably from Lawrence Kogan from the Institute for Trade, Standards and Sustainable Development, which advocates strong intellectual property regimes, felt that “to the extent there are corporate monies donated to support our efforts, all the better.”

Others admitted accepting for-profit monies but did not believe it affected their ability to deliver honest, qualified opinions. Virginia T. Ladd of the American Autoimmune Related Diseases Association noted that it “is standard practice in the USA [to] receive corporate and foundation funds from those entities [with] an interest in the work.”

Robert Weissman of Essential Action said in a statement: “Understanding an organisation’s ties is helpful in assessing the merits of comments submitted.”

Kaitlin Mara may be reached at [email protected]

This work is licensed under a Creative Commons License. All of the news articles and features on Intellectual Property Watch are also subject to a Creative Commons License which makes them available for widescale, free, non-commercial reproduction and translation.

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Pharma Links of NGOs in the WHO IGWG process

Essential Action today released a report detailing the brand-name pharmaceutical industry ties of NGOs submitting comments to the second public hearing of the World Health Organization’s Intergovernmental Working Group on Public Health, Innovation and Intellectual Property.

The full report is available here: igwg.contributorlinks.rtf

A pdf version of the report is available here: igwg.contributorlinks.pdf

The report finds that, even excluding pharmaceutical trade associations that described themselves as NGOs, NGO submissions from groups with links to the pharmaceutical industry outnumbered those from independent groups by a margin of 2 to 1.

Understanding an organization’s ties to affected industries is helpful in assessing the merits of comments submitted. Essential Action urges the WHO in the future to request that all authors disclose their financial ties to corporations, including funding sources and whether the author is a consultant, lobbyist or other representative of private industry.