A growing drum beat tuned for the election year is advising the government to override patent protection as the quick and easy way to make drugs more accessible. The patent system is being roundly condemned as a barrier to public health which must be brought to heel. Efforts range from urging the NIH to misuse the march in provisions of the Bayh-Dole Act to control drug costs to “A simple way for government to curb inflated drug prices“ in The Washington Post advising that the “government patent use” authority be invoked to take drugs deemed too expensive. The next step in the campaign is coming from the United Nations.
Improving access to needed medicines for those suffering the ravages of disease in developing countries is a serious issue. There are many factors contributing to the problem including poor transportation systems, lack of available health care and education, endemic poverty, trade barriers, systematic corruption and, of course, the cost of drugs. Yet the U.N. Secretary General’s High-Level Panel on Access to Medicines is focusing on the patent system as the source of the problem. The report is due next month.
The Panel received predictable statements from both sides of the debate, with one notable exception. The U.S. Department of State undiplomatically pointed out the crucial flaw in the study: ” We question the premise that the rights of inventors, international human rights law, trade rules, and public health are “misaligned”…
State offered a devastating indictment:
The Panel has been tasked with examining only two pieces of the larger puzzle, and will be doing so in isolation, pursuant to terms of reference which are based on a description of the problem stated in a way that suggests predetermined outcomes. The United States is concerned that by conducting such a narrow review, the report issued by the Panel may be imbalanced and of limited use, or even counterproductive in building consensus among stakeholders and national governments.
The Panel’s recent press release “Protests, Patents and Patients Dominate Debate In Johannesburg” shows that the Department’s concerns are justified. According to the release, the Panel is to “address the policy incoherence between intellectual property laws and access to medicines.” Participants praised several “alternatives and/or changes to the current patent based system” being considered. One of the “new ideas” prominently cited is having government, not industry, pay for R&D. “This means no monopolies on medicines that are financed with public money. In order to realize this, we need to find a way to work together as a global community so that all governments will contribute fairly to developing R&D costs.”
It’s hard to think of a worse idea than putting a consortium of governments in charge of drug development–unless it’s putting the UN in charge.
The statement from the Biotechnology Innovation Organization illustrates why the focus on intellectual property as the source of the problem misses the mark:
At the outset we note that the scope of the call for contributions appears to be narrower than the apparent mandate of the Commission. In fact, the call presupposes that the concept, and advances that notion that IP protections are inconsistent with public health. We disagree with this assessment and we believe that the facts prove this assertion to the contrary. For example we note that while 95% of essential medicines, as defined by the WHO, are off patent, still one third of the world’s population does not have reliable access to them and, in parts of Africa and Asia, that is true for half the population. And despite all the current mechanisms in place to facilitate no-or-low costs access to non-patented HIV medicines, only 15.8 million of the estimated 36.9 million people living with HIV globally (about 43%) were accessing treatment in 2014.
Moreover, despite the wide availability of no-or-very low cost non-patented HIV medicines, in at least 14 African countries, 80% or more of people who were estimated to be eligible for treatment under the WHO guidelines were not receiving antiretroviral therapy as of 2013. First-line treatments for killer diseases like malaria and TB are available as generic products at very low cost, and yet many people are denied access to them. And finally, according to the WHO, and estimated 649 million people, or about 50% of the population in India do not have regular access to the hundreds of non-patented drugs on India’s EML. Despite its large domestic generic drug industry, India’s investment in health as a percentage of its GDP has averaged around 4% for the last decade. India’s current level of 4.5% is one of the lowest figures in the world ranking it below such countries as Haiti and Ethiopia.
The solution to these problems isn’t destroying the system the world depends on for creating new drugs. And it’s not an accident that most come from the United States.
Drugs are only made in a handful of countries with strong patent systems. The reason is simple: the costs and the risks of bringing a new drug to market are enormous. If you’re looking to get rich quick, drug development isn’t for you. Developing a drug takes more than 12 years, costing an average of $2 billion per drug. For every 5,000 drugs tested, perhaps 5 will proceed to clinical trials, and one may reach the market. Of these, perhaps 20% will turn a profit, and they must pay for the whole system. This effort can only be justified if resulting products are patent protected so they cannot be freely copied around the world. And unlike other countries, many of our new drugs come from small companies and start ups. Patents are crucial for them to receive risk capital and to compete against well established competitors.
The US enjoys an unparalleled university and federal laboratory research system, an important source of new treatments. However, publicly funded inventions are more like ideas than products. The task of turning these discoveries into drugs that can alleviate human suffering falls on the private sector, which spends many times in development what the government spent supporting the underlying research. If the product is unsuccessful, the company alone takes the hit. Without a strong patent system, no business can afford to assume this burden.
Before passage of the Bayh-Dole Act, federally funded drug discoveries simply wasted away in the laboratory, benefitting no one. It’s no coincidence that after Bayh-Dole injected the incentives of the patent system into the process that federally supported inventions suddenly became drivers of new therapies, new companies and even a new industry– biotechnology– in which we lead the world.
Blaming the patent system for the problem of access to drugs is more than misguided, it’s destructive. The poster boy of bad behavior, Martin Shkreli, who raised the cost of Daraprim 5000% overnight wasn’t using the patent system for his misdeeds. Shkreli knew that rival companies would not go through the lengthy, expensive FDA approval process for a drug with a limited patient population. When the UN launches a study on the costs of regulation, please let me know.
The Department of State offered some important points to ponder:
The High-Level Panel’s mandate is too narrow to address the many and often inter-related barriers to access to safe, effective, and affordable medicines. The World Health Organization (WHO) identifies four main factors contributing to access to medicines: l) the rational selection and use of medicines, 2) affordable prices, 3) sustainable financing, and 4) reliable health and supply systems. None of these factors are being directly studied by the Panel. With regard to affordable pricing of medicines, the WHO has identified numerous considerations, including pricing and procurement policies, taxes, markups and tariffs, and other national policies (or lack thereof) that ultimately result in higher costs for consumers and for health systems.2 In fact, even common, essential, off-patent medicines often do not achieve their intended health impact due to supply and manufacturing issues…
State “strongly” advises the UN to “incorporate all relevant factors into a meaningful analysis of why people in low and middle income countries do not have the access to medicines that we all believe is desirable and necessary.”
Good advice. Let’s hope it’s taken. It’s advice we should incorporate into our own debate on how to make important new therapies more accessible for those who need them.
EDITORIAL NOTE: For more information on this topic please see UN Panel on Access to Medicines Should Ensure Innovation by Preserving Market Incentives, by Dr. Kristina Lybecker, published on IPWatchdog.com on February 15, 2016.