The UN has Better Things to do Than Destroy Innovation

By Chris Gallagher
September 20, 2016

Stop destructionUN Secretary General Ban-Ki-Moon’s UN High Level Panel on Access to Medicine (UNHLP) finally surfaced this week with its long awaited Report. Ring-fenced by its narrow charge, it evidenced the Panel’s wasteful one-dimensional effort. Yet despite its crabbed conclusion regarding IP’s “Incoherence” with medical access, the Panel’s majority may have performed a public service. They created a complete compendium of flawed proposals providing policy makers with a single source for elegantly-worded but unsound policy suggestions then linked them with the counterproductive measures necessary to put them into play.

The UN Panel unfortunately squandered its 9-month gestation period. It stuffed into one repository every long-discarded remnant of anti-patent and pro-price-control schemes buried in IP’s historic landfill. Its Report expressly recommended directives to carry out each of them, demonstrating their counterproductive unworkability. After cramming each policy device into a trashcan of unworkable IP stratagems, they waited until the last minute and dumped it on the doorstep of the UN General Assembly. As University of Chicago Economist Tomas Philips concisely explains in this weekend’s WSJ, the UNHLP’s recommendations are nonsensical.

Nevertheless, they are dangerous, not because responsible IP lawmakers may believe they could work, but because they will tempt irresponsible foreign governments to adopt more measures to free-load U.S. and other developed-world biopharma discoveries. Government incompetence, corruption and sometimes cruelty already block citizen access to essential medicines by failing to provide for the education of medically-trained providers while fostering deprivation of other prerequisites, including everything from roads to vaccine refrigeration. Government attitudes and the absence of such infrastructural essentials are the predominant barriers to world medical access, not patent incoherence. Misguided government priorities effectively block delivery and distribution of WHO-designated essential medicines, the vast majority of which are off-patent. The UNHLP Report’s encouragement of irresponsible pricing schemes like compulsory licensing will shrink not expand medical access in the years ahead. Sadly, if enough countries adopt the Panel’s ill-considered advice, the rest of the responsibly-governed UN member nations will be similarly deprived. The Panel’s flawed recommendations inevitably will deter investment in the invention, development and distribution of new much-needed therapies.

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Fortunately, however, the Report has attracted widespread backlash, not only from the usual pro-patent “suspects” but also from our nation’s traditionally reserved research universities and medical centers and our own State department.

Five University advocacy associations collaborated in a strong letter of concerted objection, closing with the following observation;

“We believe that the proposals in the U.N. Panel’s Report would stymie rather than support that goal; accordingly, we hope that those proposals will not serve as the basis for further work within the United Nations. Instead, universities, the federal government, NGOs and the private sector must cooperate to find innovative ways within the current system to optimize global access to new and extant drugs, therapies, and other health technologies and scientific advances.

Significantly, after noting the wisdom of an informed minority of Panelists, the US State Department expressed its firm disappointment with the Report, and also highlighted its most dangerous aspect —it’s potential misuse as a foundation for future UN action and access implementation efforts. 

“In this respect, we note the concerns raised by the several Panelists who have practical experience in managing medicine research and development that taking forward the recommendations of the Panel could have significant unintended negative consequences. The Panel has now concluded its work and missed a key opportunity to provide practical observations regarding the complex issues surrounding access to medicines. The Report instead offers only a narrow perspective on a subset of those issues and articulates divisive policies that, if implemented, could severely undermine the innovation critical for the development of medicines and health technologies as well as private sector, university and government-funded research. This divisive approach does not provide the consensus necessary to proceed.  (emphasis added)

Freed in this instance from the overbearing influence of IT megatechs, the Administration has acted responsibly regarding the Report’s counterproductive advocacy and encouragement of patent piracy policy bearing the potential of undermining needed medical access. State’s Ann Blackwood and her cabinet level colleagues throughout the Administration deserve our thanks and support for their firm stand, especially now, while the Report awaits approval by the UN General Assembly.

We live in an imperfect world. Its incomplete access to needed medicines is a painful reminder of that reality. But we have made, and are making, significant progress in life science innovation and its distribution, even within the Hobbesian landscape of undeveloped third world countries. Yes, that progress has been delivered through an existing patchwork of imperfect but limited solutions, including profit driven, philanthropic, NGO and government activities. World suffering however will not be eliminated by abandoning initiatives that are working, including today’s proven incentives to biopharma innovation, development and distribution enabled by patents and competitive markets. Rather than building on this progress by suggesting constructive ways to fill the gaps in our existing system the Panel Majority’s Report proposes replacing the entire world system with unworkable theoretical proposals economists and hands-on manufacturers like Panelist Sir Andrew Witty say will not work. Bill Gates, who certainly knows a thing or two about effectively addressing world shortages of needed health care, may have said it best. Echoing the reasoning underlying Winston Churchill’s famous description of Democracy’s superiority compared to all other systems of government, Gates said “it is better than most any other systems we can imagine.”

Indeed this Session of the UN General Assembly will better serve world public health by focusing its attention on the growing problem of anti-biotic drug-resistant “superbugs” as suggested by the Washington Post’s Editorial Board on Monday of this week.

These adaptive pathogens have amply demonstrated their potential to reverse progress already made addressing debilitating diseases long thought to have been permanently extinguished. These bugs lurk everywhere, irrespective of any country’s developmental status. UN programs to address this immanent public health care threat are not only urgently needed, unlike the UNHLP Report on Medical Access they have real potential for broad-based support within the UN General Assembly.

The Author

Chris Gallagher

Chris Gallagher is President of IP Strategic.com and a perennial selection to The Best Lawyers in America. Having spent years as one of the most influential and highly regarded advocates in the New Hampshire Legislature and state administrative agencies, Chris is now focused primarily on federal policies in Washington, DC. Chris has been involved in nearly every substantial New Hampshire economic regulatory initiative over the last 25 years. He has served as general counsel for the New Hampshire Bankers Association and has represented New Hampshire utilities, hospitals, insurers, aggregate manufacturers and numerous other entities. This experience provides him with a uniquely respected voice on Capitol Hill, enabling him to communicate effectively with members whose federal decision-making must reflect and respect the complexities of their home-state constituents.

A frequent speaker and commentator in local and national media on policy issues, regarding financial services, privacy, business and government, Chris has testified on financial services issues before U.S. House and Senate Committees and has been a panelist in Capitol Hill briefings on intellectual property issues. He can be reached at chris@ipstrategic.com

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 2 Comments comments.

  1. Keith Constantine September 20, 2016 2:49 pm

    Dear Chris,

    I am relieved to learn that the US State Department and others have taken a stand against the UNHLP report. There is much more at stake here than patent rights. In addition to dictating what severeign nations”must” do and sanctioning Columbia’s efforts to force Novartis to grant a “compulsor” license for Gleevec, the UN is trying to assume the role of global censor.

    The following is from http://www.biopharmadive.com/news/un-panel-drug-prices-rd-costs-delink/426329/

    “The panel warned against the use of ‘explicit or implicit’ threats by other governments or corporate interests to dissuade countries from taking actions enshrined in international trade law. . .”

    One may ask, what are the “enshrined” international laws that Ban Ki-moon and the esteemed Panel members referring to? They are certainly not referring to established international patent laws. Perhaps they are refering to proposed compulsory licensing laws (i.e., legalized theft) and the alluded to international gag order against any “government or corporate interests” who dare to even “implicitly threaten” (i.e. criticize) the outrages perpetrated by the UN in the name of the poor.

    Hiding behind the guise of supporting the genuinely serious problems of unmet medical needs, the UN appears to view itself as the ruler of sovereign nations and their sovereign “corporate interests.”

    If anything like these proposals are ever enacted and supported by member nations, the “R” in private global pharmaceutical R & D will shrink significantly. The vast majority of new therapeutics are produced by private ventures. The ultimate result would undo precisely one of the key goals the UN states it wants to accomplish, which is to promote research aimed at finding new drugs for diseases common in less developed nations.

    Resorting to “carrot and stick” approaches to spur research, and to theft and intimidation to obtain existing patent-protected medications, shows something about the mindset at the UN. Rather than tackle the very real issues of poverty and medical need in creative ways intended to actually last – which would mean working with innovators while not violating the rule of law – the UN is trying to impose medieval mercantile-type policies on a global scale. The former approach requires careful thought and creativity; the latter approach described by the UN is a well-understood political expedient that has failed time and time again in other circumstances.

    Working towards solutions that meet the unmet needs of the poor while keeping private industry healthy and growing will not be easy. I’m sure that with enough effort both goals could be obtained. The UN’s approach for the short term provide existing medicines to the needy. In the long term it will largely prevent the discovery of new therapies by crippling innovation in the private sector.

    Beyond that, the UN is requiring, in a limited way for now, that nations and corporate citizen’s hand their sovereignty over to the UN if they are in the Pharmaceutical business. Does anyone believe that once the line is crossed and severeignty is abdicated the UN will stop at pharmaceuticals?

    The UN is supposed to facilitate dialog and cooporation between nations, mediate conflicts and, in limited circumstances, perform temporary security, disaster relief and peacekeeping duties. The UN should not be in the business of issuing binding rules regarding trade goods, and it especially should not be issuing international gag orders to silence it’s critics. The UN should be reminder of the limits of its authority, and all of its efforts to expand its jurisdiction should be stopped by clear and unambiguous statements from our elected officials.

  2. Chris Gallagher September 21, 2016 9:07 am

    Keith,
    I completely agree with your concerns and conclusions about the UNHLP’s unwarranted assertion of sovereignty. My post’s principal policy concern however is protecting the continued viability of university life science research, the volume and content of which would be shrunk by the spread of the UNHLP Panel’s findings and recommendations. Fortunately the General Assembly has just headed in a more important health care direction (http://www.un.org/pga/71/event-latest/high-level-meeting-on-antimicrobial-resistance/) hopefully signaling its silent rejection of the Panel’s misguided Report .