The battle for affordable drugs
June 3rd, 2013
09:19 AM ET

The battle for affordable drugs

By Thomas J. Bollyky, Special to CNN

Editor’s note: Thomas J. Bollyky is senior fellow for global health, economics, and development at the Council on Foreign Relations and author ofPreventing Pharmageddon.’ You can follow him @TomBollyky. The views expressed are his own.

“No intellectual property should stand in the way of you, the countries of the world, protecting your people. Do you agree or not?”

Margaret Chan, the director general of the World Health Organization (WHO), made international news when she departed from her prepared remarks to ask this question of the national health ministers gathered at last month’s World Health Assembly, the annual WHO meetings. Chan was referring to the contractual restrictions and patent application that some governments and scientists complain are undermining efforts to develop a vaccine against the Middle East respiratory syndrome coronavirus (MERS-CoV), a deadly new virus now emerging in Europe and the Middle East. Chan’s question, however, would apply with equal force to any number of the other controversies over intellectual property (IP) now raging in the global health community.

A long simmering fight over patented cancer medications in emerging markets is escalating. Last month, the Indian Supreme Court rattled the multinational drug industry by refusing to grant a patent application on Gleevec, a leukemia drug that costs $70,000 per year in the United States. Indonesia followed suit, issuing a compulsory license that enables local drug firms to produce low cost generic versions of a liver cancer-causing hepatitis B treatment. China and the Philippines amended their pharmaceutical patent laws, making it easier to issue such licenses. Brazil and South Africa are reportedly pursuing similar amendments.

Concerns over intellectual property have paralyzed WHO efforts to stop the flow of substandard, spurious, falsely labeled, falsified, and counterfeit drugs. The U.S. National Institutes of Health (NIH) published a study in the medical journal the Lancet last year showing that 35 percent of the pharmaceutical samples that the NIH tested in South Asia and sub-Saharan Africa were fake. The problem is particularly severe for antimalarial drugs. If merely ineffective, these counterfeit products diminish public confidence in lifesaving treatments and contribute to the rise of drug resistance. If also toxic, these products sicken or kill patients. Yet fears persist that multinational drug firms and developed countries are using anti-counterfeiting to limit competition with legitimate, emerging country generic drug producers.

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Tensions over intellectual property in global health are not new. Patents and contractual limitations on the use of IP, such as those at issue in the MERS-CoV controversy, give researchers and drug firms exclusivity over their inventions. This allows firms to charge high prices for drugs for a limited period of time, which recoups medical research and development and encourages investment. But it also makes the resulting drugs and vaccines less accessible to those who need them, particularly the world’s poor, which is a fundamental objective of global health.

In the past, fights over IP in global health have been resolved by making accommodations for developing countries and their poor. International controversies over access to patented HIV/AIDS drugs diminished when multinational companies donated their products, slashed their prices in poor countries, or permitted local companies to make low-cost generic versions. After six years of difficult negotiation, the WHO concluded an international agreement last year that helps ensure developing countries are no longer expected to supply samples of the influenza viruses isolated in their territory without receiving affordable access to the vaccines and diagnostic tools that are developed from those samples.

But two developments are making intellectual property fights in global health harder to resolve.

First, the health needs of developed and developing countries are increasingly overlapping, which have made fights over IP and access more frequent. Diabetes, cancer, and heart disease – noncommunicable diseases that once confronted wealthy nations alone – are now responsible for more than 70 percent of the death and disability that occurs in many parts of Latin America, the Middle East, and Asia. With increased trade and travel, emerging microbial threats, like MERS-CoV, cross national borders with stunning speed, raising the stakes for all governments in surveillance and affordable access to effective interventions like vaccines or antibiotics.

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Second, the incomes of many developing countries are rising, which has increased the stakes of fights over intellectual property and access. Revenues have flat-lined in the United States and Europe amid budget and fiscal crises; the multinational drug industry has staked its future on noncommunicable diseases and emerging markets. IMS Health projects that annual drug spending in middle-income countries like India, China, and Indonesia will double between 2012 and 2016, to more than $300 billion. On the other hand, 70 percent of the nearly 2.5 billion people who survive on less than $2 per day live in these middle-income countries. Extending care to these poor populations is an enormous undertaking. The flexible intellectual property policies applied to HIV/AIDS and other infectious diseases that disproportionately affect poor countries will not be easily extended to large, emerging economies and the diseases that plague both rich and poor patients alike.

Defusing the IP fights now raging in global health is possible, but will require new approaches. The health needs of low-income segments of the global marketplace, whether they reside in low- or middle-income countries, must be meaningfully addressed. International drug pricing, for example, would be more sustainable if based on the income status of the patient, rather than the country where that patient resides. Governments should extend, as a matter of official national policy, the same strategies that govern the influenza virus sharing in the WHO agreement, known as the Pandemic Influenza Preparedness Framework, to other potentially pandemic microbial threats.

The relationship between IP and global health may be uneasy, but its successes are undeniable. Access to effective medical technologies, such as vaccines and HIV treatment, has dramatically lowered child mortality across the globe and afforded millions the opportunity to lead productive lives. But international support for research and development, intellectual property, and pandemic surveillance is not inevitable. As Margaret Chan suggested, these systems must serve and protect the needs of patients to function.

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Topics: Health

soundoff (8 Responses)
  1. Timmy Suckle

    I kissed my way up to VP at a health insurance company. Now I take over $600,000 of your health care dollars for NO VALUE ADDED to your health care. And that’s just me. Now think about how many other VPs, Directors, Managers, etc. are at my company alone. Now multiply that by thousands of others at hundreds of other health insurance companies. From 10 to 25% of your health care dollars go towards administration that adds NO VALUE to your health care. But my company’s PAC dollars will continue to fool you little people into thinking that a single payer system will be bad. Little people like you are so easy to fool. Little people also don’t realize that a single payer system is the ONLY system that would allow little people (as an entire country) to negotiate better health care prices. Little people don’t realize that the Medical Cartels already know that. And that is the reason why the Medical Cartels spend so much PAC money from the hospitals and doctors lobbying against a single payer system. Some little people say that a single payer system would cost you little people more. But if that were true, then wouldn’t the hospitals and doctors WANT that extra money? Yes they would. So why do the Medical Cartels lobby against a single payer system? It’s because the Medical Cartels know it would allow little people to negotiate better health care prices. And that’s what the Medical Cartels are afraid of. Period.
    But us big wigs at insurance companies, hospitals, and pharmacy companies don’t ever need to worry about health care no matter what it costs. We get our health care paid for one way or another by you little people. And we get the little people that work at our companies to contribute to our PACs. And us big wigs say it’s to protect the little peoples’ jobs. But in reality it would be in the little peoples’ best interest to NOT contribute to the PAC. Again, little people are so easy to be fooled. I won’t ever have to worry about losing my job with so many little people being brain washed by the Medical Cartels’ PAC money. Not only that, the Medical Cartels’ PAC money is used to elect so many republicans that will never allow a single payer system. Republicans have always fought against any meaningful health care reform. But that’s what our Medical Cartels’ PACs pay them for. Politicians can be bought so easily.
    Pretty soon the only people that will be able to afford health care is us big wigs. And that’s the way it should be. We don’t want you little people using up the resources when we need them. And once again, I thank you little people for capping my SS tax at the $113,700 level. Now I only pay 1.2% SS tax and you little people pay 6.2%. Also, thank you for extending my tax breaks. I’m using the extra money on my vacation houses.

    June 3, 2013 at 12:12 pm | Reply
    • Joseph McCarthy

      Well put, Timmy. That says it all!

      June 3, 2013 at 12:55 pm | Reply
    • Poltergiest

      Look I don't care if the people in my company make me a slave and take away all my freedoms and force me to rely on them for everything, only to dump me as an old man before I'm vested. I'm just mad that the government limited my right to buy a soda in the size I like.

      June 4, 2013 at 10:12 am | Reply
    • Robert

      Members of congress are elected to serve the people. Not the special interests. Will change ever come no. Greed and corruption have infected our government. Both political parties have failed the people of this country. Are the republicans out to destroy the middle class? Who will pay the bills?

      June 5, 2013 at 7:34 am | Reply
  2. joe anon 1


    no human, human problem, will get in the way of profits.

    June 3, 2013 at 3:27 pm | Reply
  3. rightospeak

    It is a sad story. The corporations run countries including the US and the Big Pharma cares little for people, only profits. The people who successfully tried to cure cancer with good results were demonized and dragged through Courts financed by the Big Pharma. They do not want a cure. The whole AMA Mafia is in the business to make money not to cure people. I could tell you stories I heard from nurses that would make your blood boil if you are human. Thousands are ripped off on unnecessary operations.
    With 13 TRILLION DOLLARS spent on endless wars we could provide free healthcare for all in the US . Instead, we are bankrupt and the warmongers still want more wars while most Americans, in spite of Imperial Parrots' propaganda in our media , are sick of it. So that is how "Democracy " works ?

    June 3, 2013 at 9:53 pm | Reply
  4. j. von hettlingen

    Affordable drugs are a good idea. Big pharmaceutical giants are reluctant to offer affordable products by justifying their high costs in R&D. They bemoan the generic drug makers for free-riding by using the lapsed patents.

    June 4, 2013 at 10:29 am | Reply

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