Lead Author: Ademola Adelekan
Additional Authors: Philomena Omoregie, Olasunkanmi Olejiya, Elizabeth Edoni, Hillary Osori,
Organization: University of Ibadan
Country: Nigeria; Mexico
Abstract
Lack of regular access to essential medication is said to account for enormous death. While developing countries like Nigeria are grappling with their obligations under the World Trade Organization (WTO), Trade Related Aspect of Intellectual Property Rights Agreement (TRIPs) which became operational since 1995, industrialized nations are resorting to higher standards of intellectual property protection through regional and bilateral free trade agreements.
Poor access to essential drugs is a global problem with other causes beside patent rights. Poor access is rather due to insufficient research and development and drug production especially in developing countries without manufacturing capacity. The local drug industry in Nigeria currently meets 20% of the drug needs as against the projection that it will meet 80% of demand by 2000. Other factors include exchange rate, high tariffs and taxes on drugs and chemicals which range between 17- 20% in Nigeria making drugs cost 2-64 times more expensive than the international reference price. Also lack of political will and poor regulation makes Nigeria a market for substandard and counterfeit drugs constituting about 48% of circulating drugs. However evidence suggests that patents are unnecessary for innovations and actually reduce access to drugs especially in developing countries.
Instead of adopting the TPPA including TRIPS-plus provisions that can hinder access for those in poor countries, the hands on deck are better off if they delineate factors that would bolster and build on the milestone already achieved towards increasing access to treatment. Bureaucrats are much better off if they resort to anchor on rational and sound measures in which trade and intellectual property policies are formulated in a way that strengthens the agenda of providing long-term, cheaper and perpetual access to medicines.
Submission
Background
The underprivileged around the globe from resource poor countries particularly, from Sub-Saharan Africa have one of the highest count of those affected with epidemics like HIV/AIDS, Tuberculosis (TB) and Malaria. It has been reported that, about 3 million patients die every year as a result of these fatal illnesses. This amounts to a global catastrophe. Lack of regular access to medication is said to account for these enormous death. According to a research conducted by the World Health Organization (WHO) with access to medication, about five – ten million deaths could be averted in the next six years. Similarly, a 2001 report by DFID (Department of International Development) reveals, “people lack access to medicines where they cannot obtain the products they need to prevent or treat a medical condition. This might be because a product is unavailable or is not offered, or because it is unaffordable.” This reality is a truism as the problems are not mutually exclusive.
The 2001 World Trade Organization (WTO) Doha Declaration on Trade Related Aspects of Intellectual Property Rights (TRIPS) and Public Health as well as the 2008 World Health Assembly (WHA), adopted the Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property (GSPOA), that advocated for an accelerated, supportable premise for targeted, requisite health Research and Development (R & D ) relating to ailments that excessively affects the poor in emerging and developing countries. Other innovative plans range amongst others, the use of innovative Public-Private Partnerships (PPPs) for health like the Global Fund to Fight AIDS, Tuberculosis and Malaria, The GAVI Alliance, the Roll Back Malaria (RBM), the Stop TB, the President’s Emergency Plan For Aids Relief (PEPFAR/Emergency Plan), The African Network for Drugs and Diagnostics (ANDI), the Innovative Medicine Initiative (IMI) amongst several other archetypes in the fight against the communicable diseases since market based innovation models fail to address the disease-burden specific to developing countries – the so-called neglected diseases.
Mechanisms like patent pools, prize funds, or Research & Development treaties allow for the de-linking of the costs of research from the price of the final product and provide a pathway for orienting R & D towards priority health needs. This is in tandem with the Millennium Development Goals (MDGs) Goal 8, the UN Political Declaration on HIV/AIDS and the Abuja Declaration on HIV/AIDs, Tuberculosis and Other Related Infectious Diseases. In the same direction, the Okinawa commitment on infectious and parasitic diseases came up with an ambitious plan on deadly diseases, notably HIV/AIDS, Malaria and Tuberculosis.
Global strategy and plan of Action on Public Health, Innovation and Intellectual Property
The global strategy and plan of Action on Public Health, Innovation and Intellectual Property brought to a close about 2 years of tasking multilateral negotiations under the auspices of an Intergovernmental Working Group (IGWG). Furthermore, the UK Commission on Intellectual Property Rights (CIPR), and the WHO Commission on intellectual Property Rights, Innovation and Public Health (CIPIH) reports, directed lots of attention on the increasing impact of ailments and situations that beyond proportion is affecting resource poor countries. To date, the WHO, UNAIDS (Joint United Nations Programme on HIV/AIDS) and a couple of other UN agencies and organizations have identified four essential elements of an access framework for drugs, each of which is regarded as being expedient in ensuring access to these medications in poor regions of the globe and they include rational selection, affordable prices, sustainable and adequate financing and a reliable health care and supply system. Perhaps, another major but ignoble factor that is yet to be taken account of is the issue of security in most of these endemic nations. Of course, the scenario of September 11, 2001 will ever remain fresh in our minds. Not just because of the bloody attack on the World Trade Centre in New York, but the challenges this has brought with it in global public health. This is because any regional or global focus must bear in mind the challenges posed by security concerns like terrorism. Potentially, atrocities of such magnitude are likely to be higher if chemical and biological compounds explored in the manufacturing of pharmaceuticals are loosely protected via a scheme of more reliable intellectual property rights and public sectors enforcement of IPRs.
Intellectual property protection through regional and bilateral free trade agreements
While developing countries like Nigeria are grappling with their obligations under the World Trade Organization (WTO), Trade Related Aspect of Intellectual Property Rights Agreement (TRIPs) which became operational since 1995, industrialized nations are resorting to higher standards of intellectual property protection through regional and bilateral free trade agreements.
However, the proliferation of these arrangements or agreements has added another layer in the access to medicine debate. A case in point is the US proposed Trans-Pacific Partnership Agreement which is viewed as having a very convoluted background. It was supposed to be a Free Trade Agreement (FTA) between Chile, New Zealand and Singapore, and subsequently Brunei Darussalam, referred to as the “Trans-Pacific Strategic Economic Partnership Agreement.” The bargain was gradually broadened to crystallize into a Trans-Pacific Partnership Agreement (TPPA) and en-compassed other negotiating countries like Australia, Peru, the United States of America, Malaysia and Vietnam. Others who became interested afterwards are Canada, Japan, and Mexico.
This TPPA is largely viewed as translating far and above ancient trade challenges, and incorporates elaborate requirements tied to intellectual property and investor protection. These “TRIPS-plus” requirements drew world’s scrutiny as the 2007 and 2008 shipments of generic medications from India to other needy nations were held at central European ports on the violation of intellectual property rights. Amongst the consignments are HIV/AIDs medicament purchased for an undertaking by the Clinton Foundation in Nigeria. The United Nations (UNITAID) in a reaction following the detention of the goods in transit said:
“… Interruption in HIV therapy is extremely dangerous and can cause resistance to the medicines. We therefore strongly urge the Dutch government to release the medicines so that they can reach patients as soon as possible. UNITAID is worried more generally about the trend that seems to have taken hold in recent months where generic medicines are stopped or confiscated while transiting through the Netherlands. Generic medicines are not counterfeit medicines.”
This current negotiation has indeed drawn enormous discussions and arguments in different forums. The secretive atmosphere under which the agreement is negotiated has been critically evaluated as the leaked text in the public domain has given rise to tremendous speculations concerning the text under review. Most discussions revolved around the intellectual property chapter proposed by the USA relates to patents. Overall, the USA’s TPPA proposal appears tilted in support of patent applicants by demanding lower levels of disclosure, lower standards of patentability, no pre-grant opposition proceedings, as well as numerous possibilities to amend patent applications. The long-term effect of these measures is likely to be the granting of a greater number of patents on medicines and medical technologies, including a greater number of weak or “poor-quality” patents. Beyond the TRIPs-plus intellectual property provisions included in the TPPA, other knotty issues relating to finances and/or re-imbursements of drugs plus investment-related matters are said to pose another major hurdle in the access to medicine conundrum and global public health as a whole.
Patent rights and essential medicines in developing countries: is access compromised for innovation in Nigeria?
Absence of patent rights discourages research into neglected diseases in developing countries [1]. Morally, patents can be justified on natural rights, distributive rights and utilitarian (economic) grounds. Man has ‘rights to his idea’ and fairness means he should be rewarded for inventions. Patent system prevents copying by competitors until profit has been made. It also serves a ‘disclosure function’ so that applicants reveal inventions and the knowledge can be used globally as basis for new inventions and for economic growth [2;3]. In cases of joint inventions patent system serves a ‘transactional function’; it prevents conflict and determines how profits are shared [3].
Notwithstanding, poor access to essential drugs is a global problem with other causes beside patent rights. Only 319 drugs on the WHO Essential Medicines List (EML) are patented; and in 65 countries only 1.4% of EML drugs are patented [4]. Since less than 10% of drugs used in developing countries are patented, conciliation of patents will not lead to significant improvement in access to drugs (Bale, 2001). Poor access is rather due to insufficient R&D and drug production especially in developing countries without manufacturing capacity. The local drug industry in Nigeria currently meets 20% of the drug needs as against the projection that it will meet 80% of demand by 2000 [5]. The products are mostly generic analgesics, antimalarials, antibiotics and vitamins. The Research and Development (R&D) effort depends on few public sector institutes like the Nigerian Institute of Pharmaceutical Research Development (NIPRD) currently involved in developing local drug against Sickle cell anaemia and Nigerian Institute of Medical Research (NIMR) occasionally in collaboration with the private sector (NIPRD). The National Agency for Food and Drug Administration and Control (NAFDAC) is poorly financed and has been accused of contributing to high costs of drugs through high registration fees [5].
Other factors include exchange rate, high tariffs and taxes on drugs and chemicals which range between 17- 20% in Nigeria making drugs cost 2-64 times more expensive than the international reference price [6]. Also lack of political will and poor regulation makes Nigeria a market for substandard and counterfeit drugs constituting about 48% of circulating drugs [7;8]. There is low demand in these countries because of poverty. Nigeria with GDP of 915 and over 70% of people living below poverty line and average monthly salary of 52 USD cannot afford drugs [7; 9]. However evidence suggests that patents are unnecessary for innovations and actually reduce access to drugs especially in developing countries.
Patents reduce access to drugs and are unnecessary for innovation
Health is a fundamental human right and essential medicines are required to maintain it. Therefore it is morally unjust and unethical to compromise access to medicines for commercial interests. Pharmaceutical companies actually use patents to stifle competition, increase price and create monopolies [10]. Generic competition is the best strategy of lowering drug prices. Anti-retrovirals (ARV) prices reduced from 10,000 to 136 USD per patient per year with supply of generics from India [11]. The threat of introducing generics actually forced down ARV and antibiotic prices in Brazil and USA respectively (during the anthrax scare).
Globally, the generic industry runs profitably with low R&D cost and standards are maintained.
Apparently, R & D is not as costly as industry claims, figures are often inflated and higher opportunity costs claimed by the companies. In 1990s actual R&D cost per new molecule discovered was 114-150 million USD [12]. Also, only a small fraction of the profit is reinvested into R&D. In 2000, eleven biggest drug companies spent 30% of their revenue for marketing and administration but a paltry 12% for R&D [13]. Moreover, public funds are used for R&D especially basic research which may be unprofitable [3;14]. Government contributed 44%, ‘not for profit’ organizations -7.6% and pharmaceutical companies-48% to the global 106 billion USD spent on R&D [15]. Also 45 out of 50 top selling drugs in the USA in 1992-1997 received government funds during R&D [13].
Industry often develops drugs from unpatented traditional knowledge like Chinese Artemisin which is received free [3]. Moreover, patents have not induced right innovations, instead old drugs are slightly altered or new dosage forms introduced. A lot of these ‘me too’ drugs should not be patented. Only drugs reflecting market patterns like anti-cancer, anti-hypertensive and not public health priority are developed. Ninety percent of research is directed against 10% of global disease burden. Only 31% of 1,223 drugs patented between 1973 and 1997 were truly innovations and only 1% was for tropical diseases. It is doubtful that patents can induce R&D in neglected and tropical diseases as the developing countries have a very small share of the drug market [14]. Patents may rather hinder development as access to information is restricted during the development phase and companies may duplicate efforts and waste resources [16].
Meanwhile, patents reduce access to drugs in developing world. The population offers a potentially large market for ARVs including patented new second line drugs [17]. Nigeria has about 2.8 million people living with HIV/AIDS (PLWHA). Access however is further reduced by the ‘TRIPS plus’ conditions included in the Free Trade Agreements (FTA). Oxfam (2006) estimates that Colombia will need extra 940 million USD for drugs and compromise access of 6 million people by 2020 and Peru will expect 100% increase in drug prices by 193 million USD as a result of these FTAs. Consequently, there are other incentives for motivating research apart from patents. Companies can be motivated by advance purchase commitments for future products like vaccines. Peer recognition, academic rewards and prizes are time-proven alternatives. Industry can be rewarded with big one-time financial reward and global fame and recognition and they may get R&D tax waivers [16;18].
Conclusion
If the fight against communicable diseases is to be won in the 21st century, voices must be raised by all stake holders, especially NGOs and even people suffering with these ailments to oppose the coming into affect of the TPPA that amongst other factors, will block generic medications from penetrating into the market, therefore, rendering those affected from poor countries to lose the hope of living and of a better society. Also, this will negate the spirit of the Doha Declaration on access to medicines. Instead of adopting the TPPA including TRIPS-plus provisions that can hinder access for those in poor countries, the hands on deck are better off if they delineate factors that would bolster and build on the milestone already achieved towards increasing access to treatment. Bureaucrats are much better off if they resort to anchor on rational and sound measures in which trade and intellectual property policies are formulated in a way that strengthens the agenda of providing long-term, cheaper and perpetual access to medicines. In aligning with UNITAID as well as other interested non-state run entities, the writer supports the endorsement of a “positive agenda”, which translates into stakeholders logically identifying and implementing policies that could enhance to attain the remit of trade and economic growth in tandem with the objectives of making access to medication and the safeguarding of public health.
Recommendations
There is need to encourage innovations without making drugs inaccessible, therefore the current patent system should be modified. There should be strict regulation of the pharmaceutical industry by neutral people without conflicting commercial interests. There should be a system for ‘capping” or controlling drug prices and only ‘true inventions’ should be patented.
The level of public sector involvement should be increased and should not be limited to initiating basic research and development but should continue up to the stage of commercializing the drugs. Capacity will need to be built in the public sector. Some research institutes like Nigeria’s NIPRD need to be upgraded and get better funded to ensure cost-effectiveness. There should be increase in research grants given to researchers and institution; this can be raised from both public and private sources. This should be given through an equitable and transparent system. Corporate organizations should be made to contribute to R&D efforts and tax credits can be received for these. Individuals in countries with low drug taxes can be made to pay special R&D taxes.
There is need to strengthen public–private partnerships for R&D as private sector tend to be cost effective. In Nigeria, more private interest should be generated and it should be linked with public institutes like NIPRD which is currently developing drugs against Sickle cell anaemia. The health systems of developing countries require strengthening to promote access and rational drug use. There is need to improve data management, drug distribution and bulk purchasing mechanisms. There is need to encourage prescriptions of generics. The drug regulatory agency should be adequately funded so as to ensure that good standards and combat drug counterfeiting.
The effort of international organizations like WHO, UNDP, World Bank in advocacy for drug access should be continued. Also their involvement through initiating and funding institutes for R&D of drugs for tropical diseases should be encouraged. International partnerships like the ‘International AIDS Vaccine Initiatives’ and ‘Drugs for Neglected Diseases Initiative’ (DNDi) should be strengthened. The American ‘Orphan Drug Law’ program which has generated modest R&D on drugs with high therapeutic but low economic value can be explored and reproduced in other countries.
Finally, there is need to exploit flexibilities present in the TRIPS agreement. Moreover, experts should closely examine future international treaties, agreements and bilateral FTAs and ensure that they do not compromise the health of the populace. The Nigerian government should reduce tariff on drugs and local manufacturing capacity should be developed. Foreign direct investments and drug donations should be attracted through good governance.
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