[Ip-health] HepC

Mohga Kamal-Yanni mkamalyanni at Oxfam.org.uk
Wed Jul 30 07:07:26 PDT 2014

World Hepatitis Day: Celebration of a new cure or commiseration for those 
who can?t afford it?

It?s not very often that we hear of a new medicine that actually cures a 
serious disease. This year, WorlIt?s not very often that we hear of a new 
medicine that actually cures a serious disease. This year, World Hepatitis 
Day comes with the exciting news of sofosbuvir; the new hepatitis C 
medicine with a cure rate of over 90%. Sofosbuvir can be used on its own 
in the form of one pill per day for 12 weeks. Existing treatments rely on 
a combination of daily oral ribavirin and weekly Interferon injections for 
around 48 weeks. The effectiveness of these old medicines is far below 
90%, and they also carry painful side-effects in addition to the hassle 
associated with weekly injections.
So a new cure is good news? Unfortunately there is a big catch. The 
medicine is not affordable, even in high income countries. At the current 
price US $1000 per pill, the US public purse may have to pay over US $300 
billion if the 3 million infected people are to be treated[1]. For 
example, it would cost the state of Oregon $360 million to treat its 
infected population. This would deplete the $377 million that the Oregon 
Medicaid program spent on all prescription drugs for its 600,000 members 
in 2013[2]. US insurance companies are rationing treatment and are telling 
doctors not to offer the medicine for all the patients that need it ? 
keeping it only for very specific cases.
The situation in Europe is not much better. The cost of a 12-week 
treatment is ?50,000 (US$68,000). The French health minister warned that 
such a high cost would have a negative impact on the French social 
security system, and called on the EU to collectively negotiate a lower 
price for sofosbuvir[3].
If cost is a major problem in the wealthier countries, then the impact of 
treatment price in middle-income and low-income countries will be even 
more dire. The majority of hepatitis C infected people ? 80% ? live in 
these countries. Countries with an infection prevalence rate higher than 
10% are: Egypt at 14%, Cameroon 13.8%, Burundi 11.3%, and Mongolia 10.7%
Clearly, none of these countries can afford the current high price. Gilead 
has entered into a deal with the Egyptian government to provide a 12-week 
course of treatment at US $900 per patient for the public sector[5]. At 
14% prevalence in a population of over 82 million people, the potential 
number of people living with hepatitis C in Egypt is around 11.5 million
[6]. To treat even just 5 million patients would cost Egypt the equivalent 
of nearly two-thirds of its total health budget (US $4.5 billion out of 
the current total health budget of US$ 7.22 billion for 2014/15)[7]. This 
cost is in addition to other drugs ? pegylated interferon and ribavirin ? 
which are needed in combination with sofosbuvir to reach the 90% cure rate 
for genotype 4, which is the strain of hepatitis C prevalent in Egypt.
Yet the price does not have to be this high, as illustrated in two ways. 
Firstly, a study by researchers at Liverpool University looked at the 
total real cost of the active pharmaceutical ingredients and the cost of 
manufacturing of the new direct anti-viral medicines class, of which 
sofosbuvir is one. They estimated the cost of a 12-week course of 
treatment with the combination of sofosbuvir and daclatasvir as US $78 per 
Secondly, evidence shows that the price of medicines is slashed by generic 
competition. HIV treatment is a case in point: in 2000, at the height of 
the public outcry campaign against high medicine prices, it was very 
difficult to persuade any government or donors to pay for treatment, and 
millions of people in poor countries were left to die. The price of triple 
therapy for HIV was US $10,000 per patient per year. That was clearly 
unaffordable to patients, governments, and donors at the time. Thanks to 
generic competition from Indian companies, the price dropped almost 
overnight to US $360 per patient per year or US $1 day. Continuation of 
competition has resulted in the current price of triple therapy for HIV of 
approximately US $100 per patient per year.
Now that Trade Related Aspects of Intellectual Property Rights (TRIPS) is 
implemented in almost all countries, including those with manufacturing 
capacity such as India, it is much harder to scale up generic competition. 
However, TRIPS includes some flexibilities, which countries can use to 
help lower prices. For example, India?s patent law has a clause on 
?pre-grant opposition?, which allows any interested groups to challenge a 
patent application before the patent is granted. Civil society 
organisations have used this clause for sofosbuvir and therefore 
currently, it does not have a patent in India (although the final decision 
is awaiting a court ruling).
Compulsory licensing is an important legal TRIPS tool for governments to 
ensure affordable prices of new medicines. Use of this tool in India 
decreased the price of sorafenib (Nexavar) for the treatment of liver and 
kidney cancer from over US $5,500 per month to US $175[9]. In 2008, 
Thailand issued compulsory licenses for 3 cancer medicines, leading to a 
big drop in prices. For example, the price of one tablet of 2.5 mg of 
letrozole was slashed from the original Novartis price of US $£7.35 to the 
generic price of US $0.19-0.22 ? a price differential of 30 times[10].
Obviously pharmaceutical companies and rich countries who support them do 
not like any government using this legal TRIPS tool. When Thailand issued 
compulsory licenses for medicines to treat HIV, cardiovascular disease, 
and cancer, it came under tremendous pressure from the US and the EU to 
stop[11]. Last year there was pressure by US businesses and Congress for 
the US government to take actions against India over its intellectual 
property regime[12].
The fundamental problem is the system of intellectual property rules which 
allows big companies to hold a monopoly on the price of medicines, thus 
giving them the power to set high prices. Moreover, financing for research 
and development (R&D) is still dictated by commercial interests rather 
than public health needs all over the world. Pharmaceutical companies are 
ferociously lobbying for stricter and stricter intellectual property 
protections as the only way to stimulate R&D and to ensure they can 
maintain their monopoly to set prices.
The price of the new hepatitis C medicine has given more momentum to the 
rising global movement that is challenging the high prices of new 
effective medicines for diseases ranging from cancer to cystic fibrosis
[13]. As long as the cost of R&D is linked to drug pricing, pharmaceutical 
companies will continue to price medicines to ensure maximum profit, even 
if it means decreased access for people who need it. This is a public 
health travesty. .
The un-affordability of the most effective medicine that can cure 
hepatitis C today highlights the critical need to de-link financing for 
R&D from the price of medicines, and for finding new ways to finance R&D 
so that effective medicines are available at an affordable price to all 
who need them.
[4] Lavanchy D.( 2011) Evolving epidemiology of hepatitis C virus. Clin 
Microbiol Infect.;17(2):107-15
[6] http://countryeconomy.com/demography/population/egypt
[7] Forthcoming: New effective hepatitis C medicines must reach all 
patients. PLOS
[11] http://www.wcl.american.edu/pijip/documents/mandelson07102007.pdf

Best wishes 
Mohga (Dictating to the computer so please forgive silly mistakes)
Dr. Mohga M Kamal-Yanni
Senior health & HIV policy advisor, Oxfam GB
John Smith Drive, Oxford, OX4 2JY, UK
UK Mobile   + 44 (0)777 62 55 884
Follow me @MohgaKamalYanni

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