[Ip-health] IP-Watch: The Case For Nations To Act On Medicines Access

Thiru Balasubramaniam thiru at keionline.org
Mon Jul 24 08:19:40 PDT 2017


The Case For Nations To Act On Medicines Access


NEW YORK — A range of speakers, including top health officials from both a
developed and developing country, last week laid out the case for why the
world’s leaders must now launch a shift in the way medicines all
populations need are developed and priced. The need for global
collaboration is clear, speakers said, but who will lead?

The 17 July event was titled, “UN Secretary-General’s High-Level Panel on
Access to Medicines: Advancing Health-Related SDGs through Policy
Coherence.” The panel came in the context of the UN High Political Forum on
Sustainable Development taking place during the week at the UN headquarters
in New York.

Speakers at the event included:

Hon. Michael Kirby, former member of the High-Level Panel and former
Justice, High Court of Australia
Prof. Sakiko Fukuda-Parr, former member of the High-Level Panel and
professor at the New School in New York
Clemens Auer, director general, Federal Ministry of Health and Women’s
Affairs, Austria
Margrete Auken, Member of the European Parliament from Denmark (remote
Javier Guzmán, director-general of the National Food and Drug Surveillance
Institute, Colombia
Mogha Kamal-Yanni, senior health and HIV policy advisor, Oxfam

Introductory remarks and moderation were provide by Magdy Martínez-Solimán,
assistant secretary-general, assistant administrator and director, Bureau
of Policy and Programme Support, UN Development Programme.

The Burden on Patients and Health Systems

Most countries from the poorest to the most prosperous are facing
challenges in affording medicines for their populations, Martínez-Solimán
said in opening remarks. For instance, he noted that 11 or 12 cancer
medicines introduced in the United States cost over US$ 100,000 per patient
per year, “putting an egregious burden on the patient and health systems

And he gave several examples of cases where the system is not providing
needed treatments, such as antimicrobial resistance, multi-drug resistant
tuberculosis, malaria and neglected tropical diseases.

“We have to do more to incentivize innovation for unmet health needs,” he

Judge Kirby laid out the background and main recommendations of the
High-Level Panel report, which was issued in September 2016 and has been
gathering attention ever since.

He mentioned that the preceding and “prescient” UN Declaration on Human
Rights included both that the right to health is a basic human right for
all, but that inventors have a right to be rewarded for their work. “So
there you have it,” he said, the two elements that have never been properly
reconciled at the international level, and were a focal point of the
High-Level Panel on Access to Medicines.

The 1980 Bayh-Dole Act in the United States, which required protection of
intellectual property rights in health research, came as a shock around the
world, he said, as many did not protect health research up to that point.
“The sleeping beauty awoke,” he said, and was followed by the 1994 WTO
TRIPS Agreement, and the 2001 Doha Declaration on TRIPS and Public Health.

The debate was “very energetic” in the 1990s and 2000s as the rise of
HIV/AIDS led to efforts to make available the very effective
antiretrovirals that had been developed, as it was recognised that market
forces could not deliver them. So it was at that time that the concept
arose that one should not have access to medicines based on the “good
fortune of where they were born,” but as a universal principle, he said.

The latest big commitment is in the Sustainable Development Goals, which
assert the goal of access for all to health. And with some insisting on the
primacy of their intellectual property rights over the right to health, the
UN secretary-general called for the High-Level Panel on Access to Medicines
to look at the issue.

Kirby insisted the panel was conducted in a completely open and inclusive
fashion, consulting industry and all others, and that the report “is a
consensus report.” There were differences, he said, as one would expect,
about matters of detail within the report, and those are expressed in the
report. But “what was delivered as the central core message of the report
was done by consensus,” he said.

Finally, Kirby talked about a program in his native Australia under the
national health system to provide the latest treatment to anyone who has
hepatitis C, of which there are some 300,000 people, in order to eliminate
the disease from the population. The negotiated price with the IP rights
holder was undisclosed but was believed to be about AUS$ 48,000, compared
to the price in the United States for the same drug of US 84,000 – which is
equivalent to AUS$ 100,000, or twice the negotiated price in Australia.
Based on market research and in the interest of company shareholders, the
company in the US raised the price of the drug by 4000 percent.

“This is the problem of leaving issues of essential drug care only to
markets,” Kirby said. “Markets will not necessarily protect the rights of
ordinary citizens.” So the Australian government stepped in and negotiated
a price and made it available to all of its citizens who need it. And in
Egypt, with an epidemic of hepatitis C, it is available for about US$800.

“What is the principle of $84,000, $48,000 and $800?” he asked. “There is
no principle. It is only what the market demands.” Citing an ambassador
from the Netherlands who has called this “unacceptable,” he said, “We need
a more principled response to the needs of health of people everywhere and
it is this report that shows the way ahead.”

Main Recommendations

The UN High-Level Panel report recommended respecting and strengthening the
legal landscape, arguing that free trade agreements often go beyond the
minimum standards for intellectual property protection, and that
international agreements should be used to improve innovation and access,
not hinder it.

It suggests that governments: should give patents only for genuine
innovations, and must not undermine the use of flexibilities built into the
World Trade Organization Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS). It also said governments should create an enabling
environment for exporting medicines under compulsory licence; and that the
WTO secretariat should register complaints of pressure on countries and
take punitive measures.

Another set of recommendations focuses on implementing additional models of
funding for research and development, ensuring innovative companies are
rewarded and that people can access the medicines at a fair price. Examples
are public-private partnerships and product development partnerships, as
well as grants and prizes.

Other recommendations include a change in transparency practices by having
governments require all manufacturers and distributors to disclose the
costs of producing and dispensing their products. This also includes
requiring that all knowledge generated from publicly funded R&D be made
freely and widely available. And it calls for the WHO to create a database
of prices of patented, generic and biosimilar medicines in countries.

Further recommendations cover increasing investment in health R&D, and
creating a framework of accountability, including by having the UN
secretary-general establish an independent review body for assessing health
technology innovation and access. And governments should review national
policies from the standpoint of human rights obligations and make the
results public.

On the way forward, a High-Level Panel flyer states: “Achieving global
goals, particularly Sustainable Development Goal 3, which emphasizes health
and well-being for all, will require reconciling the need for great
investment in innovation, services and medicines, with the high costs of
health technologies that are currently burdening rich and poor countries

A key recommendation was that the 2018 UN General Assembly hold a session
on the progress on these issues.

The Call for Ambitious, Universal Solutions

“This to me is a human rights issue,” Fukuda-Parr said in her presentation
titled, “A call for ambitious, transformative, integrated, universal

She tied the panel’s work with the UN Sustainable Development Goals for
2030, which she said is not just a list of 17 goals, 169 targets and 232
indicators, but a “new concept,” a “real paradigm shift,” that “have to be
looked at holistically.”

She pointed to SDG 3 on health, target 3.8: “Achieve universal health
coverage (UHC), including financial risk protection, access to essential
health-care services, and access to safe, effective, quality and affordable
essential medicines and vaccines for all.” And also highlighted how health
goals relate to others such as science and technology, trade, and private
sector partnerships, all under SDG 17.

Fukuda-Parr described access as voluntary and case-by-case, and innovation
as limited in scope and scale and uncoordinated. She highlighted the
antimicrobial resistance problem, saying today’s 700,000 deaths per year
due to drug resistance could lead to 10 million deaths by 2050, but that
the market incentive is still lacking for new antibiotic research, for
which only two new drugs have come out in the past 50 years. She also
mentioned the research gaps and high prices for tuberculosis and cancer

Currently, negotiations are done on a product-by-product,
country-by-country, company-by-company basis, and there is a need for new
models than one based on high prices. The market is misaligned with health
priorities, she said.

“We need an institutional system for medical R&D” that does not perpetuate
the widening gaps, she said. “We need something that would address the
problem as a universal problem to address the misalignment between public
health priorities and market incentives.”

Fukuda-Parr described some recommended alternative models to the current
system of reward based on high prices and high sales, that incentivize
investment in those health priorities. Examples included “push, pull,
pooling,” open collaborative research, public-private partnerships, a
binding R&D convention, plus forming a working group out of the Principles
for Biomedical Research.

The 2016 UN General Assembly’s political declaration on antimicrobial
resistance (AMR) offers a range of alternatives including the concept of
delinking product price from the cost of R&D, she noted.

High-Income Countries “Woke Up”

Auer opened by saying as director general, “you can blame me as being the
ugly face” of a high income, high-priced country. In the boardrooms of
pharmaceutical companies, countries with high GDP like Austria are
interesting because they set the price for their medical products. This can
have an impact on the European countries around Austria to the east that
then are faced with prices they struggle to pay – and they tell him so.

Meanwhile when it comes to the SDGs, his country is “doing alright” because
they have socialised medicine based on a solidarity system, and a broad
consensus that access to healthcare is a fundamental human right (adding as
an aside, “We don’t have a Donald Trump”). So no Austrian has to be afraid
of getting sick for economic reasons because of universal healthcare, they
have an equal access to the healthcare system. This is a “notion of freedom
in a society,” said Auer.

The country has been doing fine at health coverage despite being a
high-priced country, so like others in rich countries, they largely ignored
the issue of access to medicines because it was not an issue for them. That
is, until an American company brought a hepatitis C drug to market at such
a high price it “changed the game totally.”

The people like him, in countries like his, “we woke up,” he said,
recognising that if this was the business model the pharmaceutical industry
wanted to bring to them, they would not be able pay for drugs any longer
and the model is not working. The business case that has worked very well
for the pharmaceutical industry if one looks at their profit margins over
the past 20 years, is really not working anymore, he said.

“Even a country like mine is not able to pay the prices anymore,” Auer
said. So the recommendations from the UN panel report are of “high value,”
he said. Parallel to that, there is a whole set of policy actions are
coming out of that realisation.

The big companies make global or regional decisions, but governments don’t
make decisions collectively. “Industry loves the fragmentation of the
public healthcare sector,” he said. “I’m convinced that we have to overcome

He mentioned that other countries along with Austria are beginning to band
together to better share analysis and are thinking about jointly
negotiating prices with industry. Austria alone is a market of 8 million,
but combined with the Netherlands and Belgium (BeneluxA) it makes a market
of some 45 million, a market “industry cannot ignore so easily.”

He mentioned a study being done by the Organization for Economic
Cooperation and Development (OECD, the Paris-based group made up of richer
economies worldwide) that is looking at the issue and trying to come up
with a set of policy recommendations like with the UN panel report.

A key issue for Auer is to look at policy failures, for instance cases
where the public funds research into drugs that then are sold back to them
at high prices.

Another issue is that governments “are not involved in how public funds for
R&D are spent,” do not know how it is spent, and cannot be sure it is the
interest of the public health system he said. He mentioned that with public
university funding for research, governments did not link the public
funding to price. “We are left with a whole series of medical gaps,” he

He called on health ministers to work together, and said Austria will hold
a match-making conference with investors and researchers when it holds the
European Union presidency next year.

Another policy failure is value-based pricing, he said. “Who knows what is
the value of a drug?” For this, he used the popular example of brakes on a
car. They could be seen as the highest value part of the car since they
save your life, but they are not the most expensive part.

“There is no transparency on what makes the price,” he said. And the public
sector is even collaborating with the industry on this, because they sign
confidentiality clauses in the vested interest of industry. “How stupid can
we be in the public sector to do this” so they do not have an understanding
of what is done with it. “We know shamelessly little” about the value added
after market authorisation.

He asked: “Do we have the mechanisms in place to assess innovation? I would
say yes …. Do we use these instruments we have? No, I don’t think so. We
have to get better.”

“The recommendations of this High-Level Panel are very, very valuable,”
Auer said, and are “not alone anymore,” as the issue has been taken up by
the OECD and the European Union Council of Ministers have a similar
approach. The World Health Organization “needs to get more involved,” he

Learning from Colombia’s Universal Healthcare Success

Guzmán said in its effort to join the OECD, Colombia, a middle-income
country, has been cited for its “remarkable example of rapid progress
toward universal health coverage” and deserves to be better known
internationally. Colombia is proud of having gone from 24 percent health
coverage to universal health coverage in 20 years, lowering out-of-pocket
expenditures to be one of the lowest in the world. But progress is “very
fragile”. Challenges include efficiency and sustainability, he said.

On access to medical products, “competition and regulation are not enough
anymore,” he said. “We are happy to see that our problem is no longer
[only] our problem but it is a global problem and is recognised as such.”

The UN panel report is important for Colombia because it frames their
national debate in an international context, and also because it is the
first time for many things. This includes the first time the UN
secretary-general got involved, and first time to address the “incoherence”
between the right of the inventor and the right to healthcare as a human
right. It also is the first time the problem is considered as a global
problem (including high-income countries)

It will be a “long and difficult” way ahead to implement the
recommendations, he predicted, and said an open discussion should be taking
place within the WHO, WTO and the World Intellectual Property Organization,
within the UN.

Guzmán suggested using the AMR situation as a “window of opportunity” to go
beyond current solutions and coordinate them in a “more rational manner.”
Colombia has been “very open about our tensions and incoherence” within the
government, between different agencies, he said, debating for instance
whether to issue compulsory licences. And they saw how one government can
have different views, setting agencies like the health ministry against
agencies like the Commerce Department and patent office, which were
essentially “predators.” So it is difficult for a government to decide on a
position to take.

And the report states the difference between what TRIPS says, and the
reality. The TRIPS flexibilities are there, but cannot be used, not only
because “we got pressure from everyone” (positive and negative) when they
try to use them, but the country also lacked the capacity to carry out the

This shows how countries need support, and “we are happy to offer our
experience,” so others can do it in a much more efficient and efficacious
manner, said Guzmán. The Colombian patent office does not think there is
any room for flexibilities with regard to patentability, and are “very
proud” to have short timeframes and to give as many patents as possible,
following developed patent offices in “patenting everything,” he said.

Discussions on how to have the synthesis of the different views are taking
place because of the report. It has encouraged them to have those
discussions and they have found common ground. They may not find the
perfect solution, but the little steps they make toward the goal include
having more transparency, or clearer guidelines on how to conduct a
compulsory licence, for instance.

If nations are serious about the Sustainable Development Goals and about
access to medicines, Guzmán said, the problems addressed by the High-Level
Panel “need to be acted upon now.”

Who Will Lead?

“The crisis of innovation is a global crisis,” Kamal-Yanni said in her
remarks, stating that the lack of innovation into more obscure diseases is
actually a “crisis for everyone.” The UN panel was unique in breaking the
barrier in this issue, which are artificial barriers given the global
nature of the crisis. What is needed is a coherent action which is global,
she said.

Kamal-Yanni asked who is responsible to take the recommendations forward so
that people in the north and the south have access to safe and affordable
medicines. The world needs leadership to get all stakeholders to move in
the same direction, she said, adding that Oxfam sees three key stakeholders
to move the recommendations forward. These are: governments; UN agencies
acting collaboratively but not settling for the lowest common denominator
with WHO in the lead with sufficient funding; and the UN
secretary-general’s office (the panel report was requested by the previous

Voice of Contention

Speakers ran over time so there was not time for questions. A US delegate
in the audience told Intellectual Property Watch afterward that the
critical statement by the US on the High-Level Panel from 16 September 2016
“still stands,” arguing that the panel report is “flawed” and is overly

Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org

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