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Patents and Public HealthPatents and Public Health

Dr. Eric Noehrenberg

Director

International Trade and Market Policy, IFPMA

WIPO Open Forum on the draft SPLT,

Geneva, 3 March 2006

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R&D Addressing Global Burden of R&D Addressing Global Burden of DiseaseDisease

Disease Health Burden (% of global deaths/DALYs)

Existing treatments discovered by R&D pharma industry

HIV/AIDS 4.9/5.7 All 21 drugs in 4 different classes

Respiratory Infections

6.9/6.3 All recent and effective antibiotics

Cardiovascular disease

29.3/9.9 All drugs in 8 different classes

Cancer 12.5 / 5.1 All most effective drugs in 8 classes

Depression 0 / 4.5 All recent drugs in 4 different classes

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Number of Compounds in Number of Compounds in Development by Selected Major Development by Selected Major

Disease CategoriesDisease Categories

395

123

55

50

44

33

22

185

271

86

0 100 200 300 400 500

Cancers

Neuropsychiatric diseases

Infectious diseases + Respiratory infections*

Cardiovascular diseases

HIV/AIDS**

Musculoskeletal diseases

Diabetes

Respiratory diseases

Digestive diseases

Sense organ disorders

* Excluding HIV/AIDS; including 61 vaccines** Including 15 vaccines

Source: PhRMA, Medicines in Development Surveys 2003/2004

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Are We Getting Innovation?

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R&D Industry addressing R&D Industry addressing Developing Country Health NeedsDeveloping Country Health Needs

90% of innovative drugs on the WHO Model Essential Medicines List were developed by the R&D-based pharmaceutical industry

Best current treatments for truly “neglected diseases” come from R&D-based industry:– Sleeping sickness – Sanofi Aventis– River blindness – Merck– Leishmaniasis – Merck + GSK

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Patents NOT blocking access to Patents NOT blocking access to essential medicines in poor countriesessential medicines in poor countries

Over 95% of drugs on WHO Essential Medicines List off-patent worldwide; 99% in poorest countries

Patented drugs on EML are being offered by patent-holders to poor countries at cost, below cost or even for free– Antiretrovirals via AAI, reaching over 455’000

people in developing countries worldwide– Coartem® from Novartis in partnership with

WHO

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Export CL TRIPS AmendmentExport CL TRIPS Amendment

If country sees patents as a barrier and cannot produce domestically via CL, then they can go to foreign suppliers to get alternative supplies via export CL

Waiver of TRIPS Art. 31(f) and (h) Solution ensures transparency and non-diversion Humanitarian purposes, non-commercial, non-

industrial policy use Non-bureaucratic procedure, simple notifications

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Who are the authors of the Who are the authors of the solution?solution?

South AfricaKenyaIndiaBrazilUSAChaired by Singapore

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““Flexibilities” are not public Flexibilities” are not public health solutionshealth solutions

International exhaustion => « parallel trade »

Compulsory licensing

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Parallel TradeParallel TradeParallel trade is bad for poor countries – their

supplies disappear!– Parallel trade moves products from low-price markets

to higher-priced markets– Parallel trade will interrupt stable supply chain in

importing and exporting countries– Parallel trade will harm ability of companies to

distribute differentially priced drugs Price differences may be short lived; parallel trade

not reliable over long termParallel trade can contribute to trade in substandard

and counterfeit drugs – African regulators at WHO Conference in Rome two weeks ago

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Realities in Zimbabwe after Realities in Zimbabwe after Compulsory LicensingCompulsory Licensing

Compulsory licenses in 2002Prices are high = US$1638 per year, about

equal to annual salaryAccess is poor, with fewer than 20'000 Zim

residents out of an estimated 1.8 million living with HIV getting ARVs

What is the quality of the drugs available?

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Realities in Zambia and Realities in Zambia and Mozambique after CLMozambique after CL

Zambia : No patents on the drugsMozambique : No patents from MNCs;

CIPLA’s TRIOMUNE patent affected

Access to quality medicines was NOT improved due to CL

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““Flexibilities” are INDUSTRIAL Flexibilities” are INDUSTRIAL policy, not “health policy”policy, not “health policy”

Beneficiaries are copy companies, not consumers

Foreign manufacturers benefit more than local manufacturers

Policy choice is: do you prefer to promote an innovative, value-added market model, or an old-fashioned copying model?

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Effective use of IPR incentives Effective use of IPR incentives improves public health through improves public health through

innovationinnovation90% of innovative drugs on WHO EML

originated from MNCs using incentives of patent system, including for “tropical diseases”

PPPs such as Medicines for Malaria Venture address areas where partnerships can best address health research needs

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IPRs create therapeutic IPRs create therapeutic competitioncompetition

In 1987, one antiretroviral Thanks to patents, innovators had to find new

ways of attacking HIV Now, over 20 ARVs on the market and over 80

compounds in development Through AAI – over 455’000 patients getting top-

quality, triple-ARV therapy “Drug portfolio” important in all areas of health –

not everyone responds the same way to the same drug!

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Second Use and Adaptive Second Use and Adaptive Innovation bring health benefitsInnovation bring health benefits

Study shows that circa 25% of drugs on EML are indicated for uses other than the original indication

The large majority of drugs on EML are not the first drugs in their class on the market

Most drugs on EML are modified formulations of original products

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Adaptive innovation is patentableAdaptive innovation is patentable Indian generic drug manufacturers have 84 patents

pending in Brazil on new salts, esters, polymorphs and similar "incremental innovation” on existing pharmaceutical products – ironically, they cannot get the same protection in India itself;

Indeed, patentability of adaptive innovation is limited in India, removing incentives for needed innovations (heat-stable insulin, for example)

Thousands of patents applied for in China based on traditional Chinese medicine

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Cases of adaptive innovation Cases of adaptive innovation bringing public health benefitsbringing public health benefits

Zithromax SR – improving an existing antibiotic into a single-dose form, now used to treat trachoma effectively

Neurontin – new production process brought effective epilepsy drug to broader populations

Procardia XL – new administration technology for existing drug more than tripled population which could benefit from therapy to treat agina

Agenerase – new formulation brought new protease inhibitor in fight against AIDS

Effexor – slow-release formulation improved use of antidepressant

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ConclusionsConclusions

Debate over “flexibilities” in international agreements is an industrial policy debate, not a health policy debate

IPRs spur innovation which promotes public health Protection of adaptive innovation and “second use”

brings public health benefits, including for developing countries

IPR definitions should be harmonized via WIPO to recognize all innovation, including adaptive innovation