gsk vs cipla final

8/2/2019 GSK vs Cipla Final

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Brief Introduction of Glaxo Smithkline

British Multinational Pharmaceutical company.

Worlds 3rd largest Pharmaceutical company.

Actively involved in disease areas includingasthma, cancer, HIV, etc.

World leader in AIDS drug manufacturing.

Revenue of 28.392 billion pounds.

Serves 140 global markets. Average R&D budget of 20% of sales. $6 bn in

2011.


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Prescription, Vaccine and Over the

counter productsPrescription drugs

Advair Asthma

Avandia Diabetes

Lamictal Seizures

Vaccines

FluLaval Influenza vaccine

Havrix Hepatitis A vaccine

Over the Counter products

Sensodyne

Boost

Horlicks


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3 commitments by CEO Jean-Pierre Garnier in 2001

To continue investment in R&D on diseases that

affect the developing world

To offer sustainable preferential (not-for-profit)pricing arrangements in (LDCs) and Sub-Saharan

Africa for currently available medicines that are

needed most

To take a leading role in community activities thatpromote effective healthcare


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HIV and AIDS"Hope springs eternal in the human breast Alexander Pope

HIV attacks the human immune system and if leftuntreated, ultimately leaves it completely ineffective tofight infection, an end stage known as AIDS.

Infection with HIV is associated with a progressive decrease

of the CD4+ or T-cell count and an increase in viral load, thelevel of HIV in the blood.

Every single day, 13,000 people worldwide are infectedwith HIV

An estimated 22.5 million people (68% of the global total)

live with HIV in sub-Saharan Africa, which is also home to90% of the world's 16.6 million children orphaned by HIV

In less than ten years, there has been a 70% decrease in theHIV/AIDS death rate


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The HAART of the matter

A triple cocktail of ARV medication is prescribed tomathematically beat the odds of virus mutation

A person on ARV, can need to take up to 40 pills a day.

Treatment for Opportunistic infections are seen as acomplement to ARV.

The strategy with the best yield is to hit early and hithard

HAART medication and managing its side effects is acomplex task, whose dynamics cannot be reduced toprice competition by generic drugs


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GlaxoSmithKline: Worlds most

experienced campaigner against HIV

GSK was the first company to get FDA approval for combining

multiple ARV treatments into one pill, the Combivir

GSK has had a significant history of developing medicines to treat

HIV, offering its HIV/AIDS medicines at not-for-profit (nfp) prices in

2001 in Least Developed Countries (LDCs) and sub-Saharan Africa

In February 2009, GSK head Andrew Witty announced that the

company will cut drug prices by 25% in 50 of the poorest nations.

GSKs business activity in countries that are subject to a trade

embargo, such as Burma (Myanmar), North Korea, Iran and Sudan Closer to a cure? Dolutegravir After 16 weeks of treatment 92%

of the patients taking the experimental drug had undetectable

levels of HIV


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TRIPS and the WTO The Agreement on Trade Related Aspects of Intellectual

Property Rights (TRIPS) is an internationalagreement administered by the World TradeOrganization (WTO)

TRIPS required WTO member states to grant patents onall classes of products (including medicines), to provide

protections for a minimum of 20 years, and to allowpatent rights to be satisfied either by importing the drugor by producing the drug domestically.

The TRIPS Agreement has been in force since 1995 and isto date the most comprehensive multilateral agreement

on intellectual property. The TRIPS Agreement introduced global minimum

standards for protecting and enforcing nearly all forms ofintellectual property rights (IPR), including those forpatents.


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Despite these new requirements, the TRIPS

agreement allowed the continuing production of pre-

1995 drugs and several "transitional" years tobecome TRIPS-compliant

Developed countries had until January 1996 to adopt

domestic legislation that would make them TRIPS

compliant

Most developing countries and former Soviet bloc

states were required to conform by 2000, while the

least developed countries (LDCs) had until January2006 to comply now extended to 2016

The TRIPS Agreement now requires all WTO

members, with few exceptions, to adapt their laws to

the minimum standards of IPR protection


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The Indian government became a signatory toTRIPS after it joined the WTO in 1995.

In a move designed to make Indias patentlegislation conform with the World Trade

Organizations Trade Related Intellectual PropertyRights (TRIPS) patent regime, the government haspushed a patent amendment bill through IndiasParliament.

The developing countries were given atransition period of 10 years to bring theirnational laws in accordance with TRIPS.


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GSK vs CIPLA(1/3)

Generic drugs are copies of brand-name drugs that haveexactly the same dosage, intended use, effects, side effects,

route of administration, risks, safety, and strength as the

original drug.

Generic drugs are only cheaper because the manufacturershave not had the expenses of developing and marketing a

new drug

Do not bear the burden of the safety and efficacy of the

drugs, borne by the original manufacturer

They may also enjoy the benefit of previous marketing

efforts of the original brand company


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GSK vs CIPLA(2/3)

In letters to a drug distributor in Ghana and a generic-drug maker based in India, Glaxo said sales of genericversions of Combivir in Ghana were illegal becausethey violated company patents.

Cipla tried to sell a generic version of the AIDS drugCombivir to health officials in Ghana.

India has no patent protection for Combivir, aGlaxoSmithKline product, and produces a genericversion for about one-tenth of the price.

GlaxoSmithKline negotiates patents in some Africancountries through a regional organization that itbelieves extends to Ghana.


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GSK vs CIPLA(3/3)

Combivir is a combination of two of the best-selling AIDS drugs, AZT and 3TC.

Total world-wide sales of AZT, 3TC, and Combivir

are expected to top $1.1 billion this year -- upfrom about $775 million in 1997.

Earlier in 2000, Glaxo had offered to sell Combivirfor $2 a day , as opposed to Cipla's genericversion (Duovir) sells for about $1.74 a day inGhana.

As a result, the Indian company, Cipla Ltd. ofBombay, stopped selling its low-cost version inGhana.


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Research and Development Cost

In 2009 GSK spent $5.6 billion and in 2010 $6.09billion in R&D

GlaxoSmithKline profitability started declining

Andrew Witty has been hell bent on restructuring

GSK since taking the reins there in 2008

Exiting certain diseases, simplifying its structure

and diversifying into consumer product areas

They have exited research and development indiseases affecting the brain, nervous system and

gastrointestinal disorders


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Thats good for shareholders, perhaps, but not

so good for patients

Glaxos R&D spending in 2010 as a percent of

total pharma sales was 12%, down 3%

Frantically searching for viable new business

models to offset the loss of protective patents

on key drugs If this trend continues, the worlds ageing

population faces a painful and unhealthy

future.

Corporate Wealth v/s Patients Health


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Generic vs Branded: Same Quality?

According to the FDA, all drugs, including

brand name drugs and generic drugs, must

work well and be safe

Generic drugs must use the same active

ingredients as their brand name counterparts.

Generics are likely to be made in factories in

parts of the world like India that have cheap

labor and overhead


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FDA halted imports from two plants of

Ranbaxy Laboratories

Similar action taken for over 30 generic drugs

This was because of manufacturing

deficiencies that put the products at risk for

contamination and other safety problems The FDA kept one antiviral agent important to

AIDS patients off the banned list since that

would have meant a U.S. drug shortage Mylan, has been accused of failing to enforce

adequate quality control procedures


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Some workers apparently violated normal

protocols to keep production lines running.

"A lot of parallel imports come from places

like India, and half the time there are no active

ingredients. It's killing patients and giving

false hope.

Drugs such as combivir is also prescribed as a

preventive drug and not just for cure

Generics known for their lower quality cannotbe trusted when it comes to prevention


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Cipla Dumping in Africa?

AHF hosted a press conference in 2008 tochallenge Cipla, for its steep prices for AIDS

drugs in India.

The print ad unveiled was headlined, "Profit at

What Cost? AIDS Drugs for All."

Advocates have long wondered why Cipla's

life-saving AIDS medicines cost more than

twice as much-than that in Africa


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India's own Cipla charged two-and- one-half

times as much in India as it did in Africa for its

AIDS tablets

In India, Cipla currently sells medicines for

54,000 rupees (USD $1,344) per patient, per

year (PPY) However the generic Indian drug giant charges

only 21,200 rupees (USD $528) in Africa

Cipla's corporate slogan is 'None shall bedenied,


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Other Patent Infringements by Cipla

In December 2007, Roche accused Cipla forinfringement of anticancer drug erlotinib ,soldby Roche as 'Tarceva

In March 2010, Bayer has filed a case againstCipla, to stop from selling its generic version ofcontroversial cancer medicine Nexavar

Again in 2011, US pharma major Merial Ltd.

accused Cipla for its sale of Pet Armor Plus ananimal health care product, as it infringedMerials patent.


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Exploitation or patent-violation?lex parsimoniae the simplest explanation will be the most plausible until evidence is presented

to prove it false

Gates Foundation, the largest private donortowards HIV control in the world, recentlyendorsed GSK in a large coordinated effort against

eliminate 10 "neglected tropical diseases" by 2020 GlaxoSmithKline is sharing more than 800 of its

patents with other companies working to findtreatments for such neglected diseases

Africa faces an acute shortage of doctors andtrained healthcare workers. GSK, as part of itssocial outreach, is helping create a setup


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CSR activities of GSK

In 2001, GSK became the first major drug maker to sell itsAIDS medicines at cost in 100 countries worldwide.

It granted eight licenses to local companies to producegeneric versions of these medicines.

GSK sells 90% of its vaccines, in volume terms, at not-for-profit prices to customers in the developing world.

Chose Mexico over other, wealthier nations as the launchpad for Rotarix, a new vaccine against gastrointestinalrotavirus.

Developed a vaccine that provides 18 months of protectionagainst malaria.

Plans to invest $97 million in AIDS treatment in Africa overnext 10 years.

gsk vs cipla final

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