Cheap Aids drugs under threat

[kpih]

Cheap Aids drugs under threat

Body blow to developing states' fight against disease as Indian MPs ban copying of patented products

Randeep Ramesh in New Delhi
Wednesday March 23, 2005

Guardian

The days of cheap treatments for millions of Aids patients around the world are coming to an end, health agencies warned last night, after the Indian parliament passed a bill that makes it illegal to copy patented drugs.
The practice of copying patented drugs has made medicines affordable for patients around the world. The parliament's move was to fulfil India's commitment to the World Trade Organisation's intellectual property regime.

The copycat drugs industry in India has forced down the annual cost of Aids treatment from $15,000 (£7,900) a patient to a little more than $200 in less than 10 years.

The country's "generics" pharmaceutical industry now provides treatment to half the 700,000 HIV-infected people in developing countries.

The supply of cheap medicines was only possible because Indian law hitherto had no product patent constraints.

Critics say the new law will cut off the pipeline of inexpensive future drugs, such as the "three-in-one pill" of anti-retrovirals for Aids sufferers.

"Under the new legislation we will see new medicines only available for the rich, while old treatments will be for the poor," said Ellen't Hoen, the director of policy advocacy and research at the relief agency Médecins sans Frontières.

"Many people are building up resistance to the first generation of drugs and will need the newer treatments. But without the Indian drugs industry, where will they get cheap drugs from?"

Campaigners say African countries, where health budgets are already stretched will find it almost impossible to fund the new medicines.

"In Cameroon we pay $200 a year for each Aids patient's treatment, which is an Indian generic manufacturer's product," said Fatima Hassan of South Africa's Treatment Action Campaign. "The latest drugs are only supplied by western multinationals and they cost $4,800 a year. We cannot afford those prices."

Under the legislation, if a generics manufacturer wants to copy a patented drug, the Indian government will have to issue a compulsory licence. The patent holder gets a royalty, but does not have to consent.

But, Ms Hoen says, there are two big problems with the new regime: pharmaceutical companies can tie up such licences in court for years, and there is no ceiling on royalties.

"In South Africa, Glaxo tried to charge a 45% royalty. What we are looking at is a lot of work for lawyers."

Activists were hoping for a review of the bill and a longer public debate on the issues - Indian MPs were given only a weekend to read the bill and a couple of days to debate it.

Although there were last-minute concessions, many within the industry say the bill bears the footprint of multinational drug companies who considered Indian generic manufacturers to be "pirates".

Ranjit Shahani, managing director of Novartis India, said: "[The bill] will move India towards the patent mainstream and support and encourage innovation and investments in research and development."

Many in the generics industry say what is being given away goes against the national interest. Yusuf Hameid, the head of Cipla, one of the main generic manufacturers of HIV drugs, says India can "not afford monopolies".

He added: "Medicines in India used to be unaffordable until we adopted our patent laws in the 1970s.

"Our population and pattern of diseases means we have to increase affordability and accessibility."

Guardian Unlimited © Guardian Newspapers Limited 2005

[asvenus]

i know..they had a documentary on this a couple of years ago and the asian guy was receiving 'anonymous' death threats..i was so fucking appalled..but sadly not surprised..drug companies and patents are so fucking evil anyway partic glaxo..ergghhh..
its just sick that they are allowed to monopolise and basically gear the industry towards their profit margins regardless of human life..but hey thats capitalism for you!!

instances like this just show how influential and controlling drug companies and other MNCs are..we live in an age that is so dominated by massive conglomerates '1984' cant be far away...

[pikachupacabra]

At the same time, you can't expect a company to spend 500 million to develop a drug, and then sell it for one year, making back 400 million, before it gets turned generic and sold for pennies to the dollar compared to the brandname. Then when new drugs stop being made at ALL and all we have left are generic brand companies who actually have no researching ability, only manufacturing and synthesis structures in place, what now?

edit - i should add in that overly large profits, which a lot of bigpharm companies make, are excessive and probably could be reduced. But what if they need that money to fund a larger research project in the future? Or to sustain marketing and development for a underutilized drug? If the money just goes to the executives and stockholders, thats one thing, but if the majority goes right back into infrastructure, research, researcher benefits, modernization of equipment, theoretical exploration, etc, then who am I to say if it's right or wrong?

[hooligan]

But Bush says these drugs from Canda are bad.

[John0101]

I don't know much about the issue but let me try to get the facts straight before I jump the gun on any assumptions which I think a lot of people do. Let me bust out the micro...

Problem:
Drug companies are competing against each other to develop these extremely expensive drugs. There is an incentive to develop the drugs before their competitors because they are able to obtain patents for their drugs. Because these drug companies are the sole provider of the particular drug because of their patent, they are able to control supply of the drug and set a monopolist profits rate. Because the drug prices are so high many people in less developed countries are unable to afford these drugs.

We Know:
- If drug patents laws were removed then there would be no incentive for drug companies to develop these drugs and there would be no drugs on the market.
- The price of the drug must be atleast as high as the costs of producing the drug for drug companies to have an incentive to produce.
- There is an inefficient allocation of resources because welfare is not maximinzed at the market equilibrum rate aka there is a market failure.

Solutions:
The drug company developed a natural monopoly, a monoploy where the fixed costs (in this case R&D) is enormous. So enormous that if the government sets the price to the market equilibrum the average total cost will exceed the market price resulting in bankruptcy. One idea is to set the price of the drug to the average total cost. Government intervention is needed, the government can also subsidize people who need the drug and pay for a part or all of the drug costs.

We know that the market equilibrum maximinizes the welfare for the producers and consumers, however in this situation the market equilibrum is a socially inefficient point because many poor people are unable to recieve the drug. One of the moral question asked is at what point should people stop recieving treatment?

i.e... Should someone whose dying and only has a small chance to live recieve an extremely expensive treatment even though you have no idea if the treatment could work? If you answer yes, then we would need to sacrifice other products. Could the money be better used on other drug development?

Everything I wrote above could be totally wrong since I really don't know the international drug market but if its true, then the real problem is not capitalism but the fundamental problems of uncertainty and scarcity of resources :frown:

[haplesshobo]

umm, people do realize that the reason drug prices in the united states are so high is because the rest of the world leeches off our R&D as shown in the article.

When you account for the cost of a drug, you can't look at the cost to manufacture it. You have to include all the R&D.

Let's look at India's system. They haven't contributed any new drugs.
You are draining profits that would have been reinvested into new drugs. You'll drain the investor pool, as they go off to search for better returns. Again, this would deprive money going into R&D.

[foreverfornever]

Off topic but I wonder whether drug companies are spending the money to develop new drugs that would prolong the life of HIV+ patients (which makes perfect sense for them as they need the drug to survive) or they are spending the money for a cure.

[asvenus]

most of you are missing the point...why should the US control all the fucking patents for food, drink, drugs everything?? if a country has the opportunity to provide a cheaper alternative then the US should fucking play the game it attempts to propagate to the rest of the globe..'free commercial trade'..
all this bullshit about draining profits etc etc is just a flimsy euphemism for certain companies wanting to maintain the monopoly they have created in certain industries ove rthe years..its disgusting..we are talking about lives here not fucking profit margins..grrrr..

[John0101]

most of you are missing the point...why should the US control all the fucking patents for food, drink, drugs everything?? if a country has the opportunity to provide a cheaper alternative then the US should fucking play the game it attempts to propagate to the rest of the globe..'free commercial trade'..
all this bullshit about draining profits etc etc is just a flimsy euphemism for certain companies wanting to maintain the monopoly they have created in certain industries ove rthe years..its disgusting..we are talking about lives here not fucking profit margins..grrrr..

they should have control of the patents because these drug companies developed the drugs. If there were no patent laws then there would be NO drugs on the market.

one possible solution is for foreign governments or internation health organizations to buy patents for the drug (at a discounted rate) and have the right to sell the drugs in their domestic market only.

[pikachupacabra]

most of you are missing the point...why should the US control all the fucking patents for food, drink, drugs everything?? if a country has the opportunity to provide a cheaper alternative then the US should fucking play the game it attempts to propagate to the rest of the globe..'free commercial trade'..
all this bullshit about draining profits etc etc is just a flimsy euphemism for certain companies wanting to maintain the monopoly they have created in certain industries ove rthe years..its disgusting..we are talking about lives here not fucking profit margins..grrrr..

Venus, the main problem illustrated in the article seems to be the skirting of patent law; the "generic" companies in India, for example, are taking the drug's chemical structure, the listed synthesis method (from published journals and patents), and the previous research, marketing, safety studies, efficacy studies, etc and making the drug without following the copyright and patent law. If something like that continued, bigpharma would
a)stop researching new drugs
b)stop releasing drug data
c)start skirting safety laws in order to lower costs
d)sue, sue, sue
e)fade away and go bankrupt

none of these scenarios are desireable in the long term for the creation of new drugs. I agree that the current situation is fucked up, and I wish the world had a bit more compassion and altruism, but when it comes to companies, the general theme is unfortunately "money talks bullshit walks".

A few things I could suggest:
1)A lot of studies concerning "infectious" drugs like HIV, bacterias, flu, etc, have quite a bit government funding involved for the exploratory work. A lot of pharm companies build off of that for their own drug research, obviously saving a lot of time, and money. If there could be some sort of governmental regulation to pass that on to consumers, I'd be all for that.

2)An increase in governmental oversight and spending into drug research (but without the GOVERNMENT doing the actual research since they really suck at it) leading to lowered drug costs and drug development focused on more serious issues, rather than, say, upper lip hair removal cream.

3)Dangerous, but for drugs that are needed NOW (like HIV drugs, Cancer drugs, heart attack, pneumonia, etc), a further relaxation of the FDA safety and toxicology studies. It's very risky and i can see some serious problems, but if the people already have a high chance of dying from whatever ails them, i myself would rather take a chance with the drug that could possibly save me.


on a side note, I have to say though, there are a LOT of problems with bigpharma right now. A lot of the large companies hardly do their own research (cough cough genentech, GSK) unless they have a drug that can have 1 billion + in revenue. otherwise, they think it's just not "worth their time". You can see how this would be problematic when it comes to some very important therapeutical targets that aren't necessarily going to be big moneymakers (vaccines? antibiotics?).


Also, to add to that, a lot of bigcompanies see more of a profit coming from the developmental, clinical, marketing, and eventual selling of a product, and ignore the actual research, design, and exploratory efforts needed to create the drug. They instead turn towards the smaller pharm companies (like one around my size, <300 employees) and buy them up to take their drug designs, and then market them into their own. Bigpharma is so swollen with marketing reps, bureacracy, accounting, IT, etc etc that they can't really afford their own research anymore. They just take other peoples.



This was kind of a long rant, but hopefully it can open up future discussion.

[haplesshobo]

I don't understand what point two means. How could government increase spending without doing the actual drug research?

And, why does government suck so much at doing actual applied research?

I'd also like to point out that Viagra's initial focus was as a heart medication, and not some sex thearuptic. But, while testing it, they discovered it had these side effects, and that was one of them.

How does such a small company find the break throughs. After all, R&D is really expensive. What happens if you guys don't find something signifigant? Who supplies the funds ultimately? Big pharm?

And, some people accuse big pharm of being a conspricacy, of only focusing on drugs that make condition chronic instead of curing it. I'm not too sure how true this is, but I know that it wouldn't suppress it either. A good example would be the antibiotics for stomach ulcers.