Access to expensive medicines: just for those who can afford it?

By prof. dr. Walter Van Dyck, Associate Professor Technology & Innovation Management (Vlerick Business School) / Vlerick Healthcare Management Centre
By prof. dr. Leo Neels, Chairman of the Advisory Board of the Vlerick Healthcare Management Centre

The “pharmaceutical lobby” is regularly criticised in the media for supposedly preventing access to medicines in developing countries by abusing patent rights. Recently, this happened in response to the harsh statement made by the CEO of Bayer (cf. De Morgen from 28 January 2014: “Our medicine isn’t for Indians, it’s for rich Westerners” by Lieven Desmet). He was reacting to the permission that India gave to a local pharmaceutical manufacturer to produce a medicine for kidney and liver cancer, infringing Bayer’s patent. The article sets out the classic argument for “compulsory licences”: “India produces a lot of generic medicines and sells them itself to the underdeveloped countries”, and Indian law infringes “Western” patents “if the patented medicine cannot reach Indian patients because they cannot pay for it”. In other words, noble aims legitimise the infringement of intellectual property rights for medicines.

Actually, things are somewhat more complex. Let’s start with the facts. India is indeed the largest exporter of generic drugs, but the USA is the biggest purchaser, not the developing countries. India is a rich country with a gigantic population (1.3 billion inhabitants) that is growing too quickly and of which the vast majority is poor. According to The World Factbook, its GDP per capita is $3,800, around 10 times smaller than Belgium’s, which stands at $37,500. Life expectancy is 15 years below Belgium’s, infant mortality is 12 times higher than it is here, and India does not even have one doctor per 2,000 inhabitants (Belgium: 4 per 1,000). India, a country that also struggles with enormous budgetary and trade deficits, spends 4% of its GDP on healthcare (OECD average: 9.9%), has the largest population with communicable diseases in the world, and has the fastest-growing population with non-communicable disorders, such as diabetes or heart failure. In other words, India does not even have a basic healthcare system for its population. Advanced cancer therapy is a reality for rich Indians, but the provision for adequate cancer diagnosis and treatment for ordinary Indians is simply non-existent. Basic healthcare leaves a great deal to be desired.

These sobering facts are based on available data from UNO, WHO and OECD, and international studies, such as this one conducted by David Taylor from the School of Pharmacy of University College London.   

Western pharmaceutical companies that develop new therapies even find that their free offer of advanced medicines to the Indian authorities does not result in undertreatment being tackled. There is simply not enough infrastructure to provide the country’s own population with proper access to healthcare.

The infringement of Western patents does not change anything with regard to these basic local conditions. On the other hand, new medicines cannot be developed without correct protection of intellectual property. Development of these medicines is too uncertain, the processes too long, the safety and effectiveness requirements too high. The result is an exponentially increasing investment cost per official medicine: in 2010, PwC estimated the cost at 3 to 11 billion dollars. Pharmaceutical companies are the driver of this development, occasionally supported by authorities and an increasing number of NGOs or foundations. The “Bill and Melinda Gates Foundation” is probably the most well-known.

A number of pharmaceutical firms—J&J, GSK and others—have already made molecules available from developing countries or NGOs, and/or offer methods of co-operation that make their medicines accessible to the local population, with inventive schemes that leave international intellectual property intact, and open up local access for patients under local conditions. Many pharmaceutical companies are co-investing in primary care services, hospitals, care services and doctors. There is a thorough and impressive overview of the humanitarian involvement of Western pharmaceutical companies in developing countries and of the creativity employed.

In this context, the debate against patents is an outdated one. Everyone shares the objective of ensuring that the need for more and better therapies is met, including for the aforementioned “ignored diseases”. This includes the pharmaceutical companies, who now work in close consultation with local authorities (if any exist). India is an exception and still prefers to pursue a protectionist infringement policy, often for economic reasons.

The future for the population of these countries lies in the new, transparent co-operation models, not in a battle that does not benefit the local population of those countries, and investments in resources to tackle the conditions facing, hindering or threatening the populations.

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  1. Your money or your life: a critical note

    Date: 29/09/2016
    Category: Opinions
    In this era of healthcare budget constraints there is worldwide outrage at the high prices of medicines. And doctors are quite rightly concerned about the question of whether all their patients will continue to have access to lifesaving medicines at affordable prices. However, according to professor Walter Van Dyck the solution does not lie in scrapping the patent system, nor demanding transparency regarding the costs incurred by the biopharmaceutical industry for the new medicines that they want to bring onto the market. The only solution to this issue lies in a conditional dialogue between the community and the innovative biopharmaceutical industry.
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