국제특허분쟁연구회

drug patents don't kill poor patients contrasting china and india will show why bright b. simons (baronsimon) published 2007-06-04 11:48 (kst) the situation with access to basic healthcare in africa is extremely dire. ghana for instance has fewer than one doctor per 10,000 patients; france has almost 40 for the same number of people. the mental health picture in the west african country is even bleaker: about one psychiatrist for every one million people. even in relatively affluent south africa, 50 percent of the population has no access to basic pharmaceuticals. the intractability of the health challenge has thus made african countries very eager to learn from models of public healthcare prevalent in countries that share some of their characteristics and are themselves barely out of the developmental stage in which the continent currently finds itself entrapped. asia naturally satisfies this criterion very well. but when african policymakers look to asia for "lessons," they find two broad contending visions of what the best approach to the universal provision of public healthcare should be, visions that stand out amid all the diversity and complexity of the asian social policy experience. and both appear to turn around the issue of patents, a factor frequently cited to account for the cost of medication in poor countries. on one extreme sits india, on the other, china. in more recent times, what we are describing as the indian "vision" has advertised itself more prominently through events in thailand. since january, thailand's health ministry has issued a number of compulsory licenses to allow third-party manufacturing of famous pharmaceutical brands, most famously for pharmaceutical giant abbott's kaletra. the reason cited, following a x-script frequently used by india, is that the high costs of this and similar drugs were wrecking the country's health budget and with it the government's ability to supply medication to poor patients. this was after abbott had tried to avert the situation by halving the price of the drug following discussions with the world health organization. thailand is probably hoping for the action to produce rapid results, a hope perhaps based on reports that brazil managed to bring down the price of retroviral drugs by 82 percent through the issuing of compulsory licenses. abbott, an american company based in the state of illinois, was not the only company affected. the french company sanofi-aventis and another american company, bristol-myers squibb, also had to endure a similar treatment. the government compulsorily licensed their mega brand plavix, a blood therapeutic. according to the world trade organization rules that govern intellectual property regulation and protection across borders, the so-called trips (trade-related intellectual properties), it appears that any member country of the wto can declare any public health situation to constitute a "health emergency" and on that basis issue a compulsory license for any drug patented within its borders. companies who own patents for their innovations exercise a monopoly on its production and sale, but can choose to voluntarily "license" other firms to make use of that innovation in exchange for negotiated royalties. a compulsory license removes this voluntary character, and compels patent owners to deal with prospective copiers of their innovation. what a compulsory license cannot do of course is to compel the release of information concerning "best practices" the patent owner may have developed in the course of manufacturing and selling the drugs. courts of law do have the power to ensure that dominant companies do not undermine competition, but they cannot alter situations to get slacking underdogs to up their game. compulsory licenses may thus seek to "rationalize" costs, but they cannot similarly rationalize "standards." the issue of standards is indeed a vital point in the debate about patents and healthcare access that is often ignored because of the overwhelming emphasis on cost. in actual fact, broadly construed, a focus on standards encompasses the key elements of the debate, including innovation, costs and public safety and security. a simple formulation of this argument can be illustrated with a case study. india has an herbal formula based on a plant known locally as ashwagandha. the feeling in the country is that this therapeutic should be able to rival china's ginseng in the global health supplement market because of its exciting physiological properties. yet in a 2004 issue of current science, an indian journal, a study conducted by three institutes of the country's council of scientific and industrial research is reported to have found a wide variation in the content of active ingredients in ashwagandha made and marketed by different producers. no wonder then that the product has struggled to obtain global commercial patronage. without clear patents and robust licensing regulations, the incentive to enforce standards disappears. patents need not be owned solely by individuals or firms. they may also be owned by communities. but whoever owns these patents would be able to license them for revenue, and will therefore be much greater disposed toward ensuring adherence to standards by licensees. without patents governments are likely to be solely responsible for enforcing standards. a licensing regime brings in more self-interested brand managers and intellectual property trustees. hence, the efficacy of standards and the health of any patent regime are intimately intertwined. recent events in the east african country of ethiopia illustrate this principle very well. late last year, the country's health and safety watchdog (daca) withdrew the licenses of some 60 pharmacies representing indian generic drug manufacturers. the action was x-prompted by the outcome of a series of working tours conducted by daca personnel in india during which extensive evidence was uncovered that showed a high rate of negligence among some india drug makers in complying with internationally recognized standards of drug manufacturing. in many cases, the medicines that some of these companies were busily marketing to ethiopians through local intermediaries had never passed any well-supervised clinical trial. there were even instances of outright fraud in which some of the drugs sent to ethiopia from india were misrepresented as other, more standards-compliant, drugs. the ethiopian authorities felt that they had no choice than to bar the entry of many indian generics in order to protect the health and well-being of the ethiopian people. it follows without need for much argument that if standards suffer due to the absence of robust patent regimes, commercial prospects are similarly undermined. this is a piece of common knowledge not amiss anywhere, not even in india, the home in asia of the patent-busting movement. a rural community in india, kanis, became a joint owner in 1987 with two indian botanical researchers of a patent on a formula based on a plant remedy, arogyapacha, that residents have used for centuries as a stimulant. today they are reaping the profits accruing from the sale of the formula worldwide. quite obviously, their good fortune depends on the respect patents still command, despite the bad press, all over the world. if india's approach to patent legislation, dating back to the notorious 1970 patent law, was to attain wider global following, it is unlikely that communities like kanis would ever profit from the knowledge and innovations they have accumulated over the centuries. a cynical response would be that such episodes are isolated events with little bearing on the main thrust of the patent debate. well, say that to dr. mashelkar, the indian technocrat who is building a database of indian traditional remedies to leverage the communal intellectual property potential of such ancient knowledge. or to the administrators of india's knowledge network on medicinal plants and national center for training and technology transfer, attached to the regional research laboratory in jammu tawi. what this undoubtedly suggests is that the indian "vision," characterized primarily by anti-patent hysteria, while aggressively marketed as a kind of ideal for developing countries, such as africa's cash-strapped nations, to strive toward in their quest for strategies to deliver affordable healthcare hardly finds devotion even in its own backyard when practical solutions are being sought. recent developments in china provide clues as to why this is so. china's shanghai institute of materia medica has for the past decade been cataloguing the efficacies of traditional herbal remedies from all over china. in 2000, the swiss pharmaceutical giant, novartis, signed an intellectual property contract worth several millions of dollars for commercial access to that information, including exclusive rights to the anti-malarial formula, coartem. novartis did not confine all its hopes to simm's efforts. it also signed another contract with the kunming institute of botany, and obviously impressed by the pace of innovation on such fronts in china decided to invest a further $100 million in building a research and development center for its own operations in shanghai. the opportunities for poor communities to derive commercial benefits by utilizing intellectual property regimes to their benefit can thus not be gainsaid. and it is definitely not only in terms of how much royalties they can squeeze out of western multinationals. in the east african country of uganda for instance, there is an herbalist for every 200 people, compared to one doctor for every 20,000. like south africa, equatorial guinea, nigeria and mali, the ugandans have arrived at the conclusion that effective mass healthcare must involve mainstreaming the activities of these herbalists into the conventional health sector. but how to maintain standards? how to ensure there is a relative uniformity in the quality of care provided to patients? intellectual property mechanisms are coming to the rescue, as gradually health and safety regulators realize that innovative herbal practitioners need to be assisted to develop quality benchmarks for the newly mainstreamed industry as a whole, and that one of the best approaches to doing this is to use intellectual property incentives. since july 2004, according to expert accounts, especially from the shanghai institute for materia medica, the adoption of standards as part of a rudimentary patent system in china is helping protect public safety: heavy metals and chemical contaminants are being filtered out of health products with a greater efficiency than ever before. there are signs also that greater respect for intellectual property in this regard will help in the fight against counterfeit pharmaceuticals: a somewhat neglected menace in the debate that detailed investigations reveal was responsible for killing 192,000 people in china in 2001 alone. many readers will naturally contend that the struggle is not with patents per se. they will say: "by all means, where patents are doing a great job helping poor people, reinforce them, but the concern is with regard to situations where patents are impeding access to medicines for poor people in poor countries." alas, it is not as simple as that. compulsory licensing is not some moderate mean between dismantling patents altogether and allowing corporate greed to run amok unrestrained. intellectual property is like all other complex socio-economic issues involving government regulation: surgical manipulation of institutions and legal systems to obtain some pre-engineered end often risks doing more harm than good, simply because the surgical tools available to governments often tend to be blunt instruments. when you look critically at the patents vs. health debate being played out across asia, and increasingly impacting on the public debate in africa, however, it becomes obvious that the real issues are being obscured by an almost fanatical obsession with patents. the rave about compulsory licensing and giving unfettered freedoms to generic producers follows from this obsession and probably does not address any of the fundamental problems. for instance, some time ago, cipla, the indian generics company, introduced a version of abbott's aluvia that is more suited to tropical temperatures. there is no reason why cipla shouldn't have tried to patent its heat-stabilizing method for licensing to abbott and other companies, since it seemed to have established a true innovation lead in this area. but why should it when it could sell its "generic" version of the drug itself in africa at a price three times what abbott the original patent holder sells it for? not only is it untrue that generic production always lowers the price of drugs, it is also dishonest to ignore the fact that in india, the home of the generics aficionados, only 5 percent of research and development funds are used for research into diseases of the poor. if it is true that generic companies export 67 percent of their output into developing countries, that is only because their efforts to switch the bulk of their attention to rich markets are yet to bear fruit. in fact, rising wages in the pharmaceutical sector can only accelerate these efforts. when groups like oxfam make well-intentioned arguments in favor of generics by citing evidence to show that big pharmaceuticals make very little profit in the developing world, and need not therefore worry about losing market share in these areas to generic producers, they scarcely realize that the same will soon be true for generic companies too and so they are in effect justifying underinvestment in research related to diseases of the poor. the indian model of relying on compulsory licenses and anti-patent regulations in the name of supporting cheap generics is not and has never been a sustainable approach to universal healthcare provision. otherwise, the health system in india wouldn't be in the shambles it is currently in. the prudent lesson africa, and the rest of the developing world, can learn from the asian experience in this area is to look at the innovative approaches being pioneered in the private and voluntary sectors across china. china is, of course, by no means a paragon of virtue in the area of pharmaceutical intellectual property protection and enforcement -- a court recently overturned pfizer's patent on viagra there -- but its failings are the product of capacity shortfalls not of ideological obstinacy, and that is the crucial point. hence, programs like the good manufacturing practices scheme and the intensifying efforts to integrate trips into domestic legislature. it is by means of enforcing such standards that governments bolster their innovative capacity to deliver change across all other healthcare-access determining areas, and not by a propensity to resort to shortcuts. witness thus the increasing success of the country's multi-pronged basic healthcare insurance scheme for urban dwellers. where countries have the will to address the real issues: medical insurance, greater mainstreaming of traditional medicine, creative approaches to ip protection in the drug making industries, and the co-opting of the private sector into health infrastructure provisioning, through such innovative paradigms as micro-clinics and telemedicine, opportunities always emerge for citizens to access quality, and sustainable, healthcare. china seems to get this, and it is time the developing world paid heed. will those paleo-communists in india ever wake up?