[Ip-health] Edgardo B. Espiritu in ABS-CBNnews Interactive: The high cost of medicines

[Thiru Balasubramaniam]

http://www.abs-cbnnews.com/storypage.aspx?StoryId=3D42220

Opinion

The high cost of medicines

CONTINUUM: EDGARDO B. ESPIRITU

/In the Philippines, there is another cause of high medicine prices,
namely, the peculiar practice of using =93medical representatives=94 or dru=
g
salespersons to market pharmaceutical products to doctors and hospitals./

The World Health Organization recently released the report of the
Commission on Intellectual Property Rights, Innovation and Public
Health, a study that may have far-reaching consequences in terms of
addressing the lack of access of the world=92s poor to important
life-saving drugs. The study is revolutionary not because it provides
new crucial insights on a problem that has long been borne by the poor
particularly in the developing countries, but because it is the first
time that a root cause of the problem is being squarely and officially
recognized and recommendations are being given to strike at it.

It is well known that the problem of high cost of medicines,
particularly in the developing countries where they are needed the most,
is largely due to the insistence of multinational pharmaceutical
companies to impose intellectual property rights on important drugs even
in these poor countries. The lucrative patents on these medicines
account for a big part of their cost, often bigger than the actual cost
of the material and processing inputs that go into their production.
Moreover, the drugs that are used for the treatment of diseases that are
prevalent in the developing countries are usually not the focus of these
companies=92 research and development because they are often less
profitable than the drugs for which there is greater demand in the rich
countries.

In the Philippines, there is another cause of high medicine prices,
namely, the peculiar practice of using "medical representatives" or drug
salespersons to market pharmaceutical products to doctors and hospitals.
This is in contrast to the system in most developed countries, where
doctors only get pertinent information on drugs from brochures and
technical materials. But it is often the case that these medical
representatives provide not only information to convince doctors to use
and prescribe their particular brands of medicines, but also more costly
forms of "incentives" (such as complimentary vacations, in the guise of
"conventions"). But it is of course ultimately the consumers who
shoulder these costs.

The current poor-unfriendly drug patenting system, however, has been
tacitly accepted by most of the world=92s national and multilateral health
authorities because, as the argument goes, it is only through private
sector initiative that costly research and development on new and
important drugs can be undertaken. If the private drug companies are not
given a substantial return on these costly investments, then they would
not continue discovering and producing these new drugs, which situation
would then hurt the entire world health system. Moreover, these large
multinational pharmaceutical companies comprise a powerful lobby that
hold great influence both in the developed and in the developing countries.

There have been some countries that have defied this patenting system,
such as India, where for many years there were no pharmaceutical
patents. Generic drug manufacturers in India, invoking special
provisions of trade law, produce low-cost versions of patented drugs.
This arrangement also benefited some poor countries, which then imported
generic medicines from India, using certain justifications such as the
existence of national emergencies.

But the report has categorically said that the present system of
supporting innovations in the pharmaceutical industry, which is through
the drug patenting system, is inadequate in addressing the needs of the
developing world. This is a landmark official recognition of a fact that
the influential industry has tried to mask for so long and which may
lead to more rational policies at both the multilateral and national
levels. It has clearly identified the close link between intellectual
property rights and the way drug R & D is undertaken, on the one hand,
and access, particularly by the poor, to important medicines, on the
other. The report recommended, among other things, that governments
should try to develop and finance an alternative system for developing
and distributing drugs in the developing world. Moreover, it suggested
that pharmaceutical firms should no longer insist on imposing patents in
developing countries.