[Ip-health] KEI Comments to EWG 2nd Web-based Public Hearing: Defending the Status Quo, or Roadmap for Change?

[Thiru Balasubramaniam]

http://keionline.org/node/535
http://keionline.org/sites/default/files/kei_ewg_comments_090905.pdf

On Saturday, 5 September 2009, KEI filed comments with the WHO Expert
Working Group on R&D Financing' (EWG) 2nd web-based hearing.  The
purpose of these web-based hearings was to solicit comments from
member states, individuals, civil society groups, government
institutions, academic and research institutions, the private sector
and other interested parties to comment on the robustness of the
evaluation framework, evaluation criteria and the inventory of
financing proposals being considered by the EWG in evaluating the
financing proposals submitted for the EWG's consideration.

KEI's comments focused on the criteria for new proposals.

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EWG's 2nd web based hearing.

Defending the Status Quo, or Roadmap for Change?

September 5, 2009
Comments of Knowledge Ecology International (KEI)

Second Web-based Public Hearing of the Expert Working Group on R&D
Financing.
1. The Draft Criteria for Proposals Lacks Useful Criteria, and Does
Not Provide Sufficient Focus and Coherence with the WHO Global
Strategy on Public Health Innovation and Intellectual Property

The draft criteria for proposals is surprisingly brief, and fails to
describe or emphasize the essential policy guidance that was set out
by the World Health Assembly (WHA) in WHA61.21, the resolution that
created the Expert Working Group on R&D Financing. The EWG was created
as part of a larger effort to change the way people think about
innovation and access. In WHA61.21, the WHO has endorsed important new
policies that collectively would provide fundamental reforms of the
current system. There is little evidence this has been taken to heart
by the EWG.

Without even mentioning the WHO Global Strategy, the draft criteria
sums up all substantive policy issues relating to pricing, the
management of intellectual property, technology transfer and capacity
building in a single paragraph:

     5. Effectiveness / impact (NOTE: applies to allocation proposals
only)
     Degree to which a proposal directs R&D towards developing country
needs. This will differ at each stage of development e.g. proposals
targeting health research could include degree to which they stimulate
innovation capacity in developing countries; while early product
development, could include degree to which R&D ensures product
affordability through upfront agreements on price and distribution, or
open licensing.

Even briefer, and devoid of content, is the discussion of governance.

     16. Governance and ownership
     Is there a governance structure and what does it look like? For
example, is it a new or existing structure? Is it shared with other
incentives, or parallel and autonomous?

It is hard to imagine a criteria document that offers so little in
terms of criteria.
2. The Introduction and the Criteria Embrace the Status Quo

To the extent that the introduction and criteria documents set a tone
for the evaluation of proposals, it is to encourage the most
conventional thinking. Criteria 7, 9 and 10 are particularly pro-
status quo:

     7. Positive / negative interactions
     Degree of compatibility or conflict between proposals, and their
alignment or misalignment with existing financing mechanisms.
     9. Acceptability
     How acceptable the proposal is to relevant stakeholders. For
example, whether it is likely / unlikely to secure support from
government, community, regulatory bodies or target R&D groups.
     10. Prior experience of it
     Is the proposal based on a known approach; and has that approach
been successful/ unsuccessful in raising/ allocating funds?
     If a change in the status quo is to be considered, it may not be
acceptable to all stakeholders, and change may challenge the existing
order. By definition, innovations involve doing things that are new.

The introduction and criteria documents are being read by many as an
effort to protect the status quo.
The Global Strategy calls for new thinking, for good reason. The
existing systems have important flaws. R&D is often focused on
products of limited medical need, follow-on innovation and access to
knowledge is sometimes blocked by overly restrictive or poorly
designed intellectual property mechanisms and incentive systems, and
the linkage between R&D incentives and product prices has created
barriers to access, and poorly served persons who live in poverty.

Influencing many economists and innovation experts are the revolutions
in business models for telecommunications and software, including in
particular the recognition in telecommunications that there are huge
efficiency gains and social value in changing the way fixed costs are
recovered, how knowledge is shared, and how follow-on innovation is
enabled. These changes in business model have often been disruptive,
but necessary for the transition to more modern, dynamic and useful
systems.
3. Addition Criteria Are Needed to Refocus the EWG on the Reforms Set-
out in The Global Strategy

The following examples, taken from the WHO Global Strategy, are
illustrative of criteria that would reflect the norms embraced by the
World Health Assembly, and promote change.

Does the proposal:

    1. Provide a feasible mechanism to promote access for all?
    2. Support the application and management of intellectual property
in a manner that maximizes health-related innovation and promotes
access to health products?
    3. Develop possible new mechanisms to promote transfer of and
access to key health-related teclhnologies?
    4. Use voluntary patent pools of upstream and downstream
technologies to promote innovation of and access to health products
and medical devices?
    5. Promote competition to improve availability and affordability
of health products, including by supporting the production and
introduction of generic versions of essential medicines in developing
countries?
    6. De-link of the costs of research and development and the price
of health products?
    7. Promote greater access to knowledge and technology relevant to
meet public health needs of developing countries?
    8. Promote a range of incentive schemes for research and
development including addressing, where appropriate, the de-linkage of
the costs of research and development and the price of health
products, for example through the award of prizes, with the objective
of addressing diseases which disproportionately affect developing
countries?
    9. Frame and implement policies to improve access to safe and
effective health products, especially essential medicines, at
affordable prices, consistent with international agreements?
   10. Provide for transparency on research results and effective and
appropriate management of possible conflicts of interest?
   11. Improve access to, and promote use of, reliable, relevant,
unbiased, and timely health information?
   12. Support voluntary open-source methods to advance scientific
discovery?
   13. Promote and improve accessibility to compound libraries?
   14. Frame and develop and support effective policies that promote
the development of capacities in developing countries related to
health innovation, including those relating to science and technology,
and local production of pharmaceuticals?
   15. Examine the need for new mechanisms, in order to improve the
coordination and sharing of information on research and development
activities?
   16. Implement the recommendation made by the Commission on Health
Research for Development in 1990 that =93developing countries should
invest at least 2% of national health expenditures in research and
research capacity strengthening, and at least 5% of project and
program aid for the health sector from development aid agencies should
be earmarked for research and research capacity strengthening=94?
   17. Encourage further exploratory discussions on the utility of
possible instruments or mechanisms for essential health and biomedical
R&D, including inter alia, an essential health and biomedical R&D
treaty?

4. Cost Effectiveness

Any document dealing with finance of health care products should be
particularly sensitive and focused on issues about cost effectiveness.
In this regard, methods of supporting R&D should be cost effective,
not only in terms of producing medically important innovations, but
also in terms of the life cycle costs of acquiring those technologies
for use by patients.

   18. Is the proposal the most cost effective mechanism for inducing
medically important innovation, and acquiring access to that innovation?

5. Governance

As noted above, the existing criteria for governance is largely free
of content, other than to ask if a governance mechanism exists. The
following are some possible additional criteria for governance.

Is the governance structure:

   19. Accountable to developing countries, donors and patients groups?
   20. Transparent?
   21. Free of conflicts of interest?

6. Sustainability

The issue of sustainability is quite important, both in terms of the
sources of revenue for R&D, and the access to the products themselves.
In this respect, it is important to recognize that there is a
competition between different paradigms for supporting innovation, and
not all of the paradigms can realistically be implemented. For
example, given the limited resources that exist in developing
countries, it is both unreasonable and unrealistic to expect adequate
resources to be invested in the development of products of special
relevance for developing counties, and to promote access to all
medicines for all people, while at the same time endorsing
unrestrained monopoly pricing of medicines. There are questions about
the sustainability even of donor supported funding for the treatment
of HIV/AIDS, TB and malaria, given the high prices of second
generation medicines. Government funding of open source medical R&D or
the funding of medical innovation prizes competes, at some level, with
outlays on medicines that are super expensive because of the legal
monopolies created to stimulate R&D. Choices will be made.
7. Concluding Remarks

One of the reasons why the EWG work is considered so controversial is
that the WHO has been discussing changes in the medical R&D system
that are potentially transformative, not only for a subset of diseases
that primarily concern poor persons living in developing countries,
but for the entire global systems for supporting medical R&D. For this
reason, there are efforts to stop any innovation or change in medical
R&D paradigms that pose risks even as models for future changes. The
EWG should resist pressures to compromise in ways that are soley
designed to protect the status quo.

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Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International (KEI)
thiru@keionline.org


Tel: +41 22 791 6727
Mobile: +41 76 508 0997