[Random-bits] WHO Prize Fund article: Drug development incentives to improve access to essential medicines

[James Love]

http://www.cptech.org/ip/health/rnd/love-who052006.pdf

Bulletin of the World Health Organization | May 2006, 84 (5), page 408

Special Theme =96 Intellectual Property Rights and Public Health
Round Table Discussion

Drug development incentives to improve access to essential medicines

James Packard Love

It is hardly a matter of controversy that, as a general principle,
access to essential medicines is an issue of human rights. The
Universal Declaration on Human Rights makes reference to the right to
medical care (Article 25) and the right to share in the benefits of
scientific advancements (Article 27). Countless declarations =97 such
as those relating to access to treatment for acquired
immunodeficiency syndrome (AIDS), the WHO revised drug strategy and
the WTO Doha Declaration onTRIPS and Public Health =97 have focused on
the need for governments to promote access to medicines for all. The
interesting question is not whether access to medicine is a human
right but, rather, how governments intend to give practical effect to
these lofty aspirations.

We live in a world of vast disparities of incomes and opportunities,
which translate into vast disparities of access to decent housing,
medical services, education and many other elements relevant to human
rights. Often, too, there are vast disparities in terms of access to
medicines, but this need not be inevitable.

Medicines are knowledge goods, sharing an important characteristic
with many other knowledge goods. It may be expensive to develop a
medicine, but it is often not expensive to copy one. An AIDS drug
such as stavudine that sells for US $ 3800 for a year of treatment in
the United States is copied as a generic product for about US$ 21 for
a year of treatment.

While it is nearly impossible to avoid having to make tough choices
for scarce physical goods and services, knowledge goods are
different. Scarcity is a deliberate choice, enforced through social
mechanisms such as patents, which create monopolies and predictably
drive prices far above the costs of making copies. Do we need to make
knowledge goods expensive, and then deal with the inevitable
disparities of access associated with high prices? Or can we imagine
different incentives for drug development that would coexist with
pricing at marginal cost?

In 2005, Representative Sanders introduced HR 417 in the US Congress.
This legislation is a working model for a new paradigm for drug
development =97 the Medical Innovation Prize Fund =97 that would provide
huge rewards for the development of new drugs without introducing
artificial scarcity for new inventions. It would go much further
towards choosing abundance over scarcity, by creating a rational,
evidence-based system for rewarding inventions to provide better
health outcomes. It also provides incentives to develop products that
would address global public health problems, including new treatments
for neglected diseases such as malaria or emerging health problems
such as severe acute respiratory syndrome (SARS) or avian flu.

The Medical Innovation Prize Fund would eliminate market monopolies
for medicines in the United States, driving prices close to marginal
costs. It is not an attack on intellectual property but a new system
of intellectual property: one that separates the market for
innovation from the market for the physical copies of the knowledge
good.

The Prize Fund approach would require a new global trade framework to
deal with the issue of sharing the global burden of the costs of
research and development. In a separate
but related effort, a new global trade framework has been proposed
that would obligate governments to support R&D, but would give them
much flexibility in the mechanisms they adopt to do so. It would also
create a system for identifying and stimulating R&D in the areas of
the greatest need and priority, including new medicines for poor
populations.1,2

Taken together, the Medical Innovation Prize Fund and the medical R&D
treaty2 trace a serious and important road map towards fulfilling the
lofty aspirations of human rights to essential medicines, in a manner
that is consistent with sustain-able financial support for R&D on new
medicines.

Competing interests: none declared.
1. Hubbard T, Love JP. A new trade framework for global healthcare
R&D. PLoS Biology 2004;2:e52DOI:10.1371.
2. Call for global R&D health treaty resonates loudly. European
Commission Research Headlines, 25 March 2005. Available from: http://
europa.eu.int/comm/research/headlines/news/article_05_03_25_en.html

Consumer Project on Technology, PO Box 19367, Washington, DC 20036,
USA (email: james.love@cptech.org).
Bulletin of the World Health Organization | May 2006, 84 (5)


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James Love, CPTech / www.cptech.org / mailto:james.love@cptech.org /
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