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NEW YORK — A range of speakers, including top health officials from both a developed and developing country, last week laid out the case for why the world’s leaders must now launch a shift in the way medicines all populations need are developed and priced. The need for global collaboration is clear, speakers said, but who will lead?

The 17 July event was titled, “UN Secretary-General’s High-Level Panel on Access to Medicines: Advancing Health-Related SDGs through Policy Coherence.” The panel came in the context of the UN High Political Forum on Sustainable Development taking place during the week at the UN headquarters in New York.

Speakers at the event included:

Hon. Michael Kirby, former member of the High-Level Panel and former Justice, High Court of Australia
Prof. Sakiko Fukuda-Parr, former member of the High-Level Panel and professor at the New School in New York
Clemens Auer, director general, Federal Ministry of Health and Women’s Affairs, Austria
Margrete Auken, Member of the European Parliament from Denmark (remote participation)
Javier Guzmán, director-general of the National Food and Drug Surveillance Institute, Colombia
Mogha Kamal-Yanni, senior health and HIV policy advisor, Oxfam

Introductory remarks and moderation were provided by Magdy Martínez-Solimán, assistant secretary-general, assistant administrator and director, Bureau of Policy and Programme Support, UN Development Programme.

The Burden on Patients and Health Systems

Most countries from the poorest to the most prosperous are facing challenges in affording medicines for their populations, Martínez-Solimán said in opening remarks. For instance, he noted that 11 or 12 cancer medicines introduced in the United States cost over US$ 100,000 per patient per year, “putting an egregious burden on the patient and health systems alike.”

And he gave several examples of cases where the system is not providing needed treatments, such as antimicrobial resistance, multi-drug resistant tuberculosis, malaria and neglected tropical diseases.

“We have to do more to incentivize innovation for unmet health needs,” he said.

Judge Kirby laid out the background and main recommendations of the High-Level Panel report, which was issued in September 2016 and has been gathering attention ever since.

He mentioned that the preceding and “prescient” UN Declaration on Human Rights included both that the right to health is a basic human right for all, but that inventors have a right to be rewarded for their work. “So there you have it,” he said, the two elements that have never been properly reconciled at the international level, and were a focal point of the UN High-Level Panel on Access to Medicines.

The 1980 Bayh-Dole Act in the United States, which required protection of intellectual property rights in health research, came as a shock around the world, he said, as many did not protect health research up to that point. “The sleeping beauty awoke,” he said, and was followed by the 1994 WTO TRIPS Agreement, and the 2001 Doha Declaration on TRIPS and Public Health.

The debate was “very energetic” in the 1990s and 2000s as the rise of HIV/AIDS led to efforts to make available the very effective antiretrovirals that had been developed, as it was recognised that market forces could not deliver them. So it was at that time that the concept arose that one should not have access to medicines based on the “good fortune of where they were born,” but as a universal principle, he said.

The latest big commitment is in the Sustainable Development Goals, which assert the goal of access for all to health. And with some insisting on the primacy of their intellectual property rights over the right to health, the UN secretary-general called for the High-Level Panel on Access to Medicines to look at the issue.

Kirby insisted the panel was conducted in a completely open and inclusive fashion, consulting industry and all others, and that the report “is a consensus report.” There were differences, he said, as one would expect, about matters of detail within the report, and those are expressed in the report. But “what was delivered as the central core message of the report was done by consensus,” he said.

Finally, Kirby talked about a program in his native Australia under the national health system to provide the latest treatment to anyone who has hepatitis C, of which there are some 300,000 people, in order to eliminate the disease from the population. The negotiated price with the IP rights holder was undisclosed but was believed to be about AUS$ 48,000, compared to the price in the United States for the same drug of US$ 84,000 – which is equivalent to AUS$ 100,000, or twice the rumoured negotiated price in Australia.

He also referred to another case (headlined at the time the HLP first met in  New York) in which an investment company acquired IP rights in a cancer drug. Based on market research and in the interest of company shareholders, the company in the US raised the price of the drug by 4000 percent.

“This is the problem of leaving issues of essential drug care only to markets,” Kirby said. “Markets will not necessarily protect the rights of ordinary citizens.” So the Australian government stepped in and negotiated a price and made it available to all of its citizens who need it. And in Egypt, with an epidemic of hepatitis C, it is available for about US$800.

“What is the principle of $84,000, $48,000 and $800?” he asked. “There is no principle. It is only what the market demands.” Kirby cited an ambassador from the Netherlands at the HLP public hearing in London in 2016 who called this “unacceptable” and who said, “Do not think that this a problem only of least developed or middle income countries. It is a problem shared by developed countries and it presents major challenges to our budgets.”

Kirby concluded, “We need a more principled response to the needs of health of people everywhere and it is this report that shows the way ahead.”

We need a more principled response to the needs of health of people everywhere and it is this report that shows the way ahead – Justice Michael Kirby

Main Recommendations

The UN High-Level Panel report recommended respecting and strengthening the legal landscape, arguing that free trade agreements often go beyond the minimum standards for intellectual property protection, and that international agreements should be used to improve innovation and access, not hinder it.

It suggests that governments: should give patents only for genuine innovations, and must not undermine the use of flexibilities built into the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). It also said governments should create an enabling environment for exporting medicines under compulsory licence; and that the WTO secretariat should register complaints of pressure on countries and take punitive measures.

Another set of recommendations focuses on implementing additional models of funding for research and development, ensuring innovative companies are rewarded and that people can access the medicines at a fair price. Examples are public-private partnerships and product development partnerships, as well as grants and prizes.

Other recommendations include a change in transparency practices by having governments require all manufacturers and distributors to disclose the costs of producing and dispensing their products. This also includes requiring that all knowledge generated from publicly funded R&D be made freely and widely available. And it calls for the WHO to create a database of prices of patented, generic and biosimilar medicines in countries.

Further recommendations cover increasing investment in health R&D, and creating a framework of accountability, including by having the UN secretary-general establish an independent review body for assessing health technology innovation and access. And governments should review national policies from the standpoint of human rights obligations and make the results public.

On the way forward, a High-Level Panel flyer states: “Achieving global goals, particularly Sustainable Development Goal 3, which emphasizes health and well-being for all, will require reconciling the need for great investment in innovation, services and medicines, with the high costs of health technologies that are currently burdening rich and poor countries alike.”

A key recommendation was that the 2018 UN General Assembly hold a session on the progress on these issues.

The Call for Ambitious, Universal Solutions

“This to me is a human rights issue,” Fukuda-Parr said in her presentation titled, “A call for ambitious, transformative, integrated, universal solutions.”

She tied the panel’s work with the UN Sustainable Development Goals for 2030, which she said is not just a list of 17 goals, 169 targets and 232 indicators, but a “new concept,” a “real paradigm shift,” that “have to be looked at holistically.”

She pointed to SDG 3 on health, target 3.8: “Achieve universal health coverage (UHC), including financial risk protection, access to essential health-care services, and access to safe, effective, quality and affordable essential medicines and vaccines for all.” And also highlighted how health goals relate to others such as science and technology, trade, and private sector partnerships, all under SDG 17.

Fukuda-Parr described access as voluntary and case-by-case, and innovation as limited in scope and scale and uncoordinated. She highlighted the antimicrobial resistance problem, saying today’s 700,000 deaths per year due to drug resistance could lead to 10 million deaths by 2050, but that the market incentive is still lacking for new antibiotic research, for which only two new drugs have come out in the past 50 years. She also mentioned the research gaps and high prices for tuberculosis and cancer treatments.

Currently, negotiations are done on a product-by-product, country-by-country, company-by-company basis, and there is a need for new models than one based on high prices. The market is misaligned with health priorities, she said.

“We need an institutional system for medical R&D” that does not perpetuate the widening gaps, she said. “We need something that would address the problem as a universal problem to address the misalignment between public health priorities and market incentives.”

Fukuda-Parr described some recommended alternative models to the current system of reward based on high prices and high sales, that incentivize investment in those health priorities. Examples included “push, pull, pooling,” open collaborative research, public-private partnerships, a binding R&D convention, plus forming a working group out of the Principles for Biomedical Research.

The 2016 UN General Assembly’s political declaration on antimicrobial resistance (AMR) offers a range of alternatives including the concept of delinking product price from the cost of R&D, she noted.

High-Income Countries “Woke Up”

Auer opened by saying as director general, “you can blame me as being the ugly face” of a high income, high-priced country. In the boardrooms of pharmaceutical companies, countries with high GDP like Austria are interesting because they set the price for their medical products. This can have an impact on the European countries around Austria to the east that then are faced with prices they struggle to pay – and they tell him so.

Meanwhile when it comes to the SDGs, his country is “doing alright” because they have socialised medicine based on a solidarity system, and a broad consensus that access to healthcare is a fundamental human right (adding as an aside, “We don’t have a Donald Trump”). So no Austrian has to be afraid of getting sick for economic reasons because of universal healthcare; they have an equal access to the healthcare system. This is a “notion of freedom in a society,” said Auer.

The country has been doing fine at health coverage despite being a high-priced country, so like others in rich countries they largely ignored the issue of access to medicines because it was not an issue for them. That is, until an American company brought a hepatitis C drug to market at such a high price it “changed the game totally.”

The people like him, in countries like his, “we woke up,” he said, recognising that if this was the business model the pharmaceutical industry wanted to bring to them, they would not be able pay for drugs any longer and the model is not working. The business case that has worked very well for the pharmaceutical industry if one looks at their profit margins over the past 20 years, is really not working anymore, he said.

“Even a country like mine is not able to pay the prices anymore,” Auer said. So the recommendations from the UN panel report are of “high value.” Parallel to that, there is a whole set of policy actions coming out of that realisation.

The big companies make global or regional decisions, but governments don’t make decisions collectively. “Industry loves the fragmentation of the public healthcare sector,” he said. “I’m convinced that we have to overcome this.”

Industry loves the fragmentation of the public healthcare sector. I’m convinced that we have to overcome this. – Clemens Auer, health ministry director general, Austria

Auer mentioned that other countries along with Austria are beginning to band together to better share analysis and are thinking about jointly negotiating prices with industry. Austria alone is a market of 8 million, but combined with the Netherlands, Belgium and Luxembourg (with Austria, referred to as BeneluxA) it makes a market of some 45 million, a market “industry cannot ignore so easily.”

He also mentioned a study being done by the Organization for Economic Cooperation and Development (OECD, the Paris-based group made up of richer economies worldwide) that is looking at the issue and trying to come up with a set of policy recommendations like with the UN panel report.

A key issue for Auer is to look at policy failures, for instance cases where the public funds research into drugs that then are sold back to them at high prices.

Another problem is that governments “are not involved in how public funds for R&D are spent,” do not know how it is spent, and cannot be sure it is the interest of the public health system, he said. With public university funding for research, governments did not link the public funding to price, said Auer, adding, “We are left with a whole series of medical gaps.”

He called on health ministers to work together, and said Austria will hold a match-making conference with investors and researchers when it holds the European Union presidency next year.

Another policy failure is value-based pricing, said Auer, asking, “Who knows what is the value of a drug?” For this, he used the popular example of brakes on a car. They could be seen as the highest value part of the car since they save your life, but they are not the most expensive part.

“There is no transparency on what makes the price,” he said. And the public sector is even collaborating with the industry on this, because they sign confidentiality clauses in the vested interest of industry. “How stupid can we be in the public sector to do this” so they do not have an understanding of what is done with it. “We know shamelessly little” about the value added after market authorisation.

He asked: “Do we have the mechanisms in place to assess innovation? I would say yes …. Do we use these instruments we have? No, I don’t think so. We have to get better.”

“The recommendations of this High-Level Panel are very, very valuable,” Auer said, and are “not alone anymore,” as the issue has been taken up by the OECD, and the European Union Council of Ministers has a similar approach. The World Health Organization “needs to get more involved,” he said.

Learning from Colombia’s Universal Healthcare Success

Guzmán said in its effort to join the OECD, Colombia, a middle-income country, has been cited for its “remarkable example of rapid progress toward universal health coverage” and deserves to be better known internationally. Colombia is proud of having gone from 24 percent health coverage to universal health coverage in 20 years, lowering out-of-pocket expenditures to be one of the lowest in the world. But progress is “very fragile,” he said, and challenges include efficiency and sustainability.

On access to medical products, “competition and regulation are not enough anymore,” said Guzmán. “We are happy to see that our problem is no longer [only] our problem but it is a global problem and is recognised as such.”

The UN panel report is important for Colombia because it frames their national debate in an international context, and also because it is the first time for many things. This includes the first time the UN secretary-general got involved, and first time to address the “incoherence” between the right of the inventor and the right to healthcare as a human right. It also is the first time the problem is considered as a global problem (including high-income countries).

It will be a “long and difficult” way ahead to implement the recommendations, he predicted, and said an open discussion should be taking place within the WHO, WTO and the World Intellectual Property Organization, and elsewhere within the UN.

Guzmán suggested using the AMR situation as a “window of opportunity” to go beyond current solutions and coordinate them in a “more rational manner.” Colombia has been “very open about our tensions and incoherence” within the government, between different agencies, he said, debating for instance whether to issue compulsory licences. And they saw how one government can have different views, setting agencies like the health ministry against agencies like the Commerce Department and patent office. So it is difficult for a government to decide on a position to take.

And the report states the difference between what TRIPS says, and the reality, he said, adding: The TRIPS flexibilities are there, but cannot be used, not only because “we got pressure from everyone” (positive and negative) when they try to use them, but the country also lacked the capacity to carry out the process.

This shows how countries need support, and “we are happy to offer our experience,” so others can do it in a much more efficient and efficacious manner, said Guzmán. The Colombian patent office does not think there is any room for flexibilities with regard to patentability, and are “very proud” to have short timeframes and to give as many patents as possible, following developed patent offices in “patenting everything,” he said.

Discussions on how to have the synthesis of the different views are taking place because of the report, said Guzmán. It has encouraged them to have those discussions and they have found common ground. They may not find the perfect solution, he said, but the little steps they make toward the goal include having more transparency, or clearer guidelines on how to conduct a compulsory licence, for instance.

If nations are serious about the Sustainable Development Goals and about access to medicines, Guzmán said, the problems addressed by the High-Level Panel “need to be acted upon now.”

Who Will Lead?

“The crisis of innovation is a global crisis,” Kamal-Yanni said in her remarks, stating that the lack of innovation into more obscure diseases is actually a “crisis for everyone.” The UN panel was unique in breaking the barrier in this issue, which are artificial barriers given the global nature of the crisis, she said, adding that what is needed is a coherent action which is global.

Kamal-Yanni asked who is responsible to take the recommendations forward so that people in the north and the south have access to safe and affordable medicines. The world needs leadership to get all stakeholders to move in the same direction, she said, adding that Oxfam sees three key stakeholders to move the recommendations forward. These are: governments; UN agencies acting collaboratively but not settling for the lowest common denominator with WHO in the lead with sufficient funding; and the UN secretary-general’s office (the panel report was requested by the previous secretary-general and has not been overtly endorsed by the new secretary-general).

Voice of Contention

Speakers ran over time so there was not time for questions. A US delegate in the audience told Intellectual Property Watch afterward that the critical statement by the US on the High-Level Panel from 16 September 2016 “still stands,” arguing that the panel report is “flawed” and is overly narrow.