Expensive medicines remain inaccessible for many. Lengthy patents prevent development or importation of cheaper generic drugs. The quest for profit trumps the needs of the developing world, violating the basic tenet of justice to provide healthcare to all.
Great scientific and medical advances were made over the course of the 20th century, manifesting in the development of myriad medicines, sophisticated surgical techniques, and significant improvements in healthcare provision. Average life expectancy in the USA increased by almost three decades during this period, concomitant with a steep fall in infant mortality. In England and Wales, average lifespans rose from 49 (males) and 53 (females) in 1910 to 75 (males) and 80 (females) by the end of the century.
The development of antibiotics, novel vaccinations, and an ever-widening array of medicines are some of the reasons behind the virtual eradication of infectious diseases such as measles, rubella, and TB in the developed world.
Not everyone has equally benefitted from this scientific progress, however. The aforementioned diseases are still frighteningly prevalent across the developing world. The average life expectancy in some African nations is as low as the sixth decade of life, as millions succumb to diseases and die without access to vaccinations, medicines, or decent healthcare.
— RT America (@RT_America) January 31, 2017
There seems little to stop the pharmaceutical companies from charging steep prices for newly marketed drugs. A 2016 Deloitte report measuring the return from pharmaceutical innovation remarks that the industry is facing diminishing returns on its research and development investments. This is one argument used to justify the high cost of medicines.
Nevertheless, Forbes reports that the pharmaceutical industry’s average profit margin is almost 20 percent, exceeding that of banks, the oil and gas industries, and the media. In 2013, pharmaceutical giant Pfizer attained a 42 percent profit margin. Johnson and Johnson alone reported earning $15.4 billion in profits in the year April 2015-2016. Despite the drug being around for decades, in 2015, Turing Pharmaceuticals increased the price of Daraprim, which treats the toxoplasmosis infection that can afflict AIDS and cancer patients, from $13.50 to $750 per pill.
Earlier this year, Marathon increased the price of a medication used to treat Duchenne muscular dystrophy by 7,000 percent after acquiring the exclusive right to sell the drug within the USA for the next seven years.
In 1998, 39 pharmaceutical companies sued the South African government, closed factories, and withdrew investments in response to the nation importing and manufacturing cheaper (generic) medicines used in the treatment of HIV. The high cost of the drugs produced by Big Pharma had led many HIV sufferers to go without the treatment required to slow the virus’ progression. However, the medicine manufactures unconditionally dropped their case in 2001, following a mass public outcry.
Generic medicines providing the same pharmacological effects as more expensive brand name drugs may cost less, but cannot be produced whilst a patent exists. The Trade-Related Aspects of the Intellectual Property (TRIPS) agreement, which applies to all World Trade Organization member states, ensures patents have a 20-year lifespan commencing from when they are first registered. During this time, the full cost of the more expensive brand name drugs must be paid. However, while the cost of branded medicines can be offset for individuals living in affluent countries where health systems provide universal coverage, such as those in the UK or Americans lucky enough to have health insurance, most citizens of poor countries do not have the same luxury, as neither they nor their rudimentary health services can afford newer branded medicines.
To further extent a patent beyond its 20-year lifespan, pharmaceutical companies may also invoke a technique referred to as ‘product-line extension’, which can involve making only minor alterations to the chemical composition of a medicine or altering its route of administration. Despite the new formula being analogous to the old and still treating the same condition, the patent is extended, ensuring that prices remain high. Documents obtained by WikiLeaks also reveal how the pharmaceutical industry encourages American diplomats to lobby their host countries and discourage them from producing their own cheaper generic medicines, as well as pressure them to prolong existing patents so that drug companies can charge higher prices for longer.
An issue affecting both poor and wealthy nations alike is insufficient R&D funding to develop medicines that provide low financial returns, but are still necessary to treat diseases. Antibiotics are one example. Treatments for serious infectious diseases are another. A 2016 UN report entitled Promoting Innovation and Access to Health Technologies states: “Experts warn that drug- resistant viruses, bacteria, parasites and fungi could cause 10 million deaths a year worldwide by 2050… Meanwhile, neglected tropical diseases (NTDs) continue to receive inadequate funding for R&D and access to health technologies… The situation is driven by the relatively low purchasing power of people disproportionately affected by such conditions.” The report advocates striking a “new deal to close the health innovation and access gap,” while taking note of the contention between the “right to health on the one hand, and intellectual property and trade on the other.” Malebona Precious Matsoso, director general of the South African National Department of Health, states that “with no market incentives, there is an innovation gap in diseases that predominantly affect neglected populations, rare diseases and a crisis particularly with antimicrobial resistance, which poses a threat to humanity.”
— RT America (@RT_America) September 22, 2016
Christian Wagner-Ahlfs of the Federal Coordination of Internationalism (also known as BUKO), comprising 130 German campaign groups intent on scrutinizing the practices of the German pharmaceutical industry in developing nations, acknowledges that‘‘so-called neglected diseases are typical for poor countries… diseases that practically do not exist in Germany anymore and are thus of no interest to the commercially-oriented pharmaceutical industry… There has been practically no research in this field for the past decades.”
It seems pharmaceutical giants are becoming more cognizant of the negative publicity surrounding their practices and are seeking to improve their image. The Access to Medicines Index ranks the top 20 drug companies according to how much they are doing to improve access to medicines in the developing world. It includes markers such as their willingness to offer pharmaceuticals at reduced prices or whether they are conducting research into diseases prevalent in these nations. However, it remains uncertain if “the price reductions are enough to meaningfully increase affordability.”
Pharmaceutical giant GSK has revealed plans to cease filing patents for new drugs that are to be sold in poor nations, paving the way for cheaper generic brands to enter local markets without risk of litigation. It remains to be seen whether Big Pharma concedes that it is better to suffer some loss in profit, rather than prestige. If the imbalance between profits and providing treatment to the world’s poorest remains unaddressed, this will not only violate the basic tenet of justice to provide healthcare to all, but also bode ill for the future of the pharmaceutical industry.
By Dr. Tomasz Pierscionek