UN Human Rights Council discusses access to medicines and the right to health. Big question: Shouldn’t the right to life come before profits from IPRs?
Tobeka Daki, a single South African mother and health activist from the eastern Cape, died fighting breast cancer in November last year. Her oncologist had told Tobeka that she needed trastuzumab – a life-saving WHO essential medicine for the treatment of HER2+ breast cancer – in addition to undergoing chemotherapy. However, three years after her diagnosis, Tobeka died because she could not access the prohibitively expensive solution.
In South Africa, the annual price charged by Swiss multinational company Roche in the private sector for trastuzumab is about $38,365. The few South African public facilities that have been able to procure the medicine have done so at $15,735 per year. Analysis by health economists, however, has shown a year’s worth of trastuzumab can be produced and sold for merely $240 and that includes a 50 percent profit over the cost of production.
Tobeka’s death snowballed into a passionate cry of health activists, patients and other stakeholders who launched the Tobeka Daki Campaign (TDC) on February 7 to enhance access for the suffering millions to unaffordable drugs and vaccines.
“Roche maintains its high prices and unconscionable profits in every way possible,” a letter by TDC submitted in one of the sessions discussing access to medicines issue at the 34th session of the UN Human Rights Council (HRC) read.
Roche holds multiple evergreen patents on trastuzumab in many parts of the world, including South Africa where its patents could block biosimilars from entering the market until 2033.
Evergreening refers to strategies through which pharmaceutical patent owners use the law and related regulatory processes to extend their high rent-earning intellectual property rights (IPR) particularly over highly profitable “blockbuster” drugs. It is not a formal concept in patent law and indicates a misuse of market powers.
“In 2015, Roche made $8.9-billion profit while CEO Severin Schwan earned $12 million. It is highly plausible that Roche could cut the price of trastuzumab dramatically and still be very profitable,” the letter further states.
The issue of delinking prices of health products from investment into research and development (R&D) of these products coupled with the growing need to temper the profits of pharma companies and bring greater transparency into pricing mechanisms of drugs has resulted in clear battle lines drawn between the North and the South blocs at multilateral platforms like the World Health Organisation (WHO), the World Trade Organisation (WTO) and the HRC. The reason is clear. Most major pharma giants are headquartered in developed countries while the world leaders in generic medicines are countries like India and Thailand. The least developed countries (LDC) of Africa and parts of Southeast Asia are the most acutely affected by a lack of a steady supply of affordable drugs.
However, if one goes beyond the political imperative of standing up for domestic rich businesses the battle line on this issue is rather blurry. At least a third of the world’s population has no regular access to medicines. For example, as of June 2016, 18.2 million people were living with HIV but only half were accessing antiretroviral therapy. The moral argument for drug availability is a question that confronts the developed countries as much as the poorer ones.
How much profit is too much for Big Pharma considering that we are talking of the right to life? How much do these companies actually invest in R&D and what amount goes into marketing and advertisement? Should governments be allowed to trade away millions of lives through secret plurilateral deals? If the enjoyment of the benefits of scientific progress is a right (the right to science) recognised in the Universal Declaration of Human Rights and the International Covenant on Economic, Social and Cultural Rights how are these rights so easily disregarded when most UN member states have signed on these agreements? What happens to the innovation of drugs for those diseases, like the neglected tropical diseases (NTD), that do not yield profits for drug companies and where markets fail to produce new drugs? Should such patients be allowed to wither away and die?
Affordable drugs – a human right?
The HRC held a high-level panel discussion on access to medicines and the right to health on March 8. The discussion was facilitated through a resolution adopted by the HRC in June last year. The decision was reached upon after spearheading efforts made by countries like Brazil, South Africa and India among others.
The panel spent a good part of its time discussing the UN Secretary-General’s High-level Panel on Access to Medicines (UNHLP) that published its report in September last year. The UNHLP had as its mandate the task of looking into policy incoherence between the justifiable rights of inventors, international human rights law, trade and public health in the context of health technologies.
The UNHLP report has engendered fractious posturing between member states with many developed countries disregarding the report – even before its publication – arguing that it is based on a “flawed premise” of assuming incoherence between IPR and access to medicines.
The mention of the UNHLP report in multilateral platforms has been a bitterly contested matter, more so since its recommendations, if implemented, could potentially rein in the price-gouging techniques of pharma companies.
“The protection of intellectual property rights must not be allowed to trump enjoyment of the right to health,” said Kate Gilmore, the UN deputy high commissioner for human rights to the HRC. “Perhaps that the greatest obstacles to fulfilling the obligation to ensure access to medicines for all is political will,” she observed.
“The issue before us is not only a matter of ethics, though it is also that. It is also a matter of law – international law,” Michael Kirby, former justice of the high court of Australia and member of the UNHLP, told the HRC on March 8. He called the UNHLP report “the minimum, prudent package” to address the prevailing global situation of unaffordable health products, shortage of drugs and stimulating innovation systems on delivering drugs for “non-profitable” diseases.
The reputed jurist said that though some of the UNHLP members may have taken a different path (two members, including the chief of a pharmaceutical company, had dissenting notes on the report) and some others would have gone further but everyone agreed on the “core conclusions” of the report – to negotiate an R&D treaty that will delink the end prices of health products (drugs, vaccines, diagnostic tools) from investment in the R&D; the UNSG should initiate an independent review body by 2018 on health innovation to address market weaknesses “once and for all”; that WTO members must respect the flexibilities included in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), also in the context of the right to health; there must be no more pressuring of countries who evoke compulsory licences, and should counter evergreening and “other misuse of market practices”.
These statements from the panellists, predictably, drew strong reactions from the US and the EU.
“The current innovation model has delivered progress in public health, leading to new and improved treatments as well as extended life expectancy both in developed and least developed countries,” an EU delegate told the Council. The paper statement of the EU has the word ‘has’ underlined for emphasis. There could be “many reasons” for inaccessibility of medicines (not just IPR) and the EU recognises “that challenges remain to be addressed”.
“Unfortunately, the concept note for the panel and its composition suggest a focus on the HLP report that is inconsistent with what was agreed to in June last year,” the US said. “As the United States and others have repeatedly made clear, including at the meeting of the WHO’s Executive Board, the High-Level Panel operated under a flawed premise. The HLP report inappropriately assumes an incoherence between access to medicines, intellectual property, and trade, and fails to consider critical barriers,” the American delegate added.
Not a North-South issue
Both the US and the EU have tried to deflect attention from the focus on IPR to internal domestic barriers that hinder access to medicines and have mentioned issues like “under-resourced health systems, a lack of sufficiently qualified and skilled healthcare workers, inequalities between and within countries, exclusion, stigma, discrimination and exclusive marketing rights”.
The problem with this argument is two-fold: though the mentioned problems may well be barriers for accessing medicines in some developing countries and LDCs, it does not imply that IPR is not a crucial factor in spiking drug prices thus making them unaffordable for the majority of people. Secondly, the argument ignores the fact that in many of the rich countries, unburdened by issues like having to deal with flailing health systems, access to medicines has become a consequential political issue finding sufficient space in election-campaign rhetoric.
Kirby said that during the public hearings of governments, industry, civil society, and patients held in London, Johannesburg and Bangkok “curiously the voice that was most haunting” was that of an ambassador from the Netherlands. “Don’t assume this is just a problem of poor countries or poor people. This, he said, is a challenge for us all – a challenge for Netherlands, a rich and inventive country. The cost of essential drugs is now excessive for our budget,” Kirby told the HRC, quoting the Dutch ambassador.
“In recent times, the dramatic increase of prices of new and innovative medicines made them unaffordable to large segments of the population also in rich countries while threatening the sustainability of health care systems. In too many countries, prices of new medicines (to treat Hepatitis C and cancer, for instance) are particularly shocking,” a senior Portuguese delegate told the Council.
“I’d like to ask the panellists how they would advise States to pursue more transparency in the determination of costs of R&D for new medicines (in particular a better traceability of the public funds used in this regard, in order to better reflect actual costs in the final price of the medicines),” Portugal questioned the panellists.
These statements indicate that the EU countries may not be as united around the access issue as the EU statement makes it appear.
Right to health or right to profit?
The facts that profits should not eat into human lives and that universal access to medicines is an issue that should be top priority for all governments seem to be common-sensical givens. But, considering that drug access is such a hugely political issue now, achieving these objectives becomes an uphill struggle. The battle is being fought on many fronts from overt assertions to covert threats and complicity between rich governments, the Big Pharma and multilateral agencies.
Email records and memoranda released by the US Centers for Disease Control accessed by Knowledge Ecology International (KEI), an award-winning American organisation working on IPR and access to medicines, though the US’ Freedom of Information Act (FOIA) show that representatives of the WHO and the US government opposed including India’s proposed agenda item on the UNHLP for discussion at the 140th WHO Executive Board meeting held in January.
An email from September 30 shows that an American official, Rachel Wood, wrote to her colleagues Joel Stanojevich and Peter Mamacos, advising them that “Of our priority items ... WHO suggested removing India’s access to medicines proposal, so Dr Frieden didn’t need to”.
Several health activists across the world were outraged and demanded an explanation from the WHO director-general Margret Chan for the UN health agency’s reasons for rejection of the request.
“We congratulate the Panel for their bold effort. It’s unfortunate that some members and even WHO are undermining any discussion on the report,” the Indian statement read though it could not be delivered to the Council for the constraint of time.
“We have recognised, and this is very important, that it is a matter of state sovereignty for states to lay down the criteria for granting patents and also for states to determine health emergencies to take particular measures,” Ruth Dreifuss, former president of Switzerland, chair of the Global Commission on Drug Policy and co-chair of the UNHLP, told Council members. It is “absolutely important” to deal with matters of transparency in health products, Dreifuss stressed. However, “subsequent negotiations have reduced the Doha declaration flexibilities or put countries under pressure countries from evoking these flexibilities,” she observed.
In Brazil and Argentina, Roche is one of the pharma companies litigating against those governments for their attempts to use TRIPS flexibilities, i.e., legal international safeguards to protect public health, the TDC letter states.
Last year, a Colombian news network reported that a top US Senate Finance Committee aide, who works for Committee chairman senator Orrin Hatch, threatened to withdraw American funding for the Colombian peace process if the Colombian health ministry allows generic production of the patented leukaemia drug imatinib.
Five law suits have been filed in India and Argentina in February alone this year for slashing the cost of life-saving medicines for treating the liver disease hepatitis C. Litigants have argued that the latest class of antiviral drugs does not merit the 20-year patent monopoly that the drug manufacturers have asked for in the two countries. The treatment, which runs over three months, currently costs more than the average annual salaries of people from middle-income countries. The rich country citizens do not fare much better in this regard.
In another instance, the Delhi high court this month has asked the central government to explain the basis on which the Indian patent office has rejected a patent of the University of California’s prostate cancer drug Xtandi (the university claims to have invented the drug). Astellas Pharma, a Japanese pharmaceutical company that has marketing right for the drug, charges Rs 3.35 lakh for a month’s supply.
International activists hope that successful litigations in poorer countries may trigger off similar lawsuits in the developed parts of the world.
Greater transparency in drug prices is a noisy fight, especially in developed countries.
The US-based Interfaith Center on Corporate Responsibility (ICCR) reported that long-term shareholders are “outraged” that major American drug companies, including AbbVie, Amgen, Biogen, Bristol-Myers Squibb Company, Eli Lilly, Gilead Sciences, Johnson & Johnson, Merck & Co., Pfizer, and Vertex Pharmaceuticals, scuttled shareholders’ proposals to elicit greater transparency around excessive price increases on critical drugs. At least 16 American states have introduced legislation calling for greater drug transparency. A recent Kaiser poll indicated that 74 percent of the public believes that the pharmaceutical industry puts profits before the needs of people, ICCR says on its website.
Apart from these attempts to thwart attempts to discipline the drug industry, mega trade deals also remain handy tools for rich countries to arm-twist weaker governments from eating into the profits of their pharma companies.
“The RCEP [Regional Comprehensive Economic Partnership] will be a massive trade agreement and the content of the IP Chapter is important. It will bind India and China, two countries left out of the TPP [Trans-Pacific Partnership],” Jamie Love, the founder of KEI, had said in a statement last year.
“There are proposals for patent extensions, restrictive rules on exceptions to copyright, and dozens of other anti-consumer measures, illustrating the power of right-holder groups to use secret trade negotiations to limit democratic decisions that impact access to knowledge, the freedom to innovate and the right to health, in negative ways,” Love said.
Médecins Sans Frontières, in a statement to the HRC, urged the UN high commissioner for human rights’ office to perform human right public health assessments of trade agreements, so that bilateral and regional trade and investment treaties do not include provisions that interfere with government obligations to fulfil the right to health as recommended in the UNHLP report.
“We will never forget the voices of those who are left behind, many of them women or girls, families forced to beg for charity for patented medicines…,” Kirby told the Council. “Unless the world and the UN, and this Council act now… millions will be left behind and millions will die.”
(The story appears in the March 16-31, 2017 issue of Governance Now)