Patient-Centered Care: Innovation, Access and Implications for Intellectual Property Rights

Durhane Wong-Rieger, PhD
Consumer Advocare Network

Fundamental Premise of Patient-Centered Care: Access to Therapies

• All patients have a fundamental right to access safe and effective therapies, including medications.
• To be useful, treatments must be delivered through quality healthcare systems that have appropriate resources and safety measures for diagnosis, surgical and other therapeutic interventions, patient education, and on-going professional and lay support.
• The welfare of patients and the public require government-funded programs that address health promotion and the determinants of health (safe water, sanitation, adequate food, physical security, social relations, and meaningful occupation).
• Access and innovation are inseparable. Without access, innovation generates no benefit; without innovation, access leads to limited outcomes.

Rationale for Intellectual Property Protection

• The challenge for policy makers is to implement systems that encourage continued development of new therapies (for treated or unmet needs) while assuring therapies are available to patients to maximize health benefits.
• A strong patent system works well to stimulate development by providing incentives to developers in the form of a “limited-term monopoly.” whereby profits are returned to the developers through the sale of inventions (medical products).
• Most drugs used today—whether they are “brand-name” medicines or generic copies—are the products of a system that has encouraged innovation by protecting intellectual property through patents.
• There is a direct relationship between the strength of a country’s patent protection and the level of innovative research and development (R&D). Manufacturers locate where there are incentives (protection) for investment in new medicines. Similarly, those countries with high-level R&D support intellectual property rights because of return in sales and new knowledge generation for continued development.

Access to Innovative Therapies

• There are many challenges for patients in accessing innovative therapies, only one of which is the cost of medicine.
• Even in developed countries, access to innovative therapies is not uniform or universal and influenced by many factors, including ability to pay and access to alternative sources of funding.
• There are various strategies used to improve patient access to therapies (both patented and generic) that are used in both developed and developing countries.
• The cost of therapy may be subsidized by insurers, governments, or philanthropists.
• The price charged to some patients may be lowered through bulk pricing (e.g., US Veterans Affairs, Canadian public drug plans, large private insurers or managed care institutions).

Issues of Drug Access in the Developing World

• There are many barriers to access to healthcare in developing countries. Poverty is the principal challenge, which affects the availability of food, clean water, hospitals, clinics and healthcare professionals, all of which are key factors in improving health outcomes in poor countries.
• There are genuine disparities in global health. For example, maternal mortality is 15 times greater in least developed countries than in industrialized ones; life expectancy is 70 years in developed countries and less than 50 years in some developing countries; three diseases, HIV/AIDS, TB, and malaria, kill 6 million per year in developing countries, and the average per capita health expenditure is $98 in developing countries (less than 3% of GNP) and $3,800 in industrialized ones (approximately 14% of GNP in USA).
• Less than ten per cent of the 319 medicines on the World Health Organization’s (WHO) Essential Medicines List are patented. A study of access to essential medicines in developing countries concluded that on average only 4 of these 319 products were under patent in any of 65 poor or developing countries surveyed. Many nations lack the infrastructure to distribute even those medicines that they can afford.
• Development assistance for health purposes has grown exponentially via new initiatives by the Bill and Melinda Gates Foundation, among others, and new organizations such as the GAVI Alliance and the Global Fund to Fight AIDS, TB and Malaria. These entities have spent billions in developing viable medicine procurement and delivery systems for least-developed countries. Nevertheless, many critics of international patent rules, such as Health Action International, oppose private-public partnerships and drug donations that have been effective in helping to improve health outcomes in developing countries.
• In 2000, the 189 member states of the United Nations adopted Eight Millennium Development Goals of which three specifically target public health: to reduce child mortality, improve maternal health, and combat HIV/AIDS, malaria and other diseases. A survey (validated by the London School of Economics) of pharmaceutical companies’ contributions toward these goals estimated that from 2000 to 2005 the industry provided health interventions benefiting up to 539 million people (two thirds of the population of sub-Saharan Africa) with a value estimated at US$ 4.4 billion.
• Differential pricing for new therapies may be offered to low GDP countries where healthcare systems cannot (or will not) pay. Developing countries argue this is feasible because the majority of “innovation investment incentives” are recouped from sales in the developed markets and these sales represent “marginal” costs of production.
• A key problem with “differential pricing” has been arbitrage, or re-sell of drugs from the lower priced purchasers into the developed country markets, which undercuts the profits to the innovator or the development of a “black market” which undermines the intention to provide drugs to patients in a specific country. Some manufacturers have developed special packaging or formulation to avoid re-sell.

Alternative Routes (Generic Copying and Compulsory Licensing)

• Some countries (e.g., India, Brazil) have had very “loose” patent systems, which has allowed indigenous manufacturers to copy patented medicines and distribute these to their own patients.
• Developing countries rely on rules of compulsory licensing, for example, to hand over a patent to a local manufacturer by declaring public health need or insufficient product available to the patient population.
  • Some seize the patent and pay royalty to the inventor (to offset profit loss and support the innovation).
  • Some (China) make a copy of the product by reverse engineering.
  • Some (India) make a copy and then sell to another country that is lacking in technology, thereby making a profit for the copying country while reducing incentive for innovation.
• A key problem is the lack of quality standards (regulatory control) for treatments imported into developing countries.
  • Surveys find that 10 to 20% of drugs in developing countries fail quality control tests.
  • Fewer than “1 in 3” developing countries have fully functioning drug regulatory systems, leading to growing number of fake drugs.
  • Between 25 and 50% of medicines in developing countries are estimated by WHO to be counterfeit.
  • Inefficiencies in procurement, storage, prescribing, and use of drugs is so extensive that consumers benefit from an estimated $12 worth of treatment for each $100 spent by the public in developing countries.
• India provides a good example of the potential risks. India is the world’s primary source of generic drug production. Until 2005, only the manufacturing process, not the products themselves were covered by patents under Indian law. This gave Indian generic drug manufacturers an enormous advantage and allowed them to create generic versions of new drugs years before the patent had expired.
• While India is home to many legitimate drug manufacturers, according to a 2007 report by the European Commission, India is the number one source of counterfeit medicines seized in the European Union. Recently, Ethiopia withdrew the licenses of 60 generic manufacturers from India because of extensive evidence that they were providing sub-standard products.
• In the case of Anti-retroviral medicines (ARVs), the use of sub-standard products promotes resistance to first-line therapies and requires patients to use additional treatments. First-line therapies are the cheapest and most common form of ARVs. The cost of moving patients onto second-line therapies is significant and requires a higher level of care with supportive infrastructure and medical services, including specialist physicians, ongoing monitoring and potential hospitalization. Drug resistance is also cumulative. It is estimated that up to 45 percent of Thailand’s AIDS patients are now drug resistant.
• When an Indian generics company introduced a version of Abbott's Aluvia that was more suited to tropical temperatures, it sold this generic version in Africa at a price three times what Abbott, the original patent holder, sells it for.
• Only 5 per cent of India’s R&D funds are used to research diseases primarily affecting the poor. The increasing focus of Indian generic manufacturers on the richer markets is hypocritical as the stated intent of introducing compulsory licensing was to make treatments more affordable for those who are less affluent.

Impact of International Patent Agreements

• The Trade-Related Intellectual Property Rights Agreement (TRIPS) was introduced in 1994 and significantly affected the ability of countries with capacity to copy (but not innovate) from copying existing medicines.
• A key outcome was that Intellectual Property Rights (IPR) moved from the purview of the UN’s WIPO (World Intellectual Property Organization) to the WTO (World Trade Organization). The standards to be enforced were based on developed countries, resulting in a “worldwide upward harmonization with minimum standards.”
• In the current IPR debate as it relates to health care access, it is unclear if the WHO has the same policy-setting capacity and expertise as the WTO in matters principally related to government policies on trade and economic development.
• The patentability of molecules and active pharmaceutical ingredients were mandatory and the length of patent extended to 20 years.
• The TRIPS agreement also specified exception to patent rights (Article 30: Other Use Without Authorization) including compulsory licensing for self or 3rd party where “public interest” was concerned. However, compulsory licensing was predominantly to supply a “domestic market” and was not intended for export to countries without sufficient manufacturing capacity.
• Many countries have signed on to TRIPS, including India and Brazil, ostensibly curtailing unauthorized copying.
• The Doha Declaration (2003) provided a significant addendum to TRIPS. On the one hand, it acknowledged that intellectual property protection (IPP) was a strong incentive for the development of new drugs. However, it declared that IPR can damage public health through effect on price and thus demanded that manufacturers in developing countries (or any environment) could seize a patent and copy a drug for its own use or for another country without technical capacity. Moreover, the country could determine the grounds for compulsory licensing.

Neglected Diseases and “Needs-Based” R&D

• Critics of the current global environment for pharmaceutical research and development claim that international drug research has failed developing countries by ignoring tropical diseases such as malaria. Yet, diseases such as cancer, diabetes, and cardiovascular disorders cause more morbidity and mortality in developing countries than tropical diseases.
• The research-based pharmaceutical industry is responsible for the development of all of the most effective drugs for treating cancer and cardiovascular diseases. The research-based pharmaceutical industry is also responsible for the development of all 22 of the currently available anti-retroviral treatments for HIV/AIDS.
• The 2007 World Health Statistics report indicates that, overall, non-communicable conditions will account for almost 70% of all deaths in 2030, and the World Bank has recently warned that chronic illnesses such as cancer, diabetes, obesity, and heart disease will be the main causes of death in developing nations by 2015.
• Pharmaceutical company research projects focused on developing new medicines and vaccines for diseases primarily affecting poor countries include: 17 medicine projects and 2 vaccine projects for Tuberculosis; 18 medicine projects and 2 vaccine projects for Malaria; and 8 medicine projects plus 2 vaccine projects for other tropical diseases. Roughly half of these R&D programs are being undertaken by companies on their own, while the remainder are being conducted by industry within public-private partnerships.
• An alternative route proposed is the Medical Research & Development Treaty (MRDT) whereby countries would pool funds to develop treatments for under-served areas and disorders. The proposal is based on equitable sharing of costs of R&D, provides incentives to invest in useful R&D in areas of need and public interests, and recognizes human rights and goals of all sharing in benefits of scientific achievements. The premise is that government coordinated R&D is fairer and more efficient than market system. However, there has been no consensus and there is not evidence that the proposal would actually generate new therapies.
• Other market-based incentives to develop for under-served needs and areas include “pooled advance purchase commitments” for medicines such as vaccines, whereby governments, foundations, and international alliances would commit to purchasing specified quantities of vaccine at contracted prices and then give it to the poorest countries (at affordable prices).

WHO IGWG Strategy for IP

In August 2006 the WHO established the Intergovernmental Working Group on Public Health, Innovation and Intellectual Property (IGWG). The IGWG’s task is to prepare a global strategy and plan of action for global health research to address diseases that disproportionately affect developing countries.

More specifically the IGWG must deliver by May 2008 a medium-term strategy and plan for least-developed countries to: (1) boost R&D of medicines for non-prioritized or neglected diseases , (2) promote innovation and build capacity, including financing, for R&D activities, and (3) improve access to health products.

On July 31, 2007, the WHO IGWG submitted a first draft of its strategy and plan, which generally calls for a “weakening” of IPP as one means toward achieving these goals. However, it is not clear how reducing incentives for pharmaceutical innovation will lead to improving R&D for neglected diseases, promoting R&D capacity, and improving health outcomes in developing countries.

Rather, strengthening the incentives for continued R&D and innovation—along with other focused strategies such as public-private partnerships and similar collaborative arrangements—are essential to the development of new products for patients and for expanded access to better health care in developing nations.

It is critical for patients to engage in these discussions around IPP, and particularly important for patient-based groups to understand the implications of the WHO IGWG draft strategy and plan, so that the needs of all patients are directly reflected and patient-centered interests drive the agenda.