New Straits Times | 2 September 2015
Losing access to generic drugs may be a bitter pill to swallow
Shazelina Zainul Abidin
When the Trans-Pacific Partnership (TPP) negotiations failed to conclude in April, it was not just the die-hard opponents of TPP that breathed a sigh of relief.
In the area of healthcare, practitioners and non-governmental organisations also took satisfaction in the delay, conscious that it gave them space to regroup and retake lost ground. For all the potential advantages of TPP to the 12 participating countries, one aspect of the agreement remained lopsided.
The pharmaceutical industry, with worldwide sales of more than US$980 billion (RM4 trillion) in 2013, stood to be one of the biggest winners under TPP.
The developing countries — Brunei, Chile, Malaysia, Peru, Singapore and Vietnam — would lose out. With North America claiming more than half of global sales, the United States and Canada looked set to win big.
The problem with this is not the staggering amount in profit that the pharmaceutical companies will make.
The problem is that the agreement will wipe out the preferential treatment accorded to developing countries. It was a fight that had been fought before.
Ever since the development of patented drugs, developing countries have been fighting tooth and nail for access to these medicines. Developing countries want affordable medicines. Big pharmaceutical companies want to charge an arm and a leg for these medicines. The countries argued long and hard, and finally, common sense and humanitarian sentiment prevailed.
In 1994, the World Trade Organisation’s Uruguay Round gave developing countries the right to produce or seek out generic drugs in times of need, even if the drugs were under patent. The developing world pounced on the production of these more affordable generic medicines, which some quarters have described as “life-changing”.
For developing countries with a huge population, many below the World Bank’s poverty line definition, this access to cheap medicines would give them access to medicines that were out of their financial reach before.
For the companies, it was not as if they would be seeing their research efforts flushed down the drain.
True, 95 per cent of the profits come from the sales of patented drugs to Western countries. But, voluntary licensing in less well-off countries helps to recoup some “losses”, as well as allow access to markets that would have been closed to these pharmaceutical giants.
Take, for example, the production of sofosbuvir and ledipasvir, antiviral drugs for Hepatitis C.
In 2014, the Pharmaceutical Journal reported that American biotech Gilead Sciences agreed to licence its patented medicine to India-based companies that would produce the generic version of it.
Gilead Sciences would receive seven per cent of the royalty from these sales, and the drug would be available in 91 countries, far more than the market countries for the patented version of the drug.
Don’t get me wrong. Intellectual property rights are a good thing and the World Intellectual Property Organisation is doing a good job. It is just that the protection of intellectual property, like most things, should have its limits.
In music or literature, it is only fitting that the authors of the original work are able to make a living from their talent.
Even then, pricing the work beyond the reach of the average Joe makes no economic sense.
This is even more so when that product has the potential to save lives, not in the single digits, but in the thousands or hundreds of thousands.
Medicines under patent run for up to 20 years in some instances, and are beyond the ability of developing countries to obtain.
The ever-greening clause that the pharmaceutical companies want would mean that patents could potentially run forever, if the companies kept tweaking the original formula.
Malaysia was one of the countries that fought the good fight during the Uruguay Round.
We understood that some countries needed preferential treatment to just survive. That was why the negotiators placed generic drugs at the top of the negotiation list. It would be a shame to allow any agreement to take that away from us.
The question may yet be moot as we approach 2020 and the potential of a developed-nation status. We are bound to lose our access to preferential treatment anyway. But, losing access to generic medicines may yet be the most bitter pill to swallow.