PHM-Exch> Global R&D Treaty: Building a new research system for developing new medicines

[Claudio Schuftan]

From: Amit Sengupta <asengupta at phmovement.org>

Next month (tentatively scheduled for *26-28 November*) the WHO is
convening an 'open-ended' intergovernmental meeting to discuss the report
of an Expert Group (constituted by the WHO) tasked with developing a new
framework for promoting Research and Development. The meeting is to discuss
the next steps in implementing its recommendations. *Below is a short but
very clear analysis of the issues.*

Just to add, at the last World Health Assembly in May 2012, many developed
countries led by the US attempted to put brakes on this process as they see
the R&D treaty as a threat to their pharmaceutical industries, that thrive
on the patent based model of research. It is only due to the insistence of
some developing countries that the agenda was kept alive. The November
meeting is crucial as it will indicate if developing countries are able to
push this agenda ahead.

Detailed analysis and discussions on the issue (prepared by our 'watchers')
is available at the ghwatch website here:
http://www.ghwatch.org/who-watch/wha65/cewg

*While PHM is unlikely to have a presence at the November meeting in
Geneva, it is important for country circles -- wherever they have the
capacity -- to lobby with their governments to take a positive position o
the proposed R&D treaty.*

We shall be posting more information on this subject, in the run up to the
November meeting. Do also share information of any advocacy initiatives
that could be planned by country circles before the November meeting.

Best Wishes,

Amit
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*A global R&D treaty could boost innovation and improve the health of the
world’s poor—and rich.***

http://www.the-scientist.com/?articles.view/articleNo/32664/

Suerie Moon and Ellen ’t Hoen | October 1, 2012


Evidence is mounting that the existing global system for  pharmaceutical
R&D is badly out of tune with the needs of society.  Recently, national
health systems in the United Kingdom and the   Netherlands shied away from
providing certain recommended medicines  due to price. In the United States
, waiting lists for state HIV drug  assistance are lengthening due to the
high cost of drugs (frequently  more than US$20,000 per patient per year)—a
painful irony as evidence  rapidly mounts that earlier treatment of HIV not
only benefits the  patient, but also reduces the risk of transmission.
Medicine prices  are often just as high in developing countries, though
incomes are far  lower and social safety nets much weaker. In India , a
year’s supply of  the patented kidney cancer drug sorafenib is priced at
more than US $60,000 per year, though the average annual income is less
than  $1,500. Governments, insurers, and households everywhere are
 struggling to afford new medicines.

At the same time, illnesses that primarily affect populations with  little
purchasing power, such as Chagas disease or malaria, are  “neglected”
because they offer little return on investment for  industry. It is not
only diseases of the poor that get neglected, but  also those with small
patient populations, such as ALS, and any other area of research that fails
to generate sufficient market returns. For  example, the empty pipeline for
antibiotics has raised concern in rich  and poor countries alike. These
drugs are generally given to patients  for a few days, and thus tend to be
less lucrative than long-term  treatments for chronic diseases such as
diabetes, HIV, and heart  disease. We are saddled with an R&D system that
suffers from declining  rates of innovation, unaffordable prices for end
products, and a  misalignment between research investments and the medical
needs of  society.

Patents are a blunt policy tool: they require trade-offs between
 innovation and the high prices that restrict patient access to  medicines.

No single country can manage this problem alone. Pharmaceutical R&D is
 increasingly a global endeavor, undergirded by global rules. Today,
research advances produced anywhere can benefit people and contribute  to
scientific progress everywhere. But financing knowledge production  is
tricky. Some countries may be tempted to benefit from the knowledge
 contributed by other countries, but not make commensurate investments.
 Such “free riding” could, in turn, result in global underinvestment in
 R&D or limitations on knowledge sharing. A set of rules is needed both  to
ensure that countries contribute fairly and to create norms and  incentives
to share knowledge as widely as possible.

This past April, a group of international experts convened by the  World
Health Organization (WHO), known as the Consultative Expert Working Group
on Research and Development (CEWG), recommended just  this solution—that
countries begin negotiations over a binding treaty  on medical R&D.


 *Better than patents*

At the moment, the main set of global rules shaping R&D is the 1994  World
Trade Organization Agreement on Trade-Related Aspects of  Intellectual
Property Rights (TRIPS), which requires countries to  provide patent
protection for drugs and other health technologies.  Patents allow
pharmaceutical firms to recoup their investments by  charging a monopoly
price (higher than the cost of production) for new  medicines. All
countries purchasing patented medicines are thus making  contributions
towards R&D through these higher prices.

But patents are a blunt policy tool: they require trade-offs between
 innovation and the high prices that restrict patient access to  medicines.
Such trade-offs can be deadly and are neither morally  acceptable nor
politically sustainable in a world where 85 percent of  the population
lives in low- and middle-income countries (with annual  per capita incomes
from $230–$12,000). Patent rights are also  insufficient for directing R&D
activities to those areas most needed  by society, as the examples of
neglected and rare diseases and the  shortage of new antibiotics make
clear. Finally, by erecting walls of  property rights around bundles of
information, patents can impede the aggregation of knowledge that powers
innovation.

A global R&D treaty could encompass a number of measures that would
 improve the existing system. For example, countries could commit to
 making sustainable contributions to an international R&D fund. This  fund,
analogous in some ways to the US National Institutes of Health,  could pay
the full costs of R&D so that there would be no need to  recoup investments
and medicines could be sold at cost, making  treatments much more
affordable and health systems more sustainable.

The system could also drive research into priority diseases, either
 through traditional grant funding or through novel incentive  mechanisms
such as prizes for the successful development of products. Furthermore, the
treaty could establish norms for open innovation and  create incentives to
share research findings quickly in order to  accelerate the R&D process.
Finally, it could codify obligations for  the ethical conduct of clinical
trials, which are taking place in more  and more countries but may not
always be overseen by strong,  experienced regulatory institutions. All of
these measures are geared  toward a global R&D system that would deliver
both innovation and  equitable access to medicines.

While crafting such a system may seem ambitious, it is not such a  radical
departure from existing initiatives. For example, an  interesting precedent
was set by UNITAID, an international  organization funded by 29 countries
that has raised $2.1 billion  dollars over 5 years, primarily through a tax
on air travel. The funds
are used to make drugs and diagnostics for HIV, tuberculosis, and  malaria
more affordable or better adapted for use in resource-poor  settings. The
lower prices and new products generated through this  effort are global
public goods that provide potential benefits for  everyone. UNITAID
demonstrates that a critical mass of countries can  come together to
address global system failures that affect them all. The broken R&D system
is ripe for such a collaborative effort.

Since the CEWG report was issued, many questions have arisen regarding  the
treaty proposal: How much would countries contribute? How many  countries
would be needed to make the system work? How would  priorities be set, and
how would progress be monitored? These all  remain open questions. While
the CEWG made some specific  recommendations, such as for financing,
incentives, and monitoring, these remain proposals that governments will
now need to debate and  negotiate—the onus now rests on them to build a
better system for drug  R&D. (See the full report at
http://bit.ly/CEWGreport)

Next month, government representatives will convene at the WHO in   Geneva
to decide how to move forward. When they do so, they should not  forget the
urgency of fixing a system that fails to meet the needs of  the majority of
the world’s population. While a treaty won’t solve  every health challenge
or all the woes of industry, building a system  of global norms, rules, and
incentives that makes public health the  key driver of pharmaceutical
research would move us towards a more  equitable, healthier world.

*Suerie Moon *is research director of the Forum on Global Governance for
 Health at the Harvard Global Health Institute.

*Ellen ’t Hoen* is a lawyer and a research fellow at the IS Academy
HIV/AIDS School for Social Science Research at the University of Amsterdam
, the Netherlands .
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