A Global Village
Issue 3 » Global Health & Development

The End Of The Line For Affordable HIV Drugs?

Harriet Gliddon, Imperial College London

India has been dubbed ‘the pharmacy of the developing world’ because of measures that prevent patenting and promote competition between generic drug producers, resulting in affordable drug prices for the developing world.

However, India’s ability to produce these affordable medicines is in jeopardy. A new trade agreement between the EU and India may lead to stringent patent laws, resulting in a serious threat to the lives of hundreds of thousands of HIV patients in the developing world.

Just like any other commercially available product, pharmaceuticals are subject to intellectual property rights (IPRs) that grant patent-holders the exclusive right to commercially exploit the product under consideration during a defined period of time. They can fight patent infringement (production, import/export and use of the product) through legal means.

India has been
dubbed ‘the
pharmacy of the
developing world’

While IPRs are necessary to sustain incentive for further pharmaceutical innovation they also reduce the affordability of drugs and can form a barrier to improving health in developing countries. Due to the weakness or complete absence of public health systems in many developing countries, patients are often obliged to pay the full price for their medications. Yet for these people, paying the market price is often not an option and generic medicines may be their only treatment choice. The central case for restricting their access to medicine is the argument that a particular drug is the property of the pharmaceutical company that developed it.

As one of the world’s fastest growing economies, India is often referred to as an Innovative Developing Country (IDC); a term also applied to countries such as Brazil and Russia that are deemed ‘technologically proficient’. Nevertheless, the protection of IRPs in India and other IDCs has been questioned in recent years. In the past, the Western world has criticized India’s ‘sub-standard’ patent laws, stating that India is ‘unfriendly to business’. Meanwhile, India has also been dubbed ‘the pharmacy of the developing world’ because of measures that prevent patenting and promote competition between generic drug producers, resulting in affordable drug prices for the developing world. However, India is in serious danger of no longer being capable of manufacturing these drugs.

The European Commission (EC) is currently negotiating a number of bilateral trade agreements between the European Union (EU) and various countries in Asia and Latin America as part of the ‘Global Europe’ strategy. These agreements aim to improve the trade of various different products between countries. One particular agreement, the EU-India Free Trade Agreement (FTA), is currently being finalized and will allow a jump in bilateral trade from $90 billion to $130 billion. With negotiations ongoing since 2007, the EU announced in December 2010 that the agreement would go ahead in 2011 despite serious concerns regarding its affect on access of essential medicine by developing countries.

The EU-India FTA may lead to stringent patent laws, resulting in a serious threat to the lives of hundreds of thousands of HIV patients in the developing world. For example, Médecins Sans Frontières (MSF) buys 80% of their HIV antiretroviral medications (ARVs) from India for treatment programs that allow people infected with HIV to live normal lives, care for their children, contribute to the economy and live to an old age.

Molecules and Money
Modern drug development starts from high-throughput screening of a diverse range of chemicals, mostly chemicals present in natural products, to find compounds that can effectively inhibit the disease concerned at the molecular level. The molecule is then modified chemically to become a more biologically potent compound. After that, this ‘lead’ is subjected to animal testing to test the effect of the potential drug candidate in vivo and will then go through three phases of subsequently larger clinical trials in humans prior to regulatory approval of the product.

From the pharmaceutical industry’s perspective, there is a substantial cost involved in developing a product with the total expenditure on research and development (R&D) reaching $95.2 Billion in 2009. Ultimately very few molecules reach the market, and hence the R&D cost per successful molecule is extremely high. Also, while the market for branded drugs in the poorest economies such as Chad or the Central African Republic may be tiny, many emerging markets such as China or India have rapidly growing middle classes that offer substantial profits to the industry.

Patenting Power
ARV drugs are usually patent-protected. Originally, these patents can only be applied within a country where the patent is registered, not internationally. However, members of the World Trade Organization (WTO) are required to adhere to certain multilateral trade agreements, such as the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, which was signed in 1995 and governs patent law across the globe. It was the first consensus statement of its kind that concerned IPR Law, and is still probably the most comprehensive document in the international trading system today that relates to IPR.

Under TRIPS, patents for any new, useful and non-obvious product, including essential medications such as ARVs, are protected for at least 20 years in all WTO member states after registration. Exact meanings of whether an invention is ‘new’, ‘useful’, and ‘non-obvious’ are not explained with precision in TRIPS. Instead, those criteria are subjected to the interpretation of individual countries.

After TRIPS was signed, countries were allowed to override patents in times of national emergency, and for public non-commercial use. This is achieved through compulsory licensing, which is granted by the government of the country in question that allows the manufacture, sale or use patented technology in the jurisdiction of that country.

Doha: Supporting the Right to Public Health
The flexibilities inherent in TRIPS could have had a huge impact on public health, but were rarely used during the first few years after it was adopted because countries feared it would negatively impact on their trade with other countries. This called for the flexibilities to be formalised, which was achieved with the signing of the Doha Declaration in 2001. The Doha Declaration states that TRIPS should be treated in a way that was ‘supportive of WTO members’ right to public health and, in particular, to promote access to medicines for all’.

It was widely believed that the signing of the Doha Declaration would put an end to the battle for affordable medicines in developing countries. It allowed IDCs, which already had domestic pharmaceutical manufacturing industries, to proceed with the production of generic drugs.

Exact meanings of
whether an invention
is ‘new’, ‘useful’, and
‘non-obvious’ are
not explained with
precision in TRIPS

Unfortunately the Doha Declaration had little impact on drug production in less economically developed countries that need essential medications, largely because they lack a domestic pharmaceutical manufacturing industry and hence rely on generic drugs manufactured in countries like India. Dependent on the importation of generic medicine from IDCs, they couldn’t benefit from the Doha Declaration and had no control of the patents governing the manufacture of their drugs.

This problem was further compounded by the fact that countries with more advanced drug manufacturing capabilities were able to exert compulsory licenses only in times of national, not international, emergency. The WTO hoped to solve this problem with the August 30 2003 Decision, which allows manufacturing countries to issue compulsory licenses to export drugs to countries that are unable to produce them, even if the drug remains patent-protected for use in the country where they are produced.

Drug Seizures
The problems faced by Indian generic producers continue even after they obtain permission under Indian Law to manufacture a drug. Exporting drugs to locations like sub-Saharan Africa and Latin America is highly complex. Since 2008, there have been various seizures of generic drugs in European ports. For example, a shipment of anti-high blood pressure drugs that had been produced in India was seized in a Dutch port while en route to Brazil. Although the drug was not under patent protection in either Brazil or India, it was patent-protected in the Netherlands. A similar event occurred when a shipment of ARVs bound for Nigeria was seized in the Netherlands. The drugs were eventually sent back to India, meaning that thousands of HIV patients were forced to go without their medication. It is unsurprising that these events have frustrated aid organisations, health ministries of developing countries, generic drug producers, and above all, the patients for whom the drugs are made.

To make the matter even worse, India has strengthened its IPR legislation in the last few years. When TRIPS was signed in 1995, WTO member countries whose patent laws did not meet the TRIPS Agreement requirements were granted a ten-year adjustment period. One such country was India. As of 2005, India’s laws regarding patent protection conform to TRIPS. Any drug invented prior to 1995 will remain non-patentable in India, and any company that was already legally manufacturing a drug prior to 2005 will be allowed to continue to do so. However, newer drugs, including heat-stable and second line ARVs, will likely not be available generically from India unless granted a compulsory license.

Keep the Drugs Flowing
These problems look set to continue or worsen with the signing of the EU-India FTA. Médecins Sans Frontières (MSF) has highlighted two key areas of risk: data exclusivity and excessively broad enforcement measures. One of the terms of the FTA that the EC is pushing for is the introduction of a period of data exclusivity (DE) in India.

In principle, if a generic manufacturer can use the data generated by the innovator, they only have to demonstrate that their drug is equivalent to the original. DE prevents government from approving the manufacture of generic drugs based on clinical trial data from the inventor and bars generic producers from accessing the original clinical trial data. Repeating clinical trials are lengthy and prohibitively expensive. It is also deemed unethical to repeat clinical trials for a drug that has already been shown to be effective because it would be necessary to withhold these drugs from control groups. Effectively this measure would delay the launch of a generic drug by up to ten years.

Newer drugs, including
heat-stable and
second line ARVs, will
likely not be available
generically from India

Furthermore, the treaty may prevent access to generic medicines during patent disputes. Presently, if an innovator challenges a generic manufacturer in court production in India continues until the dispute is resolved. Under the new terms it may need to be halted, further limiting access to essential medicines.
The pharmaceutical industry, as one of the most profitable industries in the world, together with governments of developed countries, needs to take responsibility for the change it is capable of making. Meanwhile, the EC must not succumb to pressure from the pharmaceutical sector and ensure that the flow of affordable medicines is not blocked while negotiating trade agreements. The EC Commissioner, Karel de Gucht, has reassured those concerned that the agreement will be worded in such a way that access to medicines is not impeded. Nevertheless, it remains to be seen how committed the EC is to ensuring this.

It is essential that generic drug production be allowed to continue in India. In addition to this, the EU-India FTA must not contain IP constraints that are more restrictive than TRIPS, and EC customs regulations must change so that seizures of generic drugs can be avoided, allowing the unrestricted delivery of life-saving medicines to the developing world.

Harriet Gliddon is a third year Biochemistry undergraduate student at Imperial College London and current Editor for Global Health and Development at A Global Village.

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