Pharma needs to ensure access to medicines without damaging R&D / Prof. Ralf Boscheck*

Prof. Ralf Boscheck

International intellectual property regulations are doing serious damage to the pharmaceutical industry and, by extension, to the health of people around the world.

The core of the problem: growing global concern about how to ensure affordable access to medicine without damaging the initiatives that sustain pharmaceutical research. Attempts to address the issues have resulted in significant disagreement between developed and emerging economies about just how much protection should be available to companies that develop new drugs.

Members of the World Intellectual Property Organisation, which celebrated its 40th anniversary this year, are trying to resolve their differences on how – and even whether – emerging market countries should move to a framework that offers greater intellectual property (IP) protection, but the results to date are not promising.

'Access to medicine' advocates propose measures based on national income levels; branded drug producers want a time-based transition schedule; others argue that patent protection should be linked with the UN’s Human Development Index, which is a relative scale with frequently-changing outcomes and policy incomes.

The case for strong patent protection

Developed countries, particularly the United States, usually try to commit emerging economies to more stringent intellectual property right rules in exchange for bilateral concessions in other areas of trade. These arrangements typically involve an extension of patent terms and data exclusivity as well as limits to parallel trade and accelerated marketing approval for generic producers.

Strengthening intellectual property rights, they argue, incentivises research on diseases that are specific to developing countries and promotes technology transfer through the localisation of R&D and production investments. This then contributes to improving typically inadequate health service infrastructures.

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The 'evergreening' debate

'Evergreening' is a series of techniques used by pharmaceutical firms to continue protecting their drugs after the initial patent expires in order to maximise their return on R&D investments. That is, they prevent or limit the manufacture of generic drugs for longer.

The specific approaches used are numerous, but include 

• continued differentiation of branding, dosing, formulation or mode of action; 
• patenting active compounds or co-specialised delivery systems; and
• seeking to expand a compound’s market through approvals for new indications.

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 The 'evergreening' debate

Critics of evergreening strategies argue that this means that patients miss out on the benefits of cheaper generic drugs. However, they also usually neglect the existence of regulatory and market responses that limit the risk of abusive patenting.

For instance, patentability typically requires an invention to be novel, non-obvious and useful in the sense of capable of industrial application. The coloring and scoring of a drug may appear on the surface to be purely aesthetic, but if it can be shown to improve patient compliance, and therefore efficacy, that is novel and not obvious, and must therefore be patentable. In short, properly designed and implemented patent systems already deal with some of the often claimed evergreening concerns. 

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Evergreening of patents in pharma field / Novartis en India...

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Conclusion

Escalating healthcare expenditures and the need to ensure access to affordable medicine in both emerging and emerged economies are fuelling calls for containing evergreening practices around the world. But such practices are the necessary outcome of a system that responds to market incentives and is already sufficiently controlled by established patentability standards and policies to determine patent term extension. Even reverse payment arrangements may ultimately deliver consumer net benefits. They present a challenge for efficient rule writing and a reminder of the need for better and coordinated policy analysis.(Más)

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Access to medicines.

(*) Ralf Boscheck is the Lundin Family professor of economics and business policy at IMD and director of IMD’s MBA program. With more than 20 years of teaching, Boscheck believes in using intensive and direct interaction to develop technical competencies, self-awareness and moral judgment.