Access to medicines is fundamental for people to achieve their right to health. While governments have the primary responsibility for ensuring access to health care for all their citizens, the role of the pharmaceutical industry in providing a vital element – medicines – carries its own responsibilities.
In 2002, Save the Children, VSO (Voluntary Service Overseas), and Oxfam published ‘Beyond Philanthropy’, a report that called for the pharmaceutical industry to contribute to addressing the health crisis in developing countries. The report challenged the industry to adopt policies in five areas: pricing, patents, joint public–private initiatives, research and development, and the appropriate use of medicines. Since the publication of the report, the industry has made halting progress in some of these areas, mainly by adopting limited policies to promote access to medicines for high-profile diseases such as HIV and AIDS, TB, and malaria.
However, the challenge to ensure that millions of poor people can get the medicines they need remains huge, given the appearance of new diseases; the re-emergence of ‘old’ diseases; the threat of pandemics; and the growing burden of non-communicable diseases in developing countries.
1. Malaria claims the lives of one million people every year – mostly children and pregnant women.
Two million people die annually from TB. Half of the global cancer deaths are in developing countries. The World Health Organisation (WHO) estimates that the occurrence of asthma is increasing on average by 50 per cent every ten years in cities in the developing world.
Currently 85 per cent of the world’s population is being priced out of the industry’s market.
Current industry approaches do not address the problem sufficiently.
Major shortcomings include:
• a failure to implement systematic and transparent tiered-pricing mechanisms for medicines of therapeutic value to poor people in developing countries, where prices are set according to a standard formula which reflects ability to pay and the price of generic versions where they exist;
• the lack of research and development (R&D) to address the dearth of dedicated products for diseases that predominantly affect poor people in developing countries. This includes drug formulations that are applicable and usable in the developing world. Between 1999 and 2004, there were only three new drugs for neglected diseases out of 163 new chemical entities (NCEs);
• persistent inflexibility on intellectual property protection, and in some cases, active lobbying for stricter patent rules and legal challenges to governments’ use of TRIPS public-health safeguards, thereby preventing poor people from accessing inexpensive generic versions of essential medicines; and
• too heavy a focus on donations, which by their nature are unpredictable and have been found to cause chaos in the market for low-cost medicines as well as undermining generic competition.
Oxfam believes that the potential for pharmaceutical companies to contribute more substantially and effectively towards increasing access to medicines for poor people in developing countries is not being met, and that there are three factors that have prevented companies from moving forward.
First, companies’ pursuit of strategies that address access to medicines merely as a reputational problem has resulted in patchy, ad-hoc approaches which have failed to deliver sustainable solutions.
Second, the industry’s responses to flagging financial performance – hiking up prices, aggressively defending patents and prolonging existing ones through ‘ever-greening’ rather than investing in research and development of new medicines – have undermined needs for lower prices, flexible approaches to patenting, and R&D investment into diseases relevant to the developing world.
Third, the industry’s failure to comprehend access to medicines as a fundamental human right enshrined in international law, and to recognise that pharmaceutical companies have responsibilities in this context, has prevented the adoption of appropriate strategies.
It is clear that there are pressures on the pharmaceutical industry to change course. Increased financial burdens on health systems due to ageing populations and changing disease burdens are stimulating calls for lower prices from both North and South. The industry is now challenged to be more transparent about its price rationale so that governments and public-health advocates can request greater alignment between the prices set and purchasing power. The intellectual property regime and the market-driven model of drug development are criticised for not delivering real innovation required to relieve the global public-health crisis.
At the same time, investors are clearly concerned that this industry is not delivering the profits that it used to. Emerging market economies are being identified as the possible panacea to this flagging growth. There are enormous opportunities in these markets, including lower costs to conduct R&D and clinical trials, and low-cost manufacturing. These economies also offer substantial market potential. However, for this to be realised, the industry will have to recognise that serving these markets requires a vastly different approach: one which reflects the significance of massive income disparities, the impacts of high prices on increasing vulnerability and insecurity, and the need for medicines that are relevant and adaptable to poor settings.
Pressures on the industry to meet society’s expectations of access to medicines will continue for a number of reasons:
First, a growing number of developing-country governments are making serious commitments towards achieving viable health services and equity of access. Without a solution to the problem of access to medicines, they cannot meet their goals and obligations to their populations. In the developing world, where the majority of people live in poverty and are highly sensitive to price rises, companies will have to respond by implementing sophisticated differential pricing policies correlated to different income levels or by instituting flexible patent policies to ensure the desirable low price is achieved.
Second, the epidemiology of public health is changing, with a more diverse range of diseases that require appropriate products. For developing countries particularly, their specific contextual realities need to be taken seriously: new products are needed, formulations need to be usable, and drug information and labelling should be comprehensible. R&D will have to be tailored to end-use realities.
Third, demands from civil society for the industry to deliver their end of the social contract are likely to grow and become more exacting. As the current models and incentives for delivering medicines that are suitable, usable, and affordable for poor people come under increasing scrutiny, this will add to the growing pressure upon the pharmaceutical industry to adopt different strategies that better meet global health needs.
If companies continue a slow evolution of the existing approach without addressing society’s expectations, they are likely to fall seriously short of meeting the challenges of access to medicines.
Now is the time for companies to take a bold look at new ways of doing business, incorporating a social equity bottom line into their thinking, working more flexibly, transparently, and practically with a wide range of stakeholders. The current inertia on access to medicines can be overcome by placing concerns about affordability and availability at the core of business decision-making processes and operations. To do so will require strong leadership and long-term vision.
Oxfam also believes that integrating access to medicines into the core business model will institutionalise a framework for the industry to predict, respond to, and satisfy the needs of people in developing-country markets. Investors who are encouraging pharmaceutical companies to enter emerging market economies identify the need to adapt prices, to have more flexible distribution systems, and to make products that are relevant to the markets being served, as necessary elements of a business strategy.
Oxfam recognises that the fact that a social good is being provided through the market is always going to pose challenges and is susceptible to the problems of market failure. Collective action to overcome this is an imperative.
In this context, society expects pharmaceutical companies – with their privileged access to a global market – to develop necessary products at prices that are affordable, in presentations that are usable, and to market them ethically. The pharmaceutical industry is expected to fulfil these requirements reliably and sustainably, and by so doing, play its part in the wider responsibilities to improve the health of all.
Full report here.
No comments:
Post a Comment