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[e-drug] India refuses to hike cancer drug price(2)

E-DRUG: India refuses to hike cancer drug price(2)

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Obama's Global Health Policy Undercuts Reform At Home
Posted: 07/10/2012 9:20 Updated: 07/10/2012 4:09 pm 
WASHINGTON -- A few hours after the Supreme Court upheld his signature health 
care legislation last week, President Barack Obama approached a White House 
podium, addressed the camera and declared that the nation's top justices had 
reaffirmed an important guiding principle of his presidency.

"Here in America -- in the wealthiest nation on Earth -- no illness or accident 
should lead to any family's financial ruin," Obama said.
That single sentence was a compelling invocation of nearly every political 
theme Obama has presented on the campaign trail this year: To live in a nation 
is to take part in a social contract; personal wealth does not determine human 
dignity; decent people in a nation of means do not allow the
less fortunate to suffer needlessly.

But while the president has focused on lowering health care costs at home, he 
has repeatedly sought to impose higher drug prices abroad. For pharmaceutical 
companies, that has meant steady profits, but for the global
poor in desperate need of affordable drugs, those lofty prices are often a
matter of life and death.

Nevertheless, members of the Obama administration continue to pursue policies 
around drug pricing that multiple United Nations groups, the World Health 
Organization, human rights lawyers and patient advocates worldwide

Two weeks ago, U.S. Patent and Trademark Office Deputy Director Teresa Stanek 
Rea sparked an uproar among public health experts when she�testified before 
Congress�on multiple administration strategies to affect drug pricing abroad by 
using American international political muscle.

Her testimony focused on the Indian government's efforts earlier this year to 
create an affordable generic alternative to an expensive cancer drug called 
Nexavar, which had been patented by Bayer AG, a multinational pharmaceutical 
conglomerate best known in the United States for aspirin pills.

Over the course of 70 minutes, Rea�repeatedly castigated�India's government for 
approving the generic drug, calling the move an "egregious" violation of World 
Trade Organization treaties. India's decision, Rea said, "dismayed and 
surprised" her, and she boasted about "personally" engaging "various agencies 
of the Indian government" in efforts to overturn it.

"This is unprecedented, really shocking testimony," says Judit Rius, the U.S. 
manager of Doctors Without Borders Access to Medicines Campaign, an 
international humanitarian aid group that won the Nobel Peace Prize in 1999. 
"It doesn't have any ground in international legal norms. I've never really 
seen a U.S. government official misinforming Congress in public like this. It's 
embarrassing for the White House."

The Rea hearing, which had all the trappings of an inconsequential
technocratic snooze fest, was almost completely ignored by American media --
drowned out by the furor over the Supreme Court's historic health care ruling. 
Only eight members of the 23-person House Subcommittee on Intellectual 
Property, Competition and the Internet showed up and asked questions. 

Thus far the Indian government has resisted American pressure and continues to 
offer the generic alternative, which was approved in March after several months 
of negotiations with Bayer. 

Not once during her testimony did Rea -- or any member of Congress -- cite the 
price Bayer posted in India for its version of the drug. Bayer, which 
earned�$3.4 billion last year, was charging�over $5,000 a month�for standard 
doses, according to data from the Indian government. The cost of a generic 
version: $157 a month.

It was the high price that Bayer demanded for its cancer medication that 
prompted the Indian government to act. In a nation with a per capita income of 
just�$1,410, the Bayer drug is financially out of reach for most
Indians. The government authorized Natco Pharma to begin selling the generic
version and ordered the firm to pay Bayer a 6 percent royalty on the proceeds.

That practice, known as compulsory licensing, is commonplace. It's�explicitly 
protected by World Trade Organization treaties, an effort to ensure that good 
health care is not merely a privilege for the rich -- the kind of principle 
outlined by Obama in his celebration of the Affordable Care Act. The U.S. 
even�deploys the compulsory licensing
process�to address domestic drug shortages. 

But at the hearing, Rea said she planned to deploy the pressure it has used 
against India in other countries, too. "This is front and center," Rea said. 
"[We are] trying to stop the granting of further compulsory licenses."
Public health advocates have an entirely different take on the issue. They 
emphasize that Rea, who declined to comment for this article, did not offer a 
legal rationale for her agency's opposition to compulsory licensing, which goes 
against decades of international practices. 

Even the "Frequently Asked Questions" section of the�WTO's website�details 
broad leeway to approve generics that clearly apply to the Bayer cancer drug. 
"Ignorance is no excuse for bad argument," says Anand Grover, United Nations 
Special Rapporteur on the Right to Health and Senior Advocate for the Supreme 
Court of India, who notes that, under WTO rules, "Setting an exorbitant price 
which makes the drug unavailable to those who need it ... [is] grounds for the 
issuance of a compulsory license."

Bayer declined to comment on specific pricing for the drug, or the Indian 
government's calculations, based on Bayer data, that just 2 percent of eligible 
patients had received the drug during its first few years on the market. "We 
will rigorously continue to defend our intellectual
property rights which are a prerequisite for bringing innovative medicines to 
patients," Bayer spokeswoman Heather Levis Guzzi said in an emailed
statement. "The limited period of marketing exclusivity made possible by
patents ensures that the costs associated with the research and development of 
innovative medicines can be recovered."

The company also pointed to the fact that Nexavar is not one of the 348 drugs 
on India's National List of Essential Medicines -- a compilation of treatments 
intended to be available in a country's health care system at all times. The 
medical patent system has�plenty of detractors. Many
public health experts and economists advocate for�public financing�of research 
and development costs to avoid private sector pricing problems. 

Public health experts who deal with AIDS, in particular, have long sought to 
reform the patent regime, since HIV drugs must be taken continuously for 
decades, making high dosage costs an acute problem. Nexavar is one of several 
new cancer drugs featuring a similar treatment regimen to the best HIV drugs. 
It can extend a patient's life for years, but only if taken continuously.

Whatever the import patents have in protecting intellectual property and 
corporations' bottom lines, even the strictest patent rights have always been 
accompanied by exceptions and flexibilities. "It's disappointing and 
outrageous," says Peter Maybarduk, director of Public Citizen's Access to 
Medicines Program, a consumer advocacy group, in reference to Rea's testimony. 
"Compulsory licensing is a sovereign right to protect public health and other 
public interests. It's been around as long as patents have been around. It goes 
back to the concept of 'crown use' in the oldest patent rules."

Rea and others at the briefing also failed to note that Bayer is a German 
company. During a lengthy discussion of the Obama administration's efforts to 
prevent the Indian government from providing affordable medication to its 
citizens, Rea declared, "We are doing everything we can to respect the rights 
of U.S. innovators." But she didn't mention that her efforts weren't actually 
supporting an American corporation.

This is new territory for U.S. trade negotiation and enforcement, according to 
trade experts. During the Clinton and Bush years, American diplomats were 
dispatched to Brazil and Thailand to fight compulsory licenses on key AIDS 
drugs. However, the medications facing newfound competition were patented by 
U.S. corporations -- not foreign companies.

The Obama administration was quick to push back on Rea's testimony, with 
another key trade office downplaying her comments. "We have expressed concern 
with India's interpretation of its law in authorizing the issuance of this 
license but we have not opined with regard to whether the action is consistent 
with [WTO treaties]," Carol Guthrie, spokeswoman for the Office of the U.S. 
Trade Representative, told HuffPost. While the Patent Office has extensive 
foreign educational and advisory operations in developing nations, it does not 
have authority to bring unfair trade cases before the WTO. That power rests 
with the USTR, a White House agency that is also responsible for negotiating 
international trade deals.�In a blog post�published a few days after the 
hearing, Rea walked back some of her comments, acknowledging that compulsory 
licenses can be acceptable under WTO rules. Nevertheless, she said her agency 
"encourages" other nations to adopt policies that are stricter than WTO 
standards and maintained her opposition to the Indian generic.

"Although compulsory licensing can be permissible under the TRIPS Agreement, we 
encourage our trading partners to consider ways to address their public health 
challenges while maintaining intellectual property rights systems that promote 
investment, research, and innovation," Rea
wrote. "The broad interpretation of Indian law in a recent decision by the
Controller General of Patents of India regarding compulsory licensing of 
patents, in my view, may undermine those goals." 

Public health experts emphasize that this kind of political pressure from the 
U.S. can be damaging to developing nations, even if no formal trade complaint 
is ever brought before the WTO. "The [U.S. Patent and Trademark Office] is 
viewed as a regulator in other parts of the world, and not a lobbyist for 
U.S.-style patent laws or patent enforcement," says Kajal Bhardwaj, a human 
rights lawyer in India who has done extensive work on legislation to combat HIV 
in India. "The statement by the USPTO official that its trainings are a method 
for preventing the issue of compulsory licenses is of great concern."

Rea's testimony is only the most explicit example of the Obama administration's 
efforts to use intellectual property maneuvering to inflate medical costs 
abroad. This year alone, the Department of Health and Human Services and the 
State Department have joined USTR and the USPTO in�disrupting World Health 
Assembly talks�over reducing research and development costs for medicines 
targeting developing nations, and�shut down World Intellectual Property 
Organization negotiations�aimed at curtailing the prices of existing drugs in 
poor countries.

Of course, high medicine prices abroad mean high profits for pharmaceutical 
firms, and drug companies were an important White House ally during the 
legislative push for the Affordable Care Act. Obama care seeks to contain 
medical costs by focusing on insurance reform -- it makes only very modest 
changes to prescription drug policies, and in many respects, actually breaks 
new ground on pharmaceutical company efforts to establish drug monopolies.

"We're taking the worst parts of U.S. law, the parts
that make these medications unavailable to patients, and putting them into a
trade policy as a guiding principle for developing countries," says Reshma
Ramachandran, a fellow with the American Medical Student Association, which
advocates for universal quality affordable health care and global health
equity, among other priorities. "That's ridiculous."

As HuffPost reported in the fall of 2009, the Obama administration cut a deal 
with PhRMA -- the dominant drugmaker lobbying group -- intended to smooth the 
bill's congressional path.  Obama agreed to go easy on pharmaceutical companies 
with his reforms, if PhRMA would support the overall legislation. One of the 
key giveaways to PhRMA? A new�12-year monopoly on test data�used in medical 
trials for drugs derived from proteins or living tissues. Obama approved the 
PhRMA freebie�over the explicit objections of the Federal Trade Commission, 
which concluded in a 2009 report that the new test data rights would lead to 
anti-competitive behavior.

This new power, called data exclusivity, prevents companies from relying on 
another firm's clinical trials when seeking government approval for their own 
drug. The practice violates centuries of scientific standards, but it can also 
lengthen patent monopolies and prevent the development of new, even broadly 
unrelated, medications that rely on previous scientific tests.
"The 12 years of exclusive rights in test data creates an automatic monopoly 
right that is stronger than a patent monopoly in most countries, and it raises 
drug prices," says James Love, Director of Knowledge Ecology International, a 
nonprofit dedicated to public health and access to knowledge. "It violates 
the�Helsinki Declaration�on ethical principles for research involving human 
subjects, because it requires the duplication of experiments on human subjects."

The WTO has never required countries to abide by these standards, but according 
to Rea, the U.S. is trying to use�trade negotiations�with 10 other Pacific 
nations to export the policy abroad. India isn't part of the
Trans-Pacific deal, but Rea's discussion of the pact underscores the 
administration's multi-pronged approach to elevating drug prices. While 
attempting to prevent the introduction of generic drugs in WTO nations, the
U.S. is simultaneously seeking new trade agreements that would impose  stricter 
rules than those required by the WTO. Countries involved in the Trans-Pacific 
talks include Malaysia, which has a�per capita income one-third less�than that 
of the U.S., and Vietnam, a nation significantly poorer than India.

"We view that the Trans-Pacific Partnership provides a good venue to make sure 
that we get appropriate data protection, and that the 12 years of data 
exclusivity is something that we are definitely trying to negotiate for right 
now," Rea said during her testimony. The USTR rejected Rea's statement. "That 
is incorrect," USTR's Guthrie told HuffPost, referring to Rae's claim about 
data exclusivity. "U.S. negotiators have not proposed a specific term for data 
exclusivity for biologics ... discussions
on issues relating to biologics are continuing because we want to get the
substance right." 

Although the Patent Office is a key adviser on trade agreements, negotiating 
the Trans-Pacific deal is USTR's responsibility. Draft terms of the pact, and 
the Obama administration's hoped-for final results, are withheld from the 
public -- a policy which has embroiled the agency in
considerable controversy with members of Congress, who want staffers to be able 
to access key documents. Rea's announcement of a negotiating goal was a major 
diplomatic faux pas. Rae�walked back this point�from her under-oath testimony 
in her blog.

"I was also asked to comment on a twelve year period for data protection for 
biologics which is favored by the research-based pharmaceutical industry," Rae 
wrote. "The Trans-Pacific Partnership (TPP) negotiations are ongoing and the 
United States Government has not made a proposal for a longer term of data 
protection for biologic medicines." But while there is a clear pattern to the 
Obama administration's strategy on such issues, different factions of the 
executive branch do not always agree on details. In its latest budget proposal, 
the Office of Management and Budget suggested a 7-year time limit on data 
exclusivity. But if Rea's preference policy made its way into the Trans-Pacific 
deal, the U.S. would be�subject to international trade sanctions�if it ever 
opted to shorten or eliminate the 12-year right.

The U.N. Development Program and UNAIDS, meanwhile, oppose any term of data 
exclusivity whatsoever, and�issued a report in June�encouraging countries not 
to sign trade agreements that include the provision. The latest round of 
Trans-Pacific negotiations began the week after the Supreme Court upheld the 
Affordable Care Act. The irony is not lost on health care reform activists in 
developing nations.

"That the Obama administration cannot see the gross inequity of charging $5000 
per person per month for a cancer medicine in a developing country says a lot 
about this government," says Shiba Phurailpatam of the Asia Pacific Network of 
people living with HIV/AIDS. "Affordable care, it seems, is only for U.S. 
citizens, not for the developing world."

Article updated to reference India's nominal per capita income, rather than 
purchasing power parity figures.�

Dr Gopal Dabade,
57, Tejaswinagar,
Dharwad 580 002
Tel 0836-2461722
Cell (0)9448862270

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