The key idea behind the battle James Love has been waging for the past four decades on five continents is that mass producing medicines is cheap. The real cost lies in the research and clinical trials behind the discovery and production of each new drug. But if society were to find a way to reward public laboratories and private companies for research and innovation, and then allow any company to mass produce the drug, this would significantly reduce the cost and bring huge benefits to the public health system worldwide.
Love, who is director of Knowledge Ecology International – a nongovernmental organization focused mainly on knowledge management and governance, including intellectual property policy – and also works as an adviser for various United Nations agencies, argues that the delinkage of the cost of research from the final cost of a drug is an unavoidable change in the business model.
Love was in Athens recently, as a guest of the Hellenic Organization of Industrial Property (OBI), whose director general, Dr Ioannis Kaplanis, told Kathimerini that the expert’s recommendations on compulsory licensing, open innovation and patent pools are currently under discussion with the Greek Health and Welfare ministries.
Your battle with cancer started long before it actually hit your family.
Yes. Cancer drugs were the first category of drugs I began working on around 1991, and around 1994 I started working in the international dimension of these things. I was involved in all of the early compulsory licensing in Africa, maybe half a dozen countries, in India, Thailand, Malaysia, Indonesia, also in the United States and Europe. My wife has been undergoing treatment since 2010. Right now, her drug probably costs 100,000 euros a year – just for the drug, not for the other parts of the treatment. I just don’t know how systems are going to support these kinds of costs.
What’s the driving force behind this battle?
When you recognize there’s a good reason to question what the price of a drug is – not just in terms of cancer. You have to ask yourself, if you don’t like the price, what can you do about it? If you can’t contest the monopoly on the drug, then your response is often to withhold the insurance for the product, to say it’s so expensive we won’t pay for it.
That’s what’s happening in the UK right now for the drug my wife takes [Note: The drug, Kadcyla is not available in Greece either]. They do not reimburse for the drug, so in this case, the patient is the one who bears the brunt of the failure. I was interested in finding ways to address this without hurting the patient. The idea is to use compulsory licensing to break the patent monopoly and to permit competition, to never have to use the monopoly in the first place.
I can understand temporary monopolies in other areas, like airplane seats, where there’s a lot of litigation, but in medicine it really seems like the wrong way, because the pricing abuses seem really more dramatic and the consequence of the inequality of access is really not acceptable socially.
What about drug research and development financing?
You have to put it into perspective. If you pay an additional $1,000 on a drug, you don’t get $1,000 in R&D funding. You get $100. So it’s very expensive to get that incremental amount of R&D funded through high prices. The international pharmaceutical market is more than 1 trillion euros now. You don’t get a trillion in R&D, you get a much smaller amount. Self-reporting for the industry as a whole puts it at under $100 billion and what you would consider actual experiments is significantly lower, but still a lot of money.
But there are several ways you can fund R&D. You can have direct government funding; Greece does, the US does, the European Commission does. The World Health Organization is discussing a proposal that will be up for a vote in May on cancer, where they propose a feasibility study on the elimination of monopolies on cancer drugs. It’s actually making a lot of progress when it comes to antibiotics.
Why especially antibiotics?
Because if you have a new antibiotic drug, you don’t want to have it used very widely, you want it used only when other drugs don’t work, because every time you use it, it breeds resistance. And if you have an antibiotic-resistant strain you can be defenseless. So if you’re a drug developer, what does that mean to you? You develop a drug, you have a marketing monopoly, but you are supposed to invoke stewardship of the resource by not making it available. So the idea of delinking the reward for innovation from the utilization of the drug is very popular. The European Federation of Pharmaceutical Industries and Associations as well as CEOs from big companies have endorsed this concept as relates to antibiotics. The G20, the G8 are moving on it.
Delinkage is still a long-term prospect. How can we increase drug availability within the current system?
Patent law everywhere, also in Greece, has safeguards to protect against excessive pricing. Hepatitis C is a disease you could eradicate in Greece, but not at the current price. Sovaldi is the most profitable drug in the history of the world. [Note: In Greece, Sovaldi, the drug that cures hepatitis C costs 55,000 euros without rebate, 42,000 euros with rebate.]
The generic price is $200 a cure and it can get down to 50 euros if volumes increase. The highest infection rates in Europe for hepatitis C are in Greece, Romania and parts of Italy. The tool you can use is called compulsory licensing. I think Greece should act on a compulsory license on the hepatitis C drug, as well as some cancer drugs. There are two important breast cancer drugs that are extremely expensive, as well as a couple of prostate cancer drugs.
If you issue even one compulsory license with one drug, you instantly have more bargaining power with the other drugs. You can do that right now, with the existing law, although you could also change the law to improve it. I’m aware of three cases in Germany where compulsory licenses were used for diagnostic tests for HIV and hepatitis, as well as for a fibrosis drug.
US courts issue compulsory licenses all the time for patents in products, they just give them a different name. Companies get to use someone else’s patent by paying a sum set by the court. So if a Greek company wants to produce the hepatitis drug, they could either ask for a compulsory license under Article 13 of Greek patent law, or they can try and persuade the government to request it, under Article 14, which would be much easier.
What happens next?
The first time a country uses a compulsory license is more dramatic, it’s the anxiety of the unknown. But in Greece, it’s one of those things where in theory there should be flexibility, because it’s a cost-saving measure. In the past seven years, there have been 56 new cancer drugs in the US; it’s an amazing wave of innovation and most of them are ridiculously expensive. It used to be that a drug that cost $35,000 a year was really expensive, then $50,000, then around 2000 it was $100,000. Now, it’s $150,000 a year, for a chronic illness.
Where do you think this is going to end? The probability that a person will get cancer increases as they age. At the same time, cancer patients are not dying, treatment lasts longer and longer. Like my wife, she was diagnosed in 2010, she is not cured, she is more physically fit than I am but she has this very expensive treatment. How sustainable is this? Not to mention that 80 percent of the population is currently not covered. So when people ask how realistic delinkage is, I ask them how sustainable the current system is.
If a drug is cheaper in one country and more expensive elsewhere, doesn’t this encourage parallel trade?
I think it’s an example of the problems of trying to manage the high price system. It becomes complicated to control the distribution of drugs because they are getting different prices. Drugs are in shortage in Greece and sold in France, and this sort of thing shows the irrationalities of the current system. But here is the basic question: Is the monopoly a property right above regular property? If I own a house, that’s property, but the government can come and take it to build a freeway and give me money for it. Even my house is not immune.
Do patents have some special “superproperty” status, where there’s nothing you can do? Patents were created to finance R&D, they were supposed to serve society, we’re not supposed to be the main course. It’s like Stockholm syndrome: Everyone is so used to the pain they think it’s normal.