TPP text confirms deadly impact on access to medicines
The following statement by the Malaysian AIDS Council, an umbrella organisation which supports and coordinates the efforts of non-governmental and other organisations working on HIV/AIDS issues in the country, explains the broadly shared concerns over the potential adverse impact of the TPP on access to essential drugs.
THE Trans-Pacific Partnership (TPP) Agreement is a plurilateral trade agreement involving 12 countries including Malaysia and led by the United States. It contains 30 chapters, but only 4-5 of these pertain to traditional trade matters. The chapter that is of the most concern to the Malaysian AIDS Council is the intellectual property chapter. With the release of the finalised text on 5 November, we as an organisation are horrified to note the confirmation of our very worst fears - that these provisions will put generic medicines out of the hands of patients all over Malaysia and decimate the public health budget.
Access to medicines in Malaysia
Malaysia relies heavily on generic medicines, with data showing that pharmacists recommend generic substitution for 85% of all brandname requests of medicines in Malaysia. A regional study involving 10,000 cancer patients found that approximately 45% of Malaysian cancer patients suffer from 'financial catastrophe' where medical costs exceed 30% of household income 12 months after diagnosis. In regard to HIV treatment, Malaysia currently pays up to eight times more for the HIV drug lopinavir-ritonavir when compared to countries in the same income bracket (Figure 1). More recently a new drug (sofosbuvir) that can cure hepatitis C is being priced at an unaffordable RM357,000 ($84,000) for 12 weeks' treatment.
The generic versions of these HIV and hepatitis drugs can be obtained at a fraction of these costs. For instance, generic versions of sofosbuvir can be provided at RM750.06-1,579.07 ($171-360) for 12 weeks' treatment. Examples of price differences between innovator and generic drugs used in palliative care settings in Malaysia are contained in Figure 2. Given that the median monthly household income in Malaysia is RM4,585, it is important that access to generics is protected.
With the implementation of the TPP, generic versions of these life-saving medications will not be available for additional (more than 20 years if patents for new indications are applied) years following registration. This means the government of Malaysia and Malaysians will have to pay the full price of branded medications at very very high prices.
Recently, the Minister of International Trade and Industry Mustapa Mohamed argued that the data exclusivity or patent provisions in the TPP 'will not have an influence on the price of drugs'. This statement is simplistic. What provisions in the TPP would do is extend patents and have exclusivity periods that would delay the entry of generics, meaning that Malaysians would have to pay innovator prices for longer. Innovator prices, as evidenced by Figure 2, are higher than generic prices.
It should also be noted that post-adoption of similar TRIPS-plus provisions in the Jordan-US free trade agreement, the delay of generic medicines cost Jordan an extra $18 million per year. Malaysia has been lucky to have a Ministry of Health that fully comprehends the cost impact of higher medicine prices for longer. In October 2015, the Deputy Minister of Health stated: 'The Health Ministry has announced that we do not agree with the extension of the duration of [the patent of] medicines as it will burden the people.' It is clear that, based on the release of the finalised text, the concerns of the Ministry of Health have been deemed insignificant.
The finalised text of the TPP has similar intellectual property provisions to leaked texts previously commented on by Bantah TPPA [a coalition of Malaysian civil society groups opposing the TPP]. In addition to patent extensions, the text contains a controversial provision in the intellectual property chapter requiring five or eight years of biologics exclusivity. Many cancer medications are biologic, including the breast cancer drug Herceptin which costs RM8,000 ($2,600) per cycle with 17 cycles of treatment needed, costing a total of RM136,000 ($44,000) for the entire treatment.
The finalised text states (in Article 18.52 on 'Biologics'):
'1. With regard to protecting new biologics, a Party shall either:
(a) with respect to the first marketing approval in a Party of a new pharmaceutical product that is or contains a biologic, provide effective market protection through the implementation of Article 18.50.1 (Protection of Undisclosed Test or Other Data) and Article 18.50.3, mutatis mutandis, for a period of at least eight years from the date of first marketing approval of that product in that Party; or, alternatively,
(b) with respect to the first marketing approval in a Party of a new pharmaceutical product that is or contains a biologic, provide effective market protection:
(i) through the implementation of Article 18.50.1 (Protection of Undisclosed Test or Other Data) and Article 18.50.3, mutatis mutandis, for a period of at least five years from the date of first marketing approval of that product in that Party,
(ii) through other measures; and
(iii) recognising that market circumstances also contribute to effective market protection to deliver a comparable outcome in the market..'
The Malaysian law does not have biologics exclusivity and will have to be amended to incorporate this. What does this mean for the average cancer patient in Malaysia? It means that a period of exclusivity can be imposed on their already expensive medication, keeping the cheaper generic versions out of their hands for an additional 5-8 years. The Malaysian AIDS Council is especially concerned in regard to the treatment for liver cancer and leukaemia which disproportionately affect key affected populations under our purview.
While many argue that biologics exclusivity and patent extensions are necessary to promote innovation, data indicates that pharmaceutical companies are no longer innovating, and are instead using strong intellectual property provisions to profit from 'merely minor variations' to existing drugs. Cynthia Ho, Professor of Intellectual Property Law at Loyola University Chicago, described in a 2015 article this 'innovation crisis' affecting pharmaceutical companies.
In a September 2015 op-ed, Rahman and Quigley discuss the example of India which has a flexible intellectual property system that has come under attack for being too weak - but at the same time is rapidly innovating. Medecins Sans Frontieres' Chase Perfect elaborates: 'India's current intellectual property model is under attack not because it has failed, but because it has succeeded.' India's system enables access to generic medications while ensuring that real innovation occurs, not merely minor variations of old drugs. Hence the argument of innovation fails. The release of the TPP text confirms that Malaysian patients will wait longer to access more affordable generic drugs.
The above is the text of a press release issued by the Malaysian AIDS Council on 5 November 2015 and prepared by Fifa Rahman, Policy Manager at the Council.
*Third World Resurgence No. 303/304, November/December 2015, pp 27-28