TWN Info Service on Intellectual Property Issues (Mar07/03)

14 March 2007

Abbott Withholds Registration of Important Live-saving Drugs

Earlier this year, Thailand issued a compulsory licence on an important antiretroviral medicine, Kaletra in order to improve access to affordable medicines. The move which is TRIPs compliant has upset Abbott the pharmaceutical company which produced the drug.

In a perverse effort to preserve its intellectual property rights and monopoly, the company has now responded by withholding the registration applications for the new heat stable form of Kaletra, an important AIDS medicine especially for developing countries, and for six other medicines that it had submitted for marketing approval.

This withdrawal will make it much more difficult for Thailand to grant marketing approval for generic versions of Kaletra and other Abbott medicines because the Thai drug regulatory authority will not simply be able to compare the generic version against the innovator version to confirm that they are therapeutically equivalent.

This move will thus have adverse impact on the lives of thousands of patients who rely on affordable medicines.

The article below provides details about this development.

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Standing Up To Abbott's Decision to Withhold Registration and Marketing of

Life-Saving Medicines - A New Variant of Pharmaceutical Apartheid

Brook K. Baker, Health GAP

March 13, 2007

Abbott is now doing what drug companies have long threatened to do when developing countries use lawful flexibilities to access more affordable generic medicines - it is threatening to take its marbles and go home. Unfortunately, however, Abbott is not playing marbles, it is playing a deadly game of Pharmaceutical Apartheid, where drug companies withhold access to affordable life-saving medicines in a perverse effort to preserve intellectual property rights at all costs.

Abbott is upset because Thailand has lawfully issued a compulsory license on an important antiretroviral medicine, Kaletra. According to Abbott (and its think-tank apologists and Wall Street Journal defenders), Thailand issued this license without prior negotiations for a price discount or for a voluntary license. However, contrary to Abbott's claim, both international law (the WTO TRIPS Agreement, Article 31) and the Thailand Patent Act permit Thailand to issue compulsory licenses for governmental, noncommercial use without prior negotiation. Moreover, contrary to Abbott's claim, Thailand, like many other developing countries, had long engaged in fruitless negotiations with Big Pharma for deeper price discounts, but Abbott used its monopoly power to unilaterally determine the price points for its tiered-pricing "access" program.

Because Thailand has not caved into to threats and entreaties from Abbott, the USTR, certain members of Congress, and the international business press, Abbott has now raised the stakes further by withdrawing registration applications for the new heat stable form of Kaletra, an important AIDS medicine, and for six other medicines that it had submitted for marketing approval. (The meltrex, heat stable form of Kaletra is especially important in warm country climates like Thailand where maintaining a cold-supply chain and ensuring that poor patients have access to refrigerators to store their medicines is virtually impossible.)

This withdrawal is profoundly cynical and immoral. A company which has been subsidized through NIH and university research for most of its discoveries, which gets huge taxes breaks for its research and development expenditures, and which earns monopoly profits on all its sales in rich country markets that collectively comprise 90% of global pharmaceutical sales, now determines that it will withhold marketing of life-saving medicines when a country seeks to exercise its lawful, TRIPS-compliant rights to access more affordable generic medicines.

This withdrawal will make it much more difficult for Thailand to grant marketing approval for generic versions of Kaletra and other Abbott medicines because the Thai drug regulatory authority will not simply be able to compare the generic version against the innovator version to confirm that they are therapeutically equivalent. In the worst case scenario, generic companies will now have to repeat costly, time-consuming, and ultimately unethical clinical trials to prove something that is already crystal clear - equivalent generic medicines are safe and efficacious. Even if Thailand decides to forego reliance on new clinical trials, it may instead have to amend its law so that it can rely on WHO pre-qualification and/or the fact of registration by a stringent regulatory authority elsewhere. (Note: The U.S. is trying to block Thailand's future right to legislate such reliance in its free trade agreement negotiation where it seeks five-years of data exclusivity.)

However, even though Abbott will not necessarily be able to completely block registration of follow-on generics by its market withdrawals, its withdrawals will have devastating effects for those medicines for which there is no generic alternative at present.

Thus, to prove its point, and to maintain its market and intellectual property hegemony, Abbott is willing to make Thailand and its patients a "no drug zone." The predictable, inevitable consequence of this cynical power play will be the deaths of innocent patients.

Drug companies like Abbott have all kinds of lame excuses for their murderous policies. Novartis defends its patent law lawsuit in India because it wants to maintain its right to sell Glivec to middle-income patients, even though India represents only 1.3% of the global pharmaceutical market and even though 99% of Indians are not middle class. Pfizer wants to maintain its patent monopolies in the Philippines by filing frivolous lawsuits against government officials and generic companies who seek to permit lawful early registration of generic medicines. And now Abbott, pulls a new "troop-surge" weapon from its arsenal – wholesale market withdrawals.

Once again activists and thought leaders need to rally to the support of Thailand's lawful effort to access more affordable medicines and to condemn this latest variant of pharmaceutical apartheid. One hopes fervently that Thailand will stand firm, that it will find alternative ways to grant marketing approval/registration of generic versions of Pharma products, and that even more developing countries will stand up and fight for the human right of access to essential medicines.

Professor Brook K. Baker, Health GAP
Northeastern U. School of Law
Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115
617-373-3217 (office)
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