Bangkok Post - March 2, 2007
Apiradee Treerutkuarkul

Thailand's daring step in enacting compulsory licensing for three patented Aids and heart disease medications - Efavirenz, Kaletra and Plavix - consecutively within two months is being seen as a pivotal move by developing countries in widening access to necessary medicines for their populations. The swift action was praised by HIV/Aids and consumer rights activists the world over, as much probably as it has upset big pharmaceutical firms, which are seeking ways to protect their business interests and intellectual property rights through legal bodies, both domestically and internationally.

It is understandable why the Public Health Ministry led by Mongkol na Songkhla quickly sought to implement the compulsory licensing clause allowed by the World Trade Organisation to produce or import generic versions of patented drugs for government use, as he only has a limited time to work in this position. However, it remains to be seen how he and his team completes their work and prepares the Health Ministry and related agencies to find a balance between the price war with drug companies and the sustainable expansion of public access to quality, affordable medicine.

In November, Dr Mongkol issued a compulsory licence for Merck's HIV/Aids drug Efavirenz followed by the second-line combination antiretroviral therapy Kaletra and heart disease drug Plavix in January - the first non-Aids drug to be included in the compulsory licensing list by a developing nation.

"We have to bear the financial burden in taking care of these diseases which are regarded as national epidemics. Expanding public access to medicine is very essential for us and compulsory licensing is our last resort to deal with the matter," Dr Mongkol said.

The army-appointed interim minister said health researchers had studied the problem of overpriced drugs for over five years, but none of the previous health ministers had taken action.

He decided to put the measure into effect because the ministry has long faced a tough time in negotiating with drug firms.

Evidently, the move seemed to be very effective in opening a long-awaited dialogue between the ministry and drug firms on the issue of overpriced drugs.

Right after the announcement was made, pharmaceutical groups immediately sought to negotiate with the ministry. Merck, for example, offered an official price-cut for its patented Efavirenz the world over including in Thailand. Still, the health agency questioned why should it want to return to buying the original drug when a cheaper version was available from India. The new prices for Kaletra and Plavix have yet to be agreed on between the state and private companies.

The drug firms have their own ways of defending their multi-billion-dollar businesses. They have sought help from the Department of Intellectual Property to forward the issue to the Council of State. They probably hope that the Health Ministry's action regarding drug procurement could end up the same way as its previous, futile attempt to ban alcohol advertisement.

Although Dr Mongkol has repeatedly explained that his action was in accordance with the WTO's agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) to import or produce copycats of these medicinal pills for government use, and that a white paper had been distributed explaining his actions to the public, sceptics remained doubtful whether this policy would be applied to other essential drugs - especially after a future, elected minister takes over Dr Mongkol's position.

Teera Chakajnarodom, president of the Pharmaceutical Research and Manufacturers Association, said he did not believe the future government would continue to carry out this policy. This was mainly because the Government Pharmaceutical Organisation itself had limited capacity to manufacture affordable drugs to meet public demand or to counter epidemics by itself.

"The GPO won't be able to produce generic medicines which contain the therapeutic equivalance of original ones, when its drug-manufacturing plant is not even up to standard," he said, claiming that research and development for each original drug cost up to US$1-1.5 billion.

The GPO does indeed have limited manufacturing capacity. Its present plant in Bangkok, located in the heart of the city, is overcrowded and has not passed the Good Manufacturing Practice (GMP) certification of the World Health Organisation.

Its new, larger plant has yet to be constructed even though the project has been planned for almost a decade, mainly because of transparency problems.

Undoubtedly, the flaw can be easily targeted and criticised by multinational drug firms. What's the point of issuing compulsory licences when the preparation for this new role of producing copycats of medicines for government use remains up in the air?

Although the agency is in the process of developing a laboratory for producing the generic version of Aids and heart disease drugs, and it is expected to be completed by the end of the year, the GPO requires much overhauling if the ministry truly wants to achieve its announced goal of widening the public's access to cheap but quality drugs.

Vithaya Kulsomboon, a health expert from Chulalongkorn University's Faculty of Pharmaceutical Sciences, said the GPO needed an incentive to do more research and development work. A substantial portion from its annual profit should be earmarked for boosting R&D - even though the amount could not be compared to the sums invested by big drug firms.

Apart from changes at the GPO itself, it is important that the public sector regard this experience of compulsory licensing as a stepping stone in a bid to deal with the issue of drug access after this government finishes its term, he said.

Mr Vithaya believed the best way to guarantee that the issue of public access to affordable quality drugs is carried on by the future government would be to incorporate it into the new constitution.

Now was also the best time since the Thai-US free trade agreement has been put on hold.

The bilateral trade agreement includes the issue of "data exclusivity" which guarantees additional market protection for originator pharmaceuticals by preventing authorities from accepting applications for approval of generic medicines during the period of exclusivity, usually 6 to 10 years.

By embodying this detail, the trade agreement could hinder the country's public healthcare system as a whole. This could result in the Thai people having to buy overpriced drugs indefinitely, unless the country could come up with some legal immunity against the bilateral agreement, he said.

The onus is on multinational pharmaceuticals themselves, too, to adjust their marketing strategies in developing countries where the issue of overpriced drugs is a serious impediment to public health.

"Every sector involved needs to fine-tune its standpoint in order to seek the right balance between the issue of drug price and public access. After all, medicines are not ordinary commodities. In many instances, they are life-saving tools," Mr Vithaya said.

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