10 December 2021

Pharma Prices and Patents

'Access to Medicine and TRIPS Agreement: A Historiographic Mapping of the Tradescape' by Srividhya Ragavan and Amaka Vanni in Intellectual Property Law and Access to Medicines: TRIPS Agreement, Health and Pharmaceuticals (Routledge, 2021) comments 

The tumultuous tradescape, which references the landscape of the trade regime, provides the background for this chapter and hopes to outline a historiographic mapping of the struggles of diverse actors for access to medicine rupturing established global structures over three generations. The historiographic mapping traces the changes in the patent discourse terrain by analyzing the metamorphosis of IP ideology, particularly patents. In doing so, this larger book captures the different sets of actors such as states, transnational business corporations, civil society groups, and the (re)framing of patent discourses within and among these actors. Our intergenerational analyses of the legal issues surrounding the access to medicine question provides an insight into the structures within which the actors have operated along with the dynamic relationship between structures and actors. The term structure refers to the economic system within which various actors operate. The influence of structures over the behavior of actors and in turn, the influence exerted by actors over structures eventually caused generational shifts in the debate on the role of patents, trade, and access to medication. The book examines the influences over established global protocols, national and international agreements, and state and non-state entities. In doing so, we acknowledge that the history of patent harmonization discourse is a story of dynamic actors, whose interactions with established structures continue to shape the global patent regime. 

 The authors note 

The next generation in the drug debate surprisingly involved developed countries where a steady increase in the price of pharmaceuticals over a decade caused health-care costs to skyrocket, raising questions with implications beyond pat- ents. Interestingly, pharmaceutical companies are facing growing condemnation against the background of soaring drug prices, causing governments to become constituencies acting for the cause of making either medication or health care accessible to citizens. For example, the UK’s National Institute for Health and Care Excellence recommended against the use of trastuzumab emtansine (brand name Kadcyla) in the National Health Service because of its high price, even though it recognized the efficacy of the drug to treat breast cancer. Similarly, when patient-led campaign organization Just Treatment criticized the price of cystic fibrosis drug Orkambi manufactured by Vertex Pharmaceuticals, the NHS entered into price negotiations to reduce the cost. In the Netherlands, hospitals started making their own generic versions of expensive medicines to ensure availability of expensive drugs. In France, Médecins du Monde filed a challenge at the European Patent Office against Gilead’s Sovaldi – used to treat hepatitis C – challenging the cost and patent validity of the drug.  The US has been exceptional, where several issues have been raised on the question of pharmaceutical pricing, health-care access, patents, secondary patents, data exclusivity, and more. The practice of inflating the price of off-patent drugs, such as in the case of Humalog – a brand of insulin manufactured by Eli Lilly whose patent had expired 75 years ago and whose price nearly tripled between 2002 and 2013 and doubled again since then – raised concerns even among supporters of the Pharmaceutical Research and Manufacturers of America. The biggest game changers were American senators and members of Congress – who evangelized to sympathizers for reducing health-care costs – who became critical of the exorbitant cost of pharmaceuticals. 

Particularly in the US, and generally in the West, the evolution of health care into a privilege has proportionally seen an increase in discontentment and considerable challenges against all structural barriers that work to overprotect private capital at a huge public cost. Thus, beginning with the subject of patents and its correlation to innovation, several issues have brought the health-care access debate to the forefront by raising concerns about secondary patents, the regula- tory issues relating to patents, market and data exclusivities, patent linkage, and more, each of which is dealt with in the book. For example, secondary patenting – the practice of filing patents that are minor variants of the parent compound – leads to evergreening by creating a stack of patents, such that the innovator can exercise monopoly even after the first of several stacked patents expires. Such stacking effectively extends monopoly that unfairly delays the entry of generics to the market and raises costs for governments and patients as a result. Secondary patents have been challenged because, while they can increase the number of patents, they do not necessarily reflect the presence of innovation. A report by the advocacy group Initiative for Medicines, Access & Knowledge (I-MAK) discussed that pharmaceutical companies file hundreds of patent applications that are used to extend their patent term beyond the 20 years of protection intended under international patent law. This effectively blocks competition, keeps cheaper versions of medicines off the market, and makes medicines harder to access on account of high drug prices. In effect, the world is witnessing a global shift in the access-patent discourse. Previously considered a problem for low-in- come countries, the issue is a global barrier to public health and trade. Like secondary patents, the issue of data exclusivity can also work in tandem with the patent regime to add another level of protection. Data exclusivity refers to the practice of protecting clinical trial data submitted to a regulatory body to prove the safety, quality, and efficacy of a new drug. In practical terms, this prohibits the dissemination of clinical trial data to a third party (usually, a generic company), thereby preventing the generic company from relying on the data for its own drug approval. For instance, the US Affordable Health Care for America Act in 2009 extended a 12-year exclusivity period for biologics. When patents are awarded for 20 years, whether the safety data and related information should be independently protected remains an important question. It is more complicated in cases where the underlying patent is found invalid, resulting in the clinical trial data alone preventing a generic drug company from releasing a cheaper version until the data protection period is over, thereby virtually allow- ing the holder of the invalid patent to monopolize the market for the duration when data protection prevails. 

Data exclusivity can also affect the use of CL by requiring the generic man- ufacturer to seek the patent holder’s approval to use the test data separately for marketing approval. In the EU, for instance, depending on whether the orig- inator drug is a chemical or biologic, a generic may not be marketed between 10 and 12 years after the grant of the initial market authorization for the originator product. This forces a generic company to duplicate the clinical trial, the cost of which will be passed on to consumers. The issue of data exclusivity, especially as required under Article 39 of the TRIPS Agreement, has been contentious among legal scholars and commentators. For example, Daniel Gervais reads data exclusivity as a mandate in the TRIPS requirement to protect against unfair commercial use.  Carlos Correa, on the other hand, argue that the language of Article 39 falls short of what could be recognized as data exclusivity, and that the US position is inconsistent with the TRIPS Agreement.  Similarly, Ellen T’Hoen believe that the TRIPS Agreement does not oblige countries to confer exclusive rights over data related to market- ing approval to the originator company. This book presents these challenges and issues that implicate data exclusivity, patents, and their effect on access to medication. 

In addition, patent linkage has grown in recent times to pose as a barrier to medicine access. According to Ragavan, patent linkage, which is the tying-in of patent information with data exclusivity, requires the regulatory body to verify if a generic application relates to a patented product. Thus, a government body essentially performs the role of a gatekeeper of private property. This adds another layer of administrative approval, thus operating to further delay the entry of generics. Patent linkage has far-reaching effects due to its widening scope and geographical coverage via free trade agreements (FTAs) and mega-regional agreements. By delaying the entry of generics into markets, patent link- age allows the high prices of originator medicines to remain unrestrained. It is essentially an additional layer that shields the originator pharmaceutical com- pany from generic competitors. As Kyung-Bok asserts, patent linkage facilitates innovator pharmaceutical companies to obtain a de facto injunction against a generic drug company. Such injunctions can delay generic applications for up to 30 months, unless noninfringement or invalidity is established earlier, either by court judgment or patent expiry, during the 30 months.