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Posted
January 26, 2005

A Bold New Initiative in the Struggle for Affordable Drugs

Prominent scientists petition the World Health Organization to open up trade in life-giving medicines.

Big Pharma is such a hard-driving, seemingly invincible player in global markets and policymaking that it often appears impossible to counter its influence. Now comes a fascinating new proposal that could radically change how the nations of the world could finance medical research for new drugs. Jamie Love, the brilliant strategist and director of the Consumer Project on Technology, working with dozens of influential scientists, public health officials and lawyers, has announced a new paradigm for trade policy on medical R&D.

For decades, under the current patent and trade regime, drug companies have ratcheted up the price and scope of their patent protections even though that is precisely what makes it harder to treat AIDS, malaria and many other diseases proliferating around the world, especially in developing countries. But how to get beyond this paradigm? After more than two years of discussion with an impressive list of global players, Love and others have developed a proposed medical R&D treaty that would make it easier to finance medical research on significant health problems. It would also reduce the prices of drugs that ultimately result from that research.

In an open letter to the World Health Organization’s Executive Board that is due to be submitted in late February, Love and more than fifty prominent scientists, public health experts, economists, lawyers and others write:

The current global framework for supporting medical R&D suffers from profound flaws. A growing web of multilateral, regional, bilateral and unilateral trade agreements and policies focus nearly exclusively on measures that expand the scope and power of intellectual property rights, or reduce the effectiveness of price negotiations or controls.

These mechanisms are plainly designed to increase drug prices, as the sole mechanism to increase investments in R&D. Stronger intellectual property rights and high drug prices do create incentives to invest in medical innovation, but also impose costs, including:

  1. rationing and access problems
  2. costly, misleading and excessive marketing of products
  3. barriers to follow-on research
  4. skewing of investment toward products that offer little or no therapeutic advance over existing treatments
  5. scant investment in treatments for the poor, basic research or public goods.
    A trade framework that only relies upon high prices to bolster medical R&D investments anticipates and accepts the rationing of new medical innovations, does nothing to address the global need for public sector R&D investments, is ineffective at driving investments into important priority research projects, and when taken to extremes, is subject to a number of well-known anticompetitive practices and abuses. Policy makers need a new framework that has the flexibility to promote both innovation and access, and which is consistent with efforts to protect consumers and control costs.

Among the dozens of signatories are Tim Hubbard, Head of Human Genome Research in the U.K.; Sir John Sulston, the 2002 Nobel Prize winner; Dr. Massimo Barra of the International Federation of the Red Cross; Ellen ‘t. Hoen of Medicins sans Frontieres; Oxfam International; Health Action International; Martin Khor of the Third World Network; among many other distinguished thinkers and NGO leaders. (Signatures for the treaty are being solicited; send your name and preferred identification to rndsignon@cptech.org, by February 15, 2005.)

The working draft of the new treaty that the group proposes would try to create a global market in producing public goods — namely, medically significant new drug research and treatments. Rather than financing such work through patent protection and high prices — which are palpably not developing the necessary research or end-products at affordable prices — the treaty would require signatory countries to spend an agreed-upon percentage of their Gross Domestic Product on qualified forms of R&D. Countries could meet their obligations through direct public funding of drug research, tax credits, philanthropic spending, innovation prizes, among other techniques. Strong patent protections would not be the only acceptable approach.

The treaty would serve to diversify the types of research being done; focus it on the most urgent public health problems; and decentralize control of R&D spending. The whole R&D expenditures process would be transparent and subject to independently verifiable measurement.

The treaty would assign credits to projects that are considered socially important, such as R&D for neglected diseases, open source research databases and the preservation and dissemination of traditional medical knowledge. Countries that do more than is necessary to meet their treaty obligations could then sell their excess credits to other countries that need the credits — an arrangement similar to the Kyoto climate treaty.

The scope and ambition of the draft treaty, formally known as the Medical Research and Development Treaty, is astonishing, and a potential “way out of no way” represented by the current patent system. The treaty proposal is certain to change the entire terms of debate in this area.