Are donors getting a fair deal from pharmaceutical companies?


The medical profession has been in beds with the ‘Big Pharma’ for long and it is really sad to witness that big pharmaceuticals companies are putting their profit ahead of access to affordable generic medicines to the poor nations across the globe. Even the regulating agencies and medical practitioners alike are equally easily manipulated by the big money put on the table. It can be easily observed from the EU pressure on India, dubbed as ‘pharmacy of the developing world’, for a trade agreement that blocks off providing affordable medicines reaching the poor. It is here that medical ethics and slogan for access to essential medicines for the poor should come up to reveal this unfair practice! 

In Marcia Angell’s article, The Truth About the Drug Companies, “Over the past two decades the pharmaceutical industry has moved very far from its original high purpose of discovering and producing useful new drugs. Now primarily a marketing machine to sell drugs of dubious benefit, this industry uses its wealth and power to co-opt every institution that might stand in its way, including the US Congress, the FDA, academic medical centres, and the medical profession itself. (Most of its marketing efforts are focused on influencing doctors, since they must write the prescriptions.)”

The great majority of “new” drugs are not new at all but merely variations of older drugs already on the market. These are called “me-too” drugs. The idea is to grab a share of an established, lucrative market by producing something very similar to a top-selling drug. According to Boldrin & Levine: Against Intellectual Monopoly,  “Many infected with HIV can still recall the 1980s when no effective treatment for AIDS was available, and being HIV positive was a slow death sentence. Not unnaturally many of these individuals are grateful to the pharmaceutical industry for bringing to market drugs that – if they do not eliminate HIV – make life liveable, yet it is wise to remember that the modern “cocktail” that is used to treat HIV was not invented by a large pharmaceutical company. It was invented by an academic researcher: Dr. David Ho.”

The “evil” pharmaceutical companies are, in fact, among the most beneficent organizations in the history of mankind and their research in the last couple of decades will one day be recognized as the revolution it truly is. Yes, they are motivated by profits. That’s the genius of capitalism – to harness human improvement to the always-reliable yoke of human greed.

Money has been doled out to Africa to fight HIV/AIDS in the form of tied foreign aid to developing countries. But the foreign aid is locked with malicious intentions to make the developing world a depot for their pharmaceutical companies and beyond the financial reaches of the most needy. Washington is insisting that the continent’s governments purchase anti-AIDS drugs from the United States instead of buying cheaper generic products from South Africa, India or Brazil. How cruel? It is mandatory to understand US brand name drugs are costing up to 15,000 dollars a year compared with 350 dollars annually for generics.

In Africa, a vaccine against pneumococcal diseases has recently launched as part of a programme to bring the vaccine to poor countries, but two pharmaceutical companies (GSK and Pfizer obviously) are receiving a significant payout as part of the scheme while vaccine producers in developing countries have said they could sell similar pneumococcal vaccines at more than 40% less than the $10.50 per child currently being paid. The puzzle here is: Is the foreign aid part of a market penetrating move to benefit developed nations’ pharmaceutical companies or prioritising  those who badly need affordable generic medicines in developing nations? If the latter is given priority, then why the need to lobby nations like India for an EU Trade Agreement? I would say it is a modernized and silent corruption towards poor Africans and has to stop!

“But a look at the financing mechanism to support this programme, called the Pneumococcal Advance Market Commitment (AMC), reveals that two multinational pharmaceutical companies – GlaxoSmithKline (GSK) and Pfizer/Wyeth – are receiving a significant payout as part of the scheme: the companies have each agreed to sell 30 million doses annually for ten years in exchange for US$10.50 per child vaccinated, plus a total “subsidy” of $225 million for each company. Even before the subsidy, compared to other routine vaccines, this one is priced beyond what most developing countries can afford.

The high price is contributing to financial woes at GAVI (Global Alliance for Vaccines and Immunization), which helps developing countries pay for new vaccines, but is also of great concern for the many developing countries that need to pay for the vaccine themselves.  It is very disappointing that the prices agreed with two big pharma companies will be too high for countries to afford when donor support is not or no longer available.  Prices need to come down so that as many children as possible can benefit from this vaccine. There is no mechanism in place within GAVI or the AMC to encourage competition from manufacturers in developing countries that could sell similar products for less.

Some of the $1.5 billion the AMC has slotted as potential payouts to pharmaceutical companies could have been better used to help speed up the development of more affordable products. Vaccine producers in developing countries have said they could sell similar pneumococcal vaccines at US$6.00 per child, more than 40% less than the $10.50 per child currently being paid by GAVI before the subsidy.  In today’s tight funding climate, and with countries “graduating” from being eligible for GAVI support, this difference is extremely important. GAVI, which is hosting the AMC programme, has also not paid enough attention to the issue of high vaccine prices in general.  Vaccine prices have a significant impact on the amount of assistance GAVI can offer and have contributed to the current GAVI funding shortfall. Lack of funds and high prices have also pushed GAVI to graduate 16 countries from eligibility for future GAVI support.

There is an inherent conflict of interest that makes it difficult for GAVI to effectively address sustainable pricing: vaccine producers have seats on the GAVI Board. This conflict of interest results in a tendency against transparency and for higher prices. Ahead of GAVI’s fundraising conference in June, donors should demand that vaccine manufacturers step down from the Board.  This will allow GAVI to negotiate more assertively for lower, sustainable prices.  It is a promising news that the GAVI Board Chair, Dagfinn Høybråten, has stated he would “welcome the future participation of developing country manufacturers as part of our pressure on industry to bring prices down.”” Source

I believe the approach to limit the influence of the ‘Big Pharma’ by letting them step down from the board should have been incorporated long before and still there is a lot to do to raise the level of involvement of pharmaceutical companies from developing nations, which would help generic medicines to be easily accessible in underpoverished areas.

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