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Indian Gov't Uses Special Powers To Slash Cancer Drug Price By 97%
suraj.sun sends this quote from the Times of India:
"In a landmark decision that could set a precedent on how life-saving drugs under patents can be made affordable, the government has allowed a domestic company, Natco Pharma, to manufacture a copycat version of Bayer's patented anti-cancer drug, Nexavar, bringing down its price by 97%. In the first-ever case of compulsory licensing approval, the Indian Patent Office on Monday cleared the application of Hyderabad's Natco Pharma to sell generic drug Nexavar, used for renal and liver cancer, at Rs 8,880 (around $175) for a 120-capsule pack for a month's therapy. Bayer offers it for over Rs 2.8 lakh (roughly $5,500) per 120 capsules. The order provides hope for patients who cannot afford these drugs. The approval paves the way for the launch of Natco's drug in the market, a company official told TOI, adding that it will pay a 6% royalty on net sales every quarter to Bayer."
I know I'm going to burn karma for saying this (wouldn't be the first time), but do keep in mind that the R&D costs for developing these drugs is paid from the profits these companies make. Now, maybe governments themselves should be doing the development instead of for-profit companies, maybe the drug company profits are too high, and maybe Bayer were dicks to charge that much for a drug in a poor country. But if you're going to keep the system as-is, you had think long and hard before you just start ripping patents left-and-right. It may be politically popular, but you can't have your cake and eat it too.
If you're going to say "X company doesn't get to patent its drugs" you need to come up with a replacement for the money that X company put into its research and development. If the government wants to serve its people this way, that's fine, but they also have an obligation to pony up the money for their own R&D program (and not one that just does knockoffs of existing drugs). Because without that profit motive from those patents, the drug companies sure aren't going to be developing anything new.
SJW: Someone who has run out of real oppression, and has to fake it.
The issue with compulsory licensing would get very muddy if Natco Pharma is allowed to export the medication outside of India's borders.
Vietnam Veteran / Former Postal Worker -- Use Caution When Taunting!
average life expectancy according to an article on the BBC is extended by only 3 months -
http://news.bbc.co.uk/2/hi/health/8367614.stm
with results like that, you have to overcharge like hell to get your money cause the patients will only be around three more months than usual if they weren't taking the drug -
but if you're desperate and dying anyways, why not blow 2 months salary on a 120 day supply, right? And yet, I have no sympathy for the drug companies - I wonder why....could it be their way of using lawsuits to keep generics off the market for a few extra years while they re-release a "timed" version of their product?
Drug companies are vultures - and I'd love to see more university/public funding of this research for the public interest and less for the profit motive - especially when lives are at stake
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ah honey, we're all resplendent - Bill Mallonee
That argument does not work in this situation. Bayer had priced the drug so high in India that it was clear they had no interest in serving the Indian market. I'm on a listserv for this type of information, and someone close to the issue noted that "Last year Bayer sold 493 boxes of 120 tabs of Sorafenib in India. That was enough for about 49 people, in a country with a population of 1,210,193,422."
Any money Bayer was making in India off this drug was a rounding error compared to the lucrative North American and European markets. Furthermore, Bayer argued to the Indian court that the Indian population did have access to the drug through an infringing version produced by Cipla, while at the same time Bayer was suing Cipla for patent infringement, trying to get their product off the market.
Given the 6% royalty rate that NATCO has to pay to Bayer, I wouldn't be suprised if Bayer ends up making more money with the compulsory license than before.
"Anyone who [rips a CD] is probably engaging in copyright infringement." - David O. Carson
If a drug has been patented, and made it's way through FDA approval, it's chemistry is well known, and any decent lab will be able to make it. Not selling in a market is only cutting off the nose to spite the face. They will continue to sell in that market, because rich people will still pay for it rather than the generic.
R&D are sunk costs. *Any* sales over your fixed production costs results in profit. If you want to maximize profit, you sell. (Of course, as others have pointed out, you have to make sure none of the low cost sales gets resold to someone in another country. YMMV)
All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
Yes, it's for domestic use only. It also has to manufactured domestically, which is why this type of agreement doesn't work in smaller countries without adequate manufacturing capacity for pharmaceutical products (e.g., most of Africa).
"Anyone who [rips a CD] is probably engaging in copyright infringement." - David O. Carson
Or India will just produce its drugs domestically, using its intelligence service to procure samples of high-priced drugs in other countries.
More likely, though, the WTO and the USA will attack India for "stealing" and threaten India with various trade sanctions as retribution for this action. We would not want the Indian government to work for the benefit of its citizens at the expense of foreign corporations' profits, would we?
Palm trees and 8
If its not patented in India, do any laws protect the drug from being patented by another NATCO as theirs?
Realistically what are Bayer's options, how do you combat something like this?
Buy off some Indian politicians and get that government back in-line: get that government to stop working for the benefit of its citizens, and to start working for the benefit of foreign corporations.
Palm trees and 8
For one thing, you would lose the moral high ground of being able to say you were doing it for the good of your people, not just for the profits of selling the knockoff. For another thing, this would probably violate a stack of trade agreements.
SJW: Someone who has run out of real oppression, and has to fake it.
Any decent chem lab can reproduce almost any drug given the patents and FDA approval documents. (Some drugs are difficult or perishable) People are responding that the big pharm companies will leave these markets, but if they do, it's unrelated to this.
R&D are sunk costs. *Any* sales over your fixed production costs results in profit. If you want to maximize profit, you sell.
What this might do, is limit the number of new drugs in the pipeline, but even that isn't a given. It's possible that (most) every good idea is being worked on, and all the great scientists are working on them. Once you've reached idea saturation, more money in a system just increases profits to the shareholders.
Wait, wait, I hear people yelling. If there's more money given to the shareholders, then they will invest in venture startups, and many more great new drugs will be discovered. Maybe. It's also possible that too much money in the drug company ecology will just lead to more viagra clones if not "snake oil" type products. More money might lead to more advertising, causing people to misuse drugs they don't really need.
All ideas^H^H^H^H^Hprocesses in this post are Patent Pending. (as well as the process of patenting all postings)
Since the public has decided they do not wish to pay more taxes to education, public funding has been getting slashed over and over. So we turn to the only place we can: Companies. They are willing to give money to fund research. However they own the results when they do that.
If you don't like that I'm afraid universities will need more public funding and that means higher taxes.
Thanks for the quick reply. You make it sound very noble especially the foreign corporation bit. Your argument is: ignore everything everywhere when it benefits the citizens? Please, I'm not a defender of corporations, but surely you must see that this is a slippery slope?
Man blir trött av att gå och göra ingenting.
If they won't settle for less profit, someone else will be prepared to take their position in the market.
Who is "they"? Spoken like a guy who doesn't own stocks. Scare investment capital from drug companies, and it won't go elsewhere in the market - it will go to Exxon and Apple! Buh-bye, private R&D!
Government will never give out free gas and iPhones, so my investment dollars will go there.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
...that can only be cured by the heavenly touch of Natalie Portman's hand upon my forehead.
Without this treatment, I fade in and out of conciousness, slowly losing body weight, muscle mass, and organ function. I have only 6 months to live if I do not get the treatment I need.
I've asked Mrs. Portman many times if there is a way she could lay her hand upon my forehead for the prescribed 8hr sessions 3 times a week. I've offered her all of my money. I've sold my home and my surviving family members have taken up disreputable work.
Alas, she refuses to lower her price, she has told me that she will not help me even if I pay her 1 million dollars per week!
I emplore you, caring people of the modern world. Please won't you save me?
I desperately need Natalie Portman's healing hand to save my life. But I cannot afford the outrageous prices she is demanding.
Can't someone do something?
My opinions are my own, and do not necessarily represent those of my employer.
Only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH)
Nice general talking points there, now how about some proof in the form of cites?
Besides, it's utterly pointless to say one does more than the other. How about encouraging as much funding you can going toward lifesaving drug research, instead of private sector capital fleeing to oil companies and tech?
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
Your argument is: ignore everything everywhere when it benefits the citizens? Please, I'm not a defender of corporations, but surely you must see that this is a slippery slope?
Well, if governments are not supposed to work for the benefit of their citizens, then I have to wonder what you think the proper thing for a government to do might be. Where would you suggest that slippery slope leads?
Keep in mind that the governments of the US and of western European nations work very hard to benefit their citizens at the expense of other nations, which is basically how India found itself in this situation. The west became wealthy through the exploitation of other countries; even our poorest citizens have better lives than the citizens of some of the countries we took advantage of. We pushed other countries to adopt certain industrial regulations that our corporations wanted, like copyrights and patents, rather than using our influence to affect changes that would benefit the working class (e.g. better education, better food and water, better living conditions, etc.). If we are willing to let another nation languish in poverty so that we can continue to exploit its labor force, we really cannot complain when other countries ignore corporate profits so that their citizens can get affordable medicines.
At the end of the day, a government that is not doing what benefits its citizens is a government that fails the legitimacy test.
Palm trees and 8
Given the 6% royalty rate that NATCO has to pay to Bayer, I wouldn't be suprised if Bayer ends up making more money with the compulsory license than before.
But as you said before, they have no interest in the Indian market. What they're scared of is these cheap Indian drugs leaking out to their lucrative North American and European markets. That's where this is likely to hurt their bottom line.
While I understand the reasoning behind their logic, I'd still say to them: Go ahead. Do you really think that India's reverse-engineers aren't able to get the original drug overseas?
That's the dilemma of the drug companies: they're damned if they stay, they're damned if they don't. And considering all the pain they're inflicting on dying or extremely sick people by withholding their drugs through prices that don't reflect the local purchasing power by a long stretch, they damn well deserve being damned. Maybe it's time they've got a taste of their own overly expensive medicine?
cpghost at Cordula's Web.
http://www.usatoday.com/news/world/2008-09-17-brazil-AIDS_N.htm
It is logical thing for governments to do. At least as long as they have enough sovereignity for such action. Think World Government here...
http://opencm3.net, http://www.nongnu.org/gm2/
More likely, though, the WTO and the USA will attack India for "stealing"
Yes, this, since that is exactly what is happening. "Stealing" in the IP sense, of course.
While it's great that India is getting something to help Indians, it does nothing for me except keep my costs high by not distributing the burden more widely. Maybe India shouldn't have to pay full price, but I would expect to AT LEAST see something based on purchasing power parity. And based on these tables India is not 33 times poorer in that sense, so the 97% discount rate cannot be morally justified. At that point they are doing it at our expense, not doing it in any sense of equality.
This has happened in Brazil (not specifically to this drug) and it works just fine.
The pharma companies that were crying out the end of the world are all here, still making a profit, everything is fine.
I really doubt $5500 is the correct price for that drug in India. Whoever decided to charge that much should go to jail.
none
The difficult part in many situations is not what is but how it is made, the difficult part in many cases is the actual manufacturing process.
Give any first-rate chemist a few million dollars, a bottle of pills, and a team to lead, and they'll be able to replicate just about anything. Let's set aside the fact that all you have to do is bribe somebody in the FDA to get a copy of all the details - or are you proposing that the details be kept safe from the government as well?
The difficult is not the manufacturing process - it is figuring out what to manufacture. Almost all of the costs in the commercially-funded side of drug development are in the clinical trials, and the repeated attempts to find something that works. Each attempt costs tens of millions of dollars (well, for the ones that make it past the cheap stuff like computer simulations), and it usually takes quite a few to find something that sort-of works.
If you don't allow for patents the only practical alternative is to have the government pay for end-to-end drug R&D. I'd actually like to see that happen, but there is no reason to not get that up to speed BEFORE you tear down the existing industry.
This is completely incorrect. India is a signatory to the TRIPS agreement, which explicitly permits compulsory licensing of medications where public health interests prevail such as in this case. Bayer has no legal remedy apart from appealing (in Indian courts) India's determination of what is a reasonable royalty rate.
For a site about things like basic rights, Slashdot users sure do like to censor "dissent".