Special Feature: A Look At Product Development Partnerships And Innovation For Neglected DiseasesPublished on 3 July 2013 @ 6:05 pm
By Tiphaine Nunzia Caulier for Intellectual Property Watch
An analysis of available information indicates that research-oriented product development partnerships (PDPs) are seen as providing a better approach to neglected diseases than most other public-private partnerships. Yet, in spite of many positive results, PDPs still have a limited impact in developing countries.
The following analysis of PDPs looks at how they differ from other public-private partnerships (PPPs) and how, in the current global health context and in particular with regard to neglected diseases, they offer solutions for the discovery of new treatments.
PDPs are a kind of PPP focussing on research and development for neglected diseases affecting the global South.
PDPs are relevant to intellectual property and innovation as they refer to partnerships that focus on discovering and developing new products against diseases predominantly found in developing countries, often referred as neglected diseases. In that respect, they differ from many PPPs that exclusively focus on delivery of existing technologies (called “access” partnerships or health service delivery).
The majority of PDPs work as virtual non-profit research and development (R&D) organisations. Usually, each PDP focusses on specific types of technologies (e.g., drugs, vaccines, diagnostics) and some PDPs limit themselves to a specific disease area.
Among the most well-known PDPs is the Bill and Melinda Gates Foundation. Its key priority is not distributing drugs, but rather to find and develop new tools to address the diseases.
The Gates Foundation website explains that in the HIV/AIDS context: “Our largest investment is in efforts to discover and develop an HIV vaccine. Exciting new discoveries and a robust pipeline of promising vaccine concepts have created optimism that a safe and effective vaccine will emerge that can dramatically reduce global HIV incidence. At the early discovery phase, we invest in an array of vaccine concepts. To strengthen and accelerate the HIV vaccine field broadly, we invest in research consortia as well as product development and manufacturing platforms.”
As for tuberculosis, the Gates Foundation points out that, “A new vaccine would provide the most effective way to decrease the incidence of TB, so our top priority is the development of new vaccines as well as innovative and accelerated approaches to vaccine development.”
PPPs are often depicted by academics as a controversial mechanism. One that provides advantages to the actors involved, but also a mechanism that is not genuinely turned towards public health as the first and foremost goal. One can highlight the features of PPPs in general and PDPs in particular, to analyse how PDPs differ in their approach and whether they actually address public health needs.
PPPs: Government Use of Private Knowledge and Resources
PPPs are usually portrayed as providing a win-win situation to both the private company and government involved.
According to a recent report, available here [pdf], jointly undertaken by the United Nations Economic Commission for Europe (UNECE), the World Health Organization (WHO) and the Asian Development Bank (ADB), PPPs allow to use “the expertise and skills of the private sector.”
“In modern technology intensive health care systems PPPs allow governments to leverage the expertise and skills of the private sector and thereby improve the quality and accessibility of public health care systems,” it said.
In addition, a study by the rich-nation Organisation for Economic Co-operation and Development (OECD), available here [pdf], argued that, “(PPPs) are way of delivering and funding public services using a capital asset where project risks are shared between the public and private sector. (…) A key argument for PPPs is that through harnessing the private sector’s expertise in combining the design and operation of an asset the service can be provided in a more efficient manner – i.e. providing more “value for money” compared to traditional forms of procurement and production.”
In a word, PPPs appear like a tool for governments lacking technical expertise – high-tech laboratories, local experts and more broadly speaking, resources to invest on any kind of R&D – to meet their public health needs.
Profit Motive for Companies to Enter into PPPs
From the private sector’s perspective, PPPs also present numerous advantages. A report by the World Economic Forum (WEF) said that PPPs are a way for private companies to strengthen their brand and penetrate new markets.
The WEF report, available here [pdf], says, “A key finding is that a company’s engagement in a PPP must be based on a solid business case – this includes compelling quantitative and qualitative benefits – and cannot be based solely on corporate social responsibility motives…. [A] multinational producer of an anti-malarial product can enter into a PPP to gain access to distribution channels, expand market penetration and build future brand loyalty.”
The WEF report stresses that the economic advantages for a company in joining a PPP may include “strengthened relationships with government decision-makers, support for the long-term economic growth of new markets, expansion of distribution channels, development of stable and positive business conditions.”
The Public Health Quandary
Private companies are by their very nature oriented toward profit. It is not therefore surprising that private companies use PPPs to realise that goal. However, in the global public health context, such reasoning suffers negative consequences.
If there is no profit to realise, private companies are not likely to be interested in taking a role in such partnerships, though this type of partnership can help underserved poor populations in low income areas that are not attractive for private sectors.
In a word, the PPP approach can be critical to target these populations in need. According to the WHO website, the risks associated with PPP include “conflicts of interest over the role of industry partners,” as well as “the exclusion of poor countries with large populations, unpopular governments or poor infrastructure from public-private partnership programmes.”
PPPs are then a win-win situation in the event that companies are attracted to the project, so in that respect, neglected diseases are hardly attractive for companies trying to make profit, as there is no market for such diseases. PPPs are not quite adapted to the public health needs of the poorest populations.
One could argue that PPPs in health are not only or even primarily based on philanthropist aims, but rather, are intended to couple public goods with business strategies. One may wonder if in the particular context of PDPs, the situation is similar.
The PDP Approach is Different
In another report, available here [pdf], by the Human Development Resources Centre (HDRC) a UK-based organisation specialized in health, said there is a “high technical risk associated with the underlying R&D coupled with a risk of insufficient commercial returns. PDPs have been established to overcome these investment barriers in the neglected disease field.”
Therefore, it could be said that while with PPPs, private companies might be interested in taking action based on business strategies, but it is unlikely that such business strategy is the reason for engaging in a PDP as, per se, there is no market for neglected diseases and not much money to be made for business entities.
According to Sandra Shotwell, managing partner at the US-based Alta Biomedical Group, “PDPs seek to serve underserved and disadvantaged markets where there is little or no competition from other pharmaceutical companies. In some instances, their products also will reach private, profitable markets in developed countries, but it is not their main goal to serve these markets.”
In other words, and as explained in the analysis by HDRC, PDPs are harnessing the power of the private sector and the IP system itself to help deliver public sector goods that would not have existed otherwise.
In theory, the PDP mechanism seems promising and seems to be a tool of progress. This warrants analysis of whether in practice this has been the case.
The Rising Recourse to PDPs
“Much of the money invested in neglected disease R&D over the last two decades has been either invested in or distributed through the PDP model,” Bio Ventures for Global Health (BVGH), an industry-based group, said in a recent report, available here.
The rise in financial support for this kind of initiative can appear like a proof of efficiency of this mechanism. The BVGH report said, “The total annual of R&D funding for neglected diseases increased from $2.6 billion in 2007 to $3.1 billion in 2010. PDPs are the largest recipients of neglected disease R&D funding.”
“Between 1996 and 2007, 16 new PDPs were established with significant support from the Bill & Melinda Gates Foundation, 24 PDPs continue to be the largest recipients of external neglected disease R&D funding.” the report said.
PDPs as Tools of Innovation and Positive Change
Based on evidence provided by some of the main PDPs, it appears that they do provide results and do make a difference.
According to the Medicines for Malaria Venture (MMV) – a partnership involved in R&D and development of malaria products – “MMV has helped to radically reshape the landscape of basic antimalarial drug discovery.” As reported by MMV’s website, “171 million treatments of a life-saving medicine (called CoartemDispersible) had been delivered to more than 30 malaria-endemic countries by December 2012” through this PDP.
Likewise, the Global Alliance for Tuberculosis Drug Development put forward that it has “assembled and managed the largest portfolio of potential new tuberculosis drugs in history, which includes more than 20 active development programs and 9 novel classes of drugs.” They further explain that they have “worked in partnership with Janssen Pharmaceuticals to help develop Sirturo, the first new drug approved for the treatment of Multi-drug-resistant tuberculosis (MDR-TB)”.
From this, one can draw the conclusion that PDPs lead to the tangible creation of drugs. Besides, as stated in the report by the BIO Ventures for Global Health (BVGH), available here, “there is a general conception in the global health community that products being developed in partnership with PDPs are of higher quality due to the greater breadth of expertise of the staff at these organizations and the level of partnership with industry.”
Based on this, it appears that PDPs are helping to achieve progress and provide qualitative results. However, in spite of all these financial resources invested and positive results, proportionally, the impact of PDP is surprisingly average.
Quantitative Doubts on the Impact of PDPs
As reported by the BVGH report, “product development partnership model for neglected disease R&D supports 40% of the overall neglected disease pipeline.” But this means that 60 percent of the research for neglected diseases is not carried out in the context of PDPs. Then, even if most of the financial resources invested for neglected diseases are catalyzed by PDPs, these only lead to a minority proportion of R&D developed with regard to neglected diseases. If more than half of drug and vaccine development for neglected diseases is occurring without a PDP partner, this somehow questions the efficiency of the methodology and approach followed by PDPs.
It could be summarised that the efficiency results of PDPs are mixed. One the one hand, PDPs do provide results, there are more and more used and demonstrated qualitative achievements. On the other hand, it is striking to see that PDPs attract most of the resources but the money invested in not proportionate with the results they lead to.
The PDP mechanism then appears like an interesting step forward but one may wonder if in itself, this tool is enough to achieve the public health needs of most developing countries.
Tiphaine Nunzia Caulier may be reached at email@example.com.
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