Emerging Economies’ New Initiative On Falsified And Substandard Medicines

Several major generic-medicines producing nations last week held a discussion on the dangers of compromised medical products and joined together to urge new steps such as better definitions, a focus on public health instead of intellectual property, and strengthening national regulatory capabilities beyond enforcement actions which they say have been manipulated and at times counterproductive.

The governments of Brazil, India and South Africa convened a meeting on 15 October in Geneva entitled, “Falsified and Substandard Medicines: Current Challenges and Long Term Solutions – a Public Health Perspective.”

Speakers, including officials, regulators, a United Nations special rapporteur and non-governmental representatives, levelled strong criticism at those who traffic in counterfeit medicines or in substandard medicines. But they also had sharp words for enforcement efforts from developed countries and their brand-name producers, especially charging intent to confuse the public about generics.

Still, the aim was to improve understanding of the problem and move toward positive options for addressing it. Two such options included an intensive focus on defining counterfeit, substandard and related terms, and to bolster national regulatory capacity.

And speakers stressed that the problem is one of public health, not intellectual property rights. Under the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), counterfeit refers to trademark violations – that is, identical packaging with a fake inside. It does not get into the quality of the fake, and the developing countries and public health advocates are focussed on that distinction, saying the quality is for regulatory authorities to determine.

“Placing originator pharmaceutical companies in the role of policing the quality and safety of generic drugs in developing countries based on their IPRs holdings is ceding an essential role of public health authorities, and government more generally,” said Frederick Abbott, law professor at Florida State University. “It is putting the regulated companies in charge of regulation, a rather problematic turn.”

The developing country initiative comes in the context of the May World Health Assembly’s establishment of an intergovernmental working group on the issue. It will look at WHO’s role in ensuring the availability of quality, safe, efficacious and affordable medicines as well as prevention of the opposite, and its relationship with the controversial, Interpol-driven International Medical Products Anti-Counterfeiting Taskforce (IMPACT).

Access to medicines is influenced by a variety of factors, from regulations to intellectual property. Price can be an “absolute barrier,” said Gopinathan Achamkulangare, the Indian ambassador to the United Nations.

“The deliberate confusion created by some interest groups, conflating the concept of counterfeitiing – which has a specific meaning in intellectual property law – with issues related to the quality, safety and efficacy of medicines has further confounded the issue,” he said.

India is concerned about drug consignments that in the European Union were subject to “numerous seizures” and is further concerned about TRIPS and TRIPS-plus trends initiated by “some developed countries in bilateral and regional” initiatives, such as the Anti-Counterfeiting Trade Agreement (ACTA), Achamkulangare added. “Generic drugs are an inseparable element of access to medicines.” More than 98 percent of WHO pre-approved medicines are generic, he said.

The special rapporteur to the United Nations on the right of everyone to the enjoyment of the highest attainable standard of physical and mental health told the UN last year that these initiatives negate the Doha Declaration on TRIPS and public health, and interfere with efforts to reach the Millennium Development Goals, said Achamkulangare.

The special rapporteur himself, Anand Grover, also spoke at the event, in strong terms.

Substandard Meds: Bigger Problem than Counterfeits

Falsified and counterfeit medicines are a problem, Grover said. “If you have them [it] will influence health adversely.” But there is a push for conflating counterfeit medicines with genuine generics. And this confuses the real issue. On 31 May 2007, the government of India published the results of a market survey on spurious, false, and substandard drugs. It found that actual falsified drugs which do not contain the active ingredient were 0.25-0.47 percent of the market, whereas substandard drugs accounted for 8.95 to 10 percent.

Still, whether “1 percent or 2 percent is not important,” said Mandisa Hela, manager of the National Regulation Authority in the South African Department of Health. “One life lost is too many.”

“Pharmaceutical companies have a long-term agenda,” Grover said, and that is “to have the same patent law all over the world. That is why after TRIPS, they pushed for TRIPS-plus. [And] they couldn’t do it in TRIPS Council, so they are doing it in free trade agreements.” The India-EU FTA is “the most dangerous thing that could happen,” he added, as India is the world’s most important producer of low-cost generics. “If it does, we can say goodbye to a lot of access to medicines in developing countries…. it’s antithetical to human rights.”

“Let’s be honest and candid,” he said. “This only helps a select group of pharmaceutical companies to make super profits, unconscionable profits.” He then gave examples, such as Glivec, which he said was acquired for 400 million dollars and then made $1 billion the first year.

Abbott said it could be assumed that everyone at the event shared a common objective to promote safe, effective medicines. He explained how the TRIPS agreement was set up with both business and public interest objectives in the area of public health, and how brand-name pharmaceutical companies have worked to gain advantage, sometimes going beyond what TRIPS envisions, and increasingly targeting generics producers.

“As pharmaceutical originator companies face key patent expirations over the next several years, and have not yet found replacements for their new drug pipelines, they are aggressively pursuing market share in the generics sector where they have previously been willing to cede ground to developing country producers,” Abbott said. This includes casting legitimate generics in a negative light to the public, raising doubt about them, including by blurring the line with counterfeits.

Abbott also described the intended ways to pursue civil remedies if potential infringements arise, and said court cases sometimes result in the patent being thrown out. He also raised questions about the nearly completed ACTA. “There remain provisions of the ACTA with significant implications for trade in legitimate generics, including those dealing with labelling which may affect the practice of parallel importation,” he said.

Sisule Musungu, president of IQSensato think tank, said developing countries should take leadership on enforcement. He discussed regulatory capacity and access to medicines in Africa, describing increased efforts to address spurious, falsified drugs especially through anti-counterfeiting laws. But the African laws differ from TRIPS in some ways such as focussing on criminal enforcement including for goods in transit, with no threshold for criminal liability. The laws tend to lump all types of IP infringement under counterfeiting, designate health and drug regulatory inspectors as anti-counterfeiting inspectors, and introduce presumptions regarding evidence.

Musungu described Kenya’s new anti-counterfeiting law, passed despite there being already 11 existing pieces of legislation dealing with counterfeits. The law is under challenge in the courts and may be overturned, he said.

Michelle Childs, director of policy advocacy at Médicins sans Frontières, said the organisation has dealt little with problems of counterfeit medicines, meaning trademark violations, as substandard medicines are a much bigger problem. [Editor’s Note: erroneous sentence deleted here.]

Erika Veiga of the Brazilian National Health Surveillance Agency (ANVISA) also stressed that the policy focus is on public not private rights.

Sangeeta Shashikant of Third World Network called for clarity in definitions, and suggested a focus for actions, such as a need for market surveillance producing reliable, independent, empirical data, measures to improve production of generics in developing countries, improvements to regulatory authorities, and more communications between countries.

She also said the IMPACT group at WHO has confused more than helped, has raised problematic proposals and that the complex issue “should not be left to such a group.” Shashikant is coauthor along with K. M. Gopakumar of a new booklet called, Unpacking the Issue of Counterfeit Medicines.

William Haddad, who formerly worked with California Democratic Rep. Henry Waxman (he helped draft the landmark Waxman-Hatch law boosting affordable drugs) and who is now in the generics industry, said from the audience that “counterfeit is a phoney issue [that] should not be dealt with in any other terms than criminal misuse.” He said one question should be why compulsory licences are not being used more often despite having been negotiated into the TRIPS agreement to give flexibility to developing countries.

Brazilian Ambassador to the UN Maria Nazareth Farani Azevêdo said emerging countries should take the lead on the issue and that a “silent war” is being fought that could mean life or death to many poor people. “Our fight is a fight for life,” she said. The effort will not affect TRIPS or patents, she said, but is aimed at proceeding in a “balanced way.”