Leaked Letter Shows Pressure On Colombia Not To Issue Compulsory Licence For Glivec

This letter to the Presidency of Colombia, dated 8th June 2016, comes in addition to previously leaked letters to Colombian authorities that had already demonstrated Novartis’ efforts to avoid a compulsory license and any resulting reduction in the price of its blockbuster drug. It came just a week before Colombian Health Minister, Alejandro Gaviria, passed a hotly anticipated resolution to declare Glivec of public interest (Resolution 2475 of 2016). Under Colombian law, a declaration of public interest (DPI) can be a step towards a compulsory license.

This letter can be seen as a further attempt by Novartis’ CEO to undermine legitimate decisions made by a sovereign state to protect its public health. In addition to the threat of international investment arbitration (or ISDS) made by Novartis in spring 2016, this letter undoubtedly had a direct influence on the content of the resolution mentioned above. As a result of this pressure, Resolution 2475 issued on 14th June 2016 focused only on price reduction, leaving aside the issue of a compulsory license.

In 2016, Glivec was marketed in Colombia at a price of approximately CHF 15,000 per patient per year, almost twice the average annual income in Colombia. According to figures from the Health Ministry, sales of Glivec in Colombia in 2014 accounted for 0.2% of the net global sales of the product for that year. Since its launch, Glivec has generated over CHF 50 billion in global revenue for Novartis. The economic prospects are therefore irrelevant in this case – the matter is highly political.

This additional leaked document reveals yet another side to the multi-pronged attack that Novartis has launched on sovereign countries that use legitimate legal instruments such as compulsory licenses, for fear that they might set a precedent.

Also see the article published on 04/02/2018 in the Sonntagszeitung (PDF, 636 KB)

Background:

*A compulsory license is a legal and legitimate mechanism laid down in the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) of the World Trade Organization (WTO), which was reaffirmed in the ministerial Doha Declaration on TRIPS & Public Health (2001) and, most recently, by a landmark report of the UN High-Level Panel on Access to Medicines, co-chaired by former Swiss President Ruth Dreifuss (2016). A compulsory license allows a government to restore competition in a monopoly market despite a patent, without the authorization of the patent-holder. It is part of several policy-space mechanisms also called ‘TRIPS flexibilities’. According to the WTO, each member has the right to grant compulsory licenses, and the freedom to determine the grounds upon which such licenses are granted.