by Hannah Keppler
A few weeks ago, I watched the compelling documentary “Fire in the Blood,” an account of how Western pharmaceutical companies thwarted access of potentially life-saving AIDS drugs in Africa and the opposing grassroots effort to bypass these obstacles. I will summarize the key issues addressed in this controversial story, which also apply to the larger context of medical access in the developing world, and the roles of Western nations in global health. This article will serve as a jumping-off point for future articles, where I will explore further some of the issues that are raised. With this article, I will try to demonstrate the problem, but you will have to stay tuned to hear about possible solutions.
Most people are aware that in the past twenty years, AIDS went from a death sentence to a chronic, but treatable disease, thanks to antiretroviral (ARV) drugs. According to the World Health Organization (WHO), by the end of 2012, 9.7 million people worldwide were on ARV treatment, with 7.5 million of those people living in Africa.1 Everyone hears about the AIDS epidemic in Africa, but we’ve also heard about the tremendous progress that has been made in recent years getting people on ARVs and working to prevent the spread of HIV. Logically, most people assume that upon the development of ARVs, the number of deaths worldwide due to AIDS began to decline, which is in fact the case in the United States.
In the US, the number of deaths due to AIDS-related complications reached an all-time high in 1995, which was the same year that clinical trials for ARVs were initiated and then approved as standard treatment by the FDA in 1996.2 In Africa, the numbers look rather different. A special report by UNAIDS states that AIDS-related deaths in Africa only began to decline in the year 2007.3 Why the gap? Why did AIDS deaths in the US begin to decline immediately after the development of ARVs, while AIDS deaths in Africa took over ten years longer? Millions of people in Africa died during the time between when ARVs came to market and when people in Africa had access to them. Many of those deaths could have been prevented if people had had access to ARVs. Why didn’t they?
I think to most people the answer is obvious. The drugs were too expensive. The price of brand named ARVs at the time was $10,000 USD per person per year.7 This price was completely unaffordable to most people in Africa, where the market for ARVs consisted of just 1% of the pharmaceutical industry’s total revenues. Africans themselves could not afford the medicine, and groups like Doctors without Borders and others could not afford to treat their patients in Africa.
Why are ARVs so expensive? Most people attribute high prices of drugs to the fact that drug companies have to recoup their extremely high R&D costs through sales. Thus, the current patent system is designed to give drug companies exclusive rights to sell their drug at their chosen price for twenty years in order to incentivize their investment in the development of new drugs, a process that takes many years and a lot of money. This is the system that we have.
This means that people in Africa couldn’t afford ARV treatment because the companies that owned patents on these drugs (such as Pfizer) were able to set prices as high as they needed to in order to recoup their investments. For people in the US, this is acceptable because our health insurance will cover the cost of the drug. In Africa, most people pay for their medicines out-of-pocket, so they simply could not afford ARVs.
While the drugs were out of reach in Africa, for people in other countries, such as Thailand, the drugs were more affordable because generic companies in Thailand were able to produce ARVs at a reduced price. Drug companies who held the patents for ARVs owned exclusive rights to the drugs in many countries in Africa, but not in other countries, such as Thailand. This was due to trade laws imposed on certain countries by the Trade Related Aspects of Intellectual Property (TRIPS) agreement set up by World Trade Organization (WTO).
Thus, these countries were able to manufacture the drugs at a much cheaper price so that it could be affordable to many more people. For reference, the cost of the patented medicine was $10,000 per patient per year, but the price of the generic, as manufactured by the Indian generic company Cipla, was $365 per patient per year, or $1 per day5. The Wikipedia article on HIV/AIDS in Africa includes this one-sentence blurb: “For African countries with advanced medical facilities, patents on many drugs have hindered the ability to make low cost alternatives.” 4
Because of the rights to exclusivity on ARVs, South Africa was not allowed to import cheaper generic drugs from India or Thailand to improve the prospects for their dying AIDS patients. But of course, as I mentioned before, the entire continent of Africa consisted of only about 1% of the pharmaceutical industry’s profits for ARVs. If they allowed countries in Africa to import generics, drug companies wouldn’t be losing profits anyway. So what was the problem?
Pharmaceutical companies were worried that allowing countries, such as South Africa, to import generic drugs would set a precedent, encouraging governments in other countries, where huge profits were already being made, including the United States, to try to do the same. Also, the African governments were afraid to side-step the patents and import generic drugs because they feared retaliation, such as trade sanctions, from international trade organizations like the WTO, which were dominated by western countries.
The people in South Africa were not keeping quiet about their lack of access to ARVs. With so many people dying around them, South Africans were taking a stand and actively protesting patents on ARVs, appealing to Western governments to allow the importation of generics to South Africa. In 1998, the Treatment Action Campaign was founded by activist Zachie Achmat to fight for access to generic ARVs.6 Achmat, himself, refused to take his own ARVs until everyone in his country had access to them. Unfortunately, few in the Western world heard the voices of South African activists like Achmat. Eventually, some journalists and US activists began to pay attention to the fight for generics in South Africa and helped appeal to Western governments for access.
It was a long fight. Eventually, the South African government began importing generic drugs into Africa without protest from Western countries or the WTO. More and more countries realized they would be able to import the generics without retaliation, so the generic drugs flooded into Africa and AIDS-related deaths declined.
Of course there are many other factors that affect access to medicines in developing countries, one of which is lack of healthcare infrastructure and lack of healthcare workers. However, in African countries between 1995 to the early 2000s, millions of people died from AIDS-related complications, and many of these deaths could have been prevented if people had been able to afford ARVs.
Pharmaceutical companies blocked access to lifesaving drugs for millions of people because they were afraid that allowing Africans to import generics would set a precedent that would ultimately diminish their own profits. This was only overcome after years and years of hard work by activists, journalists and many others coming together to put pressure on Washington DC and other western governments to allow importation of generics. Finally, Western countries turned a blind eye when South Africa began importing the generic ARVs, but this would not have happened if it were not for the intense amount of political pressure and criticism that they were facing.
Although African countries are now able to import generic ARVs, the problems of affordability and accessibility are far from over. Many other patented drugs remain out of reach for people in developing countries. Also, with NCDs (non-communicable diseases) on the rise worldwide, access to these medicines, such as cancer drugs, is becoming more and more of a problem.
So there you have it. Patents give drug companies exclusive rights to sell their drugs for twenty years, making them unaffordable for so many people in low and middle-income countries. However, without patents, drug companies would have no incentives to develop drugs in the first place. This system is clearly flawed but not so easily amended. I will try to present some alternatives to this system in forthcoming blog posts.
Before concluding, we must keep in mind the fact that a substantial amount of the money that goes into funding R&D for new drugs is public money. And much of the basic research for new drugs is conducted at universities like ours, with funding from the NIH and other government organizations. So what does this mean for the products and services that result from publicly funded research and drug discovery? Are the pharmaceutical companies the only ones who have a stake?
Hannah is a first-year medical student at Albert Einstein College of Medicine, recently graduated from Binghamton University. She is Suffern, NY native. Her interests include access to medicines, women and children’s health and global healthcare policy.
Want to read more about the fight for generic ARVs in South Africa? Here’s a great article: http://cyber.law.harvard.edu/people/tfisher/South%20Africa.pdf