Last week, the Trans-Atlantic Consumer Dialogue (TACD) hosted a panel on the Transatlantic Trade and Investment Partnership (TTIP) and access to medicines at the Capitol building. Videos of presentations have been posted to YouTube by Knowledge Ecology International. This blog is a quick writeup of the panel (see also, my notes on the TACD panel on TTIP, access to knowledge and digital rights.)
Moderator Ellen t’Hoen (KEI Europe) opened by highlighting examples of exorbitantly priced new medicines. New cancer drugs are routinely priced over $100,000 for a course of treatment. The new drug for Hepatitis C costs $1000/pill. TTIP negotiators may excacerbate the problem, because intellectual property rules that block generic competition, and the regulation of medicine princing policies are both on their agenda.
Leigh Purvis (American Association of Retired Persons, AARP) said that more that 3/4 of retired people in the U.S. take two or more medicines daily. Many are being treated for chronic illnesses, and many are low income. Rising medicine prices threaten public health spending through Medicare Parts B and D, and it threatens the sustainability of private plans – which are shifting more costs to patients as prices rise. AARP is strongly opposed to certain IP provisions that have been proposed in trade agreements such as TTIP, including the 12 year term of data or market exclusivity for biologics. AARP believes patent evergreening should be prohibited.
Ancel-la Santos (Health Action International-Europe) warned that rules on trade secrets that have been proposed for TTIP could impact public health by preventing the disclosure of clinical trial data. Currently, the results of studies showing maximum efficacy and minimal side effects are more likely to be published than the results of studies that reflect poorly on pipeline drugs. Health Action International and others have been advocating for governments to require the release of all conical trial data generated in drug development. This data is crucial for the protection of public health, and the advancement of biomedical science. However,the industry considers this to be business information that is protectable under trade secret or commercial business information laws. The American Chamber of Commerce warns that “failing to protect confidential commercial information contained in regulatory submissions is inconsistent with the EU’s treaty obligations contained in TRIPS,” and it has asked the U.S. to introduce this topic into the TTIP discussions.
Peter Maybarduk (Public Citizen) noted TTIP is focused on deregulation, not tariffs. U.S. and EU industries want to establish international policies, then force domestic governments to adhere to them For instance, Lilly is currently suing Canada for $500 million at an international trade tribunal because it doesn’t like the result of Canadian patent rulings. If TTIP succeeds, you’ll see more situations like this. The main “asks” of industry for TTIP are:
- Restrictions on drug pricing and reimbursement systems. When it comes to setting prices or reimbursement rates, companies want to participate in the decision making processes, and want to be able to appeal unfavorable decisions. This could affect state and federal drug programs in the United States.
- Ban of clinical data disclosure requirements. This would block access to information for independent researchers, which have in the recent past discovered important things. For instance, Tamiflu turned out to be no more effective than aspirin.
- Harmonization of U.S. and EU intellectual property regimes. This could lead us to have the most restrictive provisions in each system applied to the other. For instance, the U.S. has longer periods of exclusivity for data and market exclusivity for biologics, while the EU has longer peridocs of exclusivity for small molecule drugs.
- A united front against developing countries. PhRMA wants to use TTIP to set global rules that would then be applied in developing countries, where access to medicines problems are immediate. In the U.S., medicine prices will drive you bankrupt, but in developing countries, you die.
David Hammerstein (TACD) said that today’s pharmaceutical industry model is a total failure. It develops and produces drugs to in order to drive profits, not to address health needs, but as prices grow higher, fewer and fewer people can afford to purchase them. This model has served Western Europe decently for a while, but the chickens have come home to roost. In Southern Europe, there are big access problems.30-40% of Greeks have no health insurance, and many who do have high Out Of Pocket payments. In Spain, we’re seeing hospital closures. TTIP could do things to try to solve these problems – it could establish a patent pool for high priced cancer drugs or a transatlantic innovation prize, or focus on things like joint procurement – but these types of provisions are not under negotiation. Instead, negotiators are focusing on PhRMA’s wish list. This includes patent term extensions, data exclusivity for biologics, harmonization of patentability standards and secrecy of clinical trial data, and restrictions on pricing and reimbursement systems. This is completely driven by industry lobbying.
In the question and answer period, Els Torreele asked about evidence from other FTAs that shows the impact of trade provisions on pricing. Joel Lexchin said that a study of the impact of the Canada-EU Trade Agreement predicts an increase in spending on pharmaceuticals of about 5%, due largely to patent extensions. Hammerstein pointed to the Oxfam study of pharmaceuticals in Jordan, and I mentioned Shaffer and Brennan’s study of Guatemala as examples of studies showing price increases after trade agreements have gone into effect. Maybarduk said to look at TRIPS as an example – in the last 20 years the world as a whole has a much different drug landscape than before, with prices higher across the board.
Jamie Love warned that we are entering a time when we’ll see much more rationing of medicines. He mentioned a recent New York Times op-ed about pharmacy benefit managers shifting drugs to higher tiers, in which patients have higher copays. Additionally, HIV copays have gone from about $50 a month to $500 a month. The op-ed NYT doesn’t discuss solutions other than rationing. But we think that delinkage of drug prices and the funding of drug R&D is the better way to attack the problem. Delinking the two will involve taking on the monopolies and taking on intellectual property rights. Unfortunatley, TTIP will make it harder to do this. It will entrench the current model, which will lead to more rationing.
