PSC 2224
Patents, Innovation, and Access to Medicine
What is the goal of the patent system? -"The Congress shall have power... to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings
and discoveries."
Pharmaceuticals
-the branded pharmaceuticals industry is widely regarded to be the industry..- Branded vs Generic
-Branded means the originator pharmaceutical firm conducted research and development of a
new drug, and got a patent for it -generic means any number of firms can produce the drug
-when generic drugs enter the market, the price of drugs begins to decrease
-branded firms will often license an authorized generic' to compete with other generic firms
-major pharmaceutical firms often own substantial stakes in generic firms
-generic drugs have to demonstrate bioequivalence
-bioavailability after administration in the same dose is so close that effects, with respect to both
efficacy and safety...
-now innovations are in biologics, which are derived from living sources and are far more
complex
-generic biologics have to demonstrate biosimilarity
-the threshold for biosimilarity is lower than bioequivalence
-branded doesn't necessarily mean patented
-company might have not filed it or the patent might have been rejected
- generic companies must wait a certain period of time to gain access to the original clinical trial
data-> 5 years for regular drugs; 12 years for biologics
Drug Development -costs lots of money ($1 billion per drug) -includes the opportunity cost of capital
-companies spend a lot on marketing -a lot of basic research that contributes towards drug development is publicly funded
-NIH does basic research that late is commercialized by private companies
-the government awards grants to scientists working at public and private universities, who later
license their discoveries to private companies
-private firms have incentives to develop drugs that serve wealthy markets
Pharmaceutical Markets -US market is unique: other industrialized countries have either single payer or price controls
-people in the US pay very high prices for medicines
-income inequality affects the affordability and the access to the medicines
-even in poorer countries, medicines can cost as much as they do in wealthy countries
-pharmaceutical firms was to maximize revenue
-even when the income inequality is not a problem, companies fear the flow of cheap drugs back
to more expensive markets
Access to Medicines:
-Anti-retroviral treatments, which are used...
-US puts pressure on other countries to change patent laws -activist campaign shamed the companies into dropping lawsuits against South Africa
-compulsory licenses, governments can step in and allow generic companies to produce cheaper
versions of still-patented drugs-> improves access, but it reduces the financial return to the
patent holder -international law requires countries to protect pharmaceutical inventions with patents
-countries have flexibility to define what counts as an invention
-US shifted course dramatically post-2000
-Bush established PEPFAR, committing $15 billion over the years (2003-2008)
-requires participating organizations to sign an anti-prostitution pledge; often requires purchases
of more expensive branded drugs
-US no allocating &6.