April 11, 2008
Brazil may reject patent of AIDS drug due to price
By admin
Submitted by THE HEALTH ECONOMICS BLOG
RIO DE JANEIRO, April 10 (Reuters) - Brazil has decreed U.S. pharmaceutical firm Gilead’s AIDS drug Tenofovir “in the public interest”, signaling it may reject its patent request because of a high price and negotiate imports of generic drug.
The Health Ministry said in a decree published on Wednesday patenting the drug in Brazil “was generating expectations of monopoly rights with an impact on the price of the product.”
Latin America’s largest country has an internationally-lauded AIDS prevention and treatment program, in which patients get free antiretroviral treatment.
The ministry said it had requested a priority examination of the patent filing by the company with the Brazilian INPI patent body, which will have to take into account the ministry’s objections.
“If no patent is issued, Brazil will be free to negotiate prices of the drug, be it generic or brand name,” a health ministry source told Reuters on Thursday, adding that the case was “not about compulsory licensing” or breaking patents.
A representative of Gilead Sciences Inc. in Brazil declined to comment on the issue but said high-ranking Gilead officials were in contact with the ministry to discuss the case.
The Health Ministry source said the case was different from last year’s bypassing of a Merck patent for Efavirenz drug.
Last May, President Luiz Inacio Lula da Silva authorized Brazil to sidestep the patent on an AIDS drug made by Merck & Co. Inc. and import a generic version from India instead. It was the first time Brazil bypassed a patent to acquire cheaper drugs for its AIDS program.
The process then also started with the government declaring the drug “in the public interest” and saying it was too expensive to buy.
If the Tenofovir patent is rejected, Brazil may choose to import generic drug using a clause in World Trade Organization rules to flout drug patents in the name of public health.
Other countries, including Canada, Italy and Thailand, have also used the WTO clause to gain access to cheaper AIDS drugs.
(Reporting by Pedro Fonseca and Maria Pia Palermo, writing by Andrei Khalip; Editing by Derek Caney)
4.09.2008
Host of pricing models proposed for UK drugs
April 09, 2008
Financial Times
COMPANIES - UK
UK pharmaceuticals companies are introducing new drug pricing models as pressure mounts to offer better value for money.
The National Institute for Health and Clinical Excellence (Nice), the government’s medicines advisory body that studies clinical and cost effectiveness, has agreed three different experimental approaches to pricing with drug companies in the past year alone.
Manufacturers have also proposed their own money-back offers and discounts as a way to win reimbursement by the National Health Service or boost sales for costly new treatments. The initiatives are important for drug companies’ sales and future pricing strategy around the world.
Belen Garijo, senior vice-president for Europe and Canada for Sanofi-Aventis, said: “Pressure to keep costs under control is forcing us more and more to document the value of new products. These are times of unprecedented change. The UK has almost invented pay for performance.”
While the UK accounts for about 3 per cent of global pharmaceutical sales, it has a disproportionately greater influence internationally, reflecting its importance in research and development, relatively high prices and methods of scrutiny.
Since its creation in 1999, Nice has advised against NHS use of costly new drugs including GlaxoSmithKline’s antiviral flu drug Relenza, its first decision, to more recent rejections of Pfizer’s oral insulin Exubera for diabetics and Eisai’s Aricept in patients with early Alzheimer’s disease.
Aside from threats and legal appeals, the industry has also responded commercially. Drug pricing in the UK, like elsewhere in Europe, is tightly regulated. The UK’s Pharmaceutical Price Regulation Scheme (PPRS), currently being renegotiated, forbids increases - although it permits and even periodically imposes reductions.
Pfizer worked within the system to launch a pioneering “outcomes guarantee programme” with 18 primary care trusts in 1999. It agreed to reimburse the extra costs of using its higher priced cholesterol-lowering Lipitor over other similar drugs if patients did not show improvement.
Other variants have followed. When in 2002 Nice advised against reimbursement of beta interferons, a class of drugs to treat multiple sclerosis, the Department of Health established a “risk-sharing” scheme. The NHS would pay but periodically review effectiveness, adjusting price as a result.
Then last June, Janssen-Cilag, a subsidiary of Johnson & Johnson, avoided a negative Nice recommendation by agreeing to reimburse the NHS for the cost of Velcade, its multiple myeloma treatment, to any patients who failed to respond significantly.
The Office of Fair Trading last year endorsed “value- based pricing”, which is designed to link costs more closely to benefits, in a report calling for an overhaul of the PPRS. GSK argued prices should be re-examined after two to three years of patient use, with price increases or reductions in response to efficacy.
However, Panos Kanavos from the London School of Economics warns that such an approach “does not encourage risk taking or reward innovation”.
There are also practical difficulties. With Velcade, Nice was able to identify very precise medical measures to assess how far the medicine is helping patients. But for many other drugs, outcomes are more difficult to measure.
Michael Rawlins, chairman of Nice, suggests the potential for risk-sharing schemes is limited. “I doubt whether they have legs in the long run,” he said. He suggests companies propose them to avoid cutting prices in the UK - a decision that would spark copycat reductions by payers across Europe, but which is in any case inevitable over time.
(c) 2008 The Financial Times Limited. All rights reserved .
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