Latest Drugwonks' Blog
Gleevec case as reported by NDTV (New Delhi TV). Television segment can be seen here.
Indian drugs will now face backlash, warn analysts in US after Novartis ruling
NDTV | Reported By: Namrata Brar
Has India's Novartis ruling just killed its own innovation dreams? Will India's generic manufacturers now get slammed in their overseas markets?
While India celebrates the Novartis ruling, the United States is condemning it. The USA provides nearly 50 per cent of the profits to big pharma and India's bold decision has sent alarm waves in the lobbyist circles.
The Supreme Court on Monday dismissed Swiss drug-maker Novartis AG's attempt to win patent protection for its cancer drug Glivec, a blow to Western pharmaceutical firms targeting India to drive sales and a victory for local makers of cheap generics.
The decision sets a benchmark for intellectual property cases in India, where many patented drugs are unaffordable for most of its 1.2 billion people, and does not bode well for foreign firms engaged in ongoing disputes in India, including Pfizer Inc and Roche Holding.
"In my opinion, the Supreme Court's decision was not a patent ruling but a domestic economic policy decision," said Peter Pitts, President and Co-Founder of the Center for Medicine in the Public Interest (CMPI) and a former associate commissioner at Food & Drug Administration. "I don't agree that companies will be forced to invest in India at the end of the day because India is too big a market to ignore. If the Supreme Court of India does not understand something as basic as a beta crystal reformulation, then what hope is there for any patent?"
"If the Government of India does not understand the importance of incremental innovation, there are pretty rocky days ahead for the international community and the (Indian) government," Mr Pitts added.
While the Indian pharma market will be among the world's top 10 pharma markets by 2015, topping $20 billion (Rs. 1,08,580 crore), many in the United States feel that its restrictive patent laws will impede its growth.
The Indian pharmaceuticals industry should not celebrate too soon. On the surface the ruling might be a win for generics but in the longer term, the Big Pharma could retaliate. The US is the biggest market for Indian generics -- India exports generic drugs worth $11 billion (Rs. 59,825 crore) -- and any setback will hit them hard; the ruling could lower the chances of Indian generics companies winning contracts in the US and elsewhere. The days of Ranbaxy's Lipitor exclusivity will not come easily again.
The even bigger fear is: will innovation flee from India?
Shibani Malhotra, Global Healthcare Analyst at RBC Capital Markets, said, "Foreign investment will certainly reconsider its options... foreign majors who were investing in key partnerships with domestic Indian players, like the Abbot-Piramal deal, might have a change of heart. The idea for the investment was to build infrastructure -- a bigger foothold to launch high value drugs which now will be a difficult proposition. More importantly, what happens to a Biocon when it comes out with a new innovation? It won't want to do business in India, it would rather go to the US. India is killing its own prospects."
"We are disappointed with the decision of the Supreme Court, and remain concerned about the environment for innovation and investment in India," Pfizer said in a statement issued to NDTV.
In the US -- the heart of big pharma lobbying -- there is massive criticism of India's decision. Will companies like Novartis delay cutting edge drugs to the Indian market? May be. Will global pharma foreign direct investment in India rethink its path? May be.
One thing is certain -- the US pharma majors will not take this lying down. They say if India can be protect its generic drug makers, they too will protect their turf. This means Indian generics may be in for a tougher backlash in global markets.
The biggest canard surrounding the Indian Supreme Court’s refusal to grant Novartis a patent for Gleevec is that it will create “access.”
Let’s put the rhetoric aside and look at the facts.
1- The Government of India ranks below sub-Saharan Africa and near the bottom of all 170+ countries included in the WHO World Medicines Report in terms of GDP spend on publicly funded drug programs that serve vulnerable populations.
2- India is one of the few countries in the world that collects more on taxes and tariffs for medicines than it spends on providing medicines to the poor. Broad analysis for 2011 indicates that total annual government expenditure on drugs in India was around $1.15B in comparison to the $1.22B it received in taxation of pharmaceuticals.
3- CIPLA, an Indian generic company that was part of the Gleevec patent case, has nearly $300 million in unpaid fines for overcharging for essential medicines in India.
Make no mistake – the Novartis case wasn’t about access. It was (and is) about domestic industrial policy.
Who will India is send to BIO this year? And how will they address the concerns of jittery investors and prospective partners?
Medical device taxation and New York Times misrepresentation.
In an otherwise misguided editorial condemning the Senate’s bipartisan (79-20) call to repeal the medical device tax, the New York Times writes, “One of the signers was Ms. Warren of Massachusetts ... Ms. Warren wrote that the tax stifles innovation, research and development. That’s a high-minded justification.”
Indeed it is. And she’s right.
India -- a nation known for its innovation in many areas -- has decided that incremental innovation in pharmaceuticals isn't important -- at least when it comes to patent protection.
The Supreme Court of the world’s largest democracy has rejected Novartis’ attempt to patent the cancer treatment Gleevec. But what the India has really rejected is medical innovation. And what activists are applauding as a road to broader patient access is a phony and pyrrhic ruling.
Citing a legal provision in India's 2005 patent law aimed at preventing companies from getting fresh patents for making only minor changes (“evergreening”), India's patent office didn't issue a fresh patent for the medicine because it was not a new medicine but an amended version of its earlier product. But what makes this ruling even more absurd is that Novartis wasn't asking for a patent on an incremental innovation -- their request was for a beta crystal reformulation to make the existing product more stable.
In other words, Gleevec isn’t innovative enough for India.
According to the New York Times, "The court's ruling confirmed that India's criteria for the granting of such patents remain far higher than those in the United States, where patents are so easy to win that one was given in 1999 for a peanut butter-and-jelly sandwich."
That’s a nice anecdote but as the saying goes, the plural of “anecdote” isn’t “data.” What does the Indian decision mean?
It means the Indian court doesn’t understand how pharmaceutical innovation happens – or why it’s relevant. As any medical scientist will tell you, there are few "Eureka!" moments in health research. Progress comes step-by-step, one incremental innovation at a time. Even the smallest innovations are made only after large amounts of very expensive research is done.
Once a lifesaving drug or treatment exists, it’s seductively easy to take it for granted. We sometimes forget the years of toil these things take to develop; the millions spent to bring a new drug or treatment from theory to actuality.
Abraham Lincoln wrote, patents “add the fuel of interest to the passion of genius.”
There is a reason why virtually all the world’s “miracle drugs” have been developed in Western countries. It’s called incentive. Because innovation is honored and protected and inventors are rewarded for their work.
Where there there is no patent protection there is no investment. And where there is no investment there is no innovation.
Minus patent protection, an innovator company can't earn back what it invested in R&D, ergo they can't reinvest their profits in further R&D -- further delaying crucial incremental innovation which is how medical progress is made.
(But large Indian generic manufacturers can make a bundle.)
Not surprisingly, the usual suspects of so-called “civil society” are trumpeting the Indian decision as a victory for patient access. Nonsense. Price isn’t the problem.
Obvious by its omission is the fact that about 99% of all the Gleevec in India is given for free. Patents have not prevented access. In fact, when you examine the WHO’s model Essential Drug List, very few of the 400 or so drugs deemed essential are new or patented or were ever patented in the world’s poorest countries. In category after category, from aspirin to Zithromax, in almost every case and in almost every country, these medicines have always been (or have been for many years) in the public domain. That is, the medicine is fully open to legal and legitimate generic manufacture. And yet there still isn't broad patient access.
If we allow our emotions (and sloppy reporting) to trump reason, we’ll end up with a lot less innovation.
And fewer lifesaving drugs to take for granted.
Join me, Jim DiBiasi (Partner, 3D Communications), Tony Russo (Chairman and CEO Russo Partners), Howard Yuwen (Executive Director, Regulatory Affairs, Alexixon, and moderator David Schull (President, Russo Partners) for a must attend panel discussion:
Thriving, Not Just Surviving: FDA Advisory Committee Meetings
2:30 PM - 3:30 PM on Monday, Apr 22, 2013
Location Building: N426A
Description
For many biotech executives, the term "FDA advisory committee meeting" evokes feelings of fear, even among those with historical experience. Instead of tackling Advisory Committee (Ad Com) hearings as times of opportunity in which their companies can thrive, too many executives are focused on survival. Yet, the fate of their drugs in development can rest heavily on the decisions the FDA's outside advisors. In this dialogue, biopharma executives and industry experts review lessons learned from past experiences, as well as what best practices participants can apply to get ready for and succeed in the advisory committee environment.
Learning Objectives:
- Discuss the integration needed for medical/regulatory affairs for Ad Com success
- Identify necessary and beneficial steps to prepare your company for Ad Com interaction
- Examine lessons learned from a recent case study
Ability Level: Advanced
Learning Objectives:
- Discuss the integration needed for medical/regulatory affairs for Ad Com success
- Identify necessary and beneficial steps to prepare your company for Ad Com interaction
- Examine lessons learned from a recent case study
Government (aka “academic”) detailers calling on physicians in Utah will now have to play by the same rules as pharmaceutical representatives. Governor Gary Herbert has just signed into law H.B. 120 (“Information on Pharmaceutical Products”), a bill that “amends the Division of Occupational and Professional Licensing Act related to commercial and academic detailing for prescription drugs.”
This bill “creates standards for providing educational information to health care providers about prescription drugs” and “expands the application of federal regulations that apply to a pharmaceutical manufacturer's drug representatives to other health care providers who make educational statements about a prescription drug.”
Specifically, “An academic detailer and a commercial detailer who educate another health care provider about prescription drugs through written or oral educational material is subject to federal regulations regarding:
(i) false and misleading advertising in 21 C.F.R., Part 201 (2007);
(ii) prescription drug advertising in 21 C.F.R., Part 202 (2007); and
(iii) the federal Office of the Inspector General's Compliance Program Guidance for Pharmaceutical Manufacturers issued in April 2003, as amended.”
Utah, land of the Bonneville Salt Flats, isn’t passing judgment on academic detailing; they’re just leveling the playing field. Unlike the AAMC (which believes that Uncle Sam isn’t subject to conflict of interest when it comes to the sharing of medical information), the Beehive State has their eyes open. Detailing is Detailing is Detailing.
The Information on Pharmaceutical Products Act makes the common sense point that, without public scrutiny there is no guarantee that government-sponsored detailing will present information that is unbiased, peer-reviewed, and aligned with the existing evidence base. Without clear guidelines, there is nothing to prevent government detailers from using their outreach to advocate instead of educate.
Previous government detailing efforts have often focused on demonstrating their own value by highlighting the cost effectiveness of initiatives through savings generated from the increased utilization of generics and other low cost therapies.
Asked another way – how can an “academic detailing” program funded by our nation’s largest payer (Uncle Sam) be considered neutral? Just like detailing programs run by pharmaceutical companies, there is an inherent “interest.” And that’s okay – as long as that “interest” is transparent.
Fairness is the proper yardstick. The general lack of rules or oversight stands in stark contrast to the extreme scrutiny with which industry “detailers” are subject in their interactions with physicians. Starting with the Federal Food, Drug, and Cosmetic Act of 1938, and continuing through the 2010 FDA “Bad Ad Program,” the federal government has imposed a number of regulations on industry’s ability to promote their products and distribute information about their drugs to physicians and consumers. Rightfully so.
And now the government’s detailers must play by the same rules – at least in Utah.
It’s a good first step.
Government-funded detailers should be held to the same standard as industry representatives in every state. This simple, common sense step would ensure providers are receiving accurate, unbiased information on the best treatment options available to improve patient care.
A number of unanswered questions remain. For example, if government detailers stray into off-label conversations, to whom does FDA’s Office of Prescription Drug Promotion send a letter? Whom does the Department of Justice investigate? Who pays the fine?
That’s a good point of departure for a conversation between AHRQ and the FDA – both agencies within the US Department of Health and Human Services.
As previously discussed (“Wyden Open Spaces”), Senator Ron Wyden (D-OR.) sent a letter to NIH requesting a list of medicines that have reached the market as result of NIH research since 1995 -- when the agency removed the reasonable pricing clause from cooperative research and development agreements (CRADAs). Wyden also asked NIH to convene a panel to reexamine the pricing of medicines and treatments that are developed with public funding.
He’s made this request before. Maybe he should actually read what the NIH has already said on the matter. Here it is straight from the NIH’s Office of Technology Transfer:
Requiring direct financial recoupment of the federal investment in biomedical research can potentially impede the development of promising technologies by causing industry to be unwilling to license federally funded technologies. The “reasonable pricing” provisions that NIH once required in all CRADA and exclusive license negotiations did just that. Of even greater concern should be the potential that the economic disincentives of recoupment will make it expedient for industry to move research outside the federal milieu. Such action would diminish the strides made under the Bayh-Dole Act and have the unintended consequence of removing the research from federal oversight, a particular concern when the research involves lines of investigation that are especially critical or sensitive.
It is impossible to overstate the achievements or the global macroeconomic impact of U.S. taxpayer-supported biomedical research. Federally funded biomedical research, aided by the economic incentives of Bayh-Dole, has created the scientific capital of knowledge that fuels medical and biotechnology development. American taxpayers, whose lives have been improved and extended, have been the beneficiaries of the remarkable medical advances that have come from this enterprise.
Senator Wyden’s misinformed inquiry brings to mind a quote from Robert Louis Stevenson:
“Politics is perhaps the only profession for which no preparation is thought necessary.”
The only thing that dies harder than a bad idea is a bad idea with political resonance.
And one of the down sides of term-limited state legislators is that bad ideas keep getting resurrected. Case in point: state-sponsored schemes for drug importation.
As a public service to these newly elected members, a brief primer on why drug importation is a bad idea There are four basic reasons:
(1) It doesn’t save money.
(2) The drugs being sent to U.S. customers from Canadian Internet pharmacies are not “the same drugs Canadians get.”
(3) The state experience has been dismal and politically embarrassing.
(4) National Security concerns.
Let’s look at each of these four items.
(1) It won’t save any money. Let’s not forget the non-partisan CBO study that showed that such policy would reduce our nation’s spending on prescription medicines a whopping 0.1% -- and that’s not including the millions of dollars the FDA would need to set up a monitoring system.
(2) The drugs being sent to U.S. customers from Canadian internet pharmacies are not “the same drugs Canadians get.” That bit of rhetoric is just plain wrong. In fact, drugs sold to Americans by Canadian Internet pharmacies aren’t even legal for sale in Canada. This isn’t about the quality of Canadian drug regulation. Canadian Internet pharmacies – by their own admission – are sourcing the drugs they're sending to the United States from outside of Canada. And while they may say their drugs come from Great Britain, let’s not conveniently forget that 20% of all the medicines sold in the UK are parallel imported from other nations in the EU – like Spain, Greece, Portugal, and Lithuania.
And the important political point here is that when Americans are asked if they want drugs from nations other than Canada – the answer is a resounding “no thank you.”
(3) The state experience has been dismal and politically embarrassing. Remember Illinois’ high profile “I-Save-RX”program? Over 19 months of operation, a grand total of 3,689 Illinois residents used the program -- which equals approximately .02% of the population.
And what of Minnesota’s RxConnect program? According to its latest statistics, Minnesota RxConnect fills about 138 prescriptions a month. That's for the whole state. Minnesota population: 5,167,101.
That'ss not a surprise considering that Minnesota, state officials observed Canadian Internet pharmacies engaging in dangerous practices.
One pharmacy had its pharmacists check 100 new prescriptions or 300 refill prescriptions per hour, a volume so high that there is no way to assure safety.
One pharmacy failed to label its products and several others failed to send any patient drug information to patients receiving prescription drugs.
Drugs requiring refrigeration were being shipped un-refrigerated with no evidence that the products would remain stable.
One pharmacy had no policy in place for drug recalls. Representatives of the pharmacy allegedly said that the patient could contact the pharmacy about a recall "if they wished."
The FDA launched an investigation, confiscating thousands of drug shipments headed for the United States. Some of them were headed for Minnesotans who ordered them over the state's Web site.
When opened, nearly half claimed to be of Canadian origin, but "85 percent of them were from 27 other countries including Iran, Ecuador and China." And 30 of them were counterfeit.
One Minnesota resident discovered that one of his "Canadian" drugs came from Greece, and another came from Vanuatu, a small island in the South Pacific. "I never heard of the place," he said.
Wisconsin also has an importation program, modeled on the one in Minnesota. It too hawks its promise and hides its dangers. All of the legalese buries the fact that the state doesn't accept any responsibility for the safety or effectiveness of any medicines bought on the state's Web site.
The state won't even guarantee that the drugs ordered are what the customer will receive. Not only that, but the state also says that it will not accept any legal responsibility or liability should any of the drugs cause a problem.
And remember Springfield, MA and “the New Boston Tea Party?” Well the city of Springfield is now out of the drugs from Canada business.
(4) National Security concerns. According to a report from the federal Joint Terrorism Task Force, a global terrorist ring with ties to Hezbollah, is importing counterfeit drugs into America by way of Canada. They are doing so for profit today - but could just as easily do so for more nefarious and deadly purposes. And legalizing importation would only facilitate such actions.
And then there are those politically pesky safety issues.
Adding fuel to the reality is a new by the European Alliance for Access to Safe Medicines. The title says it all, “The Counterfeiting Superhighway.”
The report reveals the scope of the unregulated trade of fake pharmaceuticals. Through extensive research and examination of over 100 online pharmacies and over 30 commonly purchased prescription-only medicines, the report makes one thing very clear – we’re not winning the battle.
Key findings from this report
* 62% of medicines purchased online are fake or substandard (including medicines indicated to treat serious conditions such as cardiovascular and respiratory disease, neurological disorders, and mental health conditions).
* 95.6% of online pharmacies researched are operating illegally.
* 94% of websites do not have a named, verifiable pharmacist.
* Over 90% of websites supply prescription-only medicines without a prescription.
* 78.8 of websites violate intellectual property.
My favorite anecdote is the report’s example of an Internet pharmacy whose products came wrapped in pages from the Mumbai Daily News. The most frightening fact, though, is most of the fake medicines “were delivered in seemingly authentic boxes, accompanied by patient information leaflets in good condition and ostensibly trustworthy blister packs.”
Novice state legislators considering drug importation should refer to Bartlett's Familiar Quotations:
"Those who cannot learn from history are doomed to repeat it."
David Vitter: Wrong on Drug Importation. Wrong on Patent Settlements.
This overly vague language of Senator Vitter’s amendment (#628) to the Senate Budget Resolution would ban all forms of patent settlements, including those that the FTC and the courts have not opposed. This would prevent pro-consumer settlements, reduce the value of patents, and reduce incentives for innovation. Instead, enforcement agencies and courts should continue to evaluate patent settlements on a case-by-case basis, under the same antitrust principles that apply to all other patent settlements.
The Supreme Court is currently addressing the issue, and Congress should await the Court’s ruling (likely this June) on the standard for reviewing such settlements.
For the first time the Supreme Court will review a case regarding the antitrust standard that should apply to patent settlements between innovator and generic pharmaceutical companies. Given the complexities and the conflict between the circuits, even if legislators believe that Congressional action may be warranted, consideration of the issue should await the Supreme Court’s decision in the case.
A ban is bad public policy that harms innovation.
Banning Hatch-Waxman patent settlements would increase the cost of patent enforcement, decrease the value of patent protection generally, and decrease incentives for taking the risks necessary to develop new medicines. As one court has stated, “a rule prohibiting settlements of Hatch-Waxman litigation can have grave consequences for R&D and, in turn, severe consequences for consumers.”
A ban would delay generic entry and delay benefits to consumers.
Despite what proponents of the legislation say, statistics show that brand companies have prevailed in approximately 52 percent of patent cases against generic challengers.
A win by the patent holder means the generic almost certainly would not be able to enter the market before the patent expires. In many cases, therefore, settlements accelerate generic entry and provide access to lower cost medicines. According to one generic company’s estimate, settlements on 10 products alone have resulted in more than $67 billion in savings to consumers.
Congress has already given the Federal Trade Commission the ability to review and evaluate individual patent settlements.
Unlike patent settlements in any other industry, Congress in 2003 required that brand and generic companies settling patent litigation arising out of the generic company’s patent challenge must file a copy of their settlement agreement or a written description of it with the FTC and the Department of Justice before the date when the generic product may enter the market. The FTC thus has the power to challenge any agreement that it deems anticompetitive.
A ban on an entire category of settlements is unwarranted. This kind of blanket ban is overly broad and could negatively impact the availability of medicines that help patients live longer, healthier lives.
Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.
