E-DRUG: Colombia: Compulsory licensing (3)
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Hello Gidey and e-druggers,
I'll address each of your questions in turn.
I was wondering how such a problem has been a big concern in Colombia if
the drug is on market in neighboring countries at a competitive price.
My concern here is as to whether the drug available in generic form or
in the same brand of Abbott in those neighboring countries?
Colombia has been purchasing Abbott's brand-name product Kaletra.
Colombia has not been purchasing generic LPV/r.
Colombia has been paying more for Kaletra than other countries in the
region that are also buying Kaletra (such as Ecuador and Brazil).
Colombia has also been paying much more for Kaletra than countries in the
region that have been buying generic LPV/r (such as Peru and Bolivia).
Kaletra is selling to public sector programs regionally for a little more
than $1000 (and at a much higher price in the private sector). Generic
LPV/r prices vary. Recently they were around $750, but over the past
couple years have reached a low of $396 in Peru (Cipla/Eske), with
Matrix/Clinton Foundation agreement prices now available regionally at
$470, and maybe less.
Colombia most recently has been paying about $3,400 for Abbott's Kaletra -
but that price, too, has varied among Colombia's many drug purchasers.
The price order sets a public sector price at the slightly-more-than
$1,000 level. But, since Colombia's system has traditionally relied on
many private drug purchasers, the average price in Colombia may continue
to be closer to the new private sector price of about $1,600.
In that case, Colombia will continue to pay:
* more than nearby countries are paying for Abbott's Kaletra, and
* much more - even 3 or 4 times more - than other nearby countries are
paying for generic LPV/r.
But Abbott still plans to continue legal challenges to Colombia's price
order.
The other, you have mentioned that Kaletra is available in cheaper prices
in neighboring countries. If that is case, why was not possible, up to
this point, for the government to import the drug through parallel
importing in order to avert the price hike thorough completion?
Apparently the Colombian government tied its own hands right after the
signing of the TRIPS Agreement in 1995, by issuing a national decree which
effectively blocks the use of parallel importation. On February 16 of
this year, the Archbishop of Bogota wrote to President Uribe, in a letter
joined by the Colombian Medical Federation and civil society groups,
arguing that the government should revoke this decree and start using
parallel importation. They've not yet received an answer.
Second, under the TRIPs Agreement countries have the right to issue a
compulsory license subject to grounds including but not limited to public
health reasons; instance of emergency situations, epidemics, public
non-commercial use, to remedy anti-competitive practices or to protect the
environment.
If this is the case, what factors hindered the government from exercising
such rights and powers? It is my feeling that in the absence of
exercising such rights and other relevant powers, I don't think the
multinational companies will easily bend from practicing the 'skim the
cream' pricing strategy.
We agree. Competition has consistently proven the most effective way to
reduce medicine prices, and ensure they continue to fall over time.
Colombia could issue a compulsory license at any time on public interest
grounds, creating competition in the market for LPV/r, in exchange for
reasonable royalty payments to the patent holder. Civil society requested
a license from Abbott and then, after receiving no reply, an open
compulsory license from the government in 2008. The government turned it
down "for now," effectively arguing that price was not a barrier to access
in Colombia, because access is, in theory, guaranteed. Civil society
groups disagree, citing failures in Colombia's health system and gaps in
coverage that are exacerbated by higher prices. The groups also note that
the high cost of one medicine takes scarce health system resources away
from every other public health need (including services for PLHIV).
This is all the more urgent as the Colombian health system wrestles its
worsening "emergency." The sense of civil society groups has been that
the Colombian government has historically aligned itself with the
interests of multinational companies, and is therefore hesitant to use
sovereign rights like compulsory licensing that would force those
companies to compete.
But the price order is a first step toward a Colombian politics of health
independent of the interests of multinationals. Civil society will
encourage the government to take another step, and then another, placing
the needs of public health first.
Peter Maybarduk
Public Citizen
peter.maybarduk@essentialinformation.org