E-DRUG: ITPC Letter to the Medicines Patent Pool Foundation and UNITAID
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[Below a long message on a complicated debate around medicines patent pools.
E-druggers might want to also read the Q&A statements issued by the Patent Pool on the Gilead licence:
http://www.medicinespatentpool.org/LICENSING/Current-Licences/Medicines-Patent-Pool-and-Gilead-Licence-Agreement/Q-and-A-Gilead-Licences WB/BS]
ITPC Letter to the Medicines Patent Pool Foundation and UNITAID on the processes, principles of MPP and its first license agreement with Gilead
Dear All,
On 12 July 2011, the Medicine Patent Pool Foundation (MPPF) released news of
its first voluntary license agreement with Gilead, Inc. (Gilead). The
International Treatment Preparedness Coalition (ITPC), a network of people
living with HIV and their advocates working to secure universal access, and
Initiative for Medicines, Access and Knowledge (I-MAK), aiming to increase
access to affordable medicines, analyzed this agreement noting serious
concerns with content and process, and concluded that the outcome was a
setback for the global movement on access to live-saving medicines. We
requested a meeting with the MPPF.
On October 2, 2011, members from civil society from the global south, and in
particular those from countries that were excluded under this agreement, met
with staff and advisors of the MPPF and UNITAID in Geneva. At this meeting
many of the issues raised we felt were not adequately addressed by the MPPF
and UNITAID staff. At the end of the day, we made the following three
demands of the MPPF, in conjunction with UNITAID, its founding partner. MPPF
and UNITAID should:
1. Substantially revise or terminate the MPPF-brokered license agreement
with Gilead, including any potential or pending agreements with
sub-licensees, given Gilead’s bad faith and the controversial terms of the
MPPF-Gilead agreement;
2. Institute an immediate moratorium on negotiations of any new license
agreements, including any new or pending agreements with Indian generic
producers (potential sub-licensees to the MPPF-Gilead agreement) or with
other multinational drug companies (potential new licensors) until such time
as standard terms and conditions or a model agreement is agreed to; and
3. Re-evaluate the current structure of the MPPF, including its
governance and administration, goals and mission, and implement
comprehensive reforms designed to enhance its transparency, accountability
and adherence to core principles of health equity.
We next prepared a letter (available here
http://www.petitionbuzz.com/petitions/mppunitaid) noting our concerns set
out below. In less than a few days we received over 90 signatures of support
from community organizations and networks in over 20 countries including
those with access to products in the agreement. The full letter and
supporting documents including from the October 2 meeting such as
presentations, agenda, participants lists, and background documents are all
posted online at (http://www.itpcglobal.org/index2.html).
We hope that you will review the materials and decide for yourself on the
value add of this voluntary license between MPPF and Gilead with respect to
public health benefits for PLHIVs as opposed to the economic benefits to the
multinational company.
Finally, the community letter raising concerns on the MPP-Gilead agreement
and making demands of the MPPF and UNITAID leadership is now posted as a
legitimately sponsored petition by ITPC, and can be supported at
( http://www.petitionbuzz.com/petitions/mppunitaid).
*Summary of key concerns with respect to substantive content
*1) The reliance on the original Gilead voluntary license (from 2006) as the
template for the MPPF-Gilead 2011 agreement. The license agreement instead
should have been based on standard terms and conditions for
licenses developed in advance by the MPPF with community input. Ideally,
these terms and conditions should be non-negotiable when the MPPF is
brokering any agreement with a pharmaceutical company. There has to be a
threshold of concessions that the MPPF simply will not cross in negotiations
with multi-national pharmaceutical companies;
2) The restricted geographical scope of the license for tenofovir (TDF) that
excludes over 500,000 patients in more than 43 countries, and a greater
number excluded for the pipeline medicines (e.g., Botswana and Namibia). The
acceptance of restrictive terms and the lack of criticism of Gilead by the
MPPF and UNITAID for these exclusions are of great concern. Furthermore, the
claims made by MPPF of the benefits of the scope of the new license are
exaggerated and not based on any empirical assessment. The benefit of the
addition of 16 new countries in the TDF licensed territory is overstated.
Those countries represent less than a one percent increase in patient
coverage, whereas the addition of middle-income countries excluded from the
agreement would have represented a 12 percent increase in access,
significantly expanding the market;
3) The undermining of the free and full use of TRIPS flexibilities by
countries through restrictive provisions in the licences including:
(a) circumventing the 2016 TRIPS deadline for least developing countries
(LDCs) by allowing royalties on medicines supplied to them, even though
these countries do not have to impose patents on essential medicines until
2016;
(b) the imposition of restrictions on the use of compulsory licenses (CLs)
by requiring the prior permission of Gilead, thus affecting both importing
and exporting countries (and placing additional barriers on the use of the
August 30 Decision);
(c) blocking the ability of excluded countries to parallel import generic
medicines, by allowing Gilead to directly intervene and cancel generic
companies’ distribution agreements;
(d) undermining patent opposition work by requiring royalties to be paid
until all related patents, including undecided applications, go through the
entire legal appeals process and are finally rejected, which often takes
several years; and
(e) the MPPF’s licensing of poor quality patents legitimizes and endorses
weak patentability standards for medicines, which many agree requires reform
and contradicts the flexibilities enshrined in the TRIPS agreement;
4) The introduction of royalties on drugs even in countries and regions
where patents do not exist, and the payment of royalties and continuing
restrictions on generic companies even before patents are granted;
5) Restrictions imposed through the licenses on generic production in any
country except India, and through the control over the production and supply
of active pharmaceutical ingredients (APIs). These provisions limit local
generic production worldwide, which is essential to enhancing
competitiveness and self-sufficiency and is one of the few options for
countries excluded from the licensing agreement;
6) The MPPF’s inexplicable championing of the “unbundling” provision of the
licence, which allows generic companies to opt out of some drug licenses
while keeping others. No explanation has been provided to date as to why the
MPPF did not negotiate four separate licences;
7) The MPPF’s failure to explain to the public the consequences for generic
companies of severing the TDF license. If a generic company severs on TDF,
it also loses the ability to produce and supply emtricitabine;
8) The MPPF’s incomprehensible waiver of its legal standing and right to
enforce the provisions of the license in any dispute between Gilead and a
sub-licensee at a secret arbitration. This neuters the MPPF’s ability to
affect much of what occurs after a sub-licensee agreement is signed,
including ensuring that the licence is implemented in a manner that
increases access to medicines. This refusal to accept legal responsibility
is inexplicable and unwarranted, hampering not only the MPPF’s effectiveness
but also the influence of civil society groups over the implementation of
any and all licenses.
*Summary of key concerns with respect to process and MPPF principles
*1) An absolute lack of transparency on the terms of reference, roles and
responsibilities, selection criteria and selection process of the ad-hoc
Expert Advisory Group (ad-hoc EAG), which was consulted during the MPFF’s
negotiations with Gilead, and the permanent EAG currently being assembled.
Furthermore, we perceive a lack of transparency around the EAG’s process,
provision of inputs, and the extent to which these inputs are integrated
into decision-making. Also of concern is the lack of involvement of PLHIV,
and the under-representation of key organizations working on access to
medicines for HIV/AIDS in the global South on the EAG (members of which were
noted by the MPPF at the meeting on 2 October 2011).
2) The refusal by MPPF staff to disclose i) the contents of the review by
the ad-hoc EAG on the Gilead license agreement prior to its approval, and
ii) the contents of the limited (if any) due diligence the MPPF may have
conducted;
3) The lack of clarity around the process of determining whether a license
negotiated by the MPPF meets the primary purpose for which the MPPF was
created: to improve the health of people in low- and middle-income
countries;
4) The provision stating that the MPPF is to receive 5 percent of all
royalties paid by sub-licensees to Gilead up to the amount of $1 million per
annum. We believe this represents poor judgment and a serious conflict of
interest. (We note, though, that at the meeting on 2 October 2011, MPPF
staff specifically acknowledged that even the appearance of conflict of
interest in these agreements is harmful—and will consider the removal of
this language in the existing license agreement and any potential future
ones);
5) The public relations strategy of the MPPF around this agreement has
confused and misled the public. On 12 July 2011, the MPPF-Gilead agreement
was announced in London. Simultaneously, Gilead made a public announcement
in India extending its partnership with four Indian generic pharmaceutical
firms—Ranbaxy, Hetero, Matrix and Strides Arcolab—to produce and market two
pipeline HIV drugs (elvitegravir and cobicistat) and a combination product
known as the “Quad”. These separate agreements had no relationship to the
MPPF and ensured these companies would remain outside the Pool. These
separate agreements with the four Indian companies segmented the market for
the drugs in the pipeline, and completely undermined the MPPF-Gilead
agreement. It is troubling that the MPPF representatives were aware of these
“preferred partner” agreements, and yet did not publicly criticize Gilead
for acting in bad faith or draw sufficient attention to the implications of
the side deals.
Additionally, these side licenses require the Indian generic companies to
pay royalties of between 10 and 15 percent for cobicistat, elvitegravir and
the Quad in countries not included in the MPPF license (Botswana, Ecuador,
El Salvador, Indonesia, Kazakhstan, Namibia, Sri Lanka, Thailand and
Turkmenistan). To date, though, the MPPF and UNITAID have refused to comment
on Gilead’s actions. To us, this signals that the MPPF and UNITAID value
their relationship with a for-profit company far more than the principles on
which both organizations were established; and
6) The exaggerated claims of actual benefit and potential impact in public
relations by the MPPF, and supportive statements of these claims by UNITAID
and other stakeholders, about this license and the MPPF’s overall strategy.
These actions are both misleading and damaging as they allow originators and
decision-makers to be complacent and satisfied with the notion that the MPPF
solves most issues regarding access to medicines. Given that the licensing
agreement leaves behind half a million patients, both UNITAID and the MPPF
should reflect seriously on celebrating these licenses in the press.
ITPC Secretariat
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Tahir Amin
Co-Founder and Director of IP
Initiative for Medicines, Access & Knowledge (I-MAK)
Email: tahir@i-mak.org
www.i-mak.org