E-drug: Re: Drug patents and prices
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Dear e-druggers,
We agree with Joel Lexchin when he points out that the real concern with
intellectual property protection (IPP) and pharmaceuticals is how
much the patient really pays.
The study by Rozek and Berkowitz (1), commissionned by the
Pharmaceutical Research and Manufacturers of America (Phrma), is quite
clear about the "consumption structure" effect that Joel is discussing
here : "Intuitively, the expectation is that once IPP is instituted,
brand products would capture sales that would otherwise go to locally
produced copies. Therefore, even if prices of brands do no increase, the
change in consumption would cause overall spending to increase. We
examined how IPP alters the composition of drugs sold in all nine
countries. We found that, based on all the drugs in our set of six
therapeutic categories, brand products have been gaining market share
(measured in currency volume) while "other brands" have been losing
market share in six countries (Brazil, Egypt, Hungary, Jordan, Turkey
and Korea)."
Let us go further : this study is used by the pharmaceutical industry to
claim that the enactment of intellectual property protection in
developing countries does not affect drug prices. Rozek's study just
confirms what anybody knows in any country : the price of drugs is not
readjusted to reflect the inflation rate. But the study does not address
the real question : will the price of usefull new drugs go up (at
launch)? Nevertheless, the answer is quite clear for Rozek and Berkowitz
in their final conclusion : "With IPP, firms may expect to gain more
control over prices and prices changes for the products covered by
patents once price regulation is relaxed. Firms may attempt to set
introductory prices at a higher level than would be the case absent the
IPP. (...) Higher prices for pharmaceutical products without therapeutic
alternatives are the price of encouraging domestic innovation and
improve health care in a country".
This study is definitely confusing people by giving correct answers to
misleading questions.
Pierre Chirac, pharmacist, pierchir@club-internet.fr
Miloud Kaddar, economist, mkaddar@wanadoo.fr
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