E-DRUG: Sachs and Danzon at the Norway meeting
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[personal but illustrative account of day-1 of the price
differentiation meeting in Norway. Crossposted from Pharm-Policy
with thanks.
This message was copied to Jeffrey Sachs <jeffrey_sachs@harvard.edu>
The original did not state it was copied to Mrs Danzon - anyone knows
her email, and can forward it to her? NN]
I won't have my notes from the meeting ready until tomorrow, but should
comment on one thing that happened. Jeffrey Sachs appeared before the
meeting on video conference. He gave what seemed like a 30 minute
lecture on why we should be spending more on health care on the poor in
Africa, and then launced quite unexpectedly into a blistering attack on
the generics industry, and a request that the activists abandon their
compulsory licensing campaign, and "respect" patents on medicines,
apparently even in countries where patents do not exist.
Sach forcefully (to put it mildly) argued was that there should be TRIPS
plus IPR protections in the poorest countries, that northern donor aid
be used in part to prevent the poor countries from implementling the
weaker levels of IPR protection that are permitted in the WTO agreement,
and opt rather for the highest levels of protection and purchases
strickly from big pharma. We basically were told that we had his word
that the big pharma companies would lower prices to marginal costs.
There was a truly bitter exchange with me and Bill Haddad, and there
would have been much more discussion but the moderator cut off the video
conference before others could speak, including for example Paulo
Teixeira, who was clearly offended by the Sachs presentation, and whose
efforts in Brazil were completely ignored by Sachs. Sachs indicated
that there could be some "monitoring" of the pricing to ensure that
prices were low enough, but he did not respond to the issue of how
competition changes prices over time, for example, how the prices for
raw materials for 3TC droped from $10,000 per kilo to $750 per kilo in 3
years, raising of course the issue of how anyone can determine what
marginal costs are at any point in time. The other members of the group
didn't get a chance to ask Sachs how he explains the hundreds if not
thousands of cases where the poor are currently paying higher prices
than we see in OECD countries for basic medicines.
This was a dramatic and unsettling moment on the first day, as Sachs is
the co-chair of the WHO macroeconomics commission on health. This was
followed by a presentation also on video conference by Professor Patrica
Danzon from Penn, a frequent big pharma consultant but apparently an
invited expert by the WHO to this meeting (and to the Macroeconomics
commission), who explained that the WHO should assume that because of
free entry into the medicines market and competition between theraputic
substitutions, there are no inefficiences from high prices on medicines,
and she recommended that a policy of "unconstrained ramsey pricing,"
which without any budget constraint is of course the same prices that a
monopoly would charge, and she opposed national price controls and
parallel imports. This more of less set the stage on the first day, and
it was an eye opening illustration about how much the WHO has focused on
big pharam approaches to dealing with the poor. There was basically
zero support for this basic approach among the southern voices in the
meeting, nor among the NGO delgations.
--
James Love
Consumer Project on Technology
P.O. Box 19367, Washington, DC 20036
http://www.cptech.org
love@cptech.org
1.202.387.8030 fax 1.202.234.5176