E-drug: Study on tax subsidies for donations of expiring drugs
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[Copied from Ip-health. With thanks. KM]
Press Release: http://www.waronwant.org/press/dd.htm
Full Report: http://www.waronwant.org/dd-report.pdf
Drugs for cash scandal exposed by Mark Thomas and War on Want
New report launched to prevent Brown budget proposal leading UK
down US path of taxpayer-subsidised corporate greed.
New US-style tax breaks, to be announced in the forthcoming
budget, could result in British drug companies such as GSK enjoying
massive publicly funded subsidies for simply offloading out of date
or dangerous medicines on the developing world.
A new report, written by Channel 4's Mark Thomas and published
by anti-poverty charity War on Want, reveals that US drug
companies have been making money out of ridding their shelves of
unsellable or out of date drugs while gaining kudos from 'charitable'
donations to areas affected by humanitarian disasters.
Under US tax law companies can claim back twice the cost of
producing the drug. Given that inappropriate drugs are often
unusable in the US, and cost money to destroy, this represents a
substantial reward for clearing the shelves of unwanted stock.
On April 17, as part of the budget, Gordon Brown will announce
legislation to encourage drug donations. This is part of a package of
incentives designed to encourage research into, and development
of, new treatments for the three target diseases identified by the
G8 and the United Nations: malaria, TB and AIDS. But there is
concern that unless donations are regulated, tax concessions could
result in the British taxpayer subsidising corporate shelf clearance.
Mark Thomas said: "Drug dumping by the pharmaceutical industry
increases the profits of drug companies and allows them to get rid
of out of date, inappropriate, useless products that are dangerous
and cost NGOs money on the ground to clear up. It's cynical,
disruptive and a rip off."
Nick Dearden, War on Want Campaigns' Officer, said: "We want
drug companies to register their donations publicly so that their
'charitable' activities can be scrutinised. We also want donations to
be determined by need, not by what companies want to shift off
their shelves."
A campaign was being launched on Mark Thomas' Channel 4 show
April 3, calling for a publicly available register of drug donations.
Mark Thomas and War on Want urge the Government to avoid the
pitfalls of the US system, by ensuring that UK drug donations are
regulated and beneficial to their recipients.
We will also be urging that tax credits should be geared to
providing the medicines needed on the ground. Donations should
only be made based on the recipient country's essential drug list, or
drugs specifically required for a given medical emergency. There
should be no donations of out of date or short-dated drugs, and
generic rather than brand name drugs should be provided.
Furthermore, tax credits should only cover the cost of the donated
product.
During the famine appetite stimulants were dumped on Sudan by
US drugs companies, while in Lithuania worming medicine meant
for animals has temporarily blinded women. In Bosnia, so much
useless stock was dumped on the refugee camps that �34 million
had to be spent on incinerating it. Donated drugs are often out of
date, not relevant to the emergency situation, unfamiliar to local
medical practitioners, or unsorted and unlabelled.
Notes for editors
Contact Nick Dearden, War on Want Campaigns Officer, on 020
7620 1111 or 07932 335464 or Geoff Atkinson at Vera on 020
7436 6116 for more details and comment. For a copy of the report
please contact Nick Dearden. War on Want is an anti-poverty and
development charity that celebrated its 50th anniversary last year.
Full details on the campaign are available on the War on Want
website (www.waronwant.org).
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