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The Proposal for a Global R&D Convention: A Challenge to its Premises

December 4, 2012

On May 26, 2012 the World Health Assembly (WHA) adopted a resolution calling for an inter-governmental meeting to examine the proposals made in April by the Consultative Expert Working Group on Research and Development: Financing and Coordination (CEWG) to initiate a Global R&D Convention. It called for “open approaches to R&D, pooled funds, direct grants to companies in developing countries, prizes for milestones and end products, and patent pools”. The main recommendation of the CEWG was, however, more far-reaching: “to start multilateral negotiations for the possible adoption of a binding convention on health R&D”.

The concept of a Global Convention rests on three main premises:

  • 1) “the current R&D model, based on patents and market-oriented research, fails to generate new health technologies to face global challenges arising from existing health needs, particularly in developing countries;
  • 2) it is necessary to secure product access and affordability by delinking R&D costs from the prices of products; and
  • 3) voluntary financing cannot be the main or unique source of funding—a better, more sustainable and predictable financing model is needed”.

In April 2012, Medecins sans Frontiers (MSF) stated: “the current R&D system is driven by market forces, not health needs, and relies overwhelmingly on the patent system to recoup costs by via high prices”.

How relevant are these premises to issues to the the Millennium Development Goals (MDGs)? In both cases, WHO was designated by the UN as the operative agency in September of that year.

Ten years ago, researchers showed that “from 1975-1999, only 1.3 percent of new drugs and medicines were developed for neglected tropical diseases and tuberculosis despite the fact that these diseases accounted for 12 percent of the global burden of disease”.

Yet, when adopting the eight MDGs in September 2000, WHO dismissed both neglected tropical diseases and TB.  In Goal #6, the only one with a specific disease target, it read: “Combat HIV/AIDS, Malaria and other diseases”. The urgency now being expressed in the high burden of tropical diseases by the CEWG was curiously absent in 2000 when WHO relegated them to a global potpourri of ‘other diseases’.

Is the low percentage of new drugs and medicines as important a factor in subsequent access and affordability, or is the number of drugs that actually came on the market in this period to diminish tropical diseases more important? Let’s look at a few examples.

In 1978, an R&D company introduced Ivermectin to combat an age old scourge: onchocerciasis or river blindness. It made this therapy available at no cost into perpetuity.  This disease is the world’s second leading cause of infectious blinding, leading to reduced agricultural output. A World Bank evaluation looked at riverine communities that had left the land due to endemic blindness. Once this disease “was controlled, 25 million hectares of land were returned to agricultural production, enough to feed 18 million people”.

In the 1980s, USAID sponsored a program to introduce Oral Hydration Salts (ORS) as the treatment of choice for diarrheal disease. The product was developed by an R&D company, and considered by some to be “possibly the most important advance of this century”.

Although the R&D companies patented their respective therapies, neither enforced them when other non-R&D companies massively produced these products. Today, ORS is the preferred treatment for diarrheal diseases, saving the lives of millions of poor children.

In 1987, when the global AIDS epidemic was beginning its ascendancy and no interventions were in sight, one R&D company developed the first therapy for effective treatment: AZT.  This sparked a revolution in product innovation by others: today MSF records that there are 26 different therapeutic classes of ARVs, all of them covered by extant patents. Most are being produced by Indian firms as generics without fear of legal challenge from their right-holders.  MSF has designated India as “pharmacy to the developing world”. (9)  WHO records in 2012 more than 8 million AIDS patients under life-extending ARV treatment, up from less than 50,000 in 2003.

In 2006, the Congressional Budget Office published a study on average costs and times to successfully develop a new molecular entity. “In 2000, the total cost was $802 million, with an average time of 11.8 years to bring a product to market”.  By 2012, that average costs has risen to $1.3 billion and the time to 12+ years.

All new drugs that reach the market after FDA approval don’t necessarily find a market. In 2006, one R&D company introduced a new inhaler for asthmatics. By 2011, it had to conclude there was no market for it, writing down $2.3 billion in losses.  An R&D Convention would most certainly produce some losers; how would they be covered?

The first order of business for the CEWG should be: in a global health community increasingly focused on evidence-based programming, can the concept for an R&D Convention be sustained by its founding premises?

If these answers can provide confidence to continue with the concept, then advocates need to propose a new regulatory agency with extraterritorial enforcement authorities. It would have to address this question: is there a scientific justification for the retention of FDA/EMEA pharmaceutical quality requirements more stringent than those of the proposed R&D Convention?   Investors, public and private, would want assurances of this nature before they expend untold billions in the absence of a proof of concept.

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