Patented drugs

It is a well-known fact that pharmaceutical products can be patented.

Pharmaceutical patents raise doubts about access to drugs which our society are provided with and ultimately, therefore, our access to the right of health.

You cannot separate the ability to obtain appropriate medical treatment from the need to use appropriate medications that allow access to proper medical care. Without admittance to appropriate drugs, no right to health is worthwhile.

The patent protects exclusive use by the owner over a period of 20 years from the date of registration.

Focusing on the pharmaceutical patent, this protection period may cause an adverse effect: a rise in retail prices of drugs.

Obviously, it is undeniable that certain economic benefits have to exist for pharmaceutical companies so they can continue in the research and development of new drugs, but what is not so sure is that these economic rights should be reconciled with the right to health, promoting access to drugs in our society.

Consequences in pricing

The fact that patented drugs have such a high cost is explained by the high costs which they have to endure up to the point when the patent is obtained.

In fact, R & D activities which pharmaceutical companies have to sustain are very expensive and deserve to be compensated. Especially, when taking into account the length of time the pharmaceutical patent ‘shortens’ practical effects.

The reality of pharmaceutical patents is that from the time of the invention and patent request to exploitation and product distribution of the product on the market can be approximately 12 years. That presumes that the effective duration of the patent is reduced from 20 to 8 years. A great loss, from the business standpoint.

Consequently, the inflated price of patented drugs is justified by the need to recuperate the investment.

This argument will never please society, since Social Security manages drug acquisition through funding obtained from citizens, and the high prices of drugs do nothing but raise public budgets on these items.

Generic Drugs

The promotion of generic drugs has attempted to alleviate the previous mentioned controversy.

The term ‘generic drug’ refers to those drugs that are exchanged with patented drugs, and whose production starts immediately after the patent which has protected them, expires. It is born when the original drug is already widely known and its safety and efficacy have been proven in medical practice for many years.

It should be equivalent, therapeutically, with respect to the patented product and is substantially cheaper.

The generic manufacturer does not have to bear the costs of R & D that the innovator manufacturer must cover. For that reason, much lower prices can be offered and it can compete effectively in the market.

Obviously, the financial sustainability of a country’s public budgets will increase if they choose to buy these drugs, ensuring the same medical results as patented drugs.

The entry of generic drugs on the market produces beneficial competition to the consumer. Manufacturers have to reduce the price of drugs if they want to be competitive.

As an example, we can look at the case of India, which in 2006 held a dispute with a pharmaceutical company regarding the patentability of a drug used to treat leukemia. The result was overwhelming, because the price offered by the drug company was 15 times higher than that offered by the generic manufacturer.

Relationship between the original drug and the generic

In spite of the above, we cannot speak of a binomial between the original and generic drug because without the original, no generic exists. The generic drug only occurs when an original drug’s patent expires.

They therefore depend on each other. The generic depends on the expiry of the original, and the original is forced to evolve because of the existence of the generic, which can take over its market position.

The goal should be to find a balance with economic benefits to the pharmaceutical industry that encourage further innovation and the use of generic drugs which allow easy access to all kinds of drugs at affordable prices.

Problems with the introduction of generic drugs

We cannot forget that there are many factors that affect the marketing of pharmaceutical products and, therefore, competition in the market and the final price to be paid by the patient.

By way of example, we can briefly describe a few of them:

1.-The doctors who prescribe drugs to patients are one of these factors. The former, in their work, do not usually consider economics in the choice of medication neither considering that the final price will be paid by Social Security nor by other external factors.

In some countries, malpractices of some pharmaceutical industries have been exposed which seek to decisively influence the decision of physicians through payment in kind, such as trips to prestigious conferences, among others.

2.- Another noteworthy factor that makes consumers choose certain products without assessing their high price is the absence of information.

In fact, advertising efforts on behalf of pharmaceutical companies have managed to create high brand loyalty in the consumer.

Although this effect has gradually reduced over the years and access to information is increasingly global, the consumer has the feeling that the ‘branded’ drug has some benefits over the generic drug. This belief is induced, without any basis of justification, in alleged advantages or benefits.

This explains why the pharmaceutical industry invests huge amounts of money on their advertising strategies, even above those resources devoted to R & D.

Conclusion

It is of crucial importance that a return to compensatory mechanisms is made that incentivize the discovery of new medicines, review patterns of R & D in the pharmaceutical sector and give necessary importance so that they continue innovating.

The activities of pharmaceutical companies should be re-directed away from focusing their research on profitable illnesses that do not necessarily report the best therapeutic results, while energies in R & D in other diseases are not exploited because of their low economic return.

The cornerstone of the patent system lies in the remuneration to the inventor, in exchange for the disclosure of his invention for the benefit of society. Therefore, we must not forget that the welfare of society is the basis of the whole system.

The objective of a patent system must achieve compatibility with an improvement in access to drugs and, therefore, the right to health.

Jordi Farré