Wrapping up 2019 – Noteworthy Medicines Law and Policy Events

2019 had its share of noteworthy medicines law and policy events. It was also a year that saw eye-popping new levels of pharmaceutical pricing. And governments in response began to ask that companies explain why such prices are demanded. Transparency of pricing and cost became central themes in international and national debates.

Here are some highlights of 2019.

In January, the World Health Organization’s Executive Board considered a study carried out by the WHO on “Pricing of cancer medicines and its impact”. High cancer drug pricing is a global crisis. But people in low- and middle-income countries are most affected. The WHO report deals with the often-heard argument that high prices are necessary to finance the development of new treatments and concludes: Concerns that lower cancer medicine prices might impair future R&D seem misplaced because evidence suggests that (a) prices of cancer medicines bear little or no relationship with R&D costs; (b) financial returns of cancer medicines are high; (c) potential impact on revenue due to lower prices could be offset by higher volume, especially when the marginal cost of production is low; and (d) governments and the non-profit-making sector have made substantial contributions to the R&D of medicines through direct funding and other incentives. See here for more information.

In February, article 53(3), the second sentence of the Dutch Patent Act 1995 came into force introducing a patent exemption for the preparation of medicines in a pharmacy. Article 53(1) of the Dutch Patent Act provides the usual list of exclusive acts reserved for the patent holder: to make, use, put on the market or resell, hire out or deliver the patented product, or otherwise deal in it in or for their business, or to offer, import or stock it for any of those purposes. The law now provides an exemption for pharmacy preparation to these exclusive acts, allowing the preparation of medicines upon prescription despite the existence of a patent. Read more here.

In March, the African Union announced the adoption of a treaty for the establishment of the African Medicines Agency (AMA). The AMA will serve as the continental regulatory body that will provide regulatory leadership to ensure harmonised and strengthened regulatory systems which govern the regulation of medicines and medical products on the African continent, according to the announcement.

Also in March Lord Jim O’Neill, who advised the UK government on antibiotic resistance, told the BBC he was shocked by pharmaceutical companies failing to tackle drug-resistant infections. He argued that part of the drugs industry should be taken over and turned into a public utility to make new antibiotics. Of course, a global public utility for antibiotic drug development exists: governments can put their money into GARP, set up by the Drugs for Neglected Diseases initiative (DNDi) and the WHO to fill antibiotic treatment gaps.

April is the month of the Office of the United States Trade Representative (USTR)’s annual special 301 list of countries the USTR deems inadequate in the protection of intellectual property rights. In the universe of the USTR, this includes not appropriately recognising the value of innovative medicines and medical devices so that trading partners contribute their fair share to research and development of new treatments and cures. For example, Chile is on the Priority Watch list because the Ministry of Health issued a Resolution 399, which declared that there are public health reasons that justify issuing compulsory licences on certain patent-protected drugs used to treat hepatitis C. And India is also on the watch list because “Section 3(d) of the India Patents Act restricts patent-eligible subject matter in a way that fails to properly incentivize innovation.” Section 3(d) of the Indian Patents Act is meant to prevent evergreening patents and granting of trivial patents. Argentina is on the list for similar reasons: not granting patents for pharmaceuticals that are granted elsewhere.

Discussions on medicines pricing continued in April at the 2nd Fair Pricing Forum held in Johannesburg, South Africa. The Forum brought together over 200 delegates from government, NGOs, academia and industry to discuss how to design a fairer pharmaceutical system where medicines are affordable to those in need and the development of effective new treatments is financed appropriately. Transparency of pricing and the cost of R&D was a central theme at the meeting. Read our report of the meeting here.

Also in April, prompted by the consumer group Test Achats, the Belgian Competition Authority announced an investigation into Leadiant after the company raised the price of an old medicine, CDCA, 360-fold. CDCA was originally used for the treatment of gall stones but has been used off-label to treat a rare metabolic disease. The Belgian developments follow the investigation into Leadiant by the Dutch competition authority (ACM)  in response to a complaint filed by the Pharmaceutical Accountability Foundation. The ACM investigation started in 2018 and is still ongoing. For details, see here.

May saw the most expensive pharmaceutical treatment ever going to market. Novartis received FDA marketing approval for Zolgensma, a gene therapy for children with a rare muscle disease. Novartis priced it at US$ 2.1 million per treatment. The price prompted the Dutch minister of health to write in an open letter to the pharmaceutical industry, stating: “What particularly bothers me, is that we are not allowed to know why we have to pay so much. We simply get no explanation, no insight into the price structure.”

The call for price transparency was also heard at this year’s World Health Assembly which adopted a resolution, spearheaded by Italy, that called for greater transparency in drug prices and the cost of research. The UK, Germany and Hungary distanced themselves from the resolution. John Zarocostas wrote a nice story for The Lancet about the drama surrounding the adoption of the resolution.

In June, parents of children with cystic fibrosis (CF), who set up a buyers club to gain access to treatments that were priced out of reach of the National Health Service (NHS), made headlines in the UK. Vertex, the sole supplier in the UK of the CF treatment Orkambi (ivacaftor-lumacaftor) insisted the NHS pays £104,000 per patient per year. Parents had found generic sources of ivacaftor-lumacaftor in Argentina and decided to set up their own supply, thereby increasing pressure on the government to issue a Crown use license to allow for the regular supply of generic ivacaftor-lumacaftor through the NHS. Re-read the story here.

Also in June, Medicines Law & Policy published reviews of the pharmaceutical incentives in the EU, including supplementary protection certificates, data exclusivity and orphan medicines regulation. The reviews include recommendations for policy and legislative change.

In July, the French NGO Médecins du Monde and the Swiss group Public Eye filed a patent opposition against a patent for Novartis Kymriah, a leukaemia treatment. Public Eye claims the patent is an attempt at evergreening patent protection of CAR-T cells to prolong exclusivity of Kymriah in the treatment of cancers.

Also in July, the WHO published the 21st Essential Medicines List, which included ten new cancer therapies. Medicines Law & Policy, together with others, wrote commentaries on the significance of this move. When WHO labels medicines as essential, it means that they have proven their utility and should be available and affordable to all. The commentaries appeared in the Lancet Oncology and the Financial Times.

On 14th of August, Winnie Byanyima was appointed Executive Director of UNAIDS. Ms Byanyima is the first woman to lead the organisation.

Also in August the FDA approved a new treatment for extensively drug resistant tuberculosis (XDR-TB). The results of drug trials with the combination treatment of bedaquiline, pretomanid and linezolid hold promise for people with XDR-TB, which is very hard to treat. The TB Alliance, a not-for-profit drug developer, developed the new treatment. Médecins Sans Frontières (MSF) called the new treatment a lifesaver for people with XDR-TB but warned that the product needs to be priced at an affordable level.

In September, Statnews reported that a French charity involved in the development of Zolgenma has obtained a ‘reasonable pricing clause’ for Zolgensma for people needing the treatment in France. Zolgensma is a gene therapy for young children with spinal muscular atrophy that entered the market in May (see above), sold and priced by Novartis at US$ 2.1 million per treatment. The discovery of the French exception raises the question of why other public research and funding agencies did not make similar demands? Read the full report here.

Also in September the UN High-Level Meeting on Universal Health Coverage (UHC) paid more attention to the need for affordable health technologies than previous discussions. The declaration adopted by the UN General Assembly calls on countries to ensure sufficient spending on health, maximise efficiency and ensure equitable allocation of health spending, to deliver cost-effective, essential, affordable, timely and quality health services. Specifically for medical products, the countries agreed to: Improve availability, affordability and efficiency of health products by increasing transparency of prices of medicines, vaccines, medical devices, diagnostics, assistive products, cell- and gene-based therapies and other health technologies across the value chain. Katrina Perehudoff et al published some ideas for lawmakers to include price control, the cost-effectiveness of medicines and intellectual property management in UHC legal reforms in Health Policy & Planning’s December 2019 supplement. Here is the checklist list with 12 principles for UHC legal reform for access to medicines.

In October, Uganda notified the African Regional Intellectual Property Organisation (ARIPO) that pharmaceutical inventions are not eligible for patentability in the country. Read more here. Uganda as a least developed country member of the World Trade Organization is not obliged to grant or enforce pharmaceutical product patents.

In October the Drugs for Neglected Diseases initiative (DNDi) celebrated its 15th anniversary and published a report on 15 years of needs-driven innovation for access. The publication includes data on how much it cost the DNDi to develop a new drug. Check it out on page 17 of the report (spoiler: it is not $2.1 billion).

2019 was also the 20th anniversary of MSF’s Access to Medicines Campaign which was the brithplace of the DNDi. They made a nice overview of the last 20 years. Watch it here.

The issue of R&D cost, pricing and transparency will also be taken up at the World Trade Organisation following a submission by South Africa titled Intellectual Property and the public interest: R&D costs and pricing of medicines and health technologies in October. See this report by KEI for more information.

In October, Italy’s competition authority also opened an investigation into Leadiant (following similar action from the Dutch and Belgian authorities mentioned above). Italy alleged that the company has abused its dominant position in the Italian market with regards to production and pricing of CDCA, a medicine to treat the rare metabolic disease, XCT. The preliminary investigation is expected to conclude by October 31, 2020. By the end of 2019, Leadiant is under investigation in three European countries: The Netherlands, Belgium and Italy.
On 24th October, after 4 years of campaigning for a better price, the CF medicine Orkambi will be available in the NHS. Watch here what it took to get there and why reforms are needed.
On the last day of October, the World Trade Organization (WTO), the World Health Organization (WHO) and the World Intellectual Property Organization (WIPO) held their annual public health love fest and examined opportunities and challenges of new health technologies, acknowledging that access to those is now a truly global problem. We wrote about it here.
In November, over 100 organisations demanded in a petition to ARIPO, the African regional patent office, in the running up of its Administrative and Ministerial Council meetings (18 to 21 November) in Liberia, to introduce reforms to ensure improved access to medicines. They state that: to date ARIPO has failed to utilise many of the key public health safeguards allowed under international law and championed by national and regional bodies throughout Africa. Instead, ARIPO continues to grant multiple unworthy pharmaceutical patents that make medicines unaffordable to patients and governments. For example, the petition points out that ARIPO grants patents for least developed countries (LDCs). LDCs are exempt from the obligation to grant or enforce medical product patents under international law.
November also finally saw some good news on Ebola when the EMA conditionally approved the first Ebola vaccine and the WHO prequalified it, paving the way for its use in high-risk countries. A coalition of funders, researchers and NGOs, with the support of the WHO and of course the people in West-Africa who participated in the trial, made the development of the vaccine possible. Merck will produce the vaccine.
In December the US government, under pressure from the democrats in Congress, dropped the demand of 10-year data-exclusivity for biologics in the US-Mexico-Canada Agreement (USMCA). The USMCA is the successor of the North American Free Trade Agreement (NAFTA). The US currently grants 12-year data exclusivity but Congress wants to have its hands free to roll back this exclusivity to allow more affordable generic products to come to the market sooner. Increasing drug prices in Canada and Mexico also curtails options for American patients to purchase cheaper medicines across the border. Such importation for personal use is an important lifeline for many in the US.
On 3 December, the French National Assembly adopted a transparency amendment to the social security budget bill that requires drug companies to disclose public financing they have received for the development of the medical product they are seeking to market in France. The comité économique des produits de santé (CEPS), the French government body in charge of setting prices for reimbursement, can take this information into consideration when negotiating drug prices. This good news, however, did not live for very long. On 20 December the Constitutional Council invalidated the amendments on procedural grounds. The amendments had wide support, including from the government. The Observatoire Transparence Médicaments (OTM) that supported the amendments has asked the government to implement the transparency demands by decree.

The WHO prequalified the first biosimilar (biogeneric) trastuzumab (a monoclonal antibody also known under the brand name Herceptin). Trastuzumab is used to treat HER2 receptor-positive breast cancer. According to the WHO, 2.1 million women contracted breast cancer in 2018 and 630,000 of them died from the disease, many because of late diagnosis and lack of access to affordable treatment. The prequalification of the biosimilar should facilitate the procurement of lower-priced trastuzumab. Trastuzumab was included in the WHO Essential Medicines List in 2015, but prices remained high because of the lack of biogeneric competition. Read more about the WHO Prequalification program here.

Finally in December, following the patent opposition launched at the EPO by Médecins du Monde and Public Eye in July, Novartis withdrew the Kymriah patent that was opposed by the two groups. See statements by the two NGOs here and here.

Happy New Year!


Ellen 't Hoen
Ellen 't Hoen
Ellen ‘t Hoen, LLM PhD, is a lawyer and public health advocate with over 30 years of experience working on pharmaceutical and intellectual property policies.


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