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28 Μαρτίου 2024, 17:09:06

Αποστολέας Θέμα: The New Pharmaceutical Frontier  (Αναγνώστηκε 1943 φορές)

0 μέλη και 1 επισκέπτης διαβάζουν αυτό το θέμα.

4 Σεπτεμβρίου 2010, 00:57:02
Αναγνώστηκε 1943 φορές
Αποσυνδεδεμένος

Gatekeeper

Επώνυμοι
The New Pharmaceutical Frontier



It has been a challenging decade for the pharmaceutical industry. With patents expiring in high numbers, new-product pipelines drying up, and intensifying competition from generics, branded pharmaceuticals have been haemorrhaging value.

At the same time, traditional markets are becoming saturated. Stark realities in industrialized countries – such as the impact of aging populations on tax-based and employer-funded health-care models – are leading governments to adopt regulatory regimes that demand more economical, value-based, and transparent drug pricing.

Under these circumstances, emerging markets present a new frontier. Originally attractive for offering low-cost production, developing countries now present a viable market for multinational corporations. The pharmaceutical industry has been eyeing this trend for a while. A recent study predicts that sales in 17 “pharmerging” countries – including India, Indonesia, Pakistan, Thailand, and Vietnam – will “in aggregate expand by $90 billion during 2009-2013.”

But in many emerging economies, a large proportion of the population is poor, and those who are not remain vulnerable to falling into poverty in times of crisis. Healthcare is financed largely out-of pocket – up to 60% in Asia – and many countries shoulder a “triple disease burden” of “old” diseases like tuberculosis and malaria, new infectious diseases like Influenza A (H1N1), and a “silent pandemic” in the form of non-communicable diseases such as diabetes and cancer. The challenges surrounding access to medicines remain critical, and, indeed, relevant to the industry’s business model.

Philanthropic approaches to the problem have achieved little systemic change. Drug donations by companies have been criticized for being mostly unsustainable. Often, the medicines are unsuitable for patients, unfamiliar to local prescribers, do not match national clinical guidelines, or are near expiry.

Because supplies of donated medicines can be unpredictable, they can create chaos in the market by preventing accurate quantification of needs and thus affecting planning. Donated supplies also have the overarching negative effect of undermining market competition – even generics cannot compete with free medicines. Price discounts have been more effective, though their effect is limited by their focus on specific high-profile diseases and least developed countries (LDCs).

Advocates of improved access to medicines have posed three demands of the pharmaceutical industry:

·        Transparent pricing schemes that systematically address the challenge of affordability;

·        Investment in research and development that is relevant to the diseases affecting developing countries, and in medicines suitable for resource-poor contexts (for example, heat-stable formulations or fixed combination drugs); and

·        A flexible approach to intellectual property (IP) rights, in recognition of the role that generics play in vastly reducing medicine prices.

Leading companies are starting to understand how integrating these concerns into core business practices may hold the answer to sustainable long-term profitability in emerging markets. Reliance on the traditional “blockbuster” model, which targets the elite, is proving unfeasible and short-sighted.

For starters, it limits the size of the consumer base. More importantly, the model’s dependence on aggressive defense of patents and high profit margins, in order to generate the all-important $1 billion per annum, keeps companies from serving target markets effectively by providing products that are relevant, affordable, and accessible. Many argue that the perverse incentives created by the blockbuster model discourage innovation.

Finally, developing-country governments are beginning to prioritize health care and are seeking cost-efficient outcomes, as well as the means to effectively manage disease burdens. In these countries, building access to medicine into companies’ core business models has become vital to securing a license to operate.

At the end of 2008, one company attempted to beat a new path. The chief executive of GlaxoSmithKline (GSK) unveiled a four-point plan that included a commitment to cap prices for patented medicines in LDCs at 25% of the price in the developed world. In middle-income countries, prices would more closely reflect a country’s ability to pay (for example, GSK cut the price of its cervical cancer vaccine, Cervarix, by 60% in the Philippines and gained a 14-fold increase in volume sales). Further, it proposed the establishment of an LDC patent pool for neglected tropical diseases and donated to it 13,500 compounds for malaria vaccines.

Slowly, other companies are following suit. Sanofi-Aventis recently announced that it would halve the price of its diabetes drug, Lantus, and cancer treatment, Taxotere, in Indonesia and the Philippines. The Japanese firm Eisai dropped its price for Aricept, an Alzheimer’s treatment in six Asian countries.

Other companies are experimenting with base-of-pyramid models that seek to boost sales. Novartis’s Arogya Parivar model sells medicines in smaller, more affordable package sizes. The jury is still out on whether or not these new approaches deliver systemic change, and whether companies are adopting a “serve” rather than “capture” market strategy, but at least the issue of access to medicines is no longer being viewed at arm’s length.

More needs to be done on the issue of IP rights – the sacred cow of the pharmaceutical industry. Developing-country governments continue to go head-to-head with Big Pharma in battles over compulsory licensing and patent legislation. There is serious questioning of whether IP rights are actually an effective incentive for drug development, especially with respect to medicines that are relevant to diseases in developing countries, given the current dearth of R&D into these diseases.

New models are being tested. UNITAID’s patent pool for AIDS medicines, for example, allows generics producers to make cheaper versions of patented medicines by enabling patent holders to license their technology in exchange for royalties. Ultimately, generics remain the current front-runner in terms of delivering affordable medicines. Formulating policies that enable generic competition with the branded pharmaceutical industry will require creative measures that emphasise the imperative of maximizing public health.

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“It’s a poor sort of memory that onlyworks backwards, the Queen remarked.”
Lewis Carroll, 1872,
Through the Looking Glass

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