By Dr Ananya Mandal, MD
Last week an Indian patent court shocked the $600 billion global pharmaceutical business by ordering Bayer, the German health care giant, to allow a tiny Indian generic drug company to sell cheap copies of the blockbuster cancer drug Nexavar – even though everyone agrees that the drug is protected by a patent. Instead, the court decided that Bayer had an obligation to make Nexavar available to people in India who needed it.
Pharmaceutical companies have a right to charge high prices for new, innovative medicines. Because more than 90% of experimental drugs fail to be proven safe or effective, it’s necessary for medicines to generate billions of dollars in sales in order to entice investors and companies to sink money into research.
But in this case, the Indian patent court and Natco Pharmaceuticals, which brought the case, have a point. The many thousands of Indian patients suffering from kidney or liver cancer could not get their hands on Nexavar. Knowledge Ecology International, a group that campaigns for people in developing world to have better access to new medicines, says Nexavar was priced at $69,000 for a year of treatment, 41 times the per capita income in India. For comparison, a drug that cost 41 times the U.S. per capita income would cost $1.6 million. The Natco price is just $177.
In the U.S., Nexavar actually costs even more in real dollars. The average liver cancer patient would pay $80,000 for a ten-month course if he were paying the wholesale acquisition cost of Nexavar; kidney cancer patients pay $96,000 a year. But they do not need to pay. The insurance does. Bayer and partner Onyx Pharmaceutical, which split sales duties in the U.S., have a program to make sure that eligible patients aren’t responsible for more than $100 of co-payment.
Yet no amount of compulsory licenses will help the millions of poor Indians suffering from diseases like cancer, because even the generic version of Nexavar will be priced beyond the reach of India's poor, experts and medical professionals say.
Increased state spending on free and accessible healthcare and policies to extend insurance cover to its poorest citizens would be far more effective weapons. ”The government has to start taking cancer seriously. They haven't done anything,” said Dr M Krishnan Nair, an award-winning Indian oncologist. “Even at generic prices, the drugs are too expensive for the poor. They don't get anything.”
India allocated 268 billion rupees for healthcare in 2011-12, around a sixth the size of the defense budget. That represents 2.13 percent of total government spending, or $4.50 for each person in the country. With around 40 percent of the population living below the poverty line, healthcare is an upper-middle-class luxury in much of India where spending in private clinics is four times the amount of that in government hospitals. The poorest would-be patients literally beg for treatment on the outside of a chronically underfunded and overstretched health system. As chairman of a committee tasked with formulating India's cancer strategy in the five years to 2012, Nair advocated 23 billion rupees for cancer control. Around $40 million was eventually spent, he says.