Technology Transfer and Issuance of Access to Medicines
- Vivek Dave, Department of Pharmacy, Banasthali University
- Kriti Kushwaha, Department of Pharmacy, Banasthali University
- Sachdev Yadav, Department of Pharmacy, Banasthali University
- Swapnil Sharma, Department of Pharmacy, Banasthali University

In the period of increasingly globalised trade, pharmaceutical play an important role in the availability and affordability of essential medicines for people living with disease in resource limited countries. Governments have the primary responsibility for ensuring access to medicine for health care for all citizens. This article examines alternative frameworks for empirical analysis of supply side activities, namely, the manufacture and distribution of medicine, through the application of New Institutional Economics (NIE) concepts. The article also focuses on problems related to the pricing of essential medications, relationships between health and human right, affordability of essential medicines, frameworks and manufacture, distribution and funding of medicine.

The World Trade Organization (WTO) is an international organisation of 160 member countries in 2014 dealing with the rules of trade, adhere to specific agreements called trade related aspects of intellectual property rights (TRIPS) establishes minimum standards for a set of intellectual property rights that WTO members institute through national legislation. The doha declaration gave primacy to public health over private intellectual property , and clarified WTO Members rights to use TRIPS safeguard. Improving access to medicines in developing countries has focused attention on the macroeconomic context and defining the demand side needs, based upon disease categories and purchasing power in a range of middle income and least developed countries. Pharmaceutical companies produce hundreds of life saving drugs every year and every year millions of people in developing countries die from preventable and treatable illnesses diseases such as HIV /AIDS, malaria and tuberculosis, because they cannot afford to buy the drugs they need. A product is available in a market if there is a manufacturer prepared to make the product, and willing to sell it in that market, and a purchaser who is able to pay for that product1. Access to medicines is a human right and the bedrock of an effective primary health care system. Therefore good quality essential drugs for the prevention and treatment of prevalent diseases should be available at all times, in adequate amounts, in appropriate dosages and at a price the community can afford. Improving access to medicines in developing countries has been conducted in the context of the complex interaction between macroeconomic progress, disease patterns and healthcare needs and provision. The World Health Organization is preoccupied with improving health status, is an objective that many see as self evidently best pursued within institutional, or public sector frameworks. The new global health fund, is now operational and supporting a range of diseases, initiatives primarily in HIV/AIDS, Malaria and tuberculosis2-3. Figure 1 shows the top factors leading to disease, disability or death clearly reflects the interrelationship of poverty and health. Drugs are often the most important cost driver of health care spending on hospitals and ambulatory care. Patients that have access to adequate and effective drugs at the time of need are more likely to be happy with the treatment they receive. When such drugs are not available or ineffective after use, patients will go elsewhere, even if they have to pay high prices to private providers, to get the care they think they need.

The availability of affordable and effective drugs is one of the most visible indicators of the quality of health services. Satisfaction with the drugs received is a key determinant of utilisation of health services and return visits in the public sector. And out of pocket spending on drugs is a major contributor to the impoverishing effects of illness. Many factors influence whether poor people can obtain affordable drugs of good quality, includes issues related to pricing and procurement of existing drugs, new product development, patents intellectual property rights, manufacturing or import of drugs, macroeconomic constraints, and foreign exchange fluctuations. In the context of access to medicines, public health principles are supported by a variety of national and international legal and policy instruments, including the constitution of the WHO. From a human rights point of view, implementation of intellectual property rules should be governed by those principles which support public health goals and access to medicines, thus ensuring a rapid and effective response to public health needs and crises, supply of quality medicines at affordable prices, effective competition through a multiplicity of potential suppliers, the provision for a wide range of pharmaceuticals to meet the basic health needs of the population, and equality of opportunities for countries in need, irrespective of their membership in the WTO level of technological capacity, or lack of manufacturing capacity.

In particular, concerns had been increasing that patent rules might limit access to reasonable medicines for populations in developing countries in their efforts to control diseases of public health importance, such as HIV, tuberculosis and malaria. Legal challenges by the pharmaceutical industry to legislation enabling parallel imports of medicines, and provisions enacted on compulsory licences, highlighted the differing interpretations of the TRIPs agreement obligations.

The lack of access to medicines also has serious social and economic consequences. More than 100 million people per year come under the category of poverty not able to pay health care expenses for sick family members. One of the main reasons for the lack of access to essential medicines is the high cost of medicines produced. The patent system, used and promoted by pharmaceutical companies, raises the prices of medicines. For this there are some factor defines the level of access to medicines was showed in Figure 26 -7.

Relationship between Health and Human Rights
The World Health Organization (WHO) target on health and human rights need attention to the remarkably complex linkages between the violations and lack of attention to human rights such as torture, violence against children, conventional unsafe practices, and discrimination can result in serious health consequences, health policies and programs can promote or violate human rights as a consequence of their design or implementation (discrimination against certain parts of the population, disregard of certain diseases), vulnerability to morbidity and mortality can be reduced by good governance, including spending resources according to actual needs and progressively with rising means. The healthier relationship was showed in Figure 3.

Trade, Price, Patents, and Access to Medicines
International trade regulation is becoming increasingly significant for health services. Trade policies, with their emphasis on the removal of import and export duties, mean that the health sector and trade in health related services are open to foreign investors. This affects not only the availability and price of medicines but also the tax revenue available to governments to fund health and other public services. The liberalisation of health services forces the public sector to compete with the private sector that already attracts the best qualified health personnel. National health systems will grow weaker and, once again, it will be the poorest who suffer most. Moreover, when intellectual property rights, such as patents and data exclusivity, are included in trade agreements, access to cheaper generics is not easy and poor countries find it hard to access essential medicines1, 11. An important factor influencing price and purchase of drugs are therefore the chosen level of profit of the drug companies, and the barriers to entry to drug manufacture. The price of medicines is determined by the company that produces them. When a company or an individual has a new medicine approved, it gets a patent to compensate for the expenses of developing the new medicine. The patent grants the company exclusive rights (monopoly) of production, distribution, terms of sale and pricing of the medicine for 20 years. During this time other companies cannot produce or sell cheaper generic versions of the patented medicine. The absence of competition prompts the manufacturer to set high prices in order to increase profits. As a result, medicines are expensive and people in developing countries cannot afford the treatments they need1-2, 11-13. The pharmaceutical industry underscores the importance of effective patent protection as an incentive for continued investment in the discovery and development of medicines. The patent system provides incentives for pharmaceutical innovation, the market exclusivity conferred by patents leads to company profits that often outstrip the associated research, development and production costs altogether. The patent system has also not provided sufficient motivation for research and development of new medicines needed for diseases that provide benefit to public health, including neglected diseases and orphan drugs, because forecasts believe the market too small or commercially unattractive14.

In many developing countries, the current concern is how adoption of intellectual property regimes as required under the TRIPs agreement can be balanced with efforts to maintain public health treatment programmes while boosting multiple sources of pharmaceuticals and controlling cost. Although patent protection systems for pharmaceutical products are available in most developing countries, multinational companies have not patented their products in all of them because companies may not think it worth the expense to obtain and maintain patent protection in countries where the market is small and the risk of infringement low. If patents do not exist for particular products and countries, the patent system may still have an effect on access to medicines. The existence of patents in potential supplier countries may allow the patentee to prevent supplies being exported to another country. Key provisions of TRIPS generic production are possible for the great majority of essential medicines, since they are currently not protected by patents in developing countries but it is not accurate for new medicines. The TRIPs agreement introduced global minimum standards for protecting and enforcing nearly all forms of intellectual property rights (IPR), including those for patents2, 15-16. Depending on the patent laws in place, conditions will be created to favour more or less competition between manufacturers of patented and generic medicines. Increased competition is proven to result in lower prices, which in turn contribute to improved access to medicines. Although access depends on numerous factors, high prices of drugs constitute a key obstacle that cannot be addressed in a comprehensive and sustainable manner through foreign aid and drug donations alone. The TRIPs Agreement requires WTO Members to provide protection for a minimum term of 20 years from the filing date of a patent application for any invention including for a pharmaceutical product or process. Prior to the TRIPs Agreement, patent duration was significantly shorter in many countries. Both developed and developing countries provided for patent terms ranging from 15 to 17 years, whilst in a number of developing countries patents were granted for shorter terms of 5 to 7 years. The TRIPs Agreement also requires countries to provide patent protection for both processes and products, in all fields of technology. Before TRIPs, many countries provided only process but not product patents. Product patents provide for absolute protection of the product, whereas process patents provide protection in respect of the technology and the process or method of manufacture. Protection for process patents would not prevent the manufacture of patented products by a process of reverse engineering, where a different process or method from that which has been invented (and patented) is used. National legislation requiring only process patent protection has enabled manufacturers in certain countries to make generic versions of patented medicines.

Generic Medicine and Affordability of Essential Medicine
When a patent expires other laboratories can produce the medicine without patent. This generic contains the same active ingredients and pharmaceutical properties as the patented medicine. As both are identical in dose, strength , safety and efficacy they should produce the same effect. Generic medicines are named after the main active ingredient while the patented one has a brand name given by the owner of the patent. Generic medicines are legitimately produced but are much cheaper than the brand one because they have no research costs. TRIPs flexibilities played an important role in the reduction of prices of medicines by allowing the production and export of generics. Competition between brand medicines and generics has been very effective in reducing the cost of drugs. The WHO list of essential medicines (EML) contains about 300 active substances. From it each country selects its own list according to disease prevalence, efficacy evidence, safety, and comparative cost effectiveness1. In past treatment was not available for diseases like HIV/AIDS, tuberculosis, hepatitis, malaria etc. due to affordability of therapy and that was the main cause of several death. When patent-protected vaccines, drugs, therapy for treatments were first introduced, the cost was very high, putting them out of reach of the vast majority of patients in developing countries. Figure 4 describe many efforts have been made to reduce prices by pharmaceutical companies, including private donations by pharmaceutical companies, price reductions, public private partnerships.

Role of the Doha Declaration
Although the TRIPs agreement affords considerable discretion on how its obligations are interpreted and implemented by governments, developing countries have faced obstacles when seeking to implement measures to promote access to affordable medicines. Thus, developing countries required to clarify through adoption of the doha declaration that the provisions in the TRIPs agreement did provide sufficient flexibility and discretion to ensure access to medicines in the interests of public health. The doha declaration refers to several aspects of TRIPs, including the right to grant compulsory licenses and the freedom to determine the grounds upon which licences are granted, the right to determine what constitutes a national emergency and circumstances of extreme urgency, and the freedom to establish the regime of exhaustion of intellectual property rights. The doha declaration states that each member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted. Since many patented products are sold at different prices in different markets, the rationale for parallel importation is to enable the import of lower priced patented products. Parallel importing can be an important tool enabling access to affordable medicines because there are substantial price differences between the same pharmaceutical products sold in different markets2, 8-9.

Doha declaration should, as a matter of law, guide the interpretation of the TRIPS agreement in a more health friendly direction in future disputes over patents. Those interpretations should also take into account countries obligations under international law to protect and promote the right to health. The doha declaration may also help developing countries fend off pressure tactics by rich countries who invoke the TRIPs agreement and threaten trade sanctions when developing countries limit exclusive patent rights in order to make medicines more affordable. The doha declaration also extended until 2016 the deadline for least developed countries to implement the sections of TRIPs that require them to grant exclusive, 20 year patent rights to pharmaceutical products8-10, 20, 25.

The Technological Economics of Medicines: Manufacturing Capabilities and Resources
The manufacture of active ingredients is by far the most expensive in terms of sunk cost investment in capital equipment and process development. Most pharmaceutical plant is multi purpose, in that a range of different products can be manufactured in the same equipment, subject to extremely thorough procedures to avoid cross contamination. Figure 5 describe the outline of the main components of manufacturing processes. Primary or active ingredient manufacture may be either chemical or biological in nature, involving quite different types of plant, technologies, skills and knowledge. The chemical and biological stages involved vary greatly from product to product in conditions of their robustness, or reliability. The more modern or complicated the products, the greater are likely to be the need for a highly skilled capability to develop and maintain the processes. The skilled scientist and engineers, laboratory facilities and instruments are specific assets, which may be limited in many middle income countries because some products require dedicated plant. In such cases capital investment is clearly a high risk activity for a new product, because if the product does not achieve technical regulatory approval by government authorities, or fails to capture significant sales in competitive markets, then the plant will have to be on paper. Secondary manufacture, or formulation into tablets, capsules or injection, is routine for many products, involving long established technologies. There are important imperatives in terms of procedures and operational disciplines needed to ensure high quality standards. For both formulation and packaging in a developed world context, these processes are highly automated with low lab or costs, whereas in developing world situations, with low labor costs, it may be more efficient to make lower investments in automated computer based equipment and rely upon manual processes. However the latest highly automated investment offers a higher guarantee of quality in substantially eliminating the scope for human error22-23.

All major international suppliers are to build staff and operate plants that are approved by leading national regulatory authorities. There is an increasing drive across the world to establish and enforce common high standards. The requirements of regulators take two discrete forms.
  • The first consists of a highly specific master file for each product , which defines scientific data on input materials, processes and the quality specification of the final product.
  • The second, which is much less well understood, is operational or procedural and is based upon the cumulative experience over many years of how to organise manufacturing systems, procedures and documentation to avoid mistakes or errors at all stages.
The enforcement of these standards is through regular inspection of plants by experts from the authorities. On a routine basis, the guardian of these standards, effectively on behalf of the agencies, performs the quality assurance function. This group, which organisationally stands apart from the normal manufacturing function, is responsible for approving the release of product batches from the site for distribution and sale. Normally, pharmaceutical companies do not strive to operate plants close to their maximum output capacity, because demand fluctuates across many markets, and, under the terms of their licenses, companies have a legal obligation to keep markets supplied. The economics of capacity planning is an important issue in the context of improving access to medicines, because the unit cost of increasing volume output on a self effacing incremental basis in an existing plant may be very low but, at the point at which new or extended plant is required, a quite different computation must be done to account for the capital and operating costs of additional capacity and services. Figure 6 showed the description of low high or very high, as somewhat subjective look for to represent the realities of the current situation. Thus, whereas at one end of the spectrum for most of the products on the WHO essential drug list, asset specificity is low and it is possible to go to the market and obtain multiple competitive offerings which ensure price competition, for some newer biological products, asset specificities are high, market competition low and prices will be accordingly high. We would particularly draw attention to assets, particularly experienced, skilled staff in quality assurance, process maintenance and regulatory compliance, which are the key to ensuring that the highest quality standards are maintained.

International Strategies for Improving Access to Medicines: Relationships between Manufacturers, Distributors and Funders
Formulating a consensus on policies and strategies involves an increasingly complex network of international agencies, interacting with national governments. The plan is to analyse the primary alternative funding and supply mechanisms, based upon the transactions involved and the capabilities and resources necessary for organisations to fulfil their roles under conditions of hierarchical governance. Improving access to unavoidably medicine depends upon the economics of supply, in terms of balancing costs and the flow of funds available. There are a multiplicity of combinations of funding, manufacture and distribution available. In new institutional economics (NIE) terms all of these offer different combinations of activities, some carried out under corporate governance and some contracted for under market or quasi market conditions. Clearly a rigorous application of transaction cost analysis (TCA) principles to compare transaction costs and evaluate their relative merits represents a formidable challenge and focus attention on the following components R & D based multinational companies (MNCs), emerging international generic suppliers, national manufacturer and distributors, alternative public sector combinations, new public private partnerships (PPPs). Figure 7 showed maps of the main components involved in this process. A distinction is made between international and national entities and between public or not for profit agencies and private sector ones. This model has two obvious limitations. Firstly it cannot reflect the wide range of national situations that exist. Secondly by consigning the pharmacy and healthcare infrastructure systems to a single box, we are in danger of overlooking important differences, which might influence choices at an earlier stage in the supply demand sequence. However, its primary function here is to display visually the alternative combinations of pathways that are possible, in order to discuss their utility in improving access. Included the funding options in the final analysis, improving access inescapably depends upon the economics of supply, in terms of balancing costs and the flow of funds available4-5,23-24.

Access to Medicine Index 2014
In order to industry progress in line with society evolving expectations, the access to medicine index methodology is systematically formulated and reviewed every two years, and maintaining as much consistency as possible for the purpose of trend analysis, the methodology is adjusted when and where it needed. The 2014 access to medicine index is currently in preparation: the Index team is now completing the data analysis, comparing companies access to medicine policies and practices. The methodology for the 2014 access to medicine index remains mostly same as the methodology for the previous index 2012. The 2014 index will use as framework for analysis, which continues to be constructed along seven technical areas with indicators measured across four strategic pillars. The weights within the framework remain unchanged and most of the indicators remain the same, though the number of indicators has been reduced. Figure 8 showed access to medicine index methodology framework 201226. Updating methodology of access to medicine framework

The Index is produced over a two year cycle. In the first year, the access to medicine foundation reviews the index methodology on the basis of intensive expert stakeholder feedback and defines the methodology for the next access to medicine index. An expert review committee and technical subcommittees, which offer strategic guidance, stakeholder perspectives and technical expertise, are formally consulted during this process. In the second year, pharmaceutical company data is collected, analysed and published in the access to medicine index report26.

The study mainly focus on the affordability of necessary medicine require at time with affordable prices for the treatment of many serious diseases. There are many pharmaceutical industry current initiatives to ensure that poor people have access to medicines. The TRIPs agreement does not prevent members from allowing generic substitution. But if implementation of TRIPs compliant national legislation and regulations are inappropriate the introduction of new generic drugs can be postponed. The adoption of the doha declaration marked a watershed in the debate on intellectual property and access to medicines, there remain major challenges for developing countries to interpret and implement the TRIPs agreement and other intellectual property rules in a manner supportive of their efforts to protect public health and promote access to medicines for all. This paper examines issues surrounding the development and transfer of technologies for addressing the problem of innovation and access to medicines.

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