Global health impact: A basis for labeling and licensing campaigns?

Developing World Bioethics

Volumn 12, Issue 3, 2012, Pages 121-134

  Hassoun, Nicole ^a  

^a CARNEGIE MELLON UNIVERSITY   (United States)

Author keywords

Developing countries; Developing world bioethics; Essential medicines; Health; Neglected disease; Pharmaceutical; Poverty

Indexed keywords

ESSENTIAL DRUG;

ARTICLE; BIOTECHNOLOGY; CERTIFICATION; DRUG INDUSTRY; ECONOMICS; ETHICS; HEALTH; HEALTH CARE DELIVERY; HEALTH CARE DISPARITY; HEALTH SERVICE; HUMAN; POVERTY; STANDARD;

BIOTECHNOLOGY; CERTIFICATION; DRUG INDUSTRY; DRUGS, ESSENTIAL; HEALTH SERVICES ACCESSIBILITY; HEALTH SERVICES NEEDS AND DEMAND; HEALTHCARE DISPARITIES; HUMANS; POVERTY; WORLD HEALTH;

EID: 84868556647     PISSN: 14718731     EISSN: 14718847     Source Type: Journal    
DOI: 10.1111/j.1471-8847.2011.00314.x     Document Type: Article

References (77)

1. See, for instance: P. Danzon & A. Towse. Differential Pricing for Pharmaceuticals: Reconciling Access, R&D and Patents. Int J Health Care Finance Econ 2003; 3: 183-205.
2. M. Abramowicz. Perfecting Patent Prizes. Vanderbilt Law Rev 2003; 56: 114-236.
3. P. Trouiller et al. Drugs for Neglected Diseases: A Failure of the Market and a Public Health Failure? Trop Med Int Health 2002; 6: 945-951.
4. K. Outterson. Patent Buy-Outs for Global Disease Innovations for Low- and Middle-Income Countries. Am J Law Med 2006; 32: 159-173.
5. A. Hollis & T. Pogge. 2008. The Health Impact Fund, Making New Medicines Accessible for All: A Report of Incentives for Global Health. Washington, DC: Knowledge Ecology International (KEI). Available at: [Accessed 1 Feb 2011http://www.keionline.org/blogs/2008/11/27/trade-off-innov-access/.
6. The World Health Organization has even convened an Intergovernmental Working Group (IGWG), the Secretariat on Public Health, Innovation and Intellectual Property to examine solutions to the second problem and create a global strategy to secure 'needs-driven, essential health research and development relevant to diseases that disproportionately affect developing countries'. One option the Working Group supported that is not discussed in what follows but merits significant consideration is patent pools, though this will not address pricing issues; World Trade Organization (WTO). 2007. About PHI. Geneva, Switzerland: WTO. Available at: http://www.who.int/phi/about/en/2011.
7. Center for Disease Control (CDC). 2005. World TB Day, March 24th 2005. Atlanta, GA: Division of Tuberculosis Elimination, CDC. Available at: http://www.cdc.gov/nchstp/tb/WorldTBDay/2005/resources_progress_elimination.htm2008.
8. UNICEF. 2005. Millennium Development Goals: Combat AIDS/HIV, Malaria, and other Diseases. Geneva, Switzerland: UNICEF; Available at: http://www.unicef.org/mdg/disease.html2011.
9. UNAIDS. 2004. World AIDS Day 2004: Women, Girls, HIV and AIDS. Geneva, Switzerland: UNAIDS. Available at: http://www.unaids.org/wad2004/report.html2008.
10. World Health Organization (WHO). World Health Report 2004. Geneva, Switzerland: WHO.2004.
11. The World Health Organization has compiled a list of 'essential' medicines in part by considering the cost of securing these medicines. Here, however, I use the term only to indicate medicines that address dire health needs in poor countries, irrespective of the cost of addressing those needs. 'This clarification should guard against the true but silly objection that monopoly prices barely impede access to essential drugs as listed by the WHO' (T. Pogge. 2007. Intellectual Property Rights and Access to Essential Medicines. New York, NY: Global Policy Innovations, Carnegie Council for International Affairs. Available at: http://www.policyinnovations.org/ideas/policy_library/data/FP42011.
12. D.G. McNeil. 2008. Index Ranks Pharmaceutical Groups According to Third World Outreach. The New York Times 17 June. Access to Medicines Index. Available at: http://www.nytimes.com/2008/06/17/health/17glob.html?_r=1&ref=health&oref=slogin2011.
13. Access to Medicines Foundation. 2010. About Us. Haarlem, Netherlands: Access to Medicines Foundation. Available at: http://www.accesstomedicineindex.org/content/about-us2011.
14. When impact is too difficult to capture, however, other output variables may be useful as proxies for impact. In looking at charitable contributions, researchers might consider the number of doses of a drug donated to aid organizations in developing countries and the average impact of a dose of medicine in good conditions. This would be a very rough proxy for impact, given that conditions are often far from ideal. So it would be better to have more information if it is available.
15. M. Angell. 2004. The Truth About the Drug Companies: How They Deceive Us and What To Do About it. New York, NY: Random House.
16. A good rating system need not measure every way in which companies can improve health in developing countries. Furthermore, the most weight should probably be given to activities for which biotechnology and pharmaceutical companies have primary responsibility. Still, biotechnology and pharmaceutical companies do invest in health infrastructure and rewarding them for these investments will help insure that they not only have incentives to cure illnesses but also to prevent them.
17. There is some work on how to help companies in developing countries meet local health needs. See, for instance, The Open University - Innovation, Knowledge and Development (IKD) Project. 2009. Non-governmental Action to Improve the Access of the Poor to Good Quality Low Cost Drugs. London, UK: Open University. Available at: http://www.open.ac.uk/ikd/projects_lowcostdrugs.shtml2011.
18. Different authors disagree about the merits of the available measures of an intervention's impact. Some, for instance, prefer to measure an intervention's impact on quality adjusted life years (QUALYs). Given this disagreement, a good rating agency should consider the merits of the different measures for the task at hand.
19. It may be hard to isolate and measure the impact of health projects. An agency would have to transparently and systematically determine how much different investments in approved health-projects help the poor. Perhaps the agency could induce companies to provide this information as a condition of certification. But, biotechnology and pharmaceutical companies would have reason to try to distort these estimates. So, one place to start would be to evaluate the 126 health partnerships the pharmaceutical industry reported to the International Federation of Pharmaceutical Manufacturers & Associations in which have been verified by researchers at the London School of Economics (A. de Francisco & S. Matlin, eds. 2006. Monitoring Financial Flows for Health Research 2006: The Changing Landscape of Health Research for Development. Geneva, Switzerland: Global Forum for Health Research).2006.
20. More precisely, orphan drugs address rare diseases in the United States (US). As the US Food and Drug Administration puts it, '.. the term rare disease or condition means any disease or condition which (a) affects less than 200,000 persons in the US or (b) affects more than 200,000 persons in the US but for which there is no reasonable expectation that the cost of developing and making available in the US a drug for such disease or condition will be recovered from sales in the U.S. of such drug'. Food and Drug Administration (FDA). 2008. OOPD Program Overview. Rockville, MD; FDA. Available at: http://www.fda.gov/orphan/progovw.htm2011.
21. A rating agency might also want to provide more incentive for companies to develop drugs and technologies that will have a large impact on the poor even if they have a large market in developed countries. So this agency might, for instance, also offer companies credit for producing drugs that address diseases on the WHO's list neglected diseases.
22. Once the rating system is up and running, the agency could make it a condition of being GHI certified that companies provide verifiable data on the number of doses they sell by a particular date.
23. For some GBD data see: WHO. 2008. The Global Burden of Disease: 2004 Update. Geneva, Switzerland: WHO. Available at: http://www.who.int/healthinfo/global_burden_disease/en/index.html2011.
24. WHO. Global Report on Antimalarial Drug Efficacy and Drug Resistance: 2000-2010. Geneva, Switzerland: WHO: 112.2010.
25. Since Mefloquine is less effective than Quinine, unless it offers some other therapeutic advantages over Quinine (it is a synthetic analogue), there may be no reason to give credit to Roche Pharmaceuticals for the development of this drug.
26. The agency might also consider the problems associated with drugs and technologies in estimating their net benefits (e.g. some drugs have pretty bad side effects that should probably be taken into account, others require difficult-to-implement treatment regimes).
27. Taking into account companies' sizes will allow new or very small companies, making only a few drugs, to compete for good ratings. A rating agency might only rate large companies, however, if that is the best way to incentivise new R &D on drugs and technologies for the poor.
28. M. Drummond, M. Sculpher, & K. Claxton. 2005. Methods for the Economic Evaluation of Health Care Programmes. Oxford, UK: Oxford University Press.
29. Again, this information might be elicited from the companies as a condition of certification. The rating agency could also charge certification fees for advertising or rely on highly rated companies to do this advertising. It is important to minimize problematic incentives in rewarding charitable programs too.
30. P. Kanavos et al. 2004. The Economic Impact of Pharmaceutical Parallel Trade in European Union Member States (Special Research Paper LSE Health and Social Care). London, UK: London School of Economics and Political Science.
31. It is important to take the costs of government oversight into account, if it proves necessary.
32. A review panel could, for instance, create a mechanism to penalize companies for 'dumping' drugs on developing country markets, if donations do more harm than good for the poor because they are driving generic competitors out of business. This would insure that companies only receive credit for making donations on the condition that they are given in ways that will not have such consequences.
33. In 1986, the market for pain relievers was US$1.7 billion. Ibuprofen pain relievers only captured nine percent of the market (New York Times. 1986. Analgesic Makers in a Battle. The New York Times 18 February. Available at: [Accessed 2 Feb]). For statistics on Fair Trade coffee see: European Fair Trade Association (EFTA) cited in L. Raynolds. 2002. Poverty Alleviation Through Participation in Fair Trade Coffee Networks: Existing Research and Critical Issues(Background Paper Prepared for Project Funded by the Community and Resource Development Program). New York, NY: The Ford Foundation.http://www.nytimes.com/1986/02/18/business/analgesic-makers-in-a-battle.html?pagewanted=12011.
34. Chain Drug Review. 2009. Internal Analgesic Tablets. Chain Drug Review 16 February. Available at: http://findarticles.com/p/articles/mi_hb3007/is_4_31/ai_n31414841/2011.
35. Fairtrade Labelling Organization Interenational (FLOI). 2009. Facts and Figures. Bonn, Germany: FLOI. Available at: http://www.fairtrade.net/facts_and_figures.html?&L=&scale=02011.
36. The Global Fund to Fight AIDS, Tuberculosis and Malaria. 2010. (Product)RED Generates Landmark $US150 million for The Global Fund. The Global Fund 1 June. Available at: http://www.theglobalfund.org/en/mediacenter/pressreleases/%28PRODUCT%29RED_generates_landmark_US$150_million_for_the_Global_Fund/2011.
37. The Co-operative Bank. 2007. The Ethical Consumerism Report 2007. London, UK: The Co-operative Bank. Available at: http://www.co-operativebank.co.uk/images/pdf/ethical_consumer_report_2007.pdf2011.
38. The world's biggest pharmaceutical company, Pfizer, has revenues of about US$48 billion per year. Pfizer. 2009. Pfizer Reports Fourth-Quarter and Full-Year 2008 Results and 2009 Financial Guidance. New York, NY: Pfizer. Available at: [Accessed 1 Feb 2011]. But a quick internet search suggests that at least three of the 23 companies producing the 26 orphan drugs with the most potential to benefit the poor only have revenues or sales between US$1-10 million per year. This list was selected by a panel of three experts in international health at the University of Pittsburgh Medical Center (Please contact the author for further information). Revenue estimates were found here: Jigsaw. 2007. Hoechst Marion Roussel Company Information. San Mateo, CA: Jigsaw. Available at: [Accessed 2 May 2008]. Jigsaw. 2010. Romark Laboratories Lc Company Information. San Mateo, CA: Jigsaw. Available at: [Accessed 1 Feb 2011]. Jigsaw. 2011. Braintree Labortories Inc. Company Information. San Mateo, CA: Jigsaw. Available at: [Accessed 1 Feb 2011]. Many of these companies make products for developed country markets or merge with other small companies that do so. See, for instance: Braintree Laboratories. 2010. Products. Braintree, MA: Braintree Laboratories. Available at: [Accessed 1 Feb 2011].,http://media.pfizer.com/files/investors/presentations/q4performance_january012609.pdf,http://www.jigsaw.com/id2028996/romark_laboratories_lc_company.xhtml,http://www.spoke.com/info/c494unR/BraintreeLaboratoriesInc,http://www.braintreelabs.com/products-suprep.htm.
39. BBC Research. 2002. The U.S. Market for Prescription Allergy Treatment and Management Report Code: PHM026A. Wellesley, MA: BBC Research. Available at: http://www.bccresearch.com/report/PHM026A.html2011.
40. Kalorama Information. 2001. The U.S. Market for Over-the-Counter Allergy and Asthma Products. Rockville, MD: MarketResearch.com Available at: http://www.marketresearch.com/product/display.asp?ProductID=5218952011.
41. A.S. Kesselheim. Think Globally, Prescribe Locally: How Rational Pharmaceutical Policy in the U.S. Can Improve Global Access to Essential Medicines. Am J Law Med 2008; 34: 125-139.
42. L.A. Mahecha. Rx-to-OTC Switches: Trends and Factors Underlying Success. Nat Rev Drug Discov 2006; 5: 380-386http://www.nature.com/nrd/journal/v5/n5/fig_tab/nrd2028_F3.html2011.
43. Sometimes companies may not want to use a label on generic products if they would prefer their customers buy their higher priced brand name drugs. But they can choose to use the label only on their brand name products if that is the case.
44. C. Mullins, F. Palumbo & B. Stuart. 2000. Projections of Drug Approvals, Patent Expirations, and Generic Entry From 2000 to 2004: A Background Report Prepared For The Department Of Health And Human Services' Conference On Pharmaceutical Pricing Practices, Utilization And Costs. Baltimore, MD: University of Maryland School of Pharmacy and University of Maryland Center on Drugs and Public Policy. Available at: http://aspe.hhs.gov/health/reports/Drug-papers/Mullins-Palumbo%20paper-final.htm2011.
45. Pfizer. 2010. Diversified Business. New York, NY: Pfizer. Available at: http://pfizer.com/research/licensing/diversified_business.jsp2011.
46. Perhaps this consideration also tells in favour of a label that says something like 'Extending Access' for companies that are just the best of a bad lot. Another label might be reserved for companies that really are doing what they should.
47. Transfair USA, for instance, has never had to take anyone to court for misusing their label, a conversation usually suffices to either get companies to stop using the label or adhere to their standards for certification. C. Sinclair, Business Development Associate, Transfair USA. Telephone interview conducted by author on 13 August 2009.
48. Some observe that the agriculture lobby succeeded in lowering the standards for what can be called 'organic'. But, even if the standards are not quite as good as one might like, the USDA does oversee the use of the pesticides and other farming practices that motivated the organic movement in the first place. United States Department of Agriculture (USDA). 2007. National Organics Program. Washington, DC: USDA. Available at: http://www.ams.usda.gov/nop/NOP/standards/ListReg.html2011.
49. Even the Norwegian government uses some socially responsible investment criteria in investing its pension funds. A. Follesdal. Ethical Investment and Human Rights: A Norwegian Case. Nord J Human Rights 2007; 25: 420-433.
50. I have discussed the proposal with the director of Universities Allied for Essential Medicine (UAEM) and he expressed interest in the project. Universities Allied for Essential Medicine (UAEM). 2008. Phone interview by author with Ethan Guillan, Director on 3 August 2008.
51. Universities Allied for Essential Medicine (UAEM). 2009. Our Proposals. Berkeley, CA: UAEM. Available at: http://www.essentialmedicine.org/our-proposals/2010.
52. Association of American Universities (AAU). 1998. University Technology Transfer of Government-Funded Research Has Wide Public Benefits. Washington, DC: AAU. Available at: http://www.aau.edu/research/TechTrans6.3.98.html2008].
53. On changing patterns in pharmaceutical company innovation see: National Institute for Health Care Management Foundation (NIHCMF). 2002. Changing Pattern of Pharmaceutical Innovation. Washington, DC: NIHCMF. Available at: http://www.nihcm.org/finalweb/innovations.pdf2008.
54. Marcia Angell. 2007. Email correspondence. October 29, 2007.
55. These included captopril (Capoten), fluoxetine (Prozac), acyclovir (Zovirax), AZT, acyclovir, fluconazole (Diflucan), foscarnet (Foscavir), and ketoconazole (Nizoral). For more information see: Joint Economic Committee (JEC). 2000. The Benefits of Medical Research and the Role of NIH. Washington, DC: JEC. Available at: http://www.faseb.org/portals/0/pdfs/opa/2008/nih_research_benefits.pdf2011].
56. Furthermore, a lot of funding for universities comes from government, so this graph probably understates the government's role.
57. Consumer Project on Technology (CPT). 2005. The Bayh-Dole Act. Geneva: CPT. Available at: http://www.cptech.org/ip/health/bd/2011.
58. Universities Allied for Essential Medicine (UAEM). 2007. Why Universities? Berkeley, CA: UAEM. Available at: http://www.essentialmedicine.org/?page_id=972008.
59. The Association of University Technology Managers licensing surveys provide information about almost 200 major universities' budgets, research expenditures and licensing agreements as well as other useful information. See: The Association of University Technology Managers (AUTM). 2007. FY 2005 AUTM U.S. Licensing Survey. Northbrook, IL: AUTM. Available at: [Accessed 2 Feb 2011]. The Association of University Technology Managers (AUTM). 2005. AUTM U.S. Licensing Survey FY2005. Northbrook, IL: AUTM. Available at: [Accessed 2 May 2008]. Also see: AUTM. 2011. About AUTM. Northbrook, IL: AUTM. Available at: [Accessed 2 May]. 2008 http://www.autm.net/AM/Template.cfm?Section=Licensing_Surveys_AUTM&TEMPLATE=/CM/ContentDisplay.cfm&CONTENTID=4510,http://www.autm.net/AM/Template.cfm?Section=Licensing_Surveys_AUTM&TEMPLATE=/CM/ContentDisplay.cfm&CONTENTID=4510,http://www.autm.net/about/dsp.Detail.cfm?pid=194.
60. Another point of contact between universities and companies is when companies want to do clinical and pre-clinical trials. Universities could require that any research funded by pharmaceutical and biotechnology companies, even if it does not result in university owned intellectual property, be done only in conjunction with GHI certified companies. This kind of policy, however, will probably not be accepted by university researchers whose careers depend on such research contracts.
61. Universities often create start up companies or license to start up companies that, being new, could not themselves be GHI certified. These companies test and develop products using university technology. Eventually these companies are sold or sell their technology to larger companies that could be GHI certified. So down-stream clauses in licensing contracts may be necessary and desirable.
62. M. Vanegas. 2007. Technology Licensing Associate. Life Sciences. Interview Conducted by Author. Pittsburgh, PA: University of Pittsburgh Office of Technology Management. The University of Pittsburgh's Office of Technology Management alone generated US$7.1 million in revenue in in licensing revenue, equity cash-outs, legal fee reimbursements from licensees. Licensing revenue alone was US$4.9 million and its equity in the start up Novecea generated US$92,000. Finally its spinout Stentor Inc. was sold for US$6.7 million. Office of Technology Management (OTM). 2007. Annual Report 2007. Pittsburgh, PA: OTM University of Pittsburgh: 7-8.2007.
63. About 20% of Stanford faculty members had industry funding in About 30% of Stanford's faculty resided in the medical school. R. Delgado. 2005. Slow Growth Seen In Faculty Ranks; Challenges Remain In Hiring Minorities, Women Stanford Report 4 May. Available at: [Accessed 1 Feb 2011]. Of course, not all of this funding would have been from pharmaceutical companies but pharmaceutical companies probably fund some non-medical faculty so it might be reasonable to suppose that 20% of the medical faculty had pharmaceutical funding at Stanford. If that is right, then about 7% of Stanford's faculty were funded by pharmaceutical companies. Another way of getting at the proportion of industry funding from pharmaceutical companies is to suppose that the percentage of the medical faculty at Stanford receiving industry funding is about the same as the percentage of medical faculty receiving industry funding on average. If it is, then 25% of medical faculty at Stanford had industry funding. Again, other industries may account for some of this funding but pharmaceutical companies may fund non-medical faculty as well. So it seems reasonable to conclude (again) that 7% of the Stanford faculty had pharmaceutical funding. Stanford, however, has a large medical school and most universities and colleges probably receive much less industry funding.2004http://news-service.stanford.edu/news/2005/may4/faculty-050405.html.
64. There are a host of alternatives in the interdisciplinary literature on the topic that merit consideration. Some suggest better prediction of demand for medicines for neglected diseases (R. Levine et al. Demand Forcasting for Essential Medical Technologies. Am J Law Med 2008; 34: 225-255.
65. Others encourage developing countries to form alliances with each other and reform their patent offices (P. Yu. Access to Medicines, BRICS Alliances, and Collective Action. Am J Law Med 2008 34: 345-394.
66. P. Drahos. 'Trust Me': Patent Offices in Developing Countries. Am J Law Med 2008; 34: 151-174.
67. Yet others, endorse international organizations' move towards promoting development (J. Lerner. Intellectual Property and Development at WHO and WIPO. Am J Law Med 2008; 34: 257-277.
68. Some even suggest changing university licensing practices to allow greater access to the fruits of university research (G. Evans. Strategic Patent Licensing for Public Research Organizations: Deploying Restriction and Reservation Clauses to Promote Medical R&D in Developing Countries. Am J Law Med 2008; 34: 175-223.
69. Similarly, when Thailand issued a compulsory license for Efavirenz an HIV/AIDS drug produced by Merck the US government was displeased. See: J. McDermott. 2006. A Morality Tale on AIDS. Available at: http://www.house.gov/mcdermott/sp060619.shtml2006.
70. P. Goodwin. Right Idea, Wrong Result - Canada's Access to Medicines Regime. Am J Law Med 2008; 34: 567-584.
71. H.E. Msgr. Diarmuid Martin. 2002. Intervention by the Holy See at the World Trade Organization. Vatican City: The Holy See. Available at: http://www.vatican.va/roman_curia/secretariat_state/documents/rc_seg-st_doc_20021220_martin-wto_en.html2011.
72. P. Drahos. 2002. Global Intellectual Property Rights: Knowledge, Access and Development. New York, NY: Palgrave MacMillion. S. Sell. Private Power, Public Law: The Globalization of Intellectual Property Rights (Cambridge Studies in International Relations). Cambridge, UK: Cambridge University Press.2003.
73. L. Jarvis. 2006. Gates Foundation, Novartis Embark on Public-Private Ventures to Combat TB and Malaria. Chemical and Engineering News 29 May. Available at: http://72.3.224.152/newscenter/view-innews.php?id=1732011.
74. It is not clear that we ought, even on Pogge's moral theory, to try to minimize the GBD rather than the disease burden of those our shared institutions have harmed (until everyone's human rights are satisfied). It may be better to just try to aid the poor. Because this is a very complicated (and partly empirical) question I will not discuss this difference between our proposals further here.
75. M.J. Selgelid. A Full-Pull Program for the Provision of Pharmaceuticals: Practical Issues. Public Health Ethics 2008; 1-12.
76. Selgelid's delightful article discusses some of the difficulties in framing the rating question and evaluating companies' efforts. The issues he raises merit further consideration.
77. A potential draw back is that the proposal's success depends on what may be fickle and easily manipulated consumer preferences.