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Booming Sales Of Unapproved Drugs: Do We Need “Safe In India” Campaign For Medicines?

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“To sin by silence when they should protest makes cowards of men”                      - Abraham Lincoln

Not just the Federal Drug Administration of the United States (USFDA), global concerns are being expressed regularly about the laxity of drug regulatory and clinical trial standards in India, exposing patients to health safety related risks.

The problem is significantly more with the Fixed Dose Combination (FDC) Drugs for various reasons. This is worrisome because; the domestic market for FDCs is very large and growing much faster, in sharp contrast to the western world. For example, in 2011-12 FDCs accounted for more than half of all NSAID and oral anti-diabetic drug sales, and one-third and one-fifth of anti-psychotic and anti-depressant/benzodiazepine sales, respectively, according to a recent study.  Both the domestic and multi-national pharma players market FDCs in India

Alarmingly, a plethora of FDCs unapproved by the drug regulators of India on their rationality, efficacy and safety, have flooded the domestic pharma market, in large quantities.

All such drugs are being actively promoted by the respective pharma players, widely prescribed by the doctors, openly sold by the chemists and freely consumed by the patients without any apprehension or having no inkling of the magnitude of the possible health hazards that such drugs might cause, both in short and long term.

Public health safety hazard arising out of this scenario does not seem to have ever been estimated by the Indian drug regulators, despite indictments even by the Parliamentary Standing Committee, nor is there any properly functional system in place to capture such data for meaningful analysis.

As the saying goes ‘better late than never’, a credible report on this menace has just been published on May 12, 2015 by independent experts, which I shall discuss in this article.

Is the situation out of control?

On the ground, the situation seems to be out of control of even the Central Drugs Standard Control Organization (CDSCO).

This is vindicated by a March 2013, written reply of the Minister for Health and Family Welfare, where the Government reportedly informed the Lok Sabha (the lower House of the Parliament) that in twenty three cases of new FDC, licenses have been granted by the State Licensing Authorities (SLAs) without the mandatory approval of the DCGI and action will be taken in all these cases.

However, no one seems to know, as yet, what action the Government has taken against those errant officials.

The latest investigative report on the criticality of the situation:

The May 12, 2015 issue of “PLOS Medicine” – a Peer-Reviewed Open-Access Journal, published the results of an investigation on CDSCO approval for and availability of oral FDC drugs in India from four therapeutic areas – analgesia (non-steroidal anti-inflammatory drugs (NSAIDs), diabetes (metformin), depression/anxiety (anti-depressants/benzodiazepines), and psychosis (anti-psychotics).

This study was done based on the Department Related Parliamentary Committee on Health and Family Welfare’s 2012 Report, stating that manufacturing licenses for large numbers of FDCs had been issued by state authorities without prior approval of the CDSCO in violation of rules, and considered that some ambiguity until 1 May 2002 about states’ powers might have contributed to this worrying consequences.

I shall also discuss the above Parliamentary Committee report in this article.

Booming sales of unapproved drugs: 

‘PLOS Medicine’ report highlighted the following:

A. They obtained information on FDC formulations approved between1961 and 2013 in each therapeutic area from the CDSCO.

B. FDC sales details were obtained for the period 2007 to 2012 from PharmaTrac database of drug sales in India. Over the five years included in the time-trend analysis, FDCs accounted for an increasing proportion of total sales volumes. By 2011–2012, FDCs accounted for more than half of all NSAID and oral anti-diabetic drug sales, and one-third and one-fifth of anti-psychotic and anti-depressant/benzodiazepine sales, respectively.

C. Of the 175 FDC formulations marketed in India in the therapeutic areas studied, only 60 (34 percent) were approved. 

Out of these, percentages of approved formulations are as follows:

-       80 percent of 25 marketed metformin FDC formulations

-       27 percent of 124 NSAID FDC formulations

-       19 percent of 16 anti-depressant/benzodiazepine FDC formulations

-       30 percent of 10 anti-psychotic FDC formulations

D. In 2011–2012, percentages of FDC sales volumes arising from unapproved formulations was:

-       43 percent for anti-psychotics

-       69 percent for anti-depressants/benzodiazepines

-       28 percent for NSAIDs

-       0.4 percent for metformin

E. Formulations including drugs of which use is banned or restricted internationally accounted for 13.6 percent and 53 percent of NSAID and anti-psychotic FDC sales, respectively.

F. While “ambiguity” in the rules prior to 2002 was advanced as a reason for some FDCs having been marketed without a record of central approval, the researchers identified no ambiguity, and in fact, following an amendment to the rules in May 2002 that extended the requirements on approval applicants, new FDCs continued to be marketed without a record of central approval.

The suggestions:

The ‘PLOS Medicine’ report concluded with the following suggestions:

Unapproved formulations should be banned immediately, prioritizing those withdrawn or banned internationally, and undertaking a review of benefits and risks for patients.

To ensure long-term safety and effectiveness of new medicines marketed in India, as well as transparency of the approval process, amendments in India’s regulatory processes and drug laws are called for. A review should be undertaken of the safety and effectiveness of FDCs currently available in India.

Indian lawmakers too pointed out this embarrassing regulatory laxity:

This saga of drug regulatory laxity in general and for the FDCs in particular, is continuing since quite a while. This is despite the fact that the Department Related Parliamentary Committee on Health and Family Welfare presented its 59th Report of 118 pages in total on the functioning of the Indian Drug Regulator – the Central Drug Standards Control Organization (CDSCO) in both the houses of the Parliament on May 08, 2012.

The report begins with a profound observation:

Medicines apart from their critical role in alleviating human suffering and saving lives have very sensitive and typical dimensions for a variety of reasons. Prescription drugs are the only commodities for which the consumers have no role to play. Nor are they able to make any informed choices, except to buy and consume whatever is prescribed or dispensed to them, because of the following reasons:

  • Drug regulators decide which medicines can be marketed
  • Pharma companies either produce or import drugs that they can profitably sell
  • Doctors decide which drugs and brands to prescribe
  • Consumers are at the mercy of external entities to protect their interests

The ‘Mission Statement’ of CDSCO is ‘Industry Oriented’ and not ‘Patient Focused:

Very interestingly, the lawmakers’ report highlights, citing the following examples, how out of line the ‘Mission Statement’ of CDSCO is, as compared to the same of other countries, by being blatantly industry oriented instead of safeguarding Public Health and Safety interests :

Drug Regulator

The ‘Mission Statement’
1.

CDSCO, India

 Meeting the aspirations…. demands and requirements of the pharmaceutical industry.
2.

USFDA, USA

 Protecting the public health by assuring the safety, efficacy, and security of human and veterinary drugs.
3.

MHRA, UK

 To enhance and safeguard the health of the public by ensuring that medicines and medical devices work, and are acceptably safe.
4.

TGA, Australia

 Safeguarding public health & safety in Australia by regulating Medicines…

Consequently, the Parliamentary Committee took a strong exception for such utter disregard and continued neglect of patients’ interest by the Drug Regulator of India. It recommended immediate amendment of the ‘Mission Statement’ of CDSCO incorporating in very clear terms that the existence of the organization is solely for the purpose of protecting the best interest of patients and their safety. It is needless to say, thereafter it would call for its stringent conformance with high precision.

A scathing remark against CDSCO:

The parliamentary Committee report made the following scathing remarks on CDSCO in its point 2.2:

“The Committee is of the firm opinion that most of the ills besetting the system of drugs regulation in India are mainly due to the skewed priorities and perceptions of CDSCO. For decades together it has been according primacy to the propagation and facilitation of the drugs industry, due to which, unfortunately, the interest of the biggest stakeholder i.e. the consumer has never been ensured.”

Allegation of possible collusion:

The report also deliberates not only on the utter systemic failure of CDSCO along with the DCGI’s office to enforce the drug regulations effectively, but also towards a possible collusion between CDSCO and the pharmaceutical industry to implement a self-serving agenda by hoodwinking the system. This is a very serious allegation, which needs to be thoroughly probed and the findings of which should be made public for everybody’s satisfaction.

The committee, therefore, felt that effective and transparent drug regulation, free from all commercial influences and callous enforcement of rules and laws, are absolutely essential to ensure safety, efficacy and quality of drugs keeping just one objective in mind, i.e., welfare of patients.

Do we need “Safe in India” campaign for drugs?

Do we need a well-hyped “Safe in India” campaign for drugs? Looking around, at least conceptually, the answer is probably ‘yes’…Seriously…I am not joking!

The reason being, despite scathing remarks of the Parliamentary Standing Committee in 2012, apparently no systematic enquiry has been undertaken by the CDSCO to ascertain the reason for continuation and the veracity of this menace, just yet.

A very significant number of unapproved medications still remain undetected by the drug regulators and continue to be abundantly available, frequently prescribed, openly sold and freely consumed by the patients without even an iota of doubt regarding possible health safety hazards that these prescription drugs might cause.

May 2015 ‘PLOS Medicine’ Report helps unraveling the underbelly of the drug regulatory scenario in India, along with its systemic decay, which fails to halt the possible serious health safety hazards that Indian patients are exposed to.

India’s image as an emerging ‘pharmacy of the world’ for cheaper generic drugs has already been dented with a number of ‘import bans’ from the US and UK for flouting the specified drug manufacturing quality standards.

The saga of ‘import bans’ for Indian drugs, together with this critical health safety related menace, probably necessitates an effective launch of a “Safe in India” campaign for medicines, in general, by the Government.

This initiative gains additional importance, as painstakingly developed reputation of the Indian drug exporters, including the largest domestic players, has now been dented. It needs to be revamped, sooner.

I addressed a related issue in my blog post of February 3, 2014, titled “FDA ‘Import Bans: Valuing Drug Supply Chain Security For Patients’ Safety.”

Conclusion:

Effective resolution of this critical issue demands high priority at the highest level of the decision making process of the Government, with commensurate sense of urgency.

Keeping that in mind, would it be a bad idea, if just like “Make in India” campaign of the Prime Minister; “Safe in India” campaign for medicines is also undertaken with equal gusto and monitored by the top echelon of the country’s rejuvenated governance machinery?

This initiative would probably help sending the very contextual ‘shape up or ship out’ signal to the drug regulators, both at the Center and also in the States to erase the prevailing menace for good.

In that process, it would eventually allay the public health safety concern with the ‘Made in India’ drugs, coming out of ‘Make in India’ campaign, not just in the country, but also beyond its shores.

The speed of action in this situation is the essence. Otherwise, the following golden words of wisdom as enunciated by Abraham Lincoln would keep haunting us, till the remedial measures taken by the Government become palpable on the ground:

“To sin by silence when they should protest makes cowards of men”

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Does ‘Free-Market Economy’ Work For Branded Generic Drugs In India?

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On April 20, 2015, a panel of 31 lawmakers of the Standing Committee on Chemicals and Fertilizers tabled its report in the Indian Parliament. The committee emphasized that patients in India should have access to all medicines, including life saving drugs, at affordable prices. Accordingly, it recommended expansion of the scope of price control to all medicines available in the country.

The Committee wondered why all medicines are still not listed in the ‘National List of Essential Medicines (NLEM)’ and is of the view that drugs of all kinds are essential and are required by the patients for treatment of various disease conditions.

Currently, the National Pharmaceutical Pricing Authority (NPPA) has fixed prices of 509 formulation packs, covering 348 drugs, based on NLEM, as specified in the Drugs Price Control Order (DPCO) 2013. Such price controlled essential drugs currently contribute less than 18 percent of the total pharmaceutical market of India in value terms. Whereas, according to reports, total number of formulation packs in India would be much over 60,000.

The panel noted that the ceiling prices of even all those medicines, which should come under price control under DPCO 2013, are yet to be announced by the NPPA. Accordingly, it advised the Government to expedite the process of notifying ceiling prices for all the remaining medicines featuring in the NLEM, without further delay.

The Parliamentary Standing Committee observed that Rs 17,944 Crore was spent in 2013-14 to import medicinal and pharmaceutical products. It expressed dissatisfaction on the Department of Pharmaceuticals’ (DoP) explanation that imports were made on quality and economic considerations and not necessarily because the products were unavailable at home.

“The Committee is of the strong view that to realize the dream of ‘Make in India’ concept in pharmaceutical sector, the government should boost and incentivize domestic bulk drug industry and discourage Indian pharmaceutical firms from importing”, the report said.

It also observed that to make India self-reliant in this area, revival of sick public sector units was necessary to create capacity of bulk drugs. The Committee urged the DoP to expedite formulation of ‘Make in India’ policy for APIs (active pharmaceutical ingredients) in India.

Indictment against the DoP:

The committee reportedly came down heavily on the DoP for its inability to utilize funds allocated for various purposes, which clearly speaks about “the poor performance of the department in utilization of its plan allocation.”

The report clearly mentions, “The committee therefore feels that department could not achieve its avowed objectives and targets set for various scheme/programs unless the funds are utilized by the department optimally and efficiently.”

Stating that the department “should make earnest efforts for optimum utilization of funds allocated to them”, the committee expressed it would “like to be apprised of the initiatives undertaken by the department in this regard”.

A quick recapitulation:

In may 2012, the Department Related Parliamentary Standing Committee on Health and Family Welfare in its 58th Report also expressed great concern on rampant prescription of irrational and useless drugs by many doctors with ‘ulterior motives’ and expressed the need of inclusion of the essential and lifesaving drugs under strict price regulation.

As it usually takes a very long time to effect any perceptible change in India, the above critical observations, as well, remained virtually unattended, even today.

Does ‘Competition’ impact Branded generic pricing?

I am personally a strong believer of ‘free-market economy’, driven by ‘market competition’, for the industrial sectors in general. It ensures rapid economic progress and growth, creating much needed wealth to cater to the growing needs of various kinds for the citizens of a nation.

However, I would strongly argue that Indian pharma industry is one of the key exceptions in this regard; as it is basically a branded generic market contributing over 90 percent to the total domestic pharmaceutical retail market.

Although, domestic market of branded generic drugs is quite crowded with a large number of respective ‘brands’ of exactly the same off-patent molecule/molecules available at widely different price ranges, patients do not derive any economic benefit out of such intense competition in a ‘free-market economy’. This happens, as the patients have no say or role in the brand selection process of the doctors to choose a price of their likings and affordability, especially when the basic drug/drugs are the same for all those brands.

Examples of huge rice variation in branded generics of the same drug:

A Research Paper published in The Indian Journal of Applied Research’ of May 2014, titled, “Cost Variation Study of Anti-diabetics: Indian Scenario” observed as follows:

“In Single drug therapy, among sulfonylurea group of drugs, Glimepiride (2 mg) shows maximum price variation of 829.72%, while Glipizide (10mg) shows minimum variation. In Meglitinides groups of drugs Repaglinide (0.5mg) shows maximum price variation 194.73% and Nateglinide (120mg) shows Minimum price variation. In Biguanides & Thizolidinediones groups of drugs, Metformin (500 mg) & Pioglitazone (15 mg) show maximum price variation of 384.18% & 600 % respectively. In α-glucosidase inhibitor group of drugs, Voglibose (0.2mg) shows maximum price variation of 387.17%, while Miglitol (25mg) shows minimum price variation.”

“In combination therapies, Glimepiride+Metformin (1+500mg) combination shows the maximum variation up to 475 %. In case of Insulin Premixed 30/70 100IU/ml shows maximum price variation of 1881.24%, while minimum variation is found with short acting 40IU/ml.”

Similar scenario prevails virtually in all therapy categories in India.

No qualms on branding:

It is understandable that generic drugs are branded o create differentiation even within exactly identical drugs. There are no qualms on branding per se, which comes at a reasonably high cost though. However, the question is, who pays for this branding exercise and for what additional tangible value/values?

If no additional tangible value is added to a generic medicine through branding, why should most of the patients sweat to pay significantly extra amount, just to help the pharma companies fighting with each other to increase their respective pies of revenue and profit?

Why drug price control in a ‘Free Market Economy’?

It is indeed a very pertinent question. Equally pertinent answers are also available in a 2014 paper titled, “Competition Issues in the Indian Pharmaceuticals Sector” of Delhi School Economics (DSE). The paper deals with issues related to failure of ‘Free Market Economy’, despite intense competition, especially for branded generic drugs in India.

In an ideally free-market economic model, for each of these brands of identical drugs, having similar regulatory approvals from the Indian drug regulator on efficacy, safety and quality standards, competitive forces should have prompted uniform or at least near uniform prices for all such products.

Any brand of the same drug/drugs charging more, should generally have attracted lesser customers, if consumers would have exercised their purchase decisions directly; efficacy, safety and quality standards being the same, as certified by the drug regulator.

Interestingly, for prescription medicines, the much proven process of consumers exercising their free choice to select a brand, influenced by advertising, does not happen at all.

Branded generics pricing paradox:

In the pharmaceutical market place, the scenario is almost just the reverse of what should happen in a highly competitive ‘free market’ model.

This means, highest priced branded varieties of identical drugs, mostly enjoy highest market share too. This in turn proves that competition within the pharma brands do not bring down the prices, benefiting the consumers/patients.

Branding of generic drugs:

Unlike many developed nations, in India, even the off-patent generic drugs are branded and differentiated on flimsy perception based intangibles to the prescribers, along with other contentious and dubious sales tools, decrying unbranded generics.

This is done in the guise of so-called pharma ‘sales and marketing’ strategies, which are sometimes shrewd and many times equally blatant, if not crude.

The DSE paper, very clearly says, ‘head to head’ competition between undifferentiated (non-branded) products would certainly cause a precipitous fall in prices.

However, it is generally believed, the prescription demand of branded generic drugs is basically created by influencing the prescribing behavior of the medical practitioners. Not just by personal selling through medical representatives, medical advertising and publicity of different types, but also through a chain of processes that many stakeholders, including the Government and law-makers generally consider as grossly unethical.

In January 2015, the Government directive for implementation of the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ by the pharma industry in India, further reinforces the point.

 ‘Dorfman-Steiner’ condition vindicated:

The above paper from the DSE underscores the old and well-established ‘Dorfman-Steiner’ condition that mathematically proves that the price-cost margin is positively related to the ratio of advertising expenditure to sales revenue.

Quoting a practicing surgeon, the DSE article states:

“Sometimes it could be just plain ignorance about the availability of a cheaper alternative that makes doctors continue to prescribe costlier brands. But one cannot ignore the role of what are euphemistically called marketing “incentives”, which basically mean the inappropriate influence pharmaceutical companies exert on doctors. This runs deep. Hospitals choose to stock only certain drugs in their in-house pharmacies and insist that hospitalized patients buy drugs only from the hospital pharmacy. Drug companies sell drugs to hospitals at a price much lower than what the patient is charged, further incentivizing the hospital to stock their products. The cheaper brands often get left out in this game.”

Reasons for success of high-priced branded generics:

Low priced non – branded cheaper generics have been systematically made to perceive as of low quality. In several media reports, including some recent ones even some well-known doctors castigated the low priced non- branded cheaper generics. Pharma industry lobby groups, in tandem, has been strongly resisting various Government initiatives of un-branding the generic drugs.

Over a long time, a common public perception has been painstakingly created that high-priced branded generics are more of high quality; MNC brands are of better quality than their ‘Desi’ counterparts and branded generics are more reliable than their non-branded equivalents.

This perception is fuelled by poor enforcement of the Drugs and Cosmetics Act of India that also regulates drug-manufacturing standards in the country, besides the prevailing overall drug regulatory scenario in the country.

The New Government attributes “Market Failure for pharmaceuticals”:

In its price notification dated July 10, 2014, the NPPA has categorically stated the following:

  • There exist huge inter-brand price differences in branded-generics, which is indicative of a severe market failure, as different brands of the same drug formulation, which are identical to each other in terms of active ingredient(s), strength, dosage, route of administration, quality, product characteristics, and intended use, vary disproportionately in terms of price.
  • It is observed that, the different brands of the drug formulation may sometimes differ in terms of binders, fillers, dyes, preservatives, coating agents, and dissolution agents, but these differences are not significant in terms of therapeutic value.
  • In India the market failure for pharmaceuticals can be attributed to several factors, but the main reason is that the demand for medicines is largely prescription driven and the patient has very little choice in this regard.
  • Market failure alone may not constitute sufficient grounds for government intervention, but when such failure is considered in the context of the essential role of pharmaceuticals play in the area of public health, which is a social right, such intervention becomes necessary, especially when exploitative pricing makes medicines unaffordable and beyond the reach of most and also puts huge financial burden in terms of out-of-pocket expenditure on healthcare.

Civil Society echoed the same sentiment:

In this context, it is important to note that in a letter dated August 20, 2014 written by seven large Civil Society Organizations to Mr. Ananth Kumar, the present Minister of Chemicals and Fertilizers with a copy to Prime Minister Modi, articulated similar view, as follows:

“Limiting all price regulation only to a list of 348 medicines and specified dosages and strengths in the DPCO 2013 goes against the policy objective of making medicines affordable to the public. The National List of Essential Medicines, a list of 348 rational and cost-effective medicines, is not the basis for production, promotion and prescription in India. In reality the most frequently prescribed and consumed medicines are not listed in the NLEM.”

I broached on a similar issue in my blog post of April 6, 2015 titled, “Would Affordable ‘Modicare’ Remain Just A Pipe Dream In India?”

An opposite view: ‘Bad Medicine’

On April 23, 2015, an Editorial with the above headline, articulating exactly opposite viewpoint, was published in a leading English business daily.

With all due respect to the concerned editor, it appeared quite funny, if not ‘hilarious’ to me for several reasons. One of which is seemingly total lack of understanding on the issue by the concerned editor.

I am quoting below some of the most obvious ones, just to cite as examples:

A. Quoting the above recommendation of the Parliamentary Standing Committee on drug price control the Editorial states:

“Not only will this make investors from other countries look at India with suspicion – Japanese pharma firm Daiichi just exited its disastrous investment in Ranbaxy (later taken over by Sun Pharma) – it will ensure Indian patients are deprived of good quality medicines.”

It is known to everybody that drug price control in India had got nothing to do with the exit of Daiichi. It was primarily due to import bans by the USFDA, caused by alleged falsification of GMP related data in Ranbaxy’s manufacturing plants selling drugs to America.

B. The Editorial continues:

“So much for Make-in-India—the other problem with price controls is that, with little incentive to invest in fraud-prevention, between a fourth and a third of India’s pharmaceuticals production is estimated to be spurious. Also, price caps have resulted in a situation where R&D expenses are very low, and there is little research on drugs of particular relevance to India.”

Again, it is much known fact that over 82 percent of Indian pharmaceutical market is currently outside price control, offering free-pricing opportunity. What does then prevent the drug companies to come out robust ‘fraud-prevention’ measures for all those free-pricing drugs?

C. The Editor stated:

“Since Indian prices are amongst the lowest in the world, it is not clear what exactly the committee had in mind, more so since costs of medicine are not, in any case, the most expensive part of medical treatment.”

Of course, all concerned knows that lowest range of generic drug prices in India, are perhaps the cheapest in the world. However, the point is, should it be considered in isolation? Not in relation to per capita income of the Indians? Not in terms of Purchasing Power Parity? In drug pricing context, one Committee Report of the DoP had shown, when adjusted against these two factors, drug prices in India are as high, if not more, as compared to the developed countries of the world.

I hasten to add that I fully resect all different view points. If I have made any mistakes in understanding this piece of bizarre editorial, I am more than willing to stand corrected with all humility, as this a very serious issue of ‘what is right’ and NOT ‘who is right’.

Conclusion:

India is a market of branded generics, where brand differentiation process involves creation of mostly unsubstantiated perceptions.

As the stakeholders, media and even the Indian Government have alleged, drug companies exert a strong influence in the brand prescription decision of the doctors, even at the cost of patients who cannot afford the same.

Even in a free-market economy with cutthroat competition, patients do not have any means to exercise their price preferences even within identical branded generic drugs. They are compelled to buy high priced brands, as prescribed by their doctors, even where low priced identical equivalents are available.

This condition gives rise into ‘Market Failure’, especially for branded generics in India. The NPPA has unequivocally enunciated it, which I have quoted above.

Being a strong believer and votary of ‘free-market economy’ and ‘market competition’, I find this pharma scenario unique. It is a rare example of failure of otherwise so successful free-market economy model, especially in the branded generic pharma space of India.

Around a decade ago, the ‘Indian Journal of Medical Ethics’ (IJME, January – March 2004 issue) captured the very essence of this deliberation, epitomized in the following sentence:

“If the one who decides, does not pay and the one who pays, does not decide and if the one who decides is ‘paid’, will truths stand any chance?”

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

‘Data Protection’: Needs A Clear Direction…But Is It An IPR Issue?

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The terminologies ‘Data Exclusivity’ and ‘Data Protection’ are quite often used interchangeably by many, creating a great deal of confusion on the subject. However, in a true sense these are quite different issues having critical impact on public health interest of a nation.

In several media reports as well, one can notice the interchangeable use of these two terms. It is especially happening when the reports are speculating whether or not the Government of India is considering putting in place ‘Data Exclusivity’/ ‘Data Protection’ along with ‘Patent Linkage’ through administrative measures, without making any amendments in the Patents Act 2005 of the country.

Tracking this development, the last week, I wrote about ‘Patent Linkage’. In this article, I shall dwell on the same area, but from ‘Data Exclusivity’/ ‘Data Protection’ perspective.

A brief overview:

Close to a decade ago, Government of India constituted ‘Satwant Reddy Committee’ to recommend a direction that India should follow on ‘Data Protection’ in the country involving pharmaceutical and agricultural products.

In 2007 the Committee submitted its report recommending ‘Data Protection’ in the country to be introduced for pharma products in a calibrated manner. However, the report did not specify a timeline for its implementation.

Interestingly, even this committee did not differentiate between the terminologies ‘Data Protection’ and ‘Data Exclusivity, as we now see in the first draft of the ‘National IPR Policy.’

According to available reports, after due deliberation, the erstwhile Government decided not to take any action on the committee’s recommendations for ‘Data Protection’ in India.

Difference between ‘Data Protection’ and ‘Data Exclusivity’:

In an article published in ipHandbook, titled “Data Protection and Data Exclusivity in Pharmaceuticals and Agrochemicals”, the author Charles Clift with a great deal of experience in the U.K. Department of International Development (DFID) and a former Secretary, Commission on Intellectual Property Rights, Innovation and Public Health, World Health Organization; differentiated these two terminologies as follows:

Data Protection (DP): Protection of commercially valuable data held by the drug regulator against disclosure and unfair commercial use.

Data Exclusivity (DE): A time bound form of Intellectual Property (IP) protection that seeks to allow companies recouping the cost of investment in producing data required by the regulatory authority.

Arguments in favor of ‘Data Exclusivity’:

International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), Geneva, in its website argues in favor of ‘Data Exclusivity’ as follows:

- Health authorities require, as part of a submission for a marketing authorization, that proprietary information be disclosed in order to ensure public health and patient safety.

- The innovator assumes the entire risk for the generation of the data, what requires expensive and lengthy clinical trials.

- ‘Data Exclusivity’ is necessary to provide a measure of certainty to the innovator that they will be provided with a period of protection for their efforts of testing a drug.

- Patents and ‘Data Exclusivity’ are different concepts, protect different subject matter, arise from different efforts, and have different legal effects over different time periods

Arguments suspecting the intent of ‘Data Exclusivity’:

The above paper of Charles Clift highlights the following on DE:

- The effect of DE is to prevent entry of generic competitors, independent of the patent status of the product in question.

- DE law, wherever applicable, prevents generic manufacturers from using innovators’ test data, though it would allow the drug regulator to analyze this data prior to market approval.

- Even if the patent period has expired or there is no patent on a product, DE will act independently to delay the generic entry until the period of DE is over.

- In that way DE compensates innovators for delayed market entry and concomitant loss of potential profits.

- DE is a much stronger right than a patent, mainly because, unlike patent law, there is no exceptions or flexibilities that allow the governments to provide the equivalent of Compulsory License (CL).

- DE acts as a barrier to CL of a patent on the same product by preventing marketing approval for a CL.

TRIPS Agreement talks about DP, but not DE:

Article 39 of TRIPS Agreement on “Protection of Undisclosed Information” contains a general clause on the obligations of the members of the WTO, where Article 39.3 specifies three obligations for its member countries as follows:

- To protect data on New Chemical Entities (NCE), the collection of which involves considerable effort, against unfair commercial use.

- To protect these data against disclosure, except where necessary to protect the public

- To protect such data against disclosure, unless steps are taken to ensure that the data are protected against unfair commercial use

According to Charles Clift, Article 39.3 only articulates widely accepted trade secret and unfair competition law, and is not an invitation to create new IP rights per se for test data. Nor does it prevent outside parties from relying on the test data submitted by an originator, except in case of unfair commercial practices.

Some developed countries, such as the United States and the European Union have argued that Article 39.3 of TRIPS requires countries to create a regime of DE, which is a new form of time-limited IP protection. However, it is worth noting that in both these countries DE regime was adopted prior to TRIPS Agreement. Hence, many experts construe such approaches and pressure, thus created for DE, as ‘TRIPS Plus’.

What is ‘TRIPS Plus’?

The ‘TRIPS-Plus’ concept would usually encompass all those activities, which are aimed at increasing the level of IP protection for the right holders, much beyond what is required for conformance of TRIPS Agreement by the World Trade Organization (WTO).

Some section of the civil society nurtures a view that ‘TRIPS Plus’ provisions could significantly jeopardize the ability, especially, of developing countries to protect the public health interest adequately.

Some common examples of ‘TRIPS Plus’ provisions:

Common examples of ‘TRIPS Plus’ provisions could include:

- Extension of the patent term beyond usual twenty-year period

- Introduction of provisions, which could restrict the use of CL

- Delaying the entry of generics

Is ‘Data Protection’ an IPR issue?

In my view, the issue of ‘Data Protection’ is more a drug regulatory than an IPR related subject and should be treated as such. This is because ‘Data Protection’ is more related to the ‘Drugs and Cosmetics Act’ of India rather than the ‘Patents Act 2005′.

Thus, it is quite intriguing to make out why ‘Data Protection’, which will be governed by ‘Drugs and Cosmetics Act’, is featuring in the IPR Policy of the country.

I wrote on the draft National IPR Policy in my blog post of January 19, 2015, titled “New “National IPR Policy” of India – A Pharma Perspective”.

Conclusion:

After jettisoning the ‘Satwant Committee Report’ on ‘Data Protection’, the Government was in no mood, until recently, to discuss anything about DP and DE, despite intense pressure from the pharma MNC lobby in India. However, the issue first resurfaced during EU-FTA negotiation, when India rejected these provisions outright and unambiguously.

However, the ghost started haunting India, yet again, when the US Government started flexing its muscle on this issue, at the behest of the American pharma companies.

Although DP is a drug regulatory issue, curiously, it features in the draft National IPR Policy. Even there, the subject has taken an interesting turn, when in the first draft of ‘National IPR Policy’ of India, the six-member ‘Think Tank’ chaired by Justice (Retd.) Prabha Sridevan clearly recommended “Protection of undisclosed information not extending to data exclusivity.”

In my opinion this is indeed a very pragmatic recommendation. It deserves support from all concerned so that the profound intent continues to feature in the final IPR Policy of India, to protect public health interest of the nation.

Just like ‘Patent Linkage’, as I discussed in my last week’s article, finding a middle ground to put ‘Data Protection’ in place through administrative measures, without making any amendments either in the Drugs & Cosmetics Act or in the Patents Act of the country, seems to be desirable and very much possible, as well.

However, the very thought of considering ‘Data Exclusivity’ in India, in my view, should prompt a clear ‘No…No’ response from the present Government of India.

This is mainly because, besides all other reasons as mentioned above, even if the patent period for a molecule has expired or there is no patent on a product, DE will act independently to delay the generic entry until the period of ‘Data Exclusivity’ gets over.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

“Kickbacks And Bribes Oil Every Part of India’s Healthcare Machinery” – A National Shame?

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“Corruption ruins the doctor-patient relationship in India” - highlights an article published in the well-reputed British Medical Journal (BMJ) on 08 May 2014. The author David Berger wrote, “Kickbacks and bribes oil every part of the country’s healthcare machinery and if India’s authorities cannot make improvements, international agencies should act.”

The author reiterated the much known facts that the latest in technological medicine is available only to those people who can pay for its high price. However, the vast majority of the population has little or no access to healthcare, and whatever access they have is mostly limited to substandard government care or to quacks, which seem to operate with near impunity. He further points out that “Corruption is rife at all levels, from the richest to the poorest”. It is a common complaint both from the poor and the middle class that they don’t trust their doctors from the core of hearts. They don’t trust them to be competent or to be honest, and live in fear of having to consult them, which results in high levels of doctor shopping.

Dr. Berger also deliberated on the widespread corruption in the pharmaceutical industry, with doctors bribed to prescribe particular drugs. Common stories usually doing the rounds that the decision makers in the hospitals are being given top of the range cars and other inducements when their hospitals sign contracts to prescribe particular expensive drugs preferentially.

The article does not fail to mention that many Indian doctors do have huge expertise, are honorable and treat their patients well. However, as a group, doctors generally have a poor reputation.

Until the profession along with the pharma industry is prepared to tackle this malady head-on and acknowledge the corrosive effects of medical corruption, the doctor-patient relationship will continue to lie in tatters, the paper says.

The saga continues through decades – unabated:

The above worrying situation in the space of medical treatment in India refuses to die down and continues since decades.

The article published in the British Medical Journal (BMJ) over a decade ago, on January 04, 2003 vindicates this point, when it brings to the fore, “Health care is among the most corrupt services in India”.

This article was based on a survey released by the India office of the international non-governmental organization ‘Transparency International’. At that time, it ranked India as one of the 30 most corrupt countries in the world. The study covered 10 sectors with a direct bearing on people’s lives, where the respondents rated the police as the most corrupt sector, closely followed by healthcare.

Medical Council of India (MCI) is responsible for enforcing the regulations on medical profession. Unfortunately, the MCI itself is riddled with corruption, fueled by the vested interests. As the first BMJ article indicates,   Subsequently, there has been controversy over the surprise removal, on the day India was declared polio-free, of the health secretary Keshav Desirajus, possibly in response to his resistance to moves to reappoint Desai to the reconstituted MCI.

Another point to ponder: Quality of Doctor – MR interactions

It is a well-established fact that the ethics, values and belief in pharmaceutical sales and marketing are primarily derived from the ethics, values and belief of the concerned organization.  Field staff systems, compliance, accountability, belief, value and culture also flow from these fundamentals. Thus, considering the comments made in the BMJ on the pharma companies, in general, let me now also deliberate on the desired roles of the Medical Representatives (MR) in this area.

It is well known that MRs of the pharma players exert significant influence on the prescribing practices of the doctors and changing their prescribing patterns too. At the same time, this is also equally true that for a vast majority of, especially, the General Practitioners (GPs), MRs are the key source of information for various drugs. In tandem, several research studies also indicate that doctors, by and large, believe that pharma companies unduly influence them.

Theoretically, MRs should be properly trained to convey to the target doctors the overall profile – the efficacy, safety, utility, precautions and contra-indications of their respective products. Interestingly, the MRs are trained by the respective pharma companies primarily to alter the prescribing habits of the target doctors with information heavily biased in favor of their own drugs.

As a result, range of safety, precautions and contra-indications of the products are seldom discussed, if not totally avoided, putting patients at risks by creating an unwarranted product bias, especially among GPs, who depend mainly on MRs for product information. Thus, the quality of product communication is mainly focused on benefits rather than holistic – covering all intrinsic merits/demerits of the respective brands in a professional manner.

Considering the importance of detailing in delivering the complete product information primarily to the GPs, there is a critical need for the pharma companies to train and equip the MRs with a complete detailing message and yet be successful in winning the doctors’ support.

This issue also needs to be properly addressed for the interest of patients.

“Means” to achieve the goal need to change: 

Globally, including India, many pharma players have not been questioned, as yet, just not on the means of their meeting the financial goals, but also the practices they follow for the doctors. These often include classifying the physicians based on the value of their prescriptions for the specific products. Accordingly, MRs are trained to adopt the respective companies’ prescribed ‘means’ to influence those doctors for creating a desirable prescription demand. These wide array of so-called ‘means’, as many argue, lead to alleged ‘bribery’/’kickbacks’ and other malpractices both at the doctors’ and also at the pharma companies’ end.

To address this issue, after the Chinese episode, GlaxoSmithKline (GSK) has reportedly announced that by the start of 2016 it will stop paying doctors to speak on its behalf or to attend conferences, to end undue influence on prescribers.

The announcement also indicated that GSK has planned to remove individual sales targets from its sales force. This means that MRs would no longer be paid according to the number of prescriptions they solicited from the doctors met by them.

Instead, GSK introduced a new performance related scheme that will reward the MRs for their technical knowledge, the quality of the service they deliver to support improved care of patients, and the overall performance of GSK’s business. The scheme is expected to start in some countries effective January 2014 and be in place globally by early 2015.

Further, GSK underscored that the latest changes were “designed to bring greater clarity and confidence that whenever we talk to a doctor, nurse, or other prescriber, it is patients’ interests that always come first.”

This is indeed a refreshing development for others to imbibe, even in India.

Capturing an Indian Example:

Just to cite an example, a couple of years ago Reuters in an article titled “In India, gift-giving drives drug makers’ marketing” reported that a coffee maker, cookware and vacuum cleaner, were among the many gifts for doctors listed in an Abbott Healthcare sales-strategy guide for the second quarter of 2011 in India, a copy of which was reviewed by Reuters.

It is interesting to note from the report, even for an antibiotic like Nupod (Cefpodoxime), doctors who pledge to prescribe Abbott’s branded drugs, or who’ve already prescribed certain amounts, can expect some of these items in return, the report mentioned.

Since decades, media reports have highlighted many more of such instances. Unfortunately, the concerned government authorities in India refused to wake-up from the deep slumber, despite the alleged ruckus spreading like a wild fire.

Self-regulation by the industry ineffective:

This menace, though more intense in India, is certainly not confined to the shores of this country. As we all know, many constituents of Big Pharma have already been implicated in the mega pharma bribery scandal in China.

Many international pharmaceutical trade associations, which are primarily the lobbying bodies, are the strong votaries of self-regulations by the industry. They have also created many documents in these regards since quite some time and displayed those in their respective websites. However, despite all these the ground reality is, the charted path of well-hyped self-regulation by the industry to stop this malaise is not working.

The following are just a few recent examples to help fathom the enormity of the problem and also to vindicate the above point:

  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.

Pricing is also another important area where the issue of both ethics and compliance to drug regulations come in. The key question continues to remain, whether the essential drugs, besides the patented ones, are priced in a manner that they can serve the needs of majority of patients in India. I have deliberated a part of this important issue in my earlier blog post titled “Is The New Market Based Pricing Model Fundamentally Flawed?”

There are many more of such examples.

Stakeholders’ anguish:

Deep anguish of the stakeholders over this issue is now being increasingly reverberated on every passing day in India, as it were. It had also drawn the attention of the patients’ groups, NGOs, media, Government, Planning Commission and even the Parliament.

The Department Related Parliamentary Standing Committee on Health and Family Welfare in its 58th Report strongly indicted the Department of Pharmaceuticals (DoP) on this score. It observed that the DoP should take prompt action in making the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ mandatory so that effective checks and balances could be brought-in on ‘huge promotional costs and the resultant add-on impact on medicine prices’.

Despite deplorable inaction by the erstwhile Government on the subject, frequent reporting by Indian media has triggered a national debate on this issue. A related Public Interest Litigation (PIL) is also now pending before the Supreme Court for hearing in the near future. Its judicial verdict is expected to usher in a breath of fresh air around a rather stifling environment for the patients.

Let us now wait and see what action the new minister of the Modi Government takes on this issue.

A prescription for change:

Very recently, Dr. Samiran Nundy, Chairman of the Department of Surgical Gastroenterology and Organ Transplantation at Sir Ganga Ram Hospital and Editor-in-Chief of the Journal of Current Medicine Research and Practice, has reportedly exposed the widespread (mal) practices of doctors in India taking cuts for referrals and prescribing unnecessary drugs, investigations and procedures for profit.

Dr. Nundy suggested that to begin with, “The Medical Council of India (MCI), currently an exclusive club of doctors, has to be reconstituted. Half the members must be lay people like teachers, social workers and patient groups like the General Medical Council in Britain where, if a doctor is found to be corrupt, he is booted out by the council.”

Conclusion:

Efforts are now being made in India by some stakeholders to declare all malpractices related to pharma industry illegal through enactment of appropriate robust laws and regulations, attracting exemplary punishments to the perpetrators.

However, enforcement of MCI Guidelines for the doctors and initiatives towards enactment of suitable laws/regulations for the pharma industry, like for example, the ‘Physician Payments Sunshine Act’ of the United States, have so far been muted by the vested interests.

If the new Modi government too, does not swing into visible action forthwith, this saga of international disrepute, corruption and collusion in the healthcare space of India would continue in India, albeit with increasing vigor and probably in perpetuity. This would, undoubtedly, sacrifice the interest of patients at the altar of excessive greed and want of the vested interests.

This new government, as most people believe, has both the will and wherewithal to hold this raging mad bull of pharma malpractices by the horn, ensuring a great relief and long awaited justice for all.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion. 

Big Pharma Receives Another Body Blow: Would Indian Slumber End Now?

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On May 13, 2014, The New York Times reported, while major pharmaceutical companies have been facing increased scrutiny of their marketing practices from governments around the world, last Wednesday the Chinese authorities sent a strong warning to the pharmaceutical industry implicating Mark Reilly, the former head of Glaxo’s China operations, of ordering his subordinates to form a “massive bribery network” that resulted in higher drug prices and illegal revenue of more than US$150 million.  Mr. Reilly, a Briton, and two Chinese-born Glaxo executives, Zhang Guowei and Zhao Hongyan, had allegedly arranged to bribe government officials in Beijing and Shanghai.

The Chinese police has reportedly said that its 10-month investigation has found that under Mr. Reilly, Glaxo had pushed its staff to meet aggressive sales targets and that the company had conducted “false transactions” through its financial department to transfer “illegal gains” made in China to overseas companies. The authorities also said Mr. Reilly and other senior executives at Glaxo had bribed officials to stop investigations of wrongdoing at the company.

The report also states, although bribery is common in China, it is rare for foreign-born executives from MNCs to be prosecuted. In 2009, a Chinese-born Australian executive at the British-Australian mining giant Rio Tinto was arrested in a bribery and money-laundering case.

“Ethics Matter” – A Chinese warning to MNCs:

On May 16, 2014, Xinhua – the official news agency of China wrote in an editorial that Chinese probe into GSK’s local sales practices should send a warning to other foreign companies doing business in the country that “Ethics Matter”.

This stern action by China is indeed another body blow on the so called ‘ethical image’ of Big Pharma, despite its sophisticated global ‘Public Relations’ machinery working overtime under the respective pharma associations across the world.

Drug price manipulation:

While citing the example of a hepatitis B drug – Heptodin, Xinhua editorial said that GSK “manipulated prices to disguise real costs”, as Heptodin is declared as 73 Yuan to customs in China even though the actual cost is 15.7 Yuan and is sold at 26 Yuan in Canada or 30 Yuan in the U.K.

Quoting a Ministry of Public Security official at a briefing on May 14, it stated that Glaxo charged prices in China that in some cases were seven times as high as in other countries, and used the extra money to pay bribes.

According to this media report, in June last year, “Chinese authorities began investigating allegations that Glaxo had funneled money through local travel agencies to pay bribes to doctors in return for prescribing its drugs. They last year detained some executives on suspicion of economic crimes involving 3 billion Yuan of spurious expenses and trading in sexual favors.”

Not a first time allegation:

This is not the first of such cases and most probably won’t be the last also. Since quite some time many pharmaceutical giants are being reportedly investigated and fined, including out of court settlements, for bribery charges related to the physicians.

In this context July 4, 2012, edition of The Guardian reported a similar astonishing story on Big Pharma. When you click on this short video clipping, which was published on September 29, 2012 you would see that Big Pharma’s Medicaid fraud penalties had reached a record high with GlaxoSmithKline fined $3 Billion in the United States at that time.

It is widespread:

Following are a few more recent examples to help fathom the enormity of the problem:

  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.

There are many more of such examples.

The situation is alarming in India too:

Back home in India, deep anguish of the stakeholders over this issue is now being increasingly reverberated on every passing day, as it were. It has also drawn the attention of the patients’ groups, NGOs, media, Government, Planning Commission and even the Parliament.

An article titled, “Healthcare industry is a rip-off” published in a leading daily, the author highlighted that the absence of regulatory oversight in the healthcare industry needs urgent attention.

The quality of the pharmaceutical marketing in India has touched a new low, causing suffering to patients. Unethical drug promotion is increasingly becoming an emerging threat to society. The Government provides few checks and balances on drug promotion.

To counter the problem of ‘Unethical Drug Promotion’ to a great extent, the author broadly recommended the following:

  • Preparing treatment guidelines,
  • Conducting periodic prescription audits,
  • Generating consumer awareness and empowering consumer with relevant information in an user friendly way
  • Regulating entertainment of doctors in the garb of Continuing Medical Education (CME)

Moreover, the Department Related Parliamentary Standing Committee on Health and Family Welfare in its 58th Report strongly indicted the Department of Pharmaceuticals (DoP) on this score. It observed that the DoP should take prompt action in making the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ mandatory so that effective checks and balances could be brought-in on ‘huge promotional costs and the resultant add-on impact on medicine prices’.

Even the Planning Commission of India has reportedly recommended strong measures against pharmaceutical marketing malpractices as follows:

“Pharmaceutical marketing and aggressive promotion also contributes to irrational use. There is a need for a mandatory code for identifying and penalizing unethical promotion on the part of pharma companies. Disclosure by pharmaceutical companies of the expenditure incurred on drug promotion to be made mandatory, ghost writing in promotion of pharma products to attract disqualification of the author as well as penalty on the company, and vetting of drug related material in Continuing Medical Education (CME) should be considered.”

Unfortunately, nothing substantive has been done in India to effectively address such malpractices in a comprehensive manner, as yet, to protect patients’ interest.

A pending PIL:

Despite deplorable inaction by the government on the subject, frequent reporting by Indian media has triggered a national debate on this issue. A related Public Interest Litigation (PIL) is also now pending before the Supreme Court for hearing in the near future. Its judicial verdict is expected to usher in a breath of fresh air around a rather stifling environment for the patients.

Ethical marketing conduct in India – A Survey:

A survey report of Ernst and Young titled, “Pharmaceutical marketing: ethical and responsible conduct”, carried out in September 2011 on the UCMP and MCI guidelines, highlighted the following:

  • Two-third of the respondents felt that the implementation of the UCPMP would change the manner in which pharma products are currently marketed in India.
  • More than 50 percent of the respondents are of the opinion that the UCPMP may lead to manipulation in recording of actual sampling activity.
  • Over 50 percent of the respondents indicated that the effectiveness of the code would be very low in the absence of legislative support provided to the UCPMP committee.
  • 90 percent of the respondents felt that pharma companies in India should focus on building a robust internal controls system to ensure compliance with the UCPMP.
  • 72 percent of the respondents felt that the MCI is not stringently enforcing its medical ethics guidelines for the doctors.
  • 36 percent of the respondents felt that the MCI’s guidelines could have an impact on the overall sales of pharma companies.

 Conclusion:

Increasingly many companies across the world are reportedly being forced to pay heavily for ‘unethical behavior and business practices’ by the respective governments.

Intense quarterly pressure for expected business performance by stock markets and shareholders could apparently be the trigger-points for short changing such codes and values.

Be that as it may, I reckon, the need to announce and implement the UCPMP by the Department of Pharmaceutical under the new Modi Government, assumes critical importance in today’s chaotic pharmaceutical marketing scenario. At the same time, demonstrable qualitative changes in corporate ethics and value standards in this regard should always be important goals for any pharmaceutical business corporation in India.

Though late, China has at least started cracking down on the perpetrators of this alleged crime. As corruption conscious Modi-Government assumes office in the country, would India wake-up now to stop this growing menace by enacting and then strictly enforcing the rule of law?

By: Tapan J Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Astronomical Prices of Patented Cancer Drugs: A Solution in Sight?

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Astronomical prices of patented anti-cancer dugs have become a subject of great concern not just in India. It is becoming an issue across the world.

After issuing the first ever Compulsory License (CL) for Nexavar of Bayer in India, the grapevine is reportedly still abuzz on the progress of issuing CL for some commonly used high priced patent protected anti-cancer drugs, such as, dasatinib (Sprycel) of Bristol-Meyer Squibb. It is believed that a CL on dasatinib will reduce the product price to around Rs 8,000 for a month’s therapy as compared to Rs. L 1.65 for “Sprycel, benefitting the patients suffering from Chronic Myelogenous Leukemia (CML).

Whenever, a discussion on such pricing issues comes up in India, the counter arguments from the pharma MNCs are put as under:

  • Does India have adequate diagnostic facilities for the disease?
  • How many diagnosed patients would be able even the low cost product?

The intent of these questions appears to be diversionary in nature and has hardly any relationship with the real issue.

Yes, diagnosing cancer at an early stage is still a challenge in India for various socio-economic reasons, which need to be addressed expeditiously. But, what happens to majority of those diagnosed patients, who cannot afford to pay over Rs. 1.65 for a month’s therapy for a product like dasatinib? Won’t the reduced price of say Rs. 8,000 expand access of the drug to many more additional patients, though may not be to all.

US researchers also point out high cancer drugs cost:

It is interesting to note, that in a in a review article published recently in ‘The Lancet Oncology’, the US researchers Prof. Thomas Smith and Dr. Ronan Kelly identified drug pricing as one area of high costs of cancer care. They are confident that this high cost can be reduced, just as it is possible for end-of-life care and medical imaging – the other two areas of high costs in cancer treatment.

Besides many other areas, the authors suggested that reducing the prices of new cancer drugs would immensely help containing cancer costs. Prof. Smith reportedly said, “There are drugs that cost tens of thousands of dollars with an unbalanced relationship between cost and benefit. We need to determine appropriate prices for drugs and inform patients about their costs of care.”

Pricing pressure in Europe too:

Another recent report highlights that Germany is contemplating legislation shortly that would force drug manufacturers to report the reduced prices they negotiate with insurers, potentially pressuring prices lower elsewhere in Europe.

The report highlights that drug manufacturers have had to negotiate rebates on new innovative medicines with German insurers for the past three years. Now, instead of referring to rebates negotiated between drug manufacturers and insurers, the law will refer to reimbursement. The shift may seem small, but it means the talks are really about price, not discounts, which is often good for a limited time or volume and is renegotiable.

It is worth noting from the report that countries including Spain, France and Italy have reduced the number of drugs for which they will reimburse patients, mandated the increased use of generic medicines and lowered the amount they will pay for some products since the economic crisis.

A solution in sight?

Coming back to the Indian scenario, unlike many other developed and developing countries of the world, there is no system yet in place in India to negotiate prices of patented drugs, including those used for cancer.

CL for all patented anti-cancer drugs may not be a sustainable measure for all time to come, either. One robust alternative is price negotiation for patented drugs in general, including anti-cancer drugs, as provided in the Drug Policy 2012. The issue has been under consideration of the Department of Pharmaceuticals (DoP) since 2007. The bizarre report produced by a committee formed for the purpose earlier had no takers.

Unfortunately administrative lethargy and lack of requisite sense of urgency have not allowed the Department of Pharmaceuticals (DoP) to progress much on this important subject, beyond customary lip service, as on date. Intense lobbying on the subject by vested interests from across the world has further pushed the envelope in a dark corner.

Recent report indicates, the envelope has since been retrieved for a fresh look with fresh eyes, most probably, as a new leader now on the saddle of the department.

An inter-ministerial committee has now reportedly been formed by the Department of Pharmaceuticals (DoP) under the chairmanship of one of its Joint Secretaries, to suggest a mechanism to fix prices of patented drugs in India.
Other members of the committee are Joint Secretary, Department of Industrial Policy and Promotion (DIPP); Joint Secretary, Ministry of Health and Family Welfare; and Member Secretary, National Pharmaceutical Pricing Authority (NPPA).

It appears, inputs will be taken from various industry associations, yet again.

Conclusion:

Pharmaco-economics input, I reckon, would be of immense value for this exercise. Since the ‘Public Health Foundation of India (PHFI)’ has one such unit doing lots of good analysis, this inter-ministerial group may also consider inclusion of this unit in the committee, as advisor.

The pricing of newer patented medicines, especially those used for the treatment of cancer, are of critical importance for the country and the committee should ground the issue satisfactorily within a specified period without further delay.

Hopefully, a well thought out report of the inter-ministerial committee would help resolving this issue soon once and for all, including a large number of cancer patients in India.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

 

“Make Global Pharma Responsible in Homeland for Objectionable Conduct in Clinical Trials Elsewhere”

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In the context of his recent meeting with Commissioner Margaret A. Hamburg of US-FDA, the Drug Controller General of India (DCGI) reportedly expressed his concern to ‘The Economic Times’ on the ‘objectionable conduct’ of global pharma in new drug trials in India, as follows:

“US and other global drug makers who conduct clinical trials at different locations across the globe need to be made responsible in their home country for their objectionable conduct in clinical trials elsewhere.”

He further added:

“While conducting trials, drug makers cannot discriminate on the basis of nationality, because patient safety is top priority for every regulator – US or India”

The above report also mentioned that there is already a law in place in the United States that makes companies accountable in their homeland, if they are found to be indulging in corruption overseas.

‘Uncontrolled clinical trials are causing havoc to human life’:

That is exactly what the Supreme Court of India observed last year in response to a Public Interest Litigation (PIL) filed by the Human Rights group ‘Swasthya Adhikar Manch (SAM)’.

At the same time, revoking the power of the ‘Central Drugs Standard Control Organization (CDSCO)’ under the Drug Controller General of India (DCGI), the apex court directed the Health Secretary of India to be personally responsible for all ‘Clinical Trials (CT)’ of new drugs conducted in the country in order to control the ‘menace’ of poorly regulated trials on a war-footing.

Earlier in May 2012, the Parliamentary Committee on Health and Family Welfare in its report on the CDSCO, also stated as follows:

“There is sufficient evidence on record to conclude that there is collusive nexus between drug manufacturers, some functionaries of CDSCO and some medical experts.”

Inaction on CT related deaths:

According to the Ministry of Health, between 2005 and 2012, around 475 new drugs were approved for CT, out of which only 17 obtained the regulatory approval for market launch. Though 57,303 patients were enrolled for CT, only 39,022 could complete the trials. During CT, 11,972 patients suffered Serious Adverse Events (SAE) and 2,644 died. 506 SAEs out of the total and 80 deaths had clearly established link to CTs. However, only 40 out of 80 trial related deaths had their respective families meagerly compensated.

An independent investigation:

Interestingly, an investigation  in 2011 by ‘The Independent’, a newspaper of global repute, also highlighted the recruitment of hundreds of tribal girls for a drug study without any parental consent.

Stringent regulatory action followed:

Following high voltage indictments, alleging wide spread malpractices, from all corners – the Civil Society, the Supreme Court and the Parliament, the Ministry of Health constituted an experts committee last year chaired by Professor Ranjit Roy Chaudhury. The committee, after due consultation with all stakeholders, submitted its report recommending a robust process for CTs in India. Besides many other, the experts committee also recommended that:

  • CTs can only be conducted at accredited centers.
  • The principal investigator of the trial, as well as the Ethics Committee of the institute, must also be accredited.
  • If a trial volunteer developed medical complications during a CT ‘the sponsor investigator’ will be responsible for providing medical treatment and care.

Further, in October 2013, the Supreme Court reportedly ordered the government to video record clinical trials of new drugs, making it even tougher for pharma MNCs and the CROs to avoid responsibility on informed consent of the participating volunteers, as required by the regulator.

Consequent industry uproar and recent Government response:

Following all these, as the ball game for CTs in India changed significantly, there were uproars from Big Pharma, the CROs and their lobbyists crying foul.

As the caustic comments and the directive of the Supreme Court of India triggered the regulatory changes in CT, the Union Ministry of Health did not have much elbowroom to loosen the rope. Consequently, the pharma industry and the CROs reportedly made some angry comments such as:

“The situation is becoming more and more difficult in India. Several programs have been stalled and we have also moved the trials offshore, to ensure the work on the development does not stop.”

In response to shrill voices against the stringent drug trial regime in India, Mr Keshav Desiraju, Secretary, Union Ministry of Health and Family Welfare, reportedly said recently:

“While it is not our intention to impose unrealistic barriers on industry, it is equally our intention not to take risks, which may compromise the safety of the subjects of clinical trials.”

During the same occasion, the Union Health Minister Ghulam Nabi Azad also remarked:

“The industry has complained that the regulations are too stringent, but there have also been complaints by parliamentarians, NGOs and others that they are too lax, which the Supreme Court had taken note of.”

He further said without any elaboration, “The Indian regulatory regime governing clinical trials needs to balance the interests of all stakeholders.”

Conclusion:

According to the Indian Society for Clinical Research (ISCR), pharma companies conduct around 60 percent of CTs and the rest 40 percent are outsourced to Contract Research Organizations (CROs) in India.

With the Supreme Court laying stringent guidelines and the regulatory crackdown on CTs, the number of new drug trials in India has reportedly come down by 50 percent. According to Frost & Sullivan, the Indian CT industry was worth US$ 450 million in 2010 -11. Currently, it is growing at 12 percent a year and is estimated to exceed the US$1 billion mark in 2016, with perhaps some hiccups in between due to recent tightening of the loose knots in this area.

Some experts reportedly argue that laxity of regulations and cost arbitrage were the key drivers for global players to come to India for CTs. Thus, there should not be any surprise that with the costs of drug trials going north, in tandem with stringent regulations in the country, some business may shift out of the country. As Mr. Desiraju epitomized in his interview succinctly, as quoted above, this shift would result in much increased costs for the respective companies, which his ministry would ‘regret greatly.’

That said, would the recent anguish of the DCGI, when he expressed “Make global pharma also responsible in their respective homelands for objectionable conduct in CTs elsewhere”, be also construed as a clear signal for shaping up, sooner?

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

New Clinical Trial Regime Deserves Support, Sans Threats

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Recent Supreme Court intervention compelling the Union Government to enforce stringent regulations both for approval and conduct of Clinical Trials (CT) in India, has unfortunately met with some strong resistance with stronger words. Some of these voices are from credible experienced sources and the shriller ones are mostly from vested interests with dubious credentials. However, it is also a fact that this interim period of process change in CT has resulted in around 50 per cent drop in new drug trials in the country, pharma MNCs being most affected.

Brief background:

The earlier system of CT in India created a huge ruckus as many players, both global and local, reportedly indulged in widespread malpractices, abuse and misuse of the system. The issue was not just of GCP or other CT related standards, but mostly related to ethical mind-set or lack of it and rampant exploitation of uninformed patients/volunteers, especially related to trial-related injuries and death All these are being well covered by the Indian and international media since quite some time.

The Bulletin of the World Health Organization (WHO) in an article titled, “Clinical trials in India: ethical concerns” reported as follows:

“Drug companies are drawn to India for several reasons, including a technically competent workforce, patient availability, low costs and a friendly drug-control system. While good news for India’s economy, the booming clinical trial industry is raising concerns because of a lack of regulation of private trials and the uneven application of requirements for informed consent and proper ethics review.”

Earlier system did not work: 

Just to give a perspective, according to a report quoting the Drug Controller General of India (DCGI), 25 people died in clinical trials conducted by 9 pharma MNCs, in 2010. Unfortunately, families of just five of these victims received” compensation for trial related deaths, which ranged from an abysmal Rs 1.5 lakh (US$ 2,500) to Rs 3 lakh (US$ 5,000) to the families of the diseased.

This report also highlighted that arising out of this critical negligence, the then DCGI, for the first time ever, was compelled to summon the concerned nine pharma MNCs on June 6, 2011 to question them on this issue and give a clear directive to pay up the mandatory compensation for deaths related to CTs by June 20, 2011, or else all CTs of these nine MNCs, which were ongoing at that time or yet to start, will not be allowed.

The 9 pharma MNCs summoned by the DCGI to pay up the mandatory compensation for deaths related to CTs were reported in the media as Wyeth, Quintiles, Eli Lilly, Amgen, Bayer, Bristol-Myers Squibb (BMS), Sanofi, PPD and Pfizer.

The report also indicated that after this ultimatum, all the 9 MNCs had paid compensation to the concerned families of the patients, who died related to the CTs. However, the situation did not change much even thereafter.

Indictment of Indian Parliamentary Committee:

On May 8, 2012, the department related ‘Parliamentary Standing Committee (PSC)’ on Health and Family Welfare presented its 59th Report on the functioning of the Indian Drug Regulator – the Central Drugs Standard Control Organization (CDSCO) in both the houses of the Parliament.

The report made the following scathing remarks on Central Drugs Standard Control Organization (CDSCO) under its point 2.2:

“The Committee is of the firm opinion that most of the ills besetting the system of drugs regulation in India are mainly due to the skewed priorities and perceptions of CDSCO. For decades together it has been according primacy to the propagation and facilitation of the drugs industry, due to which, unfortunately, the interest of the biggest stakeholder i.e. the consumer has never been ensured.”

Catalytic change with tough norms:

The intervention of the apex court heralded the beginning of a catalytic changing process in the CT environment of India. The court intervention was in response to a Public Interest Litigation (PIL) filed by the NGO Swasthya Adhikar Manch calling for robust measures in the procedural guidelines for drug trials in the country.

In an affidavit to the Court, the Government admitted that between 2005 and 2012, 2,644 people died during CTs of 475 New Chemical Entities (NCEs)/New Molecular Entities (NMEs), with serious adverse events related deaths taking 80 lives.

Accordingly, changes have been/are being made mostly in accordance with the recommendations of Professor Ranjit Roy Chaudhury Experts Committee that was constituted specifically for this purpose by the Union Ministry of Health.

Prof. Ranjit Roy Chaudhury experts committee in its 99-page report has reportedly recommended some radical changes in the CT space of India. Among others, the report also includes:

  • Setting up of a Central Accreditation Council (CAC) to oversee the accreditation of institutes, clinical investigators and ethics committees for CTs in the country.
  • Only those trials, which will be conducted at centers meeting these requirements, be considered for approval by the DCGI.

All modifications in the procedural norms and guidelines for CTs are expected to protect not just the interest of the country in this area, but would also ensure due justice to the volunteers participating in those trials.

The DCGI has now also put in place some tough norms to make the concerned players liable for the death of, or injury to, any drug trial subject. These guidelines were not so specific and stringent in the past. There are enough instances that CT in India, until recently, had exploited poor volunteers enormously, many of which reportedly did not have any inkling that the efficacy and safety of the drugs that they were administering were still undergoing tests and that too on them.

With those radical changes to the rules of the Drugs and Cosmetics Act, 1940, pertaining to CT, it is now absolutely mandatory for the principal investigator of the pharmaceutical company, unlike in the past, to reveal the contract between the subject and the company to the DCGI. Besides, much reported process of videography of informed consent ensuring full knowledge of the participant has already been made mandatory. Further, any death during the process of CT would now necessarily have to be reported to the DCGI within 24 hours.

A report quoting the Union Minister of Health has highlighted that, “Earlier, the informed consent of the persons on which the trials had been conducted was often manipulated by the companies to the disadvantage of the subjects,”

Reaction to change:

With the Government of India tightening the norms of CT, the drug trial process and the rules are undergoing a metamorphosis with increased liability and costs to the pharma players and Contract Research Organizations (CROs). The reaction has been moderate to rather belligerent from some corners. One such player reportedly has publicly expressed annoyance by saying: “The situation is becoming more and more difficult in India. Several programs have been stalled and we have also moved the trials offshore, to ensure the work on the development does not stop.”

There were couple of similar comments or threats, whatever one may call these, in the past, but the moves of the Government continued to be in the right direction with the intervention of the Supreme Court.

No reverse gear:

Thus, coming under immense pressure from the Indian Parliament, the civil society and now the scrutiny of the Supreme Court for so many CT related deaths and consequential patients’ compensation issues, the Government does not seem to have any other options left now but to bring US$ 500 million CT segment of the country, which is expected to cross a turnover of US$ 1 Billion by 2016, under stringent regulations. Thus any move in the reverse gear under any threat, as mentioned above, appears unlikely now.

Experts believe that the growth of the CT segment in India is driven mainly by the MNCs for easy availability of a large treatment naive patient population with varying disease pattern and demographic profile at a very low cost, as compared to many other countries across the world.

Conclusion: 

While the importance of CTs to ensure better and more effective treatment for millions of patients in India is immense, it should not be allowed at the cost of patients’ safety, under any garb…not even under any open threat of shifting CTs outside India.

If the DCGI loosens the rope in this critical area and even inadvertently allows some pharmaceutical players keep exploiting the system just to keep the CT costs down only for commercial considerations, judiciary has no option but to effectively intervene in response to PILs, as happened in this particular case too.

The new system, besides ensuring patients’/volunteers’ safety, justice, fairplay and good discipline for all, will have the potential to help reaping a rich economic harvest through creation of a meaningful and vibrant CT industry in India in the long run, simultaneously benefitting millions of patients, as we move on. However, the DCGI should ensure to add reasonable speed to the entire CT approval process, diligently.

Taking all these into consideration, let all concerned support the new CT regime in India, sans any threats…veiled or otherwise.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.