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Healthcare reform process and policy measures to reduce socio-economic inequalities should be implemented in tandem for optimal economic progress of a nation.

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Important research studies indicate that health of an individual is as much an integral function of the related socio-economic factors as it is influenced by the person’s life style and genomic configurations.It has now been well established that socio-economic disparities including the educational status lead to huge disparity in the space of healthcare.Healthcare preventive measures with focus just on disease related factors like, hygiene, sanitation, alcohol abuse, un-protected sex, smoking will not be able to achieve the desired outcome, unless the underlying socio-economic issues like, poverty, hunger, education, justice, values, parental care are not properly addressed.

It has been observed that reduction of social inequalities ultimately helps to effectively resolve many important healthcare issues. Otherwise, the minority population with adequate access to knowledge, social and monetary power will always have necessary resources available to address their concern towards healthcare, appropriately.

Regular flow of newer and path breaking medicines to cure and effectively treat many diseases, have not been able to eliminate either trivial or dreaded diseases, alike. Otherwise, despite having effective curative therapy for malaria, typhoid, cholera, diarrhoea/dysentery and venereal diseases, why will people still suffer from such illnesses? Similarly, despite having adequate preventive therapy, like vaccines for diphtheria, tuberculosis, polio, hepatitis and measles, our children still suffer from such diseases. All these continue to happen mainly because of socio-economic considerations.

Following are some research studies, which I am using just as examples to vindicate the point:

• HIV/AIDs initially struck people across the socio-economic divide. However, people from higher socio-economic strata responded more positively to the disease awareness campaign and at the same time more effective and expensive drugs started becoming available to treat the disease, which everybody suffering from the ailment cannot afford. As a result, HIV/AIDS are now more prevalent within the lower socio-economic strata of the society.

• Not so long ago, people across the socio-economic status used to consume tobacco in many form. However, when tobacco smoking and chewing were medically established as causative factors for lung and oral cancers, those coming predominantly from higher/middle echelon of the society started giving up smoking and chewing of tobacco, as they accepted the medical rationale with their power of knowledge. Unfortunately the same has not happened with the people of relatively lower socio-economic status. As a consequence of which, ‘Bidi’ smoking, ‘Gutka’/tobacco chewing have not come down significantly within people belonging to such class, leading to more number of them falling victim of lung and oral cancer.

Thus, in future, to meet the unmet needs when more and more sophisticated and high cost disease treatment options will be available, it will be those people with higher socio-economic background who will be benefitted more with their education, knowledge, social and monetary power. This widening socio-economic inequality will consequently increase the disparity in the healthcare scenario of the country.

Phelan and Link in their research study on this issue has, therefore, remarked:

“Breakthroughs in medical science can do a lot to improve public health, but history has shown that, more often than not, information about and access to important new interventions are enjoyed primarily by people at the upper end of the socioeconomic ladder. As a result, the wealthy and powerful get healthier, and the gap widens between them and people who are poor and less powerful.”

Conclusion:

Though healthcare reform measures are essential for the progress of any nation, without time bound simultaneous efforts to reduce the socio-economic inequalities, it will not be easy for any nation to achieve the desirable outcome.

By Tapan 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.

Healthcare reform for the needy and poor in the richest and the most populous countries of the world. What about the largest democracy of our planet?

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Healthcare reform to ensure access to affordable high quality healthcare services for all, is considered as an integral part of the economic progress of any country. During recent global financial meltdown, this need became visible all over the world, even more.In my last article, I wrote how the most populous country of the earth – China, unfolded the blueprints of a new healthcare reform process in April, 2009, taking an important step towards this direction.Around the same time, in the richest country of the world, after taking over as the new President of the United States of America, President Barak Obama also reiterated his election campaign pledge for a comprehensive healthcare reform process in the USA.

These measures, in both the countries, intend to ensure access to affordable, high quality health care coverage and services to every citizen of the respective nations. In America, the reform process also intends to bridge the healthcare coverage gap in their Medicare prescription drugs program for the senior citizens.

The pharmaceutical industry response to healthcare reform in the USA:

Responding to this major policy initiative of the government, very responsibly David Brennan, Chief Executive Officer of AstraZeneca and the Chairman of Pharmaceuticals Research and Manufacturers of America (PhRMA) announced recently:

“PhRMA is committed to working with the Administration and Congress to help enact comprehensive health care reform this year. We share a common goal: every American should have access to affordable, high-quality health care coverage and services. As part of that reform, one thing that we have agreed to do is support legislation that will help seniors affected by the coverage gap in the Medicare prescription drug benefit.”

For this purpose Brennan publicly announced the following:

1. America’s pharmaceutical research and biotechnology companies have agreed to provide a 50 percent discount to most beneficiaries on brand-name medicines covered by a patient’s Part D plan of Medicare, when purchased in the coverage gap.

2. The entire negotiated price of the Part D covered medicine purchased in the coverage gap would count toward the beneficiary’s out-of-pocket costs, thus lowering their total out-of-pocket spending.

American Pharmaceutical Industry pledges U.S$ 80 billion towards healthcare reform of the nation:

With the above announced commitment, it has been reported that the US Pharmaceutical and Biotech companies have offered to spend U.S$ 80 billion to help the senior citizens of America to be able to afford medicines through a proposed overhaul of the healthcare system of the country.

This is a voluntary pledge by the American pharmaceutical industry to reduce what it charges the federal government over the next 10 years.

What is the Medicare plan of America?

According to the explanation of the program given by Medicare, it is a prescription drug benefit program. Under this program, senior citizens purchase medicines from the pharmacies. The first U.S$ 295 will have to be paid by them. Thereafter, the plan covers 75 percent of the purchases of medicines till the total reaches U.S$ 2,700. Then after paying all costs towards medicines ‘out of pocket’ till it reaches U.S $ 4,350, patients make a small co-payment for each drug until the end of the year.

American citizens’ support on the new healthcare reform of President Barak Obama:

A leading American daily reports that American citizens overwhelmingly support substantial changes to the country’s healthcare system and are strongly behind a government run insurance plan to compete with private insurers.

According to the latest New York Times/CBS News poll most Americans would be willing to pay higher taxes, so that every individual could have health insurance. Unlike in India, Americans feel that the government could do a better job of holding down healthcare costs than the private sector.

Current American healthcare: High quality – high cost

85 percent of respondents in this survey said the country’s healthcare system should be completely overhauled and rebuilt. The survey also highlighted that American citizens are far more unsatisfied with the cost of healthcare rather than its quality.

President Obama has been repeatedly emphasizing the need to reduce costs of healthcare and believes that the health care legislation is absolutely vital to American economic recovery. 86 percent of those polled in the survey opined that the rising costs of healthcare pose a serious economic threat.

An interesting recent study from the George Washington University School of Public Health and Health Services:

A recent study conducted by the George Washington University School of Public Health and Health Services reports that as a part of the new healthcare reform initiative in the US, if the health centers are expanded from the current 19 million to 20 million patients, the country can save U.S$ 212 billion from 2010 to 2019 against a cost of U.S$ 38.8 billion that the government would have incurred to build the centers. This is happening because of lower overall medical expenses for these patients.

Last year the health centers already generated health system savings of U.S$ 24 billion.

What then is happening in the largest democracy of the planet – our own India, towards such healthcare reform?

India in its 1983 National Healthcare Policy committed ‘healthcare to all by the year 2000′. However, the fact is, in 2009, only 35 percent of Indian population is having access to affordable modern medicines. So many commendable policy announcements have been made by the government thereafter. Due to poor governance, nothing seems to work effectively in our country.

Conclusion:

People with access to the corridors of power appear to believe that when the country will clock the magic number of GDP growth of 9 percent, India will have adequate resources to invest in healthcare. Till then frugal healthcare initiatives will continue at the abysmal level of speed of execution, denying access to affordable modern medicines to 65 percent of population of the country.

If and when the healthcare reform plans will be unfolded in India, hopefully like in the USA, all stakeholders will come forward with their own slice of contribution to ensure access to affordable high quality healthcare to all the citizens of our nation.

When the world believes that healthcare reform measures to cover the entire population of the country to provide access to affordable, high quality healthcare services is fundamental to economic progress of a country, the government of India seems to nurture a diametrically opposite view in this regard. The policy makers appear to sincerely believe that 9 percent economic growth is essentiall to provide access to affordable high quality healthcare to all.

Are we engaged in the well known “Catch 22” debate at the cost of health to all?

By Tapan 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.

China has recently unfolded the blueprints of its new healthcare reform measures, when will India do so?

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Early April, 2009, China, a country with 1.3 billion people, unfolded a plan for a new healthcare reform process for the next decade to provide safe, effective, convenient and affordable healthcare services to all its citizens. A budgetary allocation of U.S $124 billion has been made for the next three years towards this purpose.
China’s last healthcare reform was in 1997:

China in 1997 took its first reform measure to correct the earlier practice, when the medical services used to be considered just like any other commercial product, as it were. Very steep healthcare expenses made the medical services unaffordable and difficult to access to a vast majority of the Chinese population.

Out of pocket expenditure towards healthcare services also increased in China…but…:

The data from the Ministry of Health of China indicate that out of pocketl spending on healthcare services had doubled from 21.2 percent in 1980 to 45.2 percent in 2007. At the same time the government funding towards healthcare services came down from 36.2 percent in 1980 to 20.3 percent in the same period.

A series of healthcare reforms was effectively implemented since then like, new cooperative medical scheme for the farmers and medical insurance for urban employees, to address this situation.

The core principle of the new phase of healthcare reform in China:

The core principle of the new phase of reform is to provide basic health care as a “public service” to all its citizens. This is the pivotal core principle of the new wave healthcare reform process in China where more government funding and supervision will now play a critical role.

The new healthcare reform process in China will, therefore, ensure basic systems of public health, medical services, medical insurance and medicine supply to the entire population of China. Priority will be given for the development of grass-root level hospitals in smaller cities and rural China and the general population will be encouraged to use these facilities for better access to affordable healthcare services. However, public, non-profit hospitals will continue to be one of the important providers of medical services in the country.

Medical Insurance and access to affordable medicines:

Chinese government plans to set up diversified medical insurance systems. The coverage of the basic medical insurance is expected to exceed 90 percent of the population by 2011. At the same time the new healthcare reform measures will ensure better health care delivery systems of affordable essential medicines at all public hospitals.

Careful monitoring of the healthcare system by the Chinese Government:

Chinese government will monitor the effective management and supervision of the healthcare operations of not only the medical institutions, but also the planning of health services development, and the basic medical insurance system, with greater care.

It has been reported that though the public hospitals will receive more government funding and be allowed to charge higher fees for quality treatment, however, they will not be allowed to make profits through expensive medicines and treatment, which is a common practice in China at present.

Drug price regulation and supervision:

The new healthcare reform measures will include regulation of prices of medicines and medical services, together with strengthening of supervision of health insurance providers, pharmaceutical companies and retailers.

As the saying goes, ‘proof of the pudding is in its eating’, the success of the new healthcare reform measures in China will depend on how effectively these are implemented across the country.

Healthcare scenario in India:

Per capita public expenditure towards healthcare in India is much lower than China and well below other emerging countries like, Brazil, Russia, China, Korea, Turkey and Mexico.

Although spending on healthcare by the government gradually increased in the 80’s, overall spending as a percentage of GDP has remained quite the same or marginally decreased over last several years. However, during this period private sector healthcare spend was about 1.5 times of that of the government.

It appears, the government of India is gradually changing its role from the ‘healthcare provider’ to the ‘healthcare enabler’.

High ‘out of pocket’ expenditure towards healthcare in India:

According to a study conducted by the World Bank, per capita healthcare spending in India is around Rs. 32,000 per year and as follows:

- 75 per cent by private household (out of pocket) expenditure
- 15.2 per cent by the state governments
- 5.2 per cent by the central government
- 3.3 percent medical insurance
- 1.3 percent local government and foreign donation

Out of this expenditure, besides small proportion of non-service costs, 58.7 percent is spent towards primary healthcare and 38.8% on secondary and tertiary inpatient care.

Role of the government:

Unlike, recent focus on the specific key areas of healthcare in China, in India the national health policy falls short of specific and well defined measures.

Health being a state subject in India, poor coordination between the centre and the state governments and failure to align healthcare services with broader socio-economic developmental measures, throw a great challenge in bringing adequate reform measures in this critical area of the country.

Healthcare reform measures in India are governed by the five-year plans of the country. Although the National Health Policy, 1983 promised healthcare services to all by the year 2000, it fell far short of its promise.

Underutilization of funds:

It is indeed unfortunate that at the end of most of the financial years, almost as a routine, the government authorities surrender their unutilized or underutilized budgetary allocation towards healthcare. This stems mainly from inequitable budgetary allocation to the states and lack of good governance at the public sector healthcare delivery systems.

Health insurance in India:

As I indicated above, due to unusually high (75 per cent) ‘out of pocket expenses’ towards healthcare services in India, a large majority of its population do not have access to such quality, high cost private healthcare services, when public healthcare machineries fail to deliver.

In this situation an appropriate healthcare financing model, if carefully worked out under ‘public – private partnership initiatives’, is expected to address these pressing healthcare access and affordability issues effectively, especially when it comes to the private high cost and high quality healthcare providers.

Although the opportunity is very significant, due to absence of any robust model of health insurance, just above 3 percent of the Indian population is covered by the organised health insurance in India. Effective penetration of innovative health insurance scheme, looking at the needs of all strata of Indian society will be able to address the critical healthcare financing issue of the country. However, such schemes should be able to address both domestic and hospitalization costs of ailments, broadly in line with the health insurance model working in the USA.

The Government of India at the same time will require bringing in some financial reform measures for the health insurance sector to enable the health insurance companies to increase penetration of affordable health insurance schemes across the length and the breadth of the country.

Conclusion:

It is an irony that on one side of the spectrum we see a healthcare revolution affecting over 33 percent population of the world. However, just on the other side of it where around 2.4 billion people (about 37 percent of the world population) reside in two most populous countries of the world – India and china, get incredibly lesser public healthcare support and are per forced to go for, more frequently, ‘pay from pocket’ pocket type expensive private healthcare options, which many cannot afford or just have no access to.

In both the countries, expensive ‘pay from pocket’ healthcare service facilities are increasing at a greater pace, whereas public healthcare services are not only inadequately funded, but are not properly managed either. Implementation level of various excellent though much hyped government sponsored healthcare schemes is indeed very poor.

Moreover, despite various similarities, there is a sharp difference between India and China at least in one area of the healthcare delivery system. The Chinese Government at least guarantees a basic level of publicly funded and managed healthcare services to all its citizens. Unfortunately, the situation is not the same in India, because of various reasons.

Over a period of time, along with significant growth in the respective economies of both the countries, with China being slightly ahead of India for many reasons, life expectancy in both India and China has also increased significantly, which consequently has lead to increase in the elderly population of these countries. The disease pattern also has undergone a shift in both the countries, mainly because of this reason, from infectious to non-infectious chronic illnesses like, hypertension, diabetes, arthritis etc. further increasing the overall burden of disease.

High economic growth in both the countries has also lead to inequitable distribution of wealth, making many poor even poorer and the rich richer, further complicating the basic healthcare issues involving a vast majority of poor population of India.

A recently published report indicates that increasing healthcare expenditure burden is hitting the poor population of both the countries very hard. The report further says that considering ‘below the poverty line’ (BPL) at U.S$ 1.08 per day, out of pocket healthcare expenditure has increased the poverty rate from 31.1 percent to 34.8 percent in India and from 13.7 percent to 16.7 percent in China.

To effectively address this serious situation, the Chinese Government has announced its blueprint for a new healthcare reform measures for the coming decade. How will the Government of India respond to this situation? It will indeed be interesting to watch.

By Tapan 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.

Increasing socio-economic inequality within the healthcare delivery systems of India

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Increasing inequality between the wide diversity of population of ‘haves’ and ‘have-nots’ in the socio-economic and cultural set up of India, clearly gets reflected in the healthcare delivery system of the country. Many research studies on this subject have established a clear relationship between healthcare services and socio-economic inequality. Several lakh of Indians still perish in the country because of this reason.
Economic growth needs to be inclusive – better said than done:
Initiation of financial reform measures since 1990 and the process of globalization during this period have spurred the economic growth of the country, the rate of which comes just next to China in the global scale of comparison for the same. However, many people strongly believe that this reform process has not been as inclusive as it should have been. Otherwise why will the country continue to witness worrisome instances of abject poverty within a large section of the society with an abnormally high rate of mortality?

Healthcare sector in India – huge socio-economic inequality:

According to the Investment Commission of India, the healthcare sector of the country has experienced rapid growth of around 12% since last 4 years and is expected to be of U.S. $ 280 billion industry by 2022.

However, due to socio-economic inequality, this growth has not been evenly distributed. As a result, 65% of the population of India still do not have access to modern medicines and a vast majority of the population experience poor healthcare facilities. Around 10 lakh women and children die in India either due to poor access to healthcare services or they cannot afford the healthcare expenses.

Centers of excellence – but not for all:

In the healthcare sector, despite having many centers of excellence of global standards, which are also attracting ‘medical tourists‘ from across the world, healthcare needs of a large number of population of the country are not being addressed adequately. About 700 million of population have no access to specialists’ care even today. The Government of India alone will not be able to address this problem of gigantic proportion without workable and time-bound Public Private Partnership (PPP) initiatives with an investment of over U.S $ 20 billion at least for next five years. For example, in terms of availability of hospital beds per 1000 population, India stands at 0.7 against 3.96 of world average.

“Fortune at the bottom of the pyramid” – anybody follows in India?

Professor C. K. Prahalad’s famous dictum, “Fortune at the bottom of the pyramid” has not been realised yet by many within the global healthcare industry, perhaps with the solitary exception of Andrew Witty, the young CEO of GlaxoSmithKline.

As per data available from the Government publications, the bottom of the pyramid where a large proportion of the Indian population is located, reflects a huge socio-economic inequality even in the healthcare sector as follows:

• Overall spending on healthcare in India is around 6% of GDP (Public and Private sectors put together). However the public expenditure is only 0.9% of the total spending.

• In rural areas per capita expenditure on healthcare is seven times lower than urban areas.

• In rural areas the ratio of hospital beds to population is fifteen times lower than the urban areas.

• In rural areas the ratio of doctors to population is almost six times lower than the urban areas.

• The rate of Infant Mortality in the 20% of the poorest population is 2.5 times higher than the richest 20% of the population in rural areas.

• Despite more health issues an individual from the poorest quintile of the population is six times less likely to access hospitalization than a person from the richest quintile in rural areas.

• From the poorest quintile of the population, the child delivery of a mother is over six times less likely to be attended by a medically trained person than during child delivery of a mother from the richest quintile of the population in rural areas.

• On an average 78% healthcare expenditure in India comes as ‘out of pocket payments’ by the people, whereas only 18% of the same is borne by the state followed by 4% by medical insurance.

• Towards public healthcare spending, only five other countries in the world (Pakistan, Burundi, Myanmar, Cambodia and Sudan) are worse off than India.

• Only 38% of all Public Health Centres (PHCs) have essential manpower and only 31% have the essential supplies with only 3% of PHCs having 80% of all critical inputs.

As a result of inadequate and unequal spending on the healthcare infrastructure, healthcare systems, healthcare financing and healthcare delivery, both by the public and private sectors in the rural areas, such inequalities towards access and affordability of the healthcare services,especially in rural India where over 70% of the country’s population reside, have now assumed an alarming proportion .

Access to healthcare is fundamental in many countries of the world:

Most of the developed countries of the world extend comprehensive healthcare access to its citizens. Even our close neighbour Thailand and Fidel Castro’s land, Cuba along with many other developing countries of the world extend basic healthcare facilities to all their citizens.

Urban poor also face the harsh reality of healthcare affordability issue:

Survey results indicate the following facts so far as urban poor are concerned:

• Healthcare facilities though skewed towards urban India, the healthcare cost, lack of culturally appropriate services; social prejudices etc prevent access to healthcare even to the urban poor.

• Infant and under-five mortality rates in the urban slums for the poorest 40% are as high as is prevalent in the rural areas.

• Because of mainly poverty, poor hygienic and almost non-existent sanitation conditions, urban slums have now become the breeding ground for diseases like cholera, malaria, hepatitis, tuberculosis, HIV – AIDS and a large variety of infectious disease.

All these conditions coupled with almost total lack of health education in slums further aggravate the healthcare situation.

Has the National Health Policy delivered?

It is widely believed that Infant and Maternal Mortality rates of a country are the most important indicators of the health of any society. For the year 2000 The National Health Policy of India had set a target to bring down the Maternal Mortality Rate to below 200 per 1 lakh live births. However, even today around 407 mothers die every year due to pregnancy related complications. So far as infant mortality is concerned the figure remain as high as 22 lakh every year.

A very sad state of public healthcare delivery system gets reflected through these very basic numbers, despite various government initiatives and mushrooming private and corporate investments towards healthcare. The privileged class of the society, as a result, is getting better and better private healthcare services and the under-privileged class is denied of, in many cases, even the very basic healthcare facilities. All these bring out to the open the social and economic inequality in our civil society even for the very basic healthcare needs of its citizens.

Growth of Private Healthcare initiatives is welcome, but are they maintaining an urban-rural balance?

Urban centric private healthcare sector in India is growing at a faster pace. However, overwhelming dominance of this sector in absence of robust PPPs will further increase the urban bias with focus on higher profit margin being more important than offering primary and secondary healthcare services to a large number of the deprived population with lesser profit margin. Following published facts may help understand the prevailing situation:

• The increasing cost of healthcare paid predominantly through ‘out of pocket’ is making healthcare unaffordable to a large number of the population.

• The number of people who are unable to seek healthcare services due to affordability issue is growing, despite rapid economic growth of the country.

• The number of people who cannot afford to basic healthcare services has doubled compared to just a decade ago.

• One in three people who need hospitalization and paying ‘out of pocket’ are forced to borrow money or sell assets to cover healthcare expenses.

• Because of ‘out of pocket’ spending on healthcare, over 20 million Indians are pushed below the poverty line every year.

• A World Bank report acknowledges the facts that doctors recommend unnecessary investigations and over-prescribe drugs in private healthcare sector.

• The same report acknowledges the relationship between the quality and cost of healthcare services in the private healthcare system with high priced services being excellent but unaffordable to many.

Conclusion:

All these facts will further establish the prevalent socio-economic inequality within the healthcare delivery systems of India. Rapidly growing urban centric private healthcare initiatives are welcome but these are now just catering to the privileged few, keeping the pressing healthcare issues of India unanswered. Only well planned time-bound PPP initiatives, in my view, are capable to address the humongous healthcare issues of India.

By Tapan 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.

The Government of India accepts the Mashelkar Committee Report on ‘Incremental Innovation’ – what does it really mean?

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‘The Mashelkar Committee’ re-submitted its report in March 2009, which primarily deals with incremental innovation related to Pharmaceuticals Research.The conclusion of the report on the incremental innovation reads as follows:“It would not be TRIPS compliant to limit granting of patents for pharmaceutical substance to New Chemical Entities only, since it prima facie amounts to a ‘statutory exclusion of a field of technology”.

Government accepts the Mashelkar committee Report:

It has now been reported that the Government has accepted this revised report, last week. With this the questions raised in the raging debate, whether incremental innovation is TRIPS compliant or not have possibly been answered well, beyond any further doubt.

The acceptance of this report by the Government further vindicates the point that all patentable innovations are not “eureka type” or “path breaking”. Innovation is rather a continuous process and more so in pharmaceuticals. Such type of innovation in the pharmaceutical industry is quite similar to what one observes in the IT industry, where incremental innovation based on existing knowledge is more a norm than an exception. With incremental innovation not just efficacy of a product, but many other important unmet needs of the patients like safety, convenience and ease of administration of the drugs can be successfully met.

Thus innovations whether “path breaking” or “incremental” in nature, need to be encouraged and will deserve patent protection, if they are novel, have followed inventive steps and are industrially applicable or useful.

R&D based Indian Pharmaceutical industry gains considerably:

Many Indian Pharmaceutical Companies have already started working on the ‘incremental innovation’ model. Appropriate amendment of section 3(d) of the Indian Patents Act 2005 will thus help all concerned – the patients, the industry and other stakeholders, as long as the prices of such medicines do not become unaffordable to majority of the population for various reasons. In any case, the Government has the law available within the patents Act to deal with any such situation, if arises at all.

Does section 3(d) warrant an amendment now?

Mashelkar committee categorically observes the following:

1. “It would not be TRIPS compliant to limit granting of patents for pharmaceutical substance to New Chemical Entities only, since it prima facie amounts to a statutory exclusion of a field of technology”, as stated above.

2. “Innovative incremental improvements based on existing knowledge and existing products is a ‘norm’ rather than an ‘exception’ in the process of innovation. Entirely new chemical structures with new mechanisms of action are a rarity. Therefore, ‘incremental innovations’ involving new forms, analogs, etc. but which have significantly better safety and efficacy standards, need to be encouraged.”

Thus, taking these recommendations together will the DIPP now finally conclude that Section 3(d) of the Patent Acts 2005 is not TRIPS compliant and recommend necessary amendments, accordingly to satisfy the needs of the Research based pharmaceutical industry?

Wait a minute – wait a minute:

The report also suggests:

1. “The Technical Experts Group (TEG) was not mandated to examine the TRIPS compatibility of Section 3(d ) of the Indian Patents Act or any other existing provision in the same Act. Therefore, the committee has not engaged itself with these issues.”

Will this comment make the Government conclude that Section 3(d) is TRIPS compliant, which includes ‘incremental innovation’ in general, however, with the rider of ‘properties related to significant improvement in efficacy’?

2. “Every effort must be made to provide drugs at affordable prices to the people of India”.

What will these efforts mean and how will these be implemented by the Government?

3. The TEG also recommends, “every effort must be made to prevent the practice of ‘ever greening’ often used by some of the pharma companies to unreasonably extend the life of the patent by making claims based sometimes on ‘trivial’ changes to the original patented product. The Indian patent office has the full authority under law and practice to determine what is patentable and what would constitute only a trivial change with no significant additional improvements or inventive steps involving benefits. Such authority should be used to prevent ‘evergreening’, rather than to introduce an arguable concept in the light of the foregoing discussion (paras 5.6 – 5.8 and paras 5.12 – 5.29) above of ‘statutory exclusion’ of incremental innovations from the scope of patentability.”

Will the Government (mis)interpret it as a vindication of Section 3(d), which does does not mean “statutory exclusion of incremental innovations from the scope of patentability” but has just made necessary provision within this section “to prevent the practice of ‘ever greening’ often used by some of the pharma companies to unreasonably extend the life of the patent by making claims based sometimes on ‘trivial’ changes to the original patented product”, as recommended by the Mashelkar Committee?

Conclusion:

In the re-submitted report of the Mashelkar committee, the TEG has made quite a few very profound comments, recommendations and suggestions, the implications of all of which are important to all the stakeholders in various different ways. Will the acceptance of this report, as a whole, by the Government and subsequent attempt by the authorities for its implementation both in the letter and spirit, will amount to “chasing a rainbow”, as it were?

Only time will us, how this “satisfy all” zig-saw-puzzle gets solved in future.

By Tapan 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.

‘Swine Flu’ – why create so much of scare to disturb public life?

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Why has so much of scare been created on ‘Swine Flu’ in India? Who are responsible for creating and spreading such panic?Any attempted answers to these question perhaps will remain baffling to many of us when we read that out of the total population of India, 1159 cases of ‘Swine Flu’ have been reported with 17 cases of death, as on August 12, 2009.Deaths due to other communicable diseases, including seasonal Flu, are far more than ‘Swine Flu’:

While looking at the above simple statistics, I wonder why we all fail to create a fraction of such awareness campaign for other almost equally infectious diseases in India, like malaria, tuberculosis, measles, and diarrhoea.

It is important to note, WHO reports that the seasonal influenza causes about 250,000 deaths per year. Deaths due to some other communicable diseases are also very significant and are as follows:

1. Tuberculosis: 365,000

2. Measles, Diphtheria: 287,000

A mad rush for H1N1 screening and test:

Due to such scare and panic, only in Mumbai 3,768 persons showed up for H1N1 screening in various Government hospitals just in one day on August 11, 2009 between 9 am and 5 pm. After screening all these people, only 448 individuals were identified for H1N1 test and only 14 of them were quarantined.

Awareness and preventive guidelines are necessary – without creating a mass hysteria:

Adequate awareness and preventive guidelines are absolutely necessary for any such disease without creating panic. Has H1N1 infection been used as a competitive tool, just as politicians very often do, to achieve relative competitive prowess by some? Highlighting each death due to H1N1 infection as administrative inefficiency and by creating a public scare in that process, no meaningful public health purpose can possibly be served, excepting perhaps attracting the eyeballs.

‘Swine Flu’ – reported to be a very low fatality disease:

2009 ‘Swine Flu’ pandemic is indeed a global outbreak of a new type of virus identified in April 2009 as H1N1. This strain of Flu virus is believed to be a mutation of four types of Flu viruses, one is usually endemic in human, the second one is endemic in birds and the other two are endemic in pigs or swine. This virus like many other infectious diseases, is usually transmitted from human to human.

The incidence worldwide:

Worldwide, out of over 1,62,380 H1N1 positive cases in 168 countries, 1,154 deaths have taken place as of August 4, 2009. Against this number 250,000 deaths per year take place due to seasonal influenza, as stated above . This vindicates that the fatality rate of this disease is indeed quite low, as of now. This percentage may even be lower, if those deaths are excluded, which were due to other conditions and complications not directly related to H1N1 infection.

All countries by and large, are affected by the ‘Swine Flu’ pandemic. WHO’s America’s region, where the outbreak was first detected, reports highest number of deaths with 1,008, followed by 65 deaths by its South-East Asia region, 41 deaths in Europe and 39 in Western Pacific region.

‘Swine Flu’ – reported to be a self limiting disease:

It has been reported that ‘Swine Flu’ is mostly a self-limiting disease. Clinical studies have confirmed that drugs like ‘Tamiflu’ reduce the duration of illness by a couple of days. The symptoms of the disease are moderate. Complete recovery from the disease has also been reported to be common with no future complications.

Panic related to H1N1 is unnecessary and avoidable:

Unfortunately ‘over-awareness’ and over communication of ‘possible fatality’ of the disease have lead to an unnecessary panic in India, especially, around the disease affected regions. Due to such panic people are running around with any slight ‘flu-like’ symptoms, crowding the H1N1 test centres and hospitals where the chances of getting infection by a non-infected person from others infected with H1N1 virus will be many times more.

Strain on scarce medical resources:

This mad rush, on the other hand, is putting unnecessary strain on the scarce medical resources of those towns and cities where the incidence of H1N1 infection is relatively more . Schools, shopping malls are being closed down and many important programs are being postponed. Migration of people from infected to non-infected places is further jeopardising the situation.

Conclusion:

Both tangible and intangible losses created out of ‘Swine Flu’ scare are bound to be quite significant. Who will take the responsibility of creating this nightmare?

We have our usual ‘punching bag’, the Government of course, to keep on bashing for any such issues totally forgetting our own responsibilities, individually or collectively. There is a silver lining though. A sense of responsibility, at last, appears to be slowly dawning on to those who really matter. Those who had ignited this fire of fear are now trying to douse it by themselves and in the best way as they possibly can. Obviously after much damage has been done. I take it as ‘better late than never’. But the moot question will still haunt many. Have we learnt anything out of this artificial crisis created through a real panic of H1N1 infection? Was it necessary? Has it served any meaningful purpose to the common man in general?

By Tapan 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.

Increasing penetration of Health Insurance: an important way to improve affordability and access to healthcare

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While India is making rapid strides in its economic growth, the country is increasingly facing constraints in providing healthcare benefits to a vast majority of its population. This is mainly because of the following reasons:1. Inadequate healthcare infrastructure and delivery system2. Lack of proper healthcare financing/insurance system for all strata of society

3. Difficulty in managing costs of healthcare even when the country is producing drugs for the world market

In this article I shall touch upon only on the healthcare financing/insurance part of the problem.

Sporadic initiatives:

We find some sporadic initiatives for population below the poverty line (BPL) with Rashtriya Swasthya Bima Yojana (RSBY) and other health insurance schemes through micro health insurance units, especially in rural India. It has been reported that currently around 40 such schemes are active in the country. Most of the existing micro health insurance units run their own independent insurance schemes.

Some initiatives by the State Governments:

Following initiatives are being taken by the state governments:

1. The Government of Andhra Pradesh is planning to offer health insurance cover under ‘Arogya Sri Health Insurance Scheme’ to 18 million families who are below the poverty line (BPL).

2. The Government of Karnataka has partnered with the private sector to provide low cost health insurance coverage to the farmers who previously had no access to insurance under “Yeshaswini Insurance scheme”. This scheme covers insurance cover towards major surgery, including pre-existing conditions.

3. Some other state governments have also started offering public health insurance facilities to the rural poor. In fact, some private health insurers like Reliance General Insurance and ICICI Lombard General Insurance were reported to have won some projects on health insurance from various state governments.

Cost of healthcare is rising but the penetration of health insurance is still very poor:

All over India costs of all types of healthcare be it primary, secondary or tertiary, are going beyond the reach of common man. Even in rural India penetration of such schemes is almost as poor as the organized health insurance schemes available in urban India. In a situation like this one will need to ponder why the penetration of health insurance and micro health insurance is so low in our country covering just around 35 to 40 million of the population.

Government spend on health is too low:

Even today the Government spends just 1.2% of GDP on health. When both public and private sectors expenditures are put together this number works out to not more than 5%.

It has been reported that in 2005-06 the total private expenditure towards healthcare was around Rs 1, 35,000 crore. This number is expected to grow at a 5-year CAGR of around 16%.

High ‘out of pocket’ expenditure towards healthcare:

Currently around 78% of healthcare expenditure is ‘out of pocket’ and without any health insurance cover. A recent survey of the National Survey Organization has reported that around 40% of the people who get admitted to hospitals for treatment go through extreme financial hardship and many a times are compelled to abandon the treatment or need to sell of their property to meet such unavoidable expenditure towards health.

Disease pattern undergoing a shift increasing healthcare expenditure:

As the disease pattern is undergoing a shift from acute to non-infectious chronic illness, the cost of treatment is becoming even more. In a situation like this there is an urgent need to have a robust healthcare financing system within the country.

Covering domiciliary treatment through health insurance is important:

Currently heath insurance schemes only cover expenses towards hospitalization. However, medical insurance schemes should also cover domiciliary treatment costs and loss of income along with hospitalization costs.

Government policy reforms towards health insurance are essential:

Currently Indian health insurance segment is growing at 50% and according to PHD Chamber of Commerce and Industry the segment is estimated to grow to US$ 5.75 billion by 2010. Even this number appears to be much less than adequate for a country like India.

It is high time that the Government creates a conducive environment for increased penetration of health insurance within the country through some innovative policy measures. One such measure could be to make it mandatory for all employers, who are required to provide provident fund facilities to their employees to also offer health insurance facilities to all of them.

It is a pity that the concept of health insurance has not taken off in our country, as yet, though has immense growth potential in the years to come. Innovative policy measures of the government towards this direction along with increasing the cap on Foreign Direct Investment (FDI) for health insurance will encourage many competent and successful global players to enter into this market. With the entry of efficient successful global players in health insurance segment, one can expect to see many innovative insurance products to satisfy the need of a large number of Indian population in the healthcare space. Such measures will also help increasing their retail distribution network with a wide geographic reach, significantly improving the affordability and access to healthcare of a large number of population of the country.

By Tapan 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.

Patent Linkage: an important step yet to be taken by the Government of India for proper enforcement of product patents granted in the country

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The process of Patent Linkage establishes a desirable communication process between the Health Ministry and the Patent Offices to prevent marketing approval of generic drugs before expiration of patents granted in India. It also ensures that one Government Department / Ministry does not impair the efforts of another Government Department / Ministry to provide effective intellectual property protection as required by Article 28 of the WTO TRIPS Agreement.
The system of Patent Linkage exists around the world:Following are some examples:

Australia – Health Authorities do not provide marketing approval for a generic copy which would infringe an existing patent.

Brazil – As of 2006, no copies of products still under patent have been launched in the market place. However, the Brazilian Health Agency (ANVISA), grants registration to copy products, based only on the merits of the case from the regulatory point of view, whether or not a patent has been granted for the same.

Canada – Health Regulatory Authorities do not provide marketing approval for pharmaceutical products protected by patents listed in the equivalent of the US FDA Orange Book.

China – The State Food & Drugs Administration (SFDA) must be satisfied that no patent is being infringed before it will issue marketing approval. If there has been litigation over a patent, SFDA will wait until the appeals process has been exhausted before acting.

Jordan – Marketing approval for a pharmaceutical product is not permitted during the period of patent protection.

Mexico – Applicants seeking marketing approval for generic pharmaceutical products in Mexico must certify that their patent rights are not infringed. The Health Regulatory Authorities then check with the Patent Office, which must respond within ten days to confirm whether a patent is involved. While Health Authorities will accept an application of marketing approval during the patent period, grant of marketing approval will be delayed until the patent expires.

Singapore – Applicants seeking marketing approval for generic pharmaceutical products in Singapore must declare that the application does not infringe any patent.

U.A.E – The Health Regulatory Authorities do not provide marketing approval for pharmaceutical products that remain under patent protection in the country.

U.S.A – U.S. FDA maintains a listing of pharmaceutical products known as the Orange Book. The Electronic Orange Book is also available via the internet at: http://ww.fda.gov/cder/ob The U.S. FDA does not authorize the marketing approval for a generic copy of a pharmaceutical product protected by a patent listed in the Orange Book.

Europe – Instead of Patent Linkage, the period of data exclusivity is for 10/11 years.

The Patent Linkage System is in progress in countries like Bahrain, Chile, Dominican Republic – Central America FTA (DR-CAFTA), Morocco and Oman.

Some people question why should India follow Patent Linkage system in the regulatory approval process?

In India ground realities in the patent enforcement process are quite unique. Thus there is an urgent need for having a Patent Linkage system in place for the following reasons:

1. The Government is granting product patent to encourage, protect and reward innovation in India, it will not be in the best interest of the innovators if the same Government grants marketing approval for a generic equivalent of the patented molecule during the patent life of the product.

2. Unlike many other countries, the Indian Patent Law has provision for both pre-grant and post-grant oppositions. Therefore, if anyone wants to challenge the patent, enough time will be available for the same.

3. After patent is granted for a product in India, if marketing approval is given to a generic equivalent of the same molecule, a dispute or patent infringement may arise. As per the Patents Act 2005, such disputes regarding patent infringement have to be challenged in a High Court. The judicial process is a long drawn one and it is quite possible that the patent life of the concerned molecule would expire during the dispute settlement period, which in turn, would raise doubts about the sanctity of granting a product patent to an innovator in our country.

Conclusions:

I therefore submit the following recommendations to ensure proper enforcement of products patent in India:

 The status of the grant of patent should be reviewed, through appropriate drug regulatory mechanism, before granting marketing permission to generic formulations and if the concerned innovative product is already patented in India, marketing permission for the generic formulation should be withheld.

 Appropriate mechanism/system should soon be worked out in co-ordination with other Ministries to avoid cases of infringement of product patents in India.

 The procedure (Patent Linkage) of checking the patent status of a product before granting marketing approval already exists in the Form 44. This procedure needs to be implemented.

India has instances where marketing permission has been granted by the DCGI for a generic product even when a product patent already exists for the same molecule in India. Such instances put the patent holder in a hardship and avoidable litigation involving huge resources both in terms of time and money. Situation like this can be effectively avoided by ascertaining the patent status before granting marketing permission to a generic manufacturer through an appropriate drug regulatory system, as indicated above.

By Tapan 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.