President Barack Obama
The White House Washington, DC
20 January 2015
Dear President Obama,
We write as American organizations in advance of your trip to India this month to ask you to support India’s central role in providing high-quality, low-cost generic medicines—which are essential for health care around the world. Recent U.S. policy stances have sought to topple parts of India’s intellectual property regime that protect public health in order to advance the interests of multinational pharmaceutical corporations in longer, stronger, and broader exclusive patent and related monopoly rights. India’s laws fully comply with the WTO TRIPS Agreement. Millions around the world depend on affordable generic medicines that would disappear if India acceded to these proposals, including many beneficiaries of US-funded programs. Instead of using your trip to promote the narrow interests of one segment of the pharmaceutical industry, we ask you to support the interests of people who need affordable medicines, whether they live in the U.S., in India, in Africa or elsewhere. Our world is safer and healthier because of India’s pro-health stance and we ask you to say so publicly while you are there.
Today Indian pharmaceutical companies produce 90% of the generic HIV/AIDS drugs used around the world—including the vast majority of the medicines procured by the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR). By reducing the price of treatment by over 96%, generic competition made it possible for you to commit to ending AIDS. Similarly, people facing heart disease, cancer, hepatitis C, and other life-threatening illness around the world, but especially in developing countries, would not be able to afford their medicines were it not for Indian generic companies.
When you were running for office you recognized this, and promised to “support the rights of sovereign nations to access quality-assured, low-cost generic medication to meet their pressing public health needs” and to “break the stranglehold” that a few big drug companies have over these medicines. Today these companies are taking aim against “Section 3(d)” of India’s patent law. Adopted after India joined the WTO, this TRIPS-compliant rule ensures that only truly new inventions are patented— avoiding the issuance of low-quality patents and “evergreening” that expands monopolies and undermines people’s access to medicines. In addition, we know industry is pushing you to pressure India to go beyond its WTO obligations to adopt “data exclusivity,” rules which make clinical trial data submitted to public regulators into another right, creating a monopoly barrier to generic registration and competition even where there is no patent. Dropping Section 3(d) and adopting data exclusivity would reward some of the world’s most profitable companies, not for innovation but simply for having effective lawyers and lobbyists. And it would damage the health of millions.
Finally, we are deeply concerned about proposals for a bilateral investment treaty with India. The current U.S. model bilateral investment treaty contains provisions that would empower disgruntled pharmaceutical corporations to bypass domestic courts and directly seek binding arbitration before international extrajudicial tribunals authorized to order taxpayer compensation for future profits if their expectations are frustrated by government policies or decisions.
As President we ask you to stand for more than the interests of a single U.S. industry as you represent our nation in India. From Detroit to New Delhi, health is increasingly interconnected. Our world is safer when it is healthier, and it is healthier because India’s laws appropriately balance health and IP. Will you stand with us for public health and the interests of consumers? We hope you will.
Health GAP (Global Access Project)
amFAR (American Foundation for AIDS Research)
Missionary Oblate of Mary Immaculate
TAG (Treatment Action Group)
AIDS Policy Project
VOCAL-NY (Voices Of Community Activists & Leaders)
GNP+ (Global Network of People living with HIV)
ACRIA (AIDS Community Research Initiative of America)
WIM/CRI (Wisconsin-Iowa-Minnesota Coalition for Responsible Investment)
Capuchin Franciscans, Province of St. Mary
by Brook K. Baker
President's State of the Union address call for trade promotion authority is a call to strengthen pharmaceutical monopolies
In his State of the Union Address on January 20, President Obama stated that he was asking both parties for trade promotion authority, otherwise known as "fast-track." This authority would limit Congressional review of trade agreements, such as those being negotiated with the Pacific Rim countries and Europe, instead allowing only limited Congressional debate and an up-or-down vote on their passage. President Obama said that the US was being squeezed by China, that new trade deals from Asia to Europe would protect American workers, and that the problem with past trade deals is that partners broke the rules at our expense. President Obama is wrong on all counts, but even more dangerously, trade promotion authority would allow fast-track approval of intellectual property (IP) and market access rules that would solidify, expand, and lengthen pharmaceutical monopolies hurting access to medicines domestically and abroad.
Economic evidence from past trade deals indicates that they have resulted in outsourcing of manufacturing jobs to cheap labor havens, where multinationals pay less to workers and pollute the environment more while reaping higher and higher profits that primarily benefit the world’s wealthiest. China was one of the beneficiaries of those policies. Country partners have not broken the rules. Rather, the corporations that benefit from global deregulation and expansion of IP monopolies have simply taken advantage of these agreements to ensure that workers—both in the U.S. and abroad—race to bottom while the richest of the rich clip coupons and rake in barely taxed capital gains. The legacy of past fast-tracked trade deals has been growing inequality with corporate elites multiplying their wealth, while workers lose ground.
These corporations aren't happy with any regulations that put the brake on their relentless search for trading profits. Similarly, IP-based industries, especially Big Pharma, are intent on expanding their patent rights and data monopolies. Pharma- inspired IP demands include patent term extensions, data monopolies, eased rules on getting patents, and elimination of price control measures and other regulatory barriers to high prices. Worse yet, when their expectations of bloated profits are thwarted by lawful regulations or decisions, corporations want the right to bypass the courts and to require biased and unreviewable arbitration directly against countries, like the $500 million NAFTA claim by Eli Lilly against Canada.
People in the US tend to think that IP-expanding trade rules mainly impact people in other countries, but increased IP monopolies will impact patients and payers here as well. Every time a rule in a US trade agreement ties the hands of a foreign government it simultaneously ties hands here as well, threatening efforts to bring drug prices under control in the US and efforts to reduce the proliferation of secondary patents on medicines that provide no real improvements for patients. Similarly, increased pharmaceutical monopolies will directly and adversely impact US global health initiatives, including those targeting HIV, TB, malaria, and even Ebola, which increasingly rely on affordable generic medicines.
Trade promotion authority is corporate profit-for-the-few promotion gussied up in the rhetoric of benefitting US exports. It's yet another massive corporate give-away, where the government, insurers, taxpayers, and individuals will pay more for medicines—or more likely, go without. Our demand should be no track for fast track.
Professor Brook K. Baker, Senior Policy Analyst Health GAP, Northeastern U. School of Law
January 16, 2015
Gilead has both announced the highest recorded prices ever for its direct acting hepatitis C antivirals, sofosbuvir/ledipasvir, and one of the most stringent anti- diversion programs ever devised. The price, highest in the US, comes in at a whopping $94,000 for a 12-week course of treatment, with slightly lower prices in Europe. Before this combo was approved, Gilead charged $84,000 – a $1000 a pill – for stand-alone sofobuvir, earning $8-10 billion in the first year of sales. This is for a course of treatment that experts have estimated can be manufactured for approximately $100. In turn, the emerging anti-diversion program requires patients in low- and middle-income countries to physically come to designated Gilead distribution sites to exchange an empty 30-day pill bottle for the next month’s supply. This program undermines the physician-patient and pharmacist- patient relationship and patient autonomy, adherence, and confidentiality. The question arises: are the excessive pricing and the draconian anti-diversion policies related? The answer is – like gold and diamonds all the way to the bank.
Gilead’s long-term pricing strategy is even more cynical than it seems at first glance. As the first company coming to the market with a highly effective and safe oral Hep C medicine, Gilead had monopoly pricing power, especially for patients seriously ill from Hep C, those living with or immediately facing severe cirrhosis, liver transplants, and/or liver cancer. These desperate patients – and their physicians and insurers, would pay almost anything to survive the extraordinary costs of thrice-weekly dialysis, liver transplantation, and cancer treatment. Gilead decided to respond to this desperation by charging a $1000 a pill, essentially saying “pay or die.” And many insurers and governments paid, thus the $10 billion in the first year.
Governments began doing the calculations and realized that these prices were completely affordable – except for the sickest – and thus state and national governments, even in the US, began to ration the drug, providng treatment only for the sickest. At this point, another company, AbbVie came to the market and nearly matched the Gilead price, but then both companies entered into the next phase of their cynical pricing strategy. They began to negotiate secret deals with larger insurers to discount the price of their Hep C medicines but only if the insurers would expand the number of patients treatment – essentially the patients most next at risk. Although these prices have not been publicly announced, based on precedent they are likely to be in the 30% range.
Suddenly, the market is expanding again even as it is being “split” between oligopolists who indirectly collude on high, quantity-based “discount” prices. Even with these discount prices, all Hep C patients will not get treatment – there will still be rationing, but the patients closest to serious disease progression will finally get a cure. However, the majority of patients who are undetected and asymptomatic will still be untreated and therefore still be transmitting the disease to a new population of future Gilead/AbbVie customers.
Looking into the future, one can anticipate that Gilead and other companies will continue to gradually reduce their hyper-inflated prices in exchange to access to more customers – and more profits. However, they will not offer an elimination price, an affordable price for the medicine that will spark a huge increase in testing, connection to care, and immediate treatment. After all, a stead crop of new “customers” makes business sense in the amoral world of corporate unaccountability.
Gilead is following a similar, equally cynical differential pricing strategy in low- and middle-income countries. It is basically negotiating, largely in secret, and charging much higher prices in upper-middle income countries like Brazil and Turkey and somewhat lower prices in certain poorer and higher prevalence countries like Egypt and India. Once again Gilead hopes that payers – patients and governments (there are few insurers) – will pay these high, “discount” prices for the sickest and wealthiest patients. These profits will be reaped for several years, even in countries where Gilead has granted a voluntary license to generic producers, given it will take time for those producers to come to market. Like in the US and Europe, Gilead will probably lower prices somewhat to gain access to a larger group of patients treated largely in the public sector. In this regard, it is important to note that Gilead has granted access via its voluntary license to only to 91 countries, leaving many of the highest burden middle-income countries outside the licensed territories. This license also keeps the more lucrative private sector to Gilead alone.
So, in sum, Gilead has devised a strategy to extract maximum profits from markets based on a geographic and time-lapse segmentation strategy. It earns the highest profits it can from the sickest people in high and middle-income countries first, then lowers prices slightly over time to gain access to an expanding pool of slightly less sick patients. Even when other companies like AbbVie enter the market, there are plenty of oligopolist profits to share when there are 150 million-plus people living with Hep C globally.
This is where anti-diversion policies come in – they come in to protect these geographic and time-series market segments and future super profits. Gilead knows that the medicines can be made cheaply and that there are huge incentives throughout the supply chain for middlemen to try to divert cheaper medicines to richer markets. Gilead knows that there are sick, but presently excluded patients who would rather get treated earlier than only after they become seriously ill. Its executives know that there are people who will want to be treated to prevent transmission to others. They know that rationing medicines keep waiting lists of people who might buy medicines more cheaply if they could – they might even be willing to travel to other countries for cheaper supplies or they might be willing to buy through less formal channels. These health-related patient incentives – incentives created by cynically pricing medicines that create rationing and wait lists – in turn create incentives for diversion on a wholesale and even retail scale. Accordingly, Gilead locks down the supply chain, especially in low- and middle- income countries, even to the level of coercing patients to act as the final stop-gap against retail diversion.
If governments go along with this staged, cynical price extortion and unethical treatment of patients, shame on them. The US can’t afford this strategy, nor can the EU, let alone low- and middle-income countries. Rationing of Hep C cures is already happening in the US, the UK, and elsewhere. Instead of moving toward Hep C elimination, we are plodding blindly towards a $100 billion rip-off of patients, taxpayers, and governments around the world. We are allowing companies to ride roughshod over patients’ rights to health and to undermine the public health imperative of disease eradication.
Paradoxically, when countries and insurers do decide that they have been “forced” to ration, the press and some patient groups blame the government instead of demanding government action to defeat this unconscionable strategy. They should be demanding that there be clinical trials to find the best treatment combination regardless of whether the medicines come from different companies. They and activists should be demanding real price drops, real price controls, and ultimately worldwide generic production of the best fixed-dose combination treatments that can end the Hep C pandemic by curing everyone with the disease. Don’t blame the governments and force taxpayers to create even more obscene pharmaceutical wealth – make them act in the public interest to ensure access to all at an affordable, disease-ending price.
Press Statement • December 10, 2014 • for immediate release
Contact: Paul Davis
Health Global Access Project (Health GAP)
Tel. +1 202 817 0129
AIDS Activists Applaud Congressional Increase for U.S. Global AIDS Program
Urge President Obama to finish the job and restore the remainder of PEPFAR cuts made since 2011
[Washington] Global AIDS campaign group Health Global Access Project (Health GAP) applauded the restoration of $300 million for the President’s Emergency Plan for AIDS Relief (PEPFAR) in the omnibus spending bill introduced in the House Tuesday night—funding the White House had proposed to cut from the overall global AIDS budget. The bill fully funds the request advocates made for the Global Fund and restores 50% of the funds cut from PEPFAR since 2011. The group also called on President Obama to include at least an additional $300 million increase in the upcoming FY16 budget proposal—currently being drafted at the White House—and to set a PEPFAR target of treating at least 12 million people by 2016.
“President Obama proposed cuts to global AIDS again this year,” stated Health GAP’s Paul Davis. “But activism and bipartisan support for PEPFAR and the Global Fund carried the day. Now President Obama must fulfill his overdue promise and comply with Congressional requirements to set treatment goals for PEPFAR. The budget the White House is putting together right now must include funds sufficient to commit PEPFAR to getting life-saving treatment to at least 12 million people by 2016.”
Activists note that the increase for FY15 only restores half of the damaging cuts made to PEPFAR since 2011, and that the overall global AIDS budget is on the same level as FY14. The increase for PEPFAR comes from reallocating funds pledged to the multilateral Global Fund to fight AIDS, Tuberculosis and Malaria that could not be contributed, due to matching requirements in U.S. law as other donors have not yet stepped up to leverage the pledges made by the United States and the UK to the Global Fund.
Support from both House Republicans and Democrats overturned the harmful cuts to global AIDS that President Obama had proposed in his draft budget early this year. Activists marched, held vigils, and lobbied hard for PEPFAR, teaming up with numerous supporters from both houses of congress and leaders from both parties, to overcome opposition and increase PEPFAR funding for the first time in years. Health GAP expressed appreciation for global AIDS champions who took leadership throughout the process, like Representatives Granger (R-Forth Worth), Lowey (D-White Plains) and Lee (D-Oakland), and the dozens of Senators who signed off on several ’Dear Colleague’ letters to appropriators throughout the year, led by Senators Coons (D-DE), Isakson (R-GA), Gillibrand (D-NY) and Coburn (R-OK).
PEPFAR is an unusually popular program in Congress, and was reauthorized for five years in late-2013 by unanimous consent immediately after last year’s government shutdown — at a time when little agreement could be found on other important issues. In the face of strong support from leaders of both parties, the Chairs and Ranking Members of the House and Senate Appropriations Committees and the State and Foreign Operations Subcommittees worked to find agreement in a tough fiscal environment to restore cuts to PEPFAR and set the stage for the coming year.
Health GAP also applauds the many grassroots activists who worked tirelessly to urge members of congress to support the increase for PEPFAR. This victory could not have happened without the Student Global AIDS Campaign and many allies who marched, organized phone calling days, held vigils and lobby visits.
On December 2, 2013, during the World AIDS Day commemoration at the White House, President Obama promised to announce new bilateral global HIV treatment targets in accordance with legislative requirements. More than a year later, there are still no targets—in spite of grassroots advocacy, and a bipartisan, bi-cameral letter to the President with over 40 signers from every point on the political spectrum calling for 12 million on antiretroviral treatment by 2016.
“Congress has shown that it can backstop an important program that is delivering on the U.S. goal of achieving an AIDS-free generation,” said Matt Kavanagh from Health GAP. “If he truly wants to end AIDS, the President’s next budget must restore the rest of the cuts he made to PEPFAR, make the maximum contribution to the Global Fund permitted by law, and include the funds necessary for PEPFAR to extend life saving medicine to at least 12 million people living with HIV by 2016.”
FOR IMMEDIATE RELEASE: Wednesday December 3 2014
Uganda can end AIDS, but only with evidence, science and human rights: does the President agree?
Civil society responds to the President’s views on the fight against HIV in Uganda and calls for urgent action to mitigate further harm to the national response
(Kampala) On December 1, 2014, World AIDS Day, President Yoweri Kaguta Museveni made remarks at the Ft. Portal national commemoration. A coalition of civil society organizations on the front lines of Uganda’s HIV response today reacted to his statements.
Despite a few reassuring comments, the views expressed by the President are cause for grave concern to every Ugandan who wants to see us defeat the AIDS epidemic—in particular, his views that Ugandans should fight AIDS by not having sex (‘put a padlock on your private parts’), and his blaming of evidence based prevention interventions such as condoms and medical male circumcision on Uganda’s troubled AIDS response. He also said becoming HIV positive brings shame to a family.
“These off the cuff comments by our leaders are a wake up call, indicating how out of touch with reality, science, and evidence Uganda’s AIDS response is,” said Alice Kayongo Mutebi of Uganda Cares. “We are also alarmed that his remarks fuel the spread of shame, stigma and discrimination which actually increase the risk of HIV infection among Ugandans, and hold people back from life saving services.”
New data released by UNAIDS show that Uganda lags far behind the region in reduction of AIDS related deaths, and contributes substantially to new infections across sub Saharan Africa. Uganda is one of three countries that accounted for an estimated 48% of new infections in sub Saharan Africa in 2013 alone. Uganda has not reported the major reductions in rates of new infection that our neighbors have. Civil society attributed this lagging performance to lack of emphasis on evidence-based interventions—in particular, the interventions the President was disparaging. Ironically, this evidence typically comes from research in Uganda, such as finding that medical male circumcision helps prevent men from acquiring HIV. Unfortunately, rates of condom use in Uganda have declined sharply between 2005 and 2011; self reported condom use during sex with a non-cohabitating partner declined from 47% to 29% and 53% to 38% among women and men, respectively. Undeniably, the president’s stigmatizing comments further undermine effective prevention.
“These claims by the President are poisoning our national efforts,” said Lilian Mworeko of ICW East Africa. “We are fighting for our lives, but views such as these actually weaken us in battle. Do our leaders want us to win this fight? Why are they content to see us continually falling behind? 570 young women aged 15-24 are infected with HIV every week in Uganda. Many times, these young women are coerced into sex, and local authorities ignore their cries for protection and solidarity. Do the president’s views on abstinence help these women, or bring them further blame and strife?”
Claims that Safe Medical Male Circumcision is ineffective are wrong! Comparing Safe Medical Male Circumcision and Traditional Male Circumcision is almost the same as comparing apples and oranges. The two procedures are not the same and the benefits of Safe Medical Male Circumcision are well proven. Science has revealed that Safe Medical Male Circumcision works. It reduces men’s risk of HIV acquisition by 60% and when enough men are circumcised, it reduces women’s risk too.
Also alarming is the President’s assertion that an HIV positive diagnosis brings shame on a family—encouraging a culture of shame and stigma actually makes people less likely to be open about their status, and more afraid of testing, because they fear the shame that could result. This in turn actually increases avoidable HIV transmission and it beats my understanding when Uganda claims to be fighting stigma and discrimination yet it is actually fueled right from the top—most people with HIV in Uganda are unaware of their status. Incredibly, only 39% of people in Uganda today know how to protect themselves against HIV—and this proportion has remained stagnant for essentially the last decade.
This lagging performance is precisely because lack of emphasis on evidence based interventions—in particular, earlier access to HIV treatment to save lives and reduce new infections; prevention and treatment targeting populations in greatest need, including young women aged 15-24, serodiscordant couples, and truck drivers; as well as criminalized groups like men who have sex with men and sex workers. Its high time Ugandans accepted reality, evidence, and the rights of all people to live in dignity, including people with HIV.
Contact for more information:
Alice Kayongo-Mutebi, Uganda Cares: 0772440108
Kenneth Mwehonge, HEPS Uganda: 0701182809
Asia Russell, Health GAP: 0776574729