Thailand stuns drug firms with generic licenses

Thu Jan 25, 2007 2:02 PM GMT

By Nopporn Wong-Anan

BANGKOK (Reuters) – Thailand’s army-installed government
has issued licenses for cheap generic versions of a heart
disease and an AIDS drug, the health minister said on Thursday,
dealing a shock blow to foreign pharmaceutical firms.

“The laws have been signed and they are now effective,”
said Mongkol na Songkhla, who became health minister after a
September 19 military coup. He cited the ballooning costs of
treatment as the reason for the move.

“We have to do this because we have so many patients to
treat with so little budget. We can’t watch our people die and
their patents have been here for so long,” he told Reuters

Under World Trade Organization rules, a government is
allowed to declare a “national emergency” and license the
production or sale of a patented drug without the permission of
the foreign patent owner.

Drug companies reacted angrily to the announcement, saying
they had been kept in the dark, and urged Mongkol to reconsider
a decision they said could lead to many firms leaving the
country.

“No company has received any contact,” said Teera
Chakajnorodom, President of the Pharmaceutical Research and
Manufacturers Association (PReMA), an industry umbrella group.
“It has stunned our industry.”

“We’ve heard it’s not just HIV drugs, it’s also cancer
drugs and cardiovascular drugs,” he said. “This is very new and
goes very far.

BLOW TO INVESTORS

Confusion remained about what drugs were affected.

Mongkol said the drugs were HIV-AIDS and heart disease
treatments but declined to confirm newspaper reports they were
Abbott Laboratories’ Kaletra, and Plavix, a blockbuster
anti-clotting agent sold by Sanofi-Aventis and Bristol-Myers
Squibb.

In November, two months after the army’s removal of Prime
Minister Thaksin Shinawatra, the interim government issued its
first compulsory license, to make a generic version of
Efavirenz, an anti-retroviral.

That decision drew a swift riposte from U.S. drug maker and
patent holder Merck & Co Inc. By contrast, AIDS activists
applauded Bangkok for taking a bold stance.

The widening of compulsory licensing is another blow to
foreign investors still reeling from capital controls imposed
in December to stem a rise in the baht and a proposed
tightening of laws governing overseas firms in Thailand.

PReMA said it had written to Prime Minister Surayud
Chulanont on Tuesday asking that no more compulsory licenses be
introduced beyond the one covering Efavirenz.

However, Mongkol, who met Sanofi-Aventis bosses on
Wednesday, appeared to have brushed aside the plea and accused
the industry of making excessive profits. 

“They are reaping colossal benefit from us,” he said,
adding that copycat versions of the drugs from Chinese or
Indian firms would cost as little as 10 percent of their
original price.

Plavix is Bristol-Myers Squibb’s biggest-selling medicine,
with annual sales of $6 billion before a copycat
Canadian-manufactured version hit the market briefly in August.

Paul Cawthorne, head of Doctors Without Borders in
Thailand, said the government was spending 11,580 baht ($330)
per patient per month for Kaletra and could cut that bill by
two thirds if it switched to a generic manufacturer.

“That’s a perfectly legal method for them to ensure access
to essential drugs for Thai people,” he said.

Thailand plans to break antiretroviral patents

Medical Patent News

Published: Sunday, 28-Jan-2007

Thai Public
Health Minister Mongkol Songkhla plans to break patents on an
antiretroviral drug and a drug for heart disease by issuing compulsory
licenses to produce lower-cost versions, Ministry of Public Health spokesperson Suphan Srithamma announced on Thursday, AFP/Yahoo! News reports (AFP/Yahoo! News, 1/25).

Mongkol declined to name the two drugs until the ministry officially announces the compulsory licensing on Monday, Thailand’s Nation reports (Khwankom, Nation, 1/26).

World Trade Organization
regulations allow governments to declare a “national emergency” and
issue compulsory licenses without consulting the foreign patent owner.

Thailand,
which has 580,000 people living with HIV/AIDS, has won international
recognition for its quick launch of a national drug program that treats
more than 82,000 HIV-positive people.

However, the government’s commitment to providing universal access to care is facing increasingly high drug costs (Kaiser Daily HIV/AIDS Report, 12/1/06).

“We
have to do this because we have so many [HIV/AIDS] patients to treat
with so little budget,” Mongkol said, adding, “We can’t watch our
people die and their patents have been here for so long” (Wong-Anan, Reuters, 1/25).

He
added that compulsory licensing “is legitimate domestically and
internationally, and Thailand is not the first” country to do it
(Nation, 1/26).

Teera Chakajnarodom, president of the Pharmaceutical Research and Manufacturers’ Association, said the Thai government is using an overly broad definition of an emergency.

“The
law allows such actions with pharmaceutical products only in cases of
extreme national emergencies, or during wartime, and only after
negotiation with the companies concerned,” Teera said, adding, “It is a
provision in the law that has to be used judiciously and with extreme
caution if one is not to undermine the confidence of the investment
community” (AFP/Yahoo! News, 1/25).

Paul Cawthorne, head of Medecins Sans Frontieres
in Thailand, said compulsory licensing is a “perfectly legal method for
[the government] to ensure access to essential drugs for Thai people”
(Reuters, 1/25)

Thailand allows copycat AIDS, heart disease drugs

By Pongpiphat Banchanont

Reuters

Monday, January 29, 2007; 5:26 AM

BANGKOK (Reuters) – Thailand’s army-appointed government
confirmed on Monday it approved a cheap, copycat version of a
blockbuster heart disease drug, the first time a developing
country has torn up the international patent for such a
treatment.

In addition to the “compulsory license” of Plavix, made by
U.S. and European pharmaceutical giants Bristol-Myers Squibb
and Sanofi-Aventis, Bangkok approved a generic version of
Abbott Laboratories‘ Kaletra, an HIV/AIDS treatment.

The move, which Thai health officials said would save the
country as much as 800 million baht ($24 million) a year, drew
flak from the drug industry but praise from AIDS activists.

“We have to do this because we don’t have enough money to
buy safe and necessary drugs for the people under the
government’s universal health scheme,” Health Minister Mongkol
na Songkhla told reporters on Monday, confirming newspaper
reports that circulated last week.

“The laws have been signed and became effective on Friday,”
said Mongkol, who incensed drugs companies in November by
introducing Thailand’s first such license for Merck’s Efavirenz
anti-retroviral AIDS treatment.

Under World Trade Organization (WTO) rules, a government is
allowed to declare a “national emergency” and license the
production or sale of a patented drug without the permission of
the foreign patent owner.

Teera Chakajnorodom, chairman of Bangkok-based
pharmaceutical industry group PReMA, said he had been kept in
the dark over the move. His only contact with the government
was a phone call on Sunday from a health official asking for
clarification of WTO rules.

Although the drug companies had not had time to coordinate
a response, Teera said they might petition the Administrative
Court, which rules on the legality of government actions, to
block the license.

“If we want to be globalizes, we have to respect the rules
of the world and the WTO,” he said.

SLASHING COSTS

The widening of compulsory licensing is another blow to
foreign investors already reeling from capital controls imposed
in December to stem a rise in the baht and a proposed
tightening of laws governing overseas firms in Thailand.

Foreign investors said it also appeared to be another case
of the government, which assumed power after a September 19
coup against Prime Minister Thaksin Shinawatra, acting
unilaterally and appearing indifferent to international
reaction.

Thawat Suntrajarn, head of the Health Ministry’s Disease
Control Department, said the copycat drugs would initially be
imported from India and would then be produced by Thailand’s
state-owned drug maker.

The price of Plavix would drop by more than 90 percent to 6
baht (18 US cents) per tablet, he said.

Plavix is Bristol-Myers Squibb’s biggest-selling medicine,
which had annual sales of $6 billion before a copycat
Canadian-manufactured version hit the market briefly in August.

Paul Cawthorne, local head of Doctors Without Borders,
backed Mongkol’s stance, saying the government was spending
11,580 baht ($347) per patient per month for Kaletra and could
cut that bill by two thirds if it switched to a generic make.

“That’s a perfectly legal method for them to ensure access
to essential drugs for Thai people,” he said.

($1=33.40 baht)

Thailand to break two drug patents

By AMBIKA AHUJA
January 29, 2007, 9:54AM EST

BANGKOK, Thailand

Thailand
paved the way Monday for the allowing the sale of generic versions of
two drugs, one to treat HIV/AIDS and the other for heart disease,
effectively breaking their patents, officials said.

The
government’s decision to allow for either the production or purchase of
generic versions of the drugs was applauded by aid agencies and
activists, who said it would improve the lives of thousands of people,
and set an example to other countries facing similar problems.

Public
Health Minister Mongkol Na Songkhla said the decision was justified
under international trade rules because the drugs’ high cost
constituted a crisis for the country’s health sector.

According
to the World Trade Organization’s agreements on intellectual property,
a government may issue a compulsory license in case of a national
public health emergency. Such action has been taken by several
countries, most notably Brazil and India, especially in the case of HIV
medicines.

The drug to treat HIV is Kaletra, produced by
U.S. health care company Abbott Laboratories. Plavix, a blood thinner,
is sold by France’s Sanofi-Aventis SA and Bristol-Myers Squibb Co, also
from the U.S.

Sanofi-Aventis, which sell the blood thinner
Plavix in Thailand, didn’t have an immediate comment. Abbott said in a
statement that it viewed the Thai government’s actions as illegal and
not in the best interest of patients.

Mongkol said generic
production of Plavix would reduce the cost from about 70 baht ($2.06) a
pill to less than 6 baht (18 cents).

He said the ministry was willing to talk to the companies about importing their drugs at cheaper prices.

“We
ask for the understanding of pharmaceutical companies. Much of our
affected population cannot afford your drugs and we want people to have
access to the medicines that they need,” Mongkol said. “We are willing
to negotiate with the companies if they are willing to give some
discounts for the import of their originals.”

Thai
officials last week announced their intention to declare compulsory
licensing for the two drugs, drawing criticism from the industry’s
Pharmaceutical Research & Manufacturers Association, who said it
could force more companies to relinquish their patents.

The
association’s president, Teera Chakajnarodom, said the decision also
could have a wider impact on foreign investors. “They are concerned
about continuing to invest in a country where the government cannot
provide a basic guarantee for the safety of their assets.”

Kannikar
Kijtiwatchakul, a campaigner in Thailand for Medecins Sans Frontieres,
or Doctors without Border, welcomed the government’s move.

“It
is a brave decision, despite both anticipated pressure from industry
and possible threats to withdraw investments. The authorities have
engaged in dialogue with companies before, but the discounts have been
marginal. The licenses will benefit a lot of people and will set an
example to other countries who face the same problem.

More
than 500,000 people in Thailand are living with HIV, according UNAIDS,
the U.N. agency that coordinates the global fight against the deadly
virus.

The Thai government has a budget of 3.8 billion baht
($112 million) allocated to the treatment of HIV patients, Mongkol
said, meaning it could afford only to provide medicine to 108,000
patients at the companies’ price.

Around 200,000 patients
in Thailand who suffer from heart conditions have blood clotting
problems that could be treated with Plavix, but only 20 percent of them
currently have access to the medicine, he said.

“We have to
consider the needs of the people. This will increase access and improve
the standard of living of the patients,” said Thawat Suntrajarn,
director-general of the Department of Communicable Disease Control,
adding that the drugs will be available only for public health services
and will not be sold in drugstores for profit.

powered by performancing firefox