1 Thailand’s perspective on new incentive systems for R&D of medicines Sripen Tantivess International Health Policy Program Ministry of Public Health, Thailand A presentation at the Chinese Medical Association, Beijing 24 th September 2007

2 Thailand participation in the PHI IGWG and intersessional activities –30 Nov 06: 1 st SEA regional consultation 4-8 Dec 06: 1 st session of IGWG –18 Jan 07: 1 st national consultation  country’s submission –5 Mar 07: 2 nd SEA regional consultation  regional submission 31 Jul 07: document A/PHI/IGWG/2/2 posted on the WHO website –29 Aug 07: 2 nd national consultation –3-5 Sep 07: Latin America & the Caribbean consultation –24-25 Oct 07: 3 rd SEA regional consultation 5-11Nov 07: 2 nd session of IGWG

3 Why new incentive mechanisms for R&D are needed Existing IP-related framework does not work Profit-driven VS need-driven Lack of purchasing power in developing countries  inadequate incentives  no R&D Some innovative incentive systems may be effective

4 Proposed disease categories (A/PHI/IGWG/2/2, page 4) Type I: diabetes, cardiovascular disease and cancer Type II: HIV/AIDS and tuberculosis Type III: chagas disease, dengue and dengue haemorrhagic fever, leishmaniasis, leprosy, lymphatic filariasis, malaria, onchocerciasis, schistosomiasis human African trypanosomiasis

5 Special incentives to encourage R&D (CIPIH 2006, page 86-91) Orphan drug schemes Tax credits Scheme for transferable IPR Transferable fast-track review scheme Reward systems Medical R&D treaty Open source approaches

6 (5.3) exploring and promoting complementary incentive schemes for R&D (a) explore and implement complementary incentive schemes for R&D that separate the incentives for innovation from the prices of health-care products (for example, the prize fund model) (b) expand the advance-market commitment approach (2.4) improving global coordination and financing of medical R&D (c) support further discussion of a medical research and development treaty. (2.3) promoting upstream research and product development in developing countries (a) promote discovery science, including through open-source methods, in order to develop a sustainable portfolio of new products (7.1) securing additional and sustainable financing for R&D in order to address the health needs of developing countries (b) assess the utility of existing funding mechanisms, or a new global funding mechanism, in order to increase global coordination and sustainable funding of medical R&D (c) use current and new financing initiatives (such as advance-market commitment schemes) to accelerate the progress of health-care products from development to delivery Proposed sub-elements and specific actions (A/PHI/IGWG/2/2)

7 Pharmaceutical industry and R&D in Thailand Secondary industry – not self reliant Over 95% of raw materials are imported local production: importation ~ 30:70 in term of values Transnational producers moving out Major R&D: finished product formulation and BE studies A number of research institutes work on R&D of herbal medicines and biotechnology Biomedical research incld. clinical studies in several areas: HIV/AIDS, TB, malaria, other tropical diseases Limitations: scientists, technology, budget

8 Draft global strategy & plan of action (A/PHI/IGWG/2/2) The context: –inadequate R&D of and access to essential medicines in developing countries –opportunities to improve the problematic situations The aim & focus: what diseases to be addressed? The elements: agreed by the 1 st IGWG session The sub-elements and specific actions: –Comprehensive – accommodate various views from different countries –Relevant to meet particular objectives? –Feasible/practical? –Agreeable – consensual among stakeholders?

9 The aim & focus (A/PHI/IGWG/2/2) ‘… to provide a medium-term framework for an enhanced and sustainable basis for need-driven, essential R&D relevant to diseases that proportionately affect developing countries.’ Paragraph 5: what expected from the strategy & POA? Do we agree with the proposal to focus on the 14 diseases?

10 Burden of diseases in Thailand (YLL), 2004 (preliminary report – do not quote) RankMaleFemale Diseases% YLLDiseases% YLL 1HIV/AIDS15.9HIV/AIDS10.6 2Traffic accidents13.8Stroke10.2 3Stroke7.0Diabetes7.1 4Liver & bile duct cancer7.0Ischemic heart diseases5.1 5Ischemic heart diseases4.3Liver & bile duct cancer4.7 6Cirrhosis3.5Traffic accidents4.5 7COPD3.2Lower respiratory tract infections3.3 8Bronchus & lung cancer2.9Cervix and uteri cancer2.8 9Drowning2.9Nephritis & nephrosis2.8 10Suicides2.7Breast cancer2.3 11Lower respiratory tract infections2.6COPD2.3 12Diabetes2.6Bronchus & lung cancer2.1 13Homicide & violence2.4Cirrhosis2.0 14Tuberculosis1.9Tuberculosis1.9 15Nephritis & nephrosis1.6Drowning1.7 Source: International Health Policy Program, 2007

11 Specific actionsComments 2.3 (a) promote discovery science, including through open-source methods, in order to develop a sustainable portfolio of new products needs cooperation from industry how to carry this out effectively? 2.4 (c) support further discussion of a medical research and development treaty difficult target to achieve, i.e. to reach a consensus among stakeholders within 1.5 years [see timeframe and progress indicator (ii)] 5.3 (a) explore and implement complementary incentive schemes for R&D that separate the incentives for innovation from the prices of health- care products (for example, the prize fund model this action should be divided into 2 phases: exploring and implementing, then set up practical timeframe WHO or other UN agencies should have a leading role, not country governments 5.3 (b) expand the advance-market commitment approach how to get this into practice? [see also the timeframe] WHO or other UN agencies should have a leading role, not country governments roles of research institutes and industry? 7.1 (b) assess the utility of existing funding mechanisms, or a new global funding mechanism, in order to increase global coordination and sustainable funding of medical R&D what is the timeframe of conducting the utility study? it is unclear how to get the assessment results into policy and action 7.1 (c) use current and new financing initiatives (such as advance-market commitment schemes) to accelerate the progress of health-care products from development to delivery similar to 5.3(b) Thailand’s perspective on the draft plan of action (new incentives for R&D)

12 Analyses of countries’ positions Submissions on A/PHI/IGWG/1/5: 19 countries and 2 regions [Source of information: Common issues: request for background information of each element of draft global strategy (WHA60.30) Debatable issues: Scope: diseases of focus Existing or new forums/mechanisms Workforce migration Transfer of technology; TRIPS flexibilities TRIPS plus Compulsory license for export Data exclusivity and evergreening patent Advance market commitment

13 IssueA/PHI/ IGWG/2/2 Member states’ comments Scope: diseases of focus Page 4IGWG’s work should focus only on Type II and Type III diseases Existing or new forums/mechanisms Existing mechanisms should be strengthened, the new ones should not be encouraged Workforce migration3.2(c)Developing countries should … address issues relating to the migration of health professionals in a manner that respects the freedom of individuals to migrate to build a better life for themselves and their families Transfer of technology4.2(d) no evidence of the lack of technology transfer any discussion regarding compliance with this provision should take place in the appropriate forum, namely the WTO TRIPS flexibilities5.2(a)The IGWG should not consider this issue TRIPS plus5.2(b)This element more appropriately fits within the scope and mandate of the WTO and WIPO (country X) cannot accept any binding proposal that bilateral agreements not contain ‘TRIPS-plus provision’ Compulsory license for export 6.3(d)This action should not be considered by the WHO and therefore the IGWG Data exclusivity & evergreening patent Not available [this element was stated in A/PHI/IGWG/1/5] Advance market commitment 7.1(c)… reference should be specific to the pilot project for a pneumococcal vaccine, and not broadened, unless the data from the pilot program demonstrate that such commitments are effective