2. The 2010 Access to Medicine Index: methodology and indicators 28 June 2010 Afshin Mehrpouya RiskMetrics Group (MCSI Inc.) WHO, Geneva

3. Presentation Outline  The Methodology of the Access to Medicine Index  Key Improvements Compared to Index 2008  Major Findings for Each Technical Area 3

4. Methodology of the Index 2010

5. 5 The Access to Medicine Index Methodology Report 2010 was published in March You can download report from http://www.atmindex.org/research_and_assessment/method

6.  Geographical Scope:  Index 2010 focuses on the Low and Medium Human Development Countries based on the UN Human Development Index (UN HDI) 2006. Countries classified as ‘medium-high’ and ‘high’ according to the World Bank Country Classifications, are excluded  Disease Scope:  Index 2010 covers a total of 33 diseases, consisting of a combination of the WHO Neglected Tropical Diseases, the top-10 non communicable diseases and the top-10 communicable diseases based on Disability Adjusted Life Years (DALY)  Increased company coverage to 27 (from 20 in Index I)  20 Originator (19+1) and 7 Generics Manufacturers 6 Highlights of Changes from Index 2008 to Index 2010 Scope

7. Highlight of Changes from Index 2008 to Index 2010  Rating along the ATM Index focus areas of innovation, transparency, performance and long term commitment  Focus on Performance Pricing Patents and Licensing R&D Pipeline Marketing Approval Sales trends  New weighting system –Based on share of generics and originator revenue streams  Deeper coverage of non-communicable diseases, pediatric formulations and vaccines  New Approach to analysis of generics manufacturing –Specific data points relevant to generics manufacturing –A separate list for generics manufacturers 7

8. Index 2008 Public Policy & Advocacy R&D Patents &Licensing Capacity Equitable Pricing Donations Philanthropy ATM Management Index 2010 Strategic Pillars CommitmentsTransparencyPerformanceInnovation Technical Areas General Access to Medicine Management Public Policy and Market Influence Research & Development Equitable Pricing, Manufacturing & Distribution Patents & Licensing Capability Advancement Advancement in Product Development and Distribution Product Donations & Philanthropic Activities 8 The New Structure 30% 10%

9. 9 The New Structure Strategic Pillars Commitments 30% Transparency 30% Performance 30%Innovation 10% Technical Areas A. General Access to Medicine Management ATM Governance ATM Management System Stakeholder Engagement B. Public Policy and Market Influence Advocacy and Lobbying Competition Behavior Marketing Behavior C. Research and Development Innovative R&D Adaptive R&D Intellectual Property Sharing D. Equitable Pricing, Manufacturing and Distribution Marketing Approval (Registration) Equitable Pricing Manufacturing & Distribution E. Patents & Licensing Patents Non-Exclusive Voluntary Licensing F. Capability Advancement in Product Development and Distribution Capacity Building in Research and Development Capacity Building in Quality Management and Distribution G. Product Donations and Philanthropic Activities Donations Philanthropy

10. Methods and Findings

11. Highlights of Analysis 11 Analysis across 111 indicators -106 used for analysis Neutral scoring used to ensure companies are ranked only on relevant indicators Attempted to diversify sources of data Used interviews for better understanding of context Focused on data partnerships to avoid redundant data collections

12. General Access to Medicine Management 12 Public Policy & Influence R&D Patents &Licensing Capablity Advancement Equitable Pricing Donations & Philanthropy ATM Management ATM Governance  Senior Governance representation of ATM in most companies ATM Management System  Six companies report ATM targets and performance at least for some initiatives  ATM reporting carried out by most companies Stakeholder Engagement  Eleven companies have active participation and sponsorship of conferences related to ATM  Gilead has a stakeholder advisory board

13. General AtM Management

14. Public Policy & Market Influence 14 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patents &Licensing Donations & Philanthropy ATM Management Lobbying & Advocacy Low level of detail on lobbying positions in 16 companies Low disclosure of lobbying activities in the Index Countries Competition Behavior Top companies showing more flexibility on competition issues through non-exclusive distribution and licensing Only two companies have made partial concessions about data exclusivity Only three companies explicitly commit to not engage in pay for delay practices Marketing Behavior No disclosure in the Index Countries regarding payments to providers and patient associations – three companies have commited to start to disclose in the new future (GSK, Merck and AstraZeneca)

15. Overview of Public Policy and Market Influence

16. Analysis Methods and Findings Research & Development 16 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patent and Licensing Donations & Philanthropy ATM Management Innovative R&D Five companies undertaking R&D for multiple Index Diseases Increased scope of discovery stage research for NTDs Adaptive R&D High activity for paediatric formulations and FDCs mostly for HIV and Malaria No activity for non-communicable diseases Intellectual Property Sharing & Collaborations 11 companies and 15 cases of providing access to compound libraries So far, has led to 18 discovery stage projects No example of out-licensing of later stage molecules during the period of analysis Increased PDP activity Low disclosure on access & IP terms of collaborations

17. Overview of R&D Pipeline

18. Equitable Pricing, Manufacturing & Distribution 18 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patents and Licensing Donations & Philanthropy ATM Management Equitable Pricing Inter-country tiered pricing with some access provisions undertaken by 13 companies Intra-country tiered pricing carried out by seven companies with logistics difficulties Most efforts focused on the Big-Three Low transparency on not-for-profit prices and impact of programs (disclosed by three and four companies respectively) Manufacturing & Distribution Few examples of custom packaging for different environments Five companies providing pictograms and color coding for ease of use (for the illiterate) WHO prequalification and FDA tentative approval both on the rise Generally, low disclosure on recalls Marketing Approval (Registration) Few companies commiting to need based registration – mostly for HIV Low public disclosure on registration

19. Overview of Equitable Pricing, Manufacturing and Distribution

20. Patents & Non-Exclusive Voluntary Licensing 20 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patents and Licensing Donations & Philanthropy ATM Management Trade Aspects of Patents Top companies have adopted more flexible approaches to patents Several ongoing cases: patent-registration linkages, compulsory licenses in the MDCs, patent extensions, patent infringement Eight companies disclose specific stance on patent related issues Non-Exclusive Voluntary Licensing Four companies engaging in NEVL All accompanied by technology transfer on request Used as a last resort solution License territories mostly limited to LDCs with exceptions such as Boehringer-Ingelheim

21. Overview of Patents and Licensing

22. Capability Advancement Advancement in Product Development & Distribution 22 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patents and Licensing Donations & Philanthropy ATM Management Capacity building in supply chain Most efforts focusing on anti-counterfeiting One company involved in initiatives targeting stock-outs Capacity Building in Quality Management Six companies in involved, through non- exclusive licensing or outsourcing manufacturing Capacity Building in Research Most efforts focused on fellowships and research collaborations

23. Product Donations & Philanthropic Activities 23 Public Policy & Influence R&D Equitable Pricing Capablity Advancement Patents &Licensing Donations & Philanthropy ATM Management Donations Nine companies undertaking single drug donations for NTDs Low disclosure of decision process, volume and destination for multi-drug donations which are mostly managed through donations management organizations Top performers audit the external agencies Philanthropy Most efforts focusing on awareness programs and training Six companies have undertaken comprehensive donations programs with capacity building components

24. Overview of Donations and Philanthropy

25. Highlight of Findings - Generics Ranbaxy, Cipla and Mylan undertaking adaptive R&D Ranbaxy, Cipla and Mylan collaborate with international programs such as PEPFAR, AMFm, UNITAID-CHAI etc. Only Ranbaxy and Cipla undertaking non-exclusive voluntary licensing Cipla has been innovative in capacity building Apotex under CAMR has been the first company to benefit from the 31f clause of TRIPS Reporting is very weak across the sector Authorized generics is a fast growing trend Teva and Sunpharma have no strategies or disclosure on access related issues

26. Key Analysis Challenges Lack of firm academic backing for several indicators Low and variable disclosure by companies and their counterparts Insufficiency of independent sources for different technical areas Analyzing litigations and fines in Index Countries

27. Thank you Afshin Mehrpouya RiskMetrics Group Afshin.mehrpouya@riskmetrics.com +33 6 21269092

28. Index 2010 Communicable Diseases - WHO Neglected Tropical Diseases Disease Reference List Disease Reference List 1Lymphatic filariasisGBD, NTD8OnchoceriasisNTD 2ShistosomiasisNTD9Chagas diseaseNTD 3 Human African trypanosomiasis NTD10LeprosyNTD 4 Soil-transmitted helminthiasis NTD11Buruli ulcerNTD 5TrachomaNTD12 Dracunculiasis (uinea- worm disease) NTD 6LeishmaniasisNTD13FascioliasisNTD 7DengueNTD14YawsNTD

29. Index 2010 Communicable Diseases - The WHO Global Burden of Diseases List Disease Reference List DALYs in LMIC – 2004 Annual Mortality in LMIC – 2004 1Lower respiratory infectionsGBD932331373866897 2Diarrheal diseasesGBD723063482148340 3HIV/AIDSGBD578430702017193 4TuberculosisGBD340142781447854 5MalariaGBD33941524888158 6MeaslesGBD14839141423333 7MeningitisGBD11312859336298 8PertussisGBD9832373254323 9Lymphatic filariasisGBD, NTD5940056289 10TetanusGBD5277017162606

30. Index 2010 Non-Communicable Diseases - The WHO Global Burden of Diseases Disease Reference List DALYs in LMIC – 2004 Annual Mortality in LMIC - 2004 1Unipolar depressive disordersGBD5542370511868 2Ischemic heart diseaseGBD548007615861587 3Cerebrovascular DiseaseGBD3159500041793423 4 Non-communicable obstructive pulmonary disease GBD265220912737049 5Diabetes mellitusGBD16062898914998 6AsthmaGBD14383499265893 7OsteoarthritisGBD127979153744 8Cirrhosis of the liverGBD11977815655083 9Nephritis / NephrosisGBD8421239611418 10EpilepsyGBD7308772131050