A Step Back for Millions of People with Hepatitis C

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SEPTEMBER 19, 2014

A Step Back for Millions of People with Hepatitis C: Why Gilead’s Recent Deal with Generic Producers for its Hepatitis C Drugs (Sofosbuvir and Ledipasvir) is a Sham

Hepatitis C Virus (HCV) Treatment: Gilead Sciences Voluntary License

Under the pretext of increasing access to its hepatitis C treatment, the new deal signed by Gilead for their HCV drugs sofosbuvir (Sovaldi©) and ledipasvir hides a clear strategy to prevent fair generic competition. Gilead, a U.S.-based pharmaceutical company, has left millions of people with hepatitis C —worldwide — without access to life-saving treatment. The International Treatment Preparedness Coalition (ITPC) denounces Gilead’s strategy to block generic competition. ITPC calls on governments across the world to take action to ensure that an HCV cure will be available and accessible at the lowest price possible, using all the flexibilities allowed under the Trade-related Aspects of Intellectual Property Rights (TRIPS) agreement including possibilities to develop local production, and use competition/antitrust laws.
On September 15th, Gilead Sciences announced a voluntary license with seven Indian-based generic companies that allows production and sale of their new hepatitis C drugs sofosbuvir (Sovaldi©) and ledipasvir in 91 countries. The licenses are mainly for low-income (LICs) and least developed countries (LDCs), and includes only a few middle-income countries (MICs). Sofosbuvir (Sovaldi©), now on the market, and ledipasvir, soon to be approved, are Direct-Acting Antivirals (DAAs) demonstrating high cure rates when used in combination with other drugs to treat HCV.
Gilead claims that their licenses will improve access to HCV treatment and cure globally, but in reality, 51 key MICs with a high burden of HCV are excluded from the deal. This initiative has little chance to improve global HCV treatment access, since (unlike HIV) the highest burden of the disease is located in upper- and middle-income countries, where 73% of the world’s 185 million people infected by HCV worldwide live.
According to Christine Stegling, Executive Director of ITPC: “In the absence of a global mechanism to fund HCV treatment in the poorest countries in the world, it is very unlikely that this license will have a significant impact. Additionally, this license leaves out developing countries that have shown leadership by putting in place treatment programs and investing domestic resources to treat their people. We know from the past that voluntary licenses can have major limitations as they do not always lead to production or export and originator companies often do not bother registering their product in poorest countries. This ultimately prevents generic producers from registering their products in the country. In the case of this license, the originator company Gilead, has not given any timeline regarding their registration process in these 91 countries”.
While the anticipated impact of the license in the covered countries remains theoretical and uncertain, we know that Gilead’s deal will immediately block access to generic HCV treatment in excluded countries, even where there are no patent barriers. Developing countries from Latin America, North Africa, the Middle East, as well as Eastern Europe and South, Southeast and Central Asia cannot afford the high prices offered by Gilead or the “discounted prices”, given the sheer number of people in need of treatment and care-related costs.
Excluded countries include: China (30 million people with HCV), Brazil (2.6 million), the Philippines (1.9 million), Turkey (1.5 million), Thailand (1.4 million) and Mexico (1.1 million).
For ITPC, the license is a step back from the international consensus on use of the flexibilities included in the TRIPS agreement to protect public health and access to medicines. Gilead’s license territory includes LDCs, which have until 2021 to implement the TRIPS agreement and are not under obligation to grant patents. The licensing agreements also provide a rationale for market monopolies in excluded countries where Gilead has no patents, nor the right to claim a monopoly.
“There are no patents on sofosbuvir in India and several other countries that these generic companies could have sold to. These licenses are clearly designed by Gilead to prevent competition, which means that millions will go without access to this drug.” said Tahir Amin, Director of Intellectual Property at I-MAK.org, which has filed patent oppositions on the drug in India. “There is a high probability that Gilead’s patents will be rejected by patent offices around the world, and yet today’s license will stop these generic companies from supplying those countries.”
In November 2013 and March 2014, The Delhi Network of Positive People (DNP+) and Initiative for Medicine and Access to Knowledge (I-MAK) filed a pre-grant oppositions application challenging the validity of key patent applications for sofosbuvir in India. The Asia Pacific Network of People Living with HIV (APN+) with Sankalp Rehabilitation Trust and Hepatitis Coalition Nagaland – represented by Lawyers Collective (LC) – filed another opposition in September 2014. A patent has already been rejected twice by the Egyptian patent office for lack of novelty and inventiveness.
“By unlocking access to generic sofosbuvir, the governments of countries left out of the license could save at least US$60 billion dollars, according to our analysis,” stated Priti Radhakrishnan, Director of Treatment Access at I-MAK.org. “We urge these country governments to take urgent action to reject the patents on sofosbuvir and ensure this drug reaches the people whose lives depend upon it.”
According to I-MAK’s analysis, the cost of the exclusion of most MICs from Gilead’s license will be extremely high. For example, if Gilead charges Latin American countries US$7,000 for a course of sofosbuvir, it would require the Argentinian health authorities to overspend (their existing budget) by US$5 billion, and the Brazilian health authorities to overspend by US$17.3 billion, to provide access to these new drugs without generic competition. Even in the unlikely scenario that Gilead were to lower its price as low as US$1,567 for excluded countries, the amount these countries would overspend would be prohibitive: in China US$36.7 billion, in Morocco US$736 million in Thailand US$1.9 billion, and in Ukraine US$2.9 billion.
Another point of concern is that Gilead’s license also excludes sales of the active pharmaceutical ingredients (API) used as raw materials for local production to non-partners of Gilead, even in countries included in the license. “This is terrible news for countries who have capacity to produce their own medicines,” said Othoman Mellouk, Regional Advocacy Coordinator of ITPC in The Middle East and North Africa (MENA), “In countries like Egypt where 20 million people are infected with HCV, governments will not be able to secure treatment for all even with the discounted price provided by Gilead. The country started working recently on local production of sofosbuvir to ensure sustainability of treatment. Now, with this license, local manufacturers will not be able to buy APIs anymore from Indian suppliers. Egypt will now have to completely rely on generic producers selected by Gilead – which essentially means just replacing a monopoly with another. Although this country is covered by the license and the patent on sofosbuvir is not granted, free and fair generic competition is just not possible anymore, thanks to Gilead’s move.”
“Gilead announced its licensing agreements as a means to increase access in developing countries. It should be clear by now that these agreements that are based on voluntary licenses, are not intended to promote access, but to segment markets and increase company profits,” stated Marcela Vieira, coordinator of GTPI/Rebrip – Working Group on Intellectual Property of the Brazilian Network for Integration of Peoples in Brazil.
“It is important to recognize that Gilead’s licenses are a wolf dressed as a lamb. They will hinder access for millions of people in desperate need of HCV treatment, and harm the entire generic industry,” stated Tracy Swan, Hepatitis/HIV Project Director at Treatment Action Group in New York City.
ITPC has noted with deep concern that the leading Indian generic company Cipla is among the companies who have signed this deal with Gilead. In the HIV field, Cipla has demonstrated a proactive approach to develop generic versions of unpatented medicines in India, and opposed abusive patents in collaboration with community and consumer groups. The company’s leadership has been an inspiration for other generic producers and garnered respect and trust from civil society and community groups worldwide. Today, ITPC is deeply concerned that by entering into such license with Gilead, Cipla will deprive many developing countries of an important source of procurement of affordable and quality generic medicines that could save millions of lives, especially in middle-income countries.
“We denounce Gilead’s attempts to block generic competition and urge them to amend this license to allow all those in need to access treatment regardless where they live. Our movement calls on governments across the world to take action to ensure that an HCV cure will be available and accessible at the lowest price possible.” Gregg Gonsalves, Interim Chair of the Global Advisory Board of ITPC.
For further information please contact:
Pauline Londeix, IP and Access Advisor, ITPC MENA, at pauline.londeix@gmail.com
Othoman Mellouk, Regional Coordinator, ITPC MENA, at o.mellouk@gmail.com
Christine Stegling, Executive Director, ITPC at cstegling@itpcglobal.com