by ALECKS P. PABICO

THE ANTI-HYPERTENSION drug Norvasc, manufactured by Pfizer, is well-known among doctors here and abroad for its efficiency and efficacy. But Dr. Rosan Badon does not prescribe the medicine to her patients at community health clinics in Bagong Silang, Caloocan and Dagat-Dagatan, Navotas.

	DOCTORS are up in arms against a provision in House Bill 2844 restricting them to prescribing only generic medicines to their patients. [PCIJ file photo]

“They can’t even afford to buy medicine that costs P5, how can they ever afford one that costs eight times more?” asks Badon. In fact, even though a generic equivalent was introduced in the market last year, Norvasc was still being sold at P44.76 per five-mg tablet and P74.57 per 10-mg tablet as of last August. In India, Norvasc retails at what amounts to P8.74 per five-mg tablet and P17.09 per 10-mg tablet. In Pakistan, it is priced even lower, and can be had for P5.98 per five-mg tablet and P8.95 per 10-mg tablet.

The World Health Organization (WHO)-commissioned book Drugs and Money: Prices, Affordability and Cost Containment cites four main reasons for steep drug prices: costs invested in research and development; factors that tend to create monopolies like patent protection; third-party payers that make consumers less price sensitive; and consumers’ attitudes that tend to use price to judge the quality and efficacy of a drug.

	PREVIOUSLY PART 1 discusses the proposed creation of a drug price regulation board, one of the most contentious issues between the House and Senate versions of the bill seeking to ensure access to affordable, quality medicines, that could delay its immediate passage.

Still, Ireneo Galicia, former Intellectual Property Office (IPO) deputy director general, argues that patents are primary to blame for the high cost of medicines in the Philippines. He says, “(To) an extent that a patent gives monopoly to a patent right owner, it gives the owner some leeway in dictating the price of a patented medicine.”

Unwittingly, too, Philippine intellectual-property laws have been protecting the monopolies of multinational drug companies. It is telling that from 2001 to August 2006, only two of the 2,296 pharmaceutical patents issued by the IPO were local.

In proposing amendments to the Intellectual Property Code (Republic Act 8293), observers and legislators alike thus believe both the Senate and House affordable-medicines bills are on the right track. For one, they say, these trace the situation of overpriced drugs to the country’s legal structure of intellectual property and trademarks. Indeed, six years after the so-called Doha Declaration, Philippine intellectual property law has yet to incorporate many of the flexibilities provided in the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement).

PROVISIONS FOR THE 'FLEXIBILITIES'
Introduced to the international trading system in 1994, the TRIPS Agreement is a set of intellectual property rules, largely patterned after the U.S. intellectual-property regime that, among others, grants drug patent protection for 20 years. Apprehensions by developing countries over the agreement’s impact on public health led to a “development round” of negotiation of new trade rules that later produced the Doha Declaration.

Among the flexibilities under the Declaration are parallel importation (allowing countries to import a patented product marketed in another country at a lower price), compulsory licensing, and government use (allowing governments to temporarily override a patent and authorize production of generic equivalents of patented medicines in the public interest).

As expected, though, multinational drug companies are against the proposed amendments to the intellectual property law. They say these are discriminatory and violate the Constitution’s due process and equal protection clauses. The firms also say the proposed changes are inconsistent with international treaty obligations of the Philippines.

One of the amendments they object to is present in both Senate and Lower House bills and follows the lead of other countries like the United States, Canada, Australia, Israel, Argentina, and Thailand: it allows a generic manufacturer to start preparing a generic version about two years before a drug’s patent expires. Thus, as soon as the patent expires, the generic equivalent is ready for selling in the market. This is commonly called the early working or “Bolar provision,” after a 1984 U.S. case law decision.

Here in the Philippines at present, it is only after a drug’s patent coverage is up (a fixed period of two decades) that a generic manufacturer can start doing research or conduct its own tests to produce a generic equivalent. Such a process, Galicia says, takes from anywhere between 18 to 24 months.

The drug firms are also against a common provision in both bills that excludes from patent protection “new uses” of a previously patented product or process. The rationale for this provision — which is patterned after amendments in the India Patents Law and is present in both the Senate and Lower House bills — is the phenomenon of “evergreening.” This consists of the patenting of minor changes to existing products (e.g. formulations, dosage forms, polymorphs, salts, etc.), thereby extending artificially the protection conferred by the original patent over a drug. The tactic has caused the proliferation of frivolous patents on just about any demonstrable “new use” — and denies people access to drugs whose patents have actually expired.

Table 4: What the House and Senate Bills Propose Source: HB 2844, SB 1658 Pertinent Amendments to the Intellectual Property Code (RA 8293):
SUBJECT	SENATE BILL 1658	HOUSE BILL 2844
Non-Patentable Invention/Inventive Step	House version amends definition of non-patentability in the case of drugs or medicines, excluding from patent protection “mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy, safety and purity of that substance, or the mere discovery of any new property or new use for a known substance, or the mere use of a known process, unless such known process results in a new product that employs at least one new reactant.” (Section 22) Senate version amends definition of inventive step to mean the same as above. (Section 26)
Parallel Importation and International Exhaustion of Intellectual Property Rights for Patents	Both versions allow the government to import and resell a patented product marketed in another country at a lower price, without the consent of the patent holder. (Section 72.1)
Experimental Use	Senate version modifies Section 72.3 as an exception to patent rights: the experimental use of the invention for scientific or educational purposes and other activities directly related to said scientific or educational experimental use.	None
Early Working ('Bolar Provision')	Both versions allow generics companies to experiment and test for regulatory approval of generic versions of drugs before the expiration of their patents. (Section 72.4)
Government Use	Senate version includes non-commercial use of the patent by the patentee as part of the conditions that allow government to exploit a patent without the consent of the patent holder. House version adds two more conditions: a national emergency or other circumstance of extreme urgency requiring the use of the invention; or the demand for the patented article in the country is not being met to an adequate extent and on reasonable terms, as determined by the Department of Health. (Section 74.1)
Compulsory Licensing	Both versions allow compulsory licensing so that the government can easily set aside patent restrictions in response to public health threats subject to certain conditions, including situations of national emergency or circumstances of extreme urgency. (Section 74)
Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health	None	House version introduces new section to implement 6 of the Doha Declaration on the TRIPS Agreement and Public Health to make effective use of compulsory licensing by countries with insufficient or no manufacturing capacity. (Section 93A)