Misc 01/01/2021

Germán Velásquez: "The main interest of the pharmaceutical industry is its shareholders; public health comes second"

Former WHO Drug Programme Director denounces patents on covid vaccines

Cristina Mas
6 min
German Velásquez, en una conferència.

BarcelonaGermán Velásquez (Colombia, 1948) worked for more than 20 years at the World Health Organization, he was the director of the Medicine Program. His defence of the right of poor countries to have access to all medicines confronted him with the pharmaceutical industry, in an unequal fight that even forced him to travel around the world with a UN escort. Doctor honoris causa from several universities, he is now special advisor to the South Centre, a Geneva-based organization made of 54 countries of the Global South. He answers ARA's questions a few days before the World Trade Organization (WTO) meeting in January to discuss the proposal to suspend patents on covid-19 vaccines, treatments and tests for the duration of the pandemic.

What would happen if the covid-19 vaccines that have been licensed and those under development were off-patent?

Access to these drugs would be substantially increased for developing countries, which account for three quarters of the world's population. And perhaps research would also be faster, because results would have been shared instead of astronomical sums of public money being invested in the initial phases of the various projects.

So are patents a barrier to access medicines?

Yes. And it is not a new problem. In the early 2000s, antiretroviral treatment for HIV cost $12,000 in South Africa and was inaccessible to most people, and since patents were lifted they cost less than $100 and have been made available to everyone who needs them. There are many more examples: five years ago, the American pharmaceutical company Gilead developed Sovaldi, a drug that cures hepatitis C: the initial price was $84,000 for a three-month treatment, when we know that the cost is less than $100. Today, in Egypt, which is the country with the highest incidence of this disease, everyone has access to this medicine because the authorities decided to reject the patent and a local industry was able to manufacture it. In 2015, the pharmaceutical company Vertex launched a drug against cystic fibrosis in children that costs 133,000 dollars. Kymriah, a Novartis drug for leukemia, costs about 320,000 euros per treatment and the same Swiss laboratory has developed what is considered the most expensive drug in history, a treatment for muscle atrophy in babies that costs 2.1 million dollars. And all this happens because they are patented drugs.

How are the drugs priced?

One hundred years ago, when the pharmaceutical industry began to develop, it was fixed in relation to the cost price, which includes investment in research, raw materials and labour. Twenty years ago patents were introduced and this changed. However, four years ago there was a particularly serious paradigm shift: now the industry argues that price should not be based on cost, but on the value of the drug. And this is as subjective as the value of a life. The WHO and governments accept this, when no other industry is allowed to do so. In the end, they set prices according to what each country is willing to pay.

The pharmaceutical companies argue that without patents there would be no innovation: that they have to get a return on the investment they have put into research.

Never in the history of medicine has there been such a massive injection of public money as there is now to develop treatments and vaccines for covid-19. And thanks to this they have been able to shorten the deadlines: normally it takes ten years to have a vaccine and now it has been done in ten months. This is very good, but there are also critical elements: there is no traceability of this public investment. The patent system exists make it easier for private money to be invested in research. But we are paying for the vaccines twice: billions of public money were put into developing them and now the citizens have to pay for them through the purchases made by governments from the pharmaceutical companies, which are allowed a patent so that they can recover an investment that they never made. It is necessary to see to what extent it is legitimate for a company to patent a product for which it has not been the main financer. And now is the time to do so.

Does the patent also serve to ensure the quality of the drugs? We saw what happened with tests and masks in the first wave of the pandemic: they were of poor quality and entire batches had to be recalled.

The patent has nothing to do with quality. There are thousands of drugs on the market that are generic, off-patent. And they have to pass the same quality controls that the regulatory authorities put in place.

Rich countries are monopolizing the production of vaccines, both existing and future ones. What impact does this have on global access?

That three quarters of the world's population will take months and probably years to access the vaccine. Simply because rich countries have done the opposite of what they pledged to the WHO: the Covax project, which was to ensure that all countries would initially have vaccines to cover at least 20% of their population. The opposite is being done. And this, from an ethical point of view, is a disgrace, as well as a mistake from a health point of view, because we know that it is important to vaccinate the whole world population at once. It is also a miscalculation from an economic perspective, because if the developing world cannot produce and consume, the world economy cannot be restored.

Do you think Covax is threatened?

The European Union, the United States, Canada, Australia and Japan have already violated the agreement by buying up all the world's production. Covax no longer makes sense. It was born very weak from the beginning because no one had the strength to force the states to implement the plan.

But the rich countries say that they will give the remaining doses.

That's what they've always said. But France and Spain have said that they will vaccinate their entire population first and then give alms to poor countries a few years from now.

If everyone agrees that the world's population must be vaccinated at once, starting with the most vulnerable to combat the pandemic, does that mean that the situation will not improve?

As the time for developing the vaccine has been reduced, perhaps new ones will come out very soon and will be cheaper, and the countries of the Global South will be able to access them. This is provided that the industrialised countries do not buy the new vaccines that are approved so that they can have a safety stock.

Do the countries of the Global South have the capacity to vaccinate massively?

Historically, vaccination campaigns have been carried out with excellent results even in the poorest countries. Another thing is that the vaccines that need the cold chain have very difficult logistics, even for the North, and almost impossible for the South.

You were the author of the 'red book' that made it clear 20 years ago that there were legal exceptions in the patent system for medicines.

When the WTO was created, the application of patents for a period of 20 years was generalized for pharmaceutical products. But there are a number of totally legal rights for countries, mechanisms to protect public health, so-called flexibilities, such as compulsory licences. All states have the right to withdraw the patent from its owner for reasons of public health or anti-competitive practices. And to authorize others to produce, which will lower costs. The patent owner receives a royalty from those who produce the generic version. And the country that has done the most licensing like this is the United States. This could be done by any country now with covid-19 vaccines.

So why isn't it being done?

Now they are taking a step back and questioning these mechanisms. At the WHO assembly in October, access to treatment and vaccines was discussed. Some heads of government like Macron, Merkel or Pedro Sanchez himself solemnly declared that drugs or vaccines for a pandemic were global public goods. And a public good cannot be patented. But while they were making these pompous speeches, their same delegations were negotiating a resolution in which there is no talk of withdrawing the patents. The Bill and Melinda Gates Foundation said that intellectual property could not be touched because the future of innovation was in question, which is totally untrue. It is precisely now that we must consider that whatever can save humanity from this challenge must be considered a public good that is universally accessible.

Could any country do this?

Yes. Today most countries in the world already include it in their national legislation. Only one country needs to do so, and the easiest would be one with the capacity to produce vaccines, such as India, South Africa or Brazil. But I do not think this will happen, because in the WTO negotiations the industrialised countries have made it clear that they will not allow it, and the United States or the EU have so much lobbying power that I do not think any country will succeed. Don't forget that when Thailand tried it out ten years ago with an anti-cancer drug, the US threatened a trade blockade. My country, Colombia, tried for two years to make a compulsory licence for a Novartis drug and ended up resigning under pressure from the Swiss and US governments.

The race for vaccines is very political.

In the last 20-30 years there has been tension between two actors: the commercial and the health sectors. The dilemma was whether the profit of private companies that are getting richer is more important or that of the citizens. Now a new actor has been added, which is politics. Governments are engaging in real vaccine nationalism to show their people that they are doing everything they can, and that is why they are hoarding vaccines even for electoral purposes.

But no industry can manufacture vaccines for 8 billion people. Instead, they don't let others do it.

The world's vaccine production capacity is 2.5 billion doses a year. With current capacity, it would take three or four years, and companies prefer to keep expensive prices, even if this means that only rich countries buy. This shows us that the main interest of the global pharmaceutical industry is not public health, but what happens in the New York and London stock exchanges, and how they remunerate their shareholders.