Orphan drugs for Third-World countries

Millions of people in Third World countries do not have access to the health care, drugs and vaccines available in developed countries. 10 million children less than 5 years old die each year of infectious diseases for which treatments exist in developing countries. 3 million children die each year because they have not been immunised. 150 million women would like to wait longer between two pregnancies or limit them, but they do not have access contraception. The spread of the AIDS epidemic only widens the health gap between poor countries and developed countries.

Acute diarrhoea, tuberculosis and respiratory infections have caused terrible losses in developing countries, although drugs to treat these diseases do exist. The obvious link between these diseases and the poverty which allows their development points the finger of blame at the cost of treatment, which is to expensive for the patient, and hence at the phamatical industry.

Reality appears to be more complex : access to healthcare does not only cover the prices of drugs but also the health equipment, the training of the medical team (nurses, doctors, pharmacists) and the education level which enables the population to understand the hygiene rules or the importance of a treatment.

The pharmaceutical industry, aware of its role, is increasing its initiatives in this direction : free availability of drugs, research programmes targetted at the Third World... Today, there are no longer isolated initiatives. All the keys players, whether governemental, intergovernemental or private, have realised the necessity of concerted action and of their involvement in projects aimed at impoving access to healthcare for poorest.

Sources: 'L'industrie Pharmaceutique et le Tiers Monde', Jean-Jacques Bertrand, SNIP 1999

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Orphan vaccines

Many vaccines are intended to prevent infections that are rare or of limited importance (found in a limited geographic area but with a very high number of cases in this region). To develop these vaccines, money has to be invested and may not be recovered by the sales of the product. Such products are a precarious venture for any pharmaceutical company planning to market them, and many hesitate. As these vaccines are neglected by the pharmaceutical industry, they are called « orphan vaccines ».

Several obstacles have to be faced before developing vaccines :

  1. the increasing cost of research and development projects (especially for a vaccine) ;
  2. a complex legislative and regulatory environment for drugs ;
  3. the obsession to streamline and optimise the product portfolio of each pharmaceutical company.

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The prices of vaccines

Contrary to popular opinion, the number of sales of vaccines is not directly linked to the extent of the epidemic (number of subjects that may be immunised), but rather to the cost of the vaccine dose. The price of the vaccine must be calculated by minimising the research and development, production, marketing and distribution costs in order to break into a limited market.

It is almost impossible to make 'economies of scale' when manufacturing vaccines. Economic models of vaccines have shown an inverse relationship between the number of doses manufactured and the cost per dose of the vaccine.

A tiered pricing strategy has been endorsed by the World Health Organisation (WHO), in which high-cost but low-volume vaccines in industrialised countries could subsidize the low cost and larger volume of sales in developing countries. Unfortunately, this may not be feasible if the quantity of vaccines needed in developing countries is low.

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Product viability with regard to patent protection

Development of new drugs relies heavily on the respect of intellectual property rights, represented by the patent, which reassures investors that drugs will provide a fair return on invested funds. The lack of patent protection or legal framework for intellectual property rights in some developing countries prevents the long-term viability of a vaccine.

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In Third World countries

It is difficult to develop new vaccines in these countries, because the optimal use of existing vaccines, considered as a priority, first need to be ensured.

Within the framework of WHO, the Children's Vaccine Initiative (CVI), set the development of vaccines with commercial prospects as a priority. This cost-oriented definition reflects the difficulty of developing drugs for tropical diseases, even the most prevalent ones such as malaria.

Other non-economic factors could justify an industry's decision to develop and market an orphan vaccine:

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Development strategy for orphan vaccines

The pharmaceutical industry must :

  1. have a high Research and Developmentcapacity;
  2. Master the technology of patents;
  3. Identify the poorest countries and those that least need the vaccine, in order to create financing systems for a low price for the vaccine.

No trade-off on the quality of an orphan vaccine is acceptable. For the pharmaceutical industry, the costs incurred in development, quality control, establishment of industrial good manufacturing practices are the same for an orphan vaccine as those for a traditional vaccine.

For all these reasons, the development of any orphan vaccine must be strongly supported by policy measures to increase the awareness of the benefits of immunisation at three levels :

  1. the decision-makers ;
  2. the carers ;
  3. the patients.

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How to improve the availability of orphan vaccines ?

'Life is not saved by a vaccine but by immunisation'. Even when vaccines exist, they must be available to the target population. Strategic propositions for the development and marketing of orphan vaccines are summed up in the chart below.

Solutions and proposals for accelerating orphan vaccine availability
1 - Provide information, prioritise, and secure demand
Increase awareness of disease: set up of special interest groups (patients, parents, professionals), expert groups, and national forums.
Acquire epidemiologic data on selected infectious diseases to guide decision-making: obtain access to data registries with comparable case-definitions across countries, and obtain information from specialised units and experts, scientific literature, patient organisations,and pharmaceutical manufacturers' associations.
Establish the suitability of vaccine prevention vs. other options: realistic comparisons of vaccination with patterns and costs of other alternatives, such as treatment or vector control.
Ensure political support for orphan vaccine initiatives and organise tripartite partnerships between public, private, and non-governmental sectors.
2 - Facilitate vaccine research and development and national/regional approvals
Promote innovative research and development technologies that could be applied to blockbuster vaccines or, alternatively, promote low-cost traditional vaccine technologies.
Encourage public/private sector links: academic/industrial research groups.
Set international standards of quality, safety, and efficacy and define minimum amount of data required for licencing.
Make recommendations on appropriate schedules, target ages.
Promote national and regional eg. U.S. and European Community incentives on Orphan Drug Policies (Latin America, Asia).
Expand and harmonise orphan drug policies as part of the ICH process (decrease time to regulatory approval).
3 - Ensure market/funding visibility, production and distribution
Reduce investment risks for manufacturers by providing realistic demand estimates.
Fund development of orphan vaccines for developing countries through various institutional bodies, such as CVI, WHO, UNICEF, PAHO, WB, USAID, NIH, CDC, PATH, other donor bodies, and non-governmental organisations and foundations (e.g., Gates Foundation) on the basis of target assistance for the neediest countries based on total gross national product.
Strengthen political and public health collaboration between orphan programmes (European Community, United States) and other countries to create a supranational office dedicated to orphan vaccines (World Office of Orphan Vaccine Development or CVI) that could harmonise and coordinate funding (from research to manufacturing) from various sources.
Identify and expand the pool of the committed purchasers based on expected coverage criteria.
Promote and support protection of intellectual property.
Clarify compensation programmes that may assume responsibility for liability.

Evaluate tiered pricing (high/low) feasibility at two levels:

  • Multinational: traveller or military vaccines in industrialised countries, endemic community vaccines in developing countries.
  • National: a private market for the high GNP per capita subgroup, a public market for the low GNP per capita subgroup.
Establish manufacturing strategies, such as campaigning to subsidise orphan vaccine cost investments by large volume sales of EPI vaccines.
Strengthen the vaccine distribution network for the targeted population.

The obstacles to the development of orphan vaccines reveal the importance of political issues such as the cost and quality of care, the access to it and the government's role in market regulation. Implementing a common policy on orphan drugs world-wide will only be possible if a strong intergovernmental organisation is promoted. This organisation would be in charge of :

Sources : CDC Emerging Infectious Diseases Development of orphan vaccines : an industry perspective'; November 1999

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Trade laws and the health emergency

The lawsuit started by 39 pharmaceutical industries against the South African government highlighted the health emergency evidentin some countries. Governments that could not pay the full price, have violated intellectual property rights by opening the national market to generics of molecules protected by a patent.

The agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was signed in 1994, at the same time as the agreements that constituted the World Trade Organization.
In 1997, South Africa passed a law allowing importations in parallel and substitution of drugs on its territory and in specific circumstances. This law was perceived as contrary to TRIPS and as non-constitutional by the pharmaceutical industry.

Some countries, such as India, where TRIPS have not been enforced yet are big producers of generic drugs very cheap. Numerous associations among which Médecins sans Frontières (Doctors Without Borders) struggle for the promotion of generic drugs with the South African government.

Pharmaceutical industries are taken as responsible for the high cost of treatments. However, they reject the idea that they are blocking the access to drugs. Because the situation is so urgent in South Africa (nearly 5 million HIV positive people at the end of 2000), the pharmaceutical industry is blamed, yet, its role does not consist in replacing the social security systems or public authorities. What matters to the pharmaceutical industry is to make sure that laws on intellectual property are respected since it is the only means to support research and development of new molecules. It affirms that it is willing to facilitate the access of poor countries to anti-retrovirals. However, it is legitimate that industries worry about the future of their patents in the rest of the world and also about the capacity of the countries concerned to reduce the traffic to industrialised countries.

Despite of all this, the South African government is not totally blameless for the current situation in the country. It refused the offers from the International Therapeutic Solidarity Fund for prevention of vertical transmission of HIV (mother-to-child), as well as offers from industries to reduce prices or to give free drugs. AIDS has not been declared to be a national emergency by the South African government and this prevents South African from benefiting totaly legally from compulsory licences.

Compulsory licences allow companies in some circumstances to produce a drug that is still patented with payment of royalties in return to the company holding this patent.

A Differential Pricing Meeting was held by the World Health Organization (WHO) and the World Trade Organization (WTO) in Hosbjor near Olso (Norway) from 8 to 11 April 2001. The theme of the workshop was Differential pricing and financing of essential drugs. Fifty experts were gathered representing all the protagonists involved in the access to essential drugs in developing countries: pharmaceutical companies, generic drug companies, NGO representatives, governments and intergovernmental organisations.
These experts concluded that expanding access to affordable medicines to poor countries was only possible and realistic in three conditions were met :

  1. Differential pricing
    Setting different prices between developed and developing countries is a principle that all have accepted provided that :
    • the price of drugs in rich countries is not increased ;
    • the price of drugs in poor countries does not become the standard price for the setting of prices in rich countries ;
    • means to prevent traffic of these drugs to rich countries are implemented.
  2. Generic drugs
    Generic drugs will be an additional means to reduce the price of drugs through competition.
    The safeguards of TRIPS are the following: protection of intellectual property rights is, everyone agrees, a motor for research and development of new molecules, but not exclusively. The countries must use the safeguards included in the agreements on TRIPS.
  3. Financing
    Despite decreased prices of treatments, it will still be impossible for some countries to buy treatments against AIDS and opportunistic diseases. External financing will be therefore necessary. It should concern the whole care system and should be extended to prevention, education and patient care.

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