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Picture As Pdf Download For debate Costs to Australian taxpayers of pharmaceutical monopolies and proposals to extend them in the Trans-Pacific Partnership Agreement US ambitions ntellectual property (IP) provisions being pursued Summary for the by the United States in the 12-country Trans-Pacific Intellectual property (IP) protections proposed by I Partnership Agreement (TPPA) negotiations have gen- the United States for the Trans-Pacific Partnership Trans-Pacific erated widespread alarm since the initial US proposals Agreement (TPPA) have sparked widespread alarm Partnership were leaked in 2011.1-5 Subsequent leaks of composite about the potential negative impact on access to drafts of the IP chapter have shown ongoing resistance affordable medicines. Agreement by most countries to many of the US proposals that would The most recently leaked draft of the IP chapter … would delay access to generic medicines.6,7 But while the most shows some shifts in the US position, presumably in recently leaked draft suggests some modifications in the response to ongoing resistance from other countries. expand and While some problematic provisions identified in US position,7 major concerns related to medicines access entrench costly earlier drafts have been removed or mitigated, major remain unresolved. concerns remain unresolved. monopolies This article focuses on three particular problems for Three of the greatest concerns for Australia in the in Australia, Australia that remain in the 2014 draft. These are provi- recent draft include provisions that would further with no sions that would further entrench secondary patenting entrench secondary patenting and evergreening, lock and evergreening, lock in extensions to patent terms, and in extensions to patent terms and extend monopoly evidence of any extend data protection for certain medicines. If agreed rights over clinical trial data for certain medicines. countervailing by negotiating countries, these provisions would future- Data from the 2013 Pharmaceutical Patents Review, and from various submissions made to it, show that benefit proof existing low standards that are antithetical to pro- moting access to, and affordability of, medicines. These pharmaceutical monopoly protections already cost Australian taxpayers hundreds of millions of dollars will not only extend monopolies over expensive new each year. treatments, but will also make subsequent reform efforts increasingly difficult. Provisions still being considered for the TPPA would further entrench and extend costly monopolies, with For each of the problems identified, we examined exist- serious implications for the budget bottom line and ing public domain data, drawn primarily from the 2013 the sustainability of the Pharmaceutical Benefits Pharmaceutical Patents Review (PPR) and submissions to Scheme. it, to identify the costs to Australian taxpayers of existing patent and data protection provisions, as well as those likely to accrue to taxpayers if the Australian Government together with barriers to the challenge and revocation of accedes to US ambitions on these matters. questionable patents. A study in Australia found an average of 49 secondary Deborah H Gleeson Secondary patents and evergreening patents for each of the 15 highest-cost drugs over a 20-year PhD, MPH, 10 GradDipHealthProm1 period. One-quarter of these secondary patents were evergreening patents. Hazel Moir The pharmaceutical industry uses a practice known as PhD, EMA, BA(Hons)2 evergreening to extend monopoly periods for medicines. Evergreening delays generic market entry and imposes Secondary patents are patents of very low inventiveness Ruth Lopert large unnecessary costs on the health care system — and BMed, MMedSci, FAFPHM3 based on an original inventive patent for a new molecule. on consumers. When a patent on a medicine expires and Evergreening patents are secondary patents held by the 1 La Trobe University, owner of the original patent. Evergreening presents a the first generic version is listed on the Pharmaceutical Melbourne, VIC. Benefits Scheme (PBS), a statutory reduction of 16% is 2 Australian National particular problem in countries with low patentability University, standards, such as Australia and the US.8,9 applied to the PBS price and it is moved from the F1 to the Canberra, ACT. F2 formulary. There, it becomes subject to the application 3 George Washington US researchers examined patents granted for two HIV 11 University, of price disclosure, which further lowers prices over time. Washington, DC, USA. drugs (ritonavir and lopinavir/ritonavir) and found that Abbott owned 82 secondary patents and had a further Generic medicines manufacturer Alphapharm (a subsidi- d.gleeson@ latrobe.edu.au 26 pending applications in the US, all of which involved ary of US-based Mylan) stated in its public submission small variations on the original patents for these drugs.9 to the PPR that: They found that these evergreening patents could delay doi: 10.5694/mja14.01682 generic competition for 19 years beyond the date from In the case of Plavix (clopidogrel) the cost to the PBS which generic entry would have been anticipated.9 This of a near 3-year delay in the generic market entry Online first 23/02/15 problem is largely due to low standards for patent grant, caused by the grant of an interim injunction over an 306 MJA 202 (6) · 6 April 2015 For debate evergreening patent that was subsequently revoked has been estimated to be about $60 million. However, the total cost to the PBS attributable to the revoked patent has been estimated to be about $644 million (p. 6).12 The Australian Generic Medicines Industry Association analysed the costs to the health system for 39 PBS-listed medicines for which generic competition was delayed after the patent on the active pharmaceutical ingredient expired, as a result of secondary patenting.13 In the 12 months to November 2012, the cost of delayed generic The PPR found that, contrary to claims by the pharma- launch was calculated at $37.8–$48.4 million. This esti- ceutical industry, there was no evidence that the public mate does not include subsequent price reductions due investment in extensions of term had led to a commensu- to price disclosure. rate increase in investment in research and development.18 An illustration of how this affects consumers comes from The PPR concluded that patent term extension was not the patents associated with an antidepressant, venlafaxine in Australia’s interests, and recommended reducing the (Efexor). Two additional patents support the extended- maximum length of extensions or the maximum effec- release form, Efexor-XR. One of these was so broad that tive patent life. it delayed generic entry by two and a half years. By the The most recent draft TPPA IP text includes provisions time this patent was eventually declared invalid, the delay for term extensions for delays in the processing of patents to generic market entry had cost Australian taxpayers and in the regulatory approval process.7 While the leaked $209 million.14 text indicates opposition by Australia to the former, and Pfizer also successfully patented desvenlafaxine (mar- the latter is consistent with the AUSFTA, patent term keted as Pristiq), the active metabolite of venlafaxine. extension has been widely reported as an area where Not only was a patent granted for desvenlafaxine, it was the US has little support from other countries. Moreover, also given a term extension until August 2023. There is the Therapeutic Goods Administration (TGA) regulatory no evidence that Pristiq offers any clinical benefit over approval process for medicines is subject to a statutory 15,16 venlafaxine. But the cost to taxpayers of doctors pre- time limit of 255 working days, after which the TGA scribing Pristiq in preference to off-patent Efexor-XR 14 forfeits 25% of the evaluation fee (Therapeutic Goods has been estimated at more than $21 million per year. Regulations 1990 [ss. 16C; 43AA]). Thus, the routine grant- The problem of evergreening in Australia is likely to be ing of extensions to compensate for rare delays in the entrenched further by the provisions of the TPPA. A foot- marketing approval process makes little sense. note to draft TPPA article QQE1 sets the current very low Earlier leaked TPPA negotiating documents show that inventiveness approach in stone, making it difficult, if not the US was seeking to mandate patent term extensions impossible, to prevent further evergreening.17 Australia is not just for new molecules, but also for new uses and new supporting a provision that commits countries to make 6 patents available for “any new uses, or alternatively, new methods of using existing products. This extension of methods of using a known product” (Art. QQE1.4(a)),7 as scope for term extensions seems to have been dropped 7 this is current Australian practice. But acceding to this from the 2014 draft, a likely result of opposition by other provision in the treaty text will limit Australia’s options countries. No evidence presented to the PPR indicated for much needed patent reform in future. that extending the scope of patent term extensions would be in the national interest.18 Patent term extension Data protection Australia is obliged to provide 20-year patents under the World Trade Organization’s Agreement on TRIPS Data protection refers to preventing or delaying the reli- (Trade-Related Aspects of Intellectual Property Rights). In ance, by a generic manufacturer, on clinical trial data pro- 1998, patent term extension provisions were introduced, duced by the originator to support marketing approval of allowing up to 5 years for delays in processing patent its product. Under the Commonwealth Therapeutic Goods applications or in the regulatory approval process. These Act 1989 (s. 25A), the TGA may not consider an application provisions were later locked in by the obligations of the for a generic medicine where that application relies on 3 Australia–US Free Trade Agreement (AUSFTA). undisclosed evidence of safety and efficacy submitted in The PPR found that about 58% of new molecules listed support of the originator product for 5 years from the date on the PBS from 2003 to 2010 received extensions of term.
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