Pfizer's Philippine follies

Big Pharma vs. public health: The Filipino Smackdown.

Published April 4, 2006 11:48PM (EDT)

On March 1, the huge pharmaceutical company Pfizer sued the Philippine International Trading Corp., the Philippines FDA and two Philippine government regulators for patent infringement. The reason, says Consumer Project on Technology lawyer Judit Rius Sanjuan: The officials were accused of "importing from India samples of a drug that Pfizer sells in both the Philippines and India, and for submitting the samples to the government drug regulatory agency."

According to Sanjuan, the patent for Pfizer's hypertension drug Norvasc expires in 2007. The Philippine officials were engaging in a practice known as the "early working" of a patent. They wanted to be ready to sell a generic version of Norvasc manufactured in India the moment the patent expired, so they were beginning the process of registering the imported version. Such a practice is entirely legal in the U.S. and many other countries, and, according to Sanjuan, while not explicitly permitted in the Philippines' Intellectual Property Code, has been standard practice for several years without previously being challenged.

Why would the Philippines be so anxious to start importing the generic version (a practice known as "parallel trade")? Maybe it's because Pfizer charges $1.46 for a 10 mg dose of Norvasc in the Philippines, but only $.18 in India. According to the Philippine press, Pfizer has so far not explained why there is such a huge price difference between the two countries, but it's not hard to guess why. The availability of generic versions of Norvasc in India has likely forced prices down there.

Meanwhile, on April 3, after two years, much wrangling and a dollop of Big Pharma controversy, the World Health Organization's Commission on Intellectual Property Rights, Innovation and Public Health finally released its long-awaited 228-page report: "Public Health, Innovation, and Intellectual Property Rights."

The reaction from various parties was as predictable as an outbreak of malaria in sub-Saharan Africa. Representatives of developed-nation industry associations condemned it as overreaching and not properly respectful of intellectual property rights. Activists concerned with public health issues called it a missed opportunity: watered down, insufficiently aggressive, and in the pocket of Big Pharma -- noting, in passing, the embarrassing revelation that a draft version of the report had been circulated with annotations inserted by an employee of the International Federation of Pharmaceutical Manufacturers & Associations.

I've only read the first and last chapters of the report, but I can sympathize with the activists. The majority of the report's recommendations sound a consistent, but not very inspiring, theme: Governments should do more to support research and development of medical science that would address the needs of poor people in developing nations.

The basic problem is well known: There's no profit in developing drugs to treat diseases that afflict poor people, so pharmaceutical companies have no incentive to devote resources to their problems. At the same time, Big Pharma demands that developing nations adopt strict intellectual property laws, and works hard at blocking efforts by developing-nation governments to provide cheap alternatives to expensive drugs.

Case in point: Pfizer's lawsuit in the Philippines. It occurred to me that one way to test whether the CIPIH's 50-odd recommendations had any teeth was to see if any could be construed to apply to the Norvasc brouhaha. Lo and behold:

  • "All companies should adopt transparent and consistent pricing policies, and should work towards reducing prices on a more consistent basis for low and lower middle income developing countries."
  • "Access to drugs cannot depend on the decisions of private companies but is also a government responsibility."
  • "Developing countries should retain the possibilities to benefit from differential pricing, and the ability to seek and parallel import lower priced medicine."
  • "Countries should provide in national legislation for measures to encourage generic entry on patent expiry, such as the 'early working' exception, and more generally policies that support greater competition between generics, whether branded or not, as an effective way to enhance access by improving affordability.

So let's be clear: Even by the standards of a watered-down report representing a consensus view of many different stakeholders but heavily influenced by the interests of rich-nation intellectual property rights holders, Pfizer's behavior in the Philippines is abominable, unconscionable and deserving of withering worldwide scorn.

By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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