Pfizer vs. the Philippines, Round 2

Pfizer sues the Philippines, the Philippines sue right back.

By Andrew Leonard
April 28, 2006 2:42AM (UTC)
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The Philippines are not backing down to Pfizer. Three weeks ago, we discussed here a patent infringement lawsuit filed by Pfizer against Philippine government officials. In 18 months, the patent on Pfizer's hypertension drug Norvasc will expire, and the Philippines wants to be ready, hoping, at that date, to immediately start importing a much cheaper Indian version of the drug. But registering a new generic drug with the Board of Food and Drugs in the Philippines is a time-consuming process, so the government wants to start now.

Norvasc is one of Pfizer's biggest sellers, and it wants to maintain its window of high-priced sales as long as possible; thus, the lawsuit. But on April 10, Roberto Pagdanganan, president of the state-owned Philippine International Trading Corp., turned around and filed a countersuit against Pfizer, just one day after testifying in the patent suit filed against him.


The whole brouhaha offers a classic illustration of how the interests of the pharmaceutical industry and developing nations don't mesh. This is not the first time that Big Pharma and the Philippines have tangled. For the better part of a decade, Philippine government officials, who claim that drug prices in the Philippines are significantly higher than elsewhere in Asia, have been looking for ways to bring down medical costs. They've been opposed at every step of the way by the pharmaceutical industry, working hand in hand with the United States government.

In 1999 the Philippine secretary of health, Alberto Romualdez, attempted to institute an "administrative order" that would require pharmaceutical companies to label off-patent drugs with their generic name, in addition to their brand name, in the hopes of educating consumers as to cheaper alternatives to the brand-name versions. The pharmaceutical industry threatened to withdraw from the country, and U.S. State Department representatives made not-so-veiled threats of trade retaliation. Romualdez's response to the threats, quoted in Jennifer Ellen Mattson's illuminating timeline of the 1999 dispute, is instructive.

"Suspension or termination of the operations of U.S.-based pharmaceuticals will cause only minor dislocations in the Philippine pharmaceutical industry, as most of these are available either through local manufacturers or from other countries. Innovative products that are truly life-saving will continue to be available through international humanitarian agencies and other concerned organizations."


"Brand name regulation ... will affect only products that require doctor's prescriptions for their use. These comprise a small fraction of total American goods sold in the Philippines. It does not seem appropriate for the strongest economic power in the world to jeopardize the entire range of commerce with the Philippines. The disproportion is especially clear if one considers that what is at stake is the health and lives of Filipino children as against the already vast profits of a few companies."

"The Department of Health has a responsibility to examine all possible options that will assure quality health care for all Filipinos. If these options include limiting the property rights of a few, it is still mandatory to consider them in view of the well-established legal maxims favoring the benefit of the majority."

"Limiting the property rights of the few... It's hard to imagine words that could strike more fear into Big Pharma. Not that anyone at Pfizer appears to be worried. Although Pfizer stock has declined in value by some 44 percent during the tenure of current CEO Hank McKinnell, Pfizer's Board of Directors has rewarded him with a pension package worth at least $83 million.

Andrew Leonard

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

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