Senator Hatch Says Global Fund Advocating For Generic Drugs To Solve Healthcare Crises Is Abusing Funds

from the also-he's-lying dept

We've written a few times about governments around the globe seeking to make use of lower-priced (and often more widely available) generic medicines for responding to serious diseases, rather than sticking with the more expensive name brand. Current international agreements, like TRIPs, allow countries to effectively "opt-out" of promises to respect other country's patent laws for the sake of supplying such medicine and, you know, saving lives. It's pretty clear that breaking the patent on these drugs is quite effective, driving costs down on a massive scale, making this part of healthcare much more cost-effective.

Of course, the pharma companies don't like this at all. So it should hardly be that big of a surprise that Senator Orrin Hatch directly tried to put pressure on Hillary Clinton and the Obama administration to stop efforts to promote more widespread use of generics in the developing world using these methods. The link above highlights that Hatch sent then Secretary of State Hillary Clinton a letter that suggested he's quite upset that the US-funded "Global Fund to Fight AIDS, Tuberculosis and Malaria" was training people in different countries to explore compulsory licenses of drugs or other ways to make use of generics.

Of course, if you just read Hatch's letter (embedded below), you'd be forgiven for being confused. In it, he claims to be outraged that the Global Fund is encouraging various countries to buy more expensive generics of "cheaper" brand name drugs. Huh? In what environment do generic drugs cost more than the brand name? Also, he appears to just be wrong. Part of the data that he based his complaint on comes from a presentation (embedded with the letter) from the Global Fund, in which they have a few graphs showing that (as you would expect if you were anyone but Orrin Hatch) the generic versions are, in fact, cheaper, which is obviously why they were recommending making use of the option.

So, even as Hatch's letter is full of bluster about misspending money, the details actually seem to suggest that they saved money.

In the letter, Hatch also claims that the presentation directly calls on countries to "disregard" the TRIPS Agreement. But, again, the attached presentation appears to tell the opposite story, with a specific call to seek solutions that comply with TRIPs.

Recipients must procure their products in accordance with national and international laws. The Global Fund encourages recipients to apply the flexibilities provided within national laws and in the World Trade Organization's Agreement on Trade-related Aspects of Intellectual Property rights (TRIPS)...

In other words, directly contrasting Hatch's claims, the Global Fund appeared to tell countries to comply with TRIPs, but (correctly) noted that there were some exceptions built within the law that allowed them to seek compulsory licensing and the use of much cheaper generics. Still, there may have been some behind-the-scenes maneuvering as well. As the IP-Watch report notes, soon after all of this, the executive director of the Global Fund, Michel Kazatchkine, resigned. The report suggests this was due to US pressure over Global Fund's daring effort to tell developing countries what their international agreements actually allow. Also: the replacement, Mark Dybul, is a US official, likely to make sure that the Global Fund works in the same manner as Hatch would like -- artificially keeping the big drug makers happily without competition and with artificially high profits, even as healthcare in the developing world might suffer.

Incredibly, Hatch actually seems to be arguing that by suggesting developing countries explore generics, it's putting people at risk because... well, there's a gap in the explanation, but it appears to be due to big pharma companies feeling they need such subsidies to make the drugs in the first place. From the letter:

By advocating for developing countries to disregard the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) through issuing compulsory licenses to gain access to Global Fund grants, we are abusing the system. Access to these products is vital to our success in fighting the war on HIV/AIDS and actions inconsistent with patent law such as these will only hinder our ability to work in partnership with the companies that have provided the intellectual property rights to develop generic versions of their products.

Got it? If you're a developing nation seeking to stem the AIDS epidemic by making AIDS drugs actually available to those with the disease, you are are actually decreasing the success of the war on AIDS because [something, something, something] big pharma will take their ball and go home. Of course, there's no actual evidence to support this, and tons of evidence that shows that developing countries who actually set a compulsory license on drugs related to critical diseases, actually do help deal with serious problems. There is no evidence that this suddenly scares companies into not making the drugs at all. They still make plenty of money in the developed world off of those drugs.

Just to summarize, though, an actual US Senator, Orrin Hatch argued that, by having the Global Fund advocate for better, cheaper generic medicines, as clearly allowed under international agreements, that the Global Fund is somehow paying more for medicines (they're not) and convincing big pharma to fail in the war against these diseases (they're not). It's no secret that politicians aren't always in sync with the truth, but this is significantly more blatant a misrepresentation than is normal.

Filed Under: developing nations, drugs, generic drugs, global fund, healthcare, hillary clinton, orrin hatch, patents, trips