Tuesday, 15 September 2015

PoliticalSpeak: will the Corbynistas lobby for a change in the patent system?

Is it time for a revolution and to disband drug patents to stimulate drug discovery? #PoliticalSpeak #MSBlog #MSResearch

"With the election of the far-left politician Jeremy Corbyn as leader of the British Labour Party, over the weekend, we may now get a socialist debate on drug discovery and the influence of Big Pharma on healthcare and healthcare delivery. Issues close to our hearts include repositioning of off-patent drugs, the prescribing of off-label 'older drugs', treating MS in the developing world, drug discovery, the rising costs of new drugs, socialist healthcare, the NHS and many more political issues. You may be interested in reading a recent article in The Economist on intellectual property; it goes into whether or not there is a viable alternative to the current patent system that some would argue is not working well enough in the biomedical space. I think if Jeremy Corbyn read The Economist, which based on his views is unlikely, he may buy into some of the proposed changes. The question is will he have enough political capital, and big enough balls, to tackle healthcare inequality and the current pharma model?"

"Until I read the article below I couldn't imagine am alternative funding system for drug discovery. As The Economist concludes it may be time to run an international experiment with other forms of financing innovation that could be run alongside the patent system to see which one is superior. I wonder which system will win?"

'The Times They are a Changing' Bob Dylan, 1964

Jeremy Corbyn - new left wing leader of the British Labour Party

The Economist. A question of utility. 2015 August 8th, page 55-57.

Excerpts:


...... Michele Boldrin and David Levine, two economists, pulled all this research together in a book published in 2008 and in “The Case Against Patents”, a 2012 paper for the Federal Reserve Bank of St Louis. They argue that patents are neither as good at rewarding innovation nor as helpful in propagating it as claimed......

....... If you look at things such as the number of inventions presented at international fairs, the evidence suggests that 19th-century countries that lacked patent systems were no less innovative than those which had them, though they did innovate in somewhat different areas...... 

...... Reviewing 23 20th-century studies Mr Boldrin and Mr Levine found “weak or no evidence that strengthening patent regimes increases innovation”—all it does is lead to more patents being filed, which is not the same thing......

..... Several of these studies found that “reforms” aimed at strengthening patent regimes, such as one undertaken in Japan in 1988, for the most part boosted neither innovation nor its supposed cause, R&D spending......

...... Even if many industries do not really need patents—and a fair few might be better off without them—there is still a strong belief that in some businesses they are vital. The example always touted is pharmaceuticals..... 

....... Drugs have to undergo exceptionally expensive and long-drawn-out testing procedures to demonstrate that they are safe and effective. And once a company has laboriously demonstrated that a molecule does its job with few or manageable ill effects, its rivals could make far cheaper copies were it not for patent protection. That is why proponents of patents see it as reasonable to let Bristol-Myers Squibb have a temporary monopoly on Opdivo, its new melanoma drug, and to charge $120,000 per course of treatment in America. If the company could not do so, the argument goes, it would not have spent a fortune on getting the drug and its complex manufacturing process approved......

........ However, the history of the industry raises doubts about such arguments. Until 1967 German drug companies could only patent the way they made drugs, not the formulae of the drugs themselves. Anyone could sell copies of the medicines if they found another method of making them......

...... Yet Mr Boldrin and Mr Levine say German drugmakers produced more innovations than British ones (remember where aspirin was invented). Another interesting case is Italy, which had no patent protection for drugs until 1978. One study showed it invented a larger proportion of the world’s new medicines before that date than afterwards. Before the “reform” it had lots of copycat firms, but the biggest of these also did research on drugs of their own. They were largely wiped out once they had to pay royalties on their copycat drugs.......

..... It is true that, encouraged by the prospects of patents, pharma companies do a lot more research today than in the 1960s and 1970s. But it is also true that they are not alone in their endeavours. Public support for biomedical research has soared over past decades; the budget of America’s National Institutes of Health is five times what it was in 1970. Mr Boldrin and Mr Levine reckon that once subsidies and tax breaks are accounted for, American private industry pays for only about a third of the country’s biomedical research. In return the patent system provides them with a great deal of income........

...... The drug companies claim this is a good deal; that the short-term gains a spate of cheap drugs would bring right after a putative abolition would be overshadowed by the long-term losses due to a dearth of new drugs. Looking at one industry-funded studythat reaches this conclusion, though, Mr Boldrin and Mr Levine found it quite sensitive to the discount rate applied to future benefits. In 2005 Dean Baker, an economist at the Centre for Economic and Policy Research, a think-tank in Washington, DC, took a much simpler, but still rather striking, approach: he just compared the costs imposed by the patent system with the innovation that system bought.

...... America’s health systems, he noted, spent $210 billion on prescription drugs that year. Based on how much cheaper generic drugs were than patented ones, Mr Baker calculated that a competitive patent-free market might have provided the same drugs for no more than $50 billion. That represented a saving of $160 billion.......

...... The drug companies reckoned at the time that they were spending $25 billion on R&D; the government was spending $30 billion on basic medical research. The money it would have been able to save buying drugs for Medicare and Medicaid in a patent-free world have allowed the government to double that research spending, more than replacing industry’s R&D, while still leaving $130 billion in public benefit......

........ With America’s prescription-drug bill now $374 billion, the opportunity looks all the greater, even though the companies now say they are putting $51 billion a year into R&D. Imagining that the government could spend R&D money as effectively as the corporate sector may sound like a stretch. But a government which simply wanted to make drugs available for competitive manufacture might find various ways to get innovative results from contract research companies. Joseph Stiglitz, an economist at Columbia University, and others have suggested encouraging teams of autonomous scientists to develop new breakthrough drugs by offering those that succeed big prizes.......

...... After a promising drug was found the final, most expensive stages of clinical trials, which measure the efficacy of a drug that has already been shown to be safe, could be publicly funded, using another portion of the huge potential savings from cheaper drugs, and conducted by independent laboratories. Once a medicine was validated, any drug company would be allowed to make it. Alternatively, the trials could be made smaller, with companies required to earn the right to manufacture a drug that had been shown to be safe by scrupulously collecting and publishing data on how the drug compared with other treatments once it was in use.......

....... This is not as strange as it may sound. Many drug startups see their exit strategy as being bought up for a billion dollars or so by a big pharma company when their projects start to look promising. Billion-dollar prizes would provide similar incentives. Nor is it all that new: Robert MacFie, a leading Victorian patent-abolitionist, also favoured prizes........

...... Six bills to reform patents in some way (including in one case by overturning an earlier reform) have been proposed to the current American Congress. None seeks abolition: any lawmaker brave enough to propose doing away with them altogether, or raising similar questions about the much longer monopolies given to copyright holders, would face an onslaught from the intellectual-property lobby......

....... But a top-to-bottom re-examination of whether patents and other forms of intellectual-property protection actually do their job, and even whether they deserve to exist, is long overdue. Simple abolition raises problems in terms of the ethics of property rights. But reductions in the duration of exclusive rights and differentiation between those rights for different sorts of innovation are possible, and could be introduced in steps over a number of years, allowing plenty of time for any ill effects to surface......

........ Experiments with other forms of financing innovation could be run alongside the patent system. If defenders of the patent system really seek to foster innovation, they should be prepared to do so in their own backyard.......

4 comments:

  1. Reform an International honey trap.....

    The patent system is made by Lawyers for Lawyers. It is archaic and a money making machine that oils a greasy cog in Lawyer land.

    Each country has its own rules, which is crazy at a time when the world has opened up with computers and the idea that you have to file in each country is bonkers,

    Just to file in Japan for instance costs about £10-12,000 is costs of translation costs, You could get a patent for Europe, but not the US makes a mockery of the system.

    I am afraid to say that English has become the international Language and it therefore should be a no brainer that patent Lawyers should likewise learn the language of science and there should be one common system. However what are the chances of that.

    In Europe public disclosure means the end of your patent opportunities but you blab about it in the States for a certain time point.

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  2. PS Does a one size fit all system work....The patent system was set up with a quick fix in mind so if you are targeting cancer where the end point was death in a few months you could afford the current system but if you have neurological disease where trials maybe ideally 5 years then the system doesn't work. But without patent protection will companies go there?

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  3. The most eye-opening idea in this article to me is that if the US government wasn't paying so much for drugs, via Medicare, etc., it could invest much more in research programs. I'd never thought of that before. Drug prices in the US are outrageously high--and not just for MS drugs anymore. We need to do something.

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  4. "But a top-to-bottom re-examination of whether patents and other forms of intellectual-property protection actually do their job, and even whether they deserve to exist, is long overdue".

    Thank goodness for some sensible thinking and some questioning

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