Intellectual Property and Access to Essential Medicines: A Tenuous Link?

According to the World Health Organization,¹ essential medicines are medicines that satisfy priority health care needs of a population, and they are selected with regard to disease prevalence, safety, efficacy, and comparative cost-effectiveness. In addition, they are intended to be available in functioning health systems at all times in adequate amounts, in appropriate dosage forms, with assured quality, and at affordable prices.

Affordability is commonly regarded as central to the accessibility of essential medicines. However, keeping the price of medicines low has been argued by some to be inimical to pharmaceutical innovation and investment. This has in turn led to a criticism of the pharmaceutical industry, which performs a critical socio-economic function of drug development, but allegedly at an unjustifiably high profit margin that precludes access by many of those who need the medicines. From about the middle of the last century onwards, the politics of drug development assumed a more complex character for a number of reasons that are related to the globalisation of research and development, drug production, and intellectual property rights. With more than two billion people in low- and middle-income countries (LMIC) lacking adequate access to essential medicines,² there is growing demand on the pharmaceutical industry to contribute to improving access to medicines for the poor in these countries.³ The sustainable way forward is one that balances the interest in drug innovation and development with alleviating the health-related sufferings and burdens of the world’s poor in the long run. These are not irreconcilable goals, but it is important not to essentialise (or unduly simplify) the relationship between price of essential medicines and their accessibility. In addition, a clearer articulation of roles and priorities is necessary among the many and varied stakeholders encompassed.

In this paper, we attempt to broaden the way in which the relationship between the price of essential medicines and their accessibility may be considered. We also highlight the importance of multi-stakeholder discussion and collaboration, with focus on the corporate responsibilities of pharmaceutical companies. Our aim is to contribute to constructive dialogue on these responsibilities, and to give emphasis to the (still contested) view that partnerships and collaboration among multiple stakeholders are urgently needed to facilitate drug innovation and development, as well as to improve equitable access to medicines.

Intellectual Property Rights and the Price of Essential Medicines

Proponents of intellectual property rights argue that a patent rights regime, for instance, could increase human welfare. The prospect of acquiring temporary monopolies in patents over pharmaceutical innovation and development could incentivise private investment. Once developed, commercialisation of the innovation would facilitate the use and spread of these new technologies and products. As the argument goes, the social costs associated with monopoly rents that patent holders derive should be adequately compensated by the benefits of new technologies and products.

While plausible in theory, a number of situational obstacles persist. Many countries, especially those with limited resources at their disposal, do not have the innovative and absorptive capabilities. A criticism of the international intellectual property regime established by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) has been in restricting the ability of local actors in low-resource settings to acquire capabilities for technological acquisition and accumulation, and unjustly entrenching the privileged position of wealthy countries as its main beneficiaries. The inability of resource-poor countries to participate in global pharmaceutical innovation has been observed to have contributed to two important issues in global health.⁴ First, there is a deficiency in global health innovation in drugs that target diseases affecting resource-poor countries. Second, a mismatch has been observed between the health needs of resource-poor countries and their health-care capabilities. To be sure, the TRIPS regime provides two policy outlets, should intellectual property rights unduly preclude access to essential medicines. These are parallel importation and compulsory licensing, which could be applied under certain conditions. For the former, a country may engage in parallel importation if the international doctrines of patent exhaustion are adopted. Hence, parallel importation...