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INTELLECTUAL PROPERTY: WHO-WIPO-WTO BOOK

Chapter 3: Medical technologies: the innovation dimension

 

C. Overcoming market failure: the challenge of neglected diseases

Key points

  • Innovation in medical technologies for neglected diseases suffers from market failure as conventional IP-based incentives do not correspond with the nature of demand for treatments of these diseases. A key factor is the limited purchasing power of both governments and patients in the countries where such diseases predominate.
  • While there is still a huge research gap, the neglected diseases R&D landscape is changing, and an increasing number of actors are engaged in funding and carrying out such research.
  • Many new innovation mechanisms and models aimed at increasing R&D to find effective treatments for neglected diseases have been discussed and implemented at international and national levels. One such innovative model set up in cooperation between multiple stakeholders is WIPO Re:Search Sharing Innovation in the Fight Against Neglected Tropical Diseases.
  • Assessments of many such proposals can be found in the reports published by the WHO Expert Working Group on Research and Development: Financing and Coordination (EWG) and by the Consultative Expert Working Group on Research and Development: Financing and Coordination (CEWG).
  • The CEWG has recommended specific action points, including establishing a binding global instrument for R&D for developing countries.
  • PDPs have significantly increased the number of products in development for diseases that predominantly affect developing countries.

 

There is a particular problem in incentivizing medical R&D for diseases that disproportionately affect poor people in developing countries as the market mechanisms, such as intellectual property rights (IPRs), do not work in this case. A key factor is the limited purchasing power of both governments and patients in the countries where such diseases predominate; unlike for other diseases, there is no positive spillover from drug development targeted at more affluent markets. These diseases are called neglected diseases, and this section deals with the challenges of medical innovation in this area.

1. Diseases disproportionately affecting people in developing countries: neglected diseases

Both the Commission on Intellectual Property Rights, Innovation and Public Health (CIPIH) (WHO, 2006b) and the WHO Global Strategy and Plan of Action on Public Health, Innovation and Intellectual Property refer to diseases that disproportionately affect people in developing countries. This concept is based on the three types of diseases distinguished by the Commission on Macroeconomics and Health (WHO, 2001a):

  • Type I diseases are found in both rich and poor countries, and affect large numbers of vulnerable populations in both. Examples of communicable diseases include measles, hepatitis B, and Haemophilus influenzae type b. Examples of non-communicable diseases include diabetes, cardiovascular diseases and tobacco-related illnesses.
  • Type II diseases are incident in both rich and poor countries, but with a substantial proportion of cases in poor countries. Examples of such diseases include HIV/AIDS and TB. While both diseases are present in rich and poor countries, more than 90 per cent of cases occur in poor countries.
  • Type III diseases are those that are overwhelmingly or exclusively incident in developing countries. Examples of such diseases include African sleeping sickness (trypanosomiasis) and African river blindness (onchocerciasis).

Type II and III diseases are often referred to as neglected diseases. These also include 17 neglected tropical diseases that are a specific focus of the work of WHO. These neglected tropical diseases currently impair the lives of an estimated one billion people (WHO, 2010f). They share a number of common features:

  • They have an enormous impact on individuals, families and communities in developing countries in terms of disease burden, quality of life, loss of productivity and the aggravation of poverty, as well as the high cost of long-term care.
  • They affect largely low-income and politically marginalized people living in both rural and urban areas. Such people cannot readily influence administrative and governmental decisions that affect their health, and often seem to have no constituency that speaks on their behalf. These people are therefore likely to be “neglected” by public policy-makers.

The distribution of these diseases is restricted by climate, in particular by its effect on the distribution of vectors and reservoir hosts. In most cases, there appears to be a low risk of transmission beyond the tropics. Unlike influenza, HIV/AIDS and malaria and, to a lesser extent, TB, most neglected tropical diseases present little threat to the inhabitants of high-income countries, thus triggering less attention. They are relatively neglected by the pharmaceutical research that is needed to develop new diagnostics and medicines, and to make accessible interventions to prevent, cure and manage the complications of these diseases (WHO, 2010f).

The unavailability of medical technologies to effectively address neglected diseases is one of the major problems associated with tackling this human health tragedy. The situation has been characterized by a chronic lack of investment in R&D to find effective treatments for neglected diseases. The innovation effort is starkly disproportionate to the public health challenge posed by such diseases. Since the diseases are concentrated in poor countries, and since poor people are affected the most, it is not just the diseases that are neglected; rather, the problem is one of neglecting patients who die of these diseases.

In 1990, the Commission on Health Research for Development found that of the US$ 30 billion global investment in health research in 1986, only 5 per cent, or US$ 1.6 billion, was devoted specifically to health problems of developing countries, although an estimated 93 per cent of the world’s burden of preventable mortality occurred in the developing world (Commission on Health Research for Development, 1990, Chapter 3). Later, based on this data, the Global Forum for Health Research coined the term “10/90 gap” to highlight the gap between the share of the global disease burden and the resources devoted to addressing it.

While a huge research gap for neglected diseases still exists today, both the health research landscape and the share of the global disease burden have been changing positively since 1990. The G-Finder reported that the funding of R&D for neglected diseases was more than US$ 3 billion in 2011, with the three “top tier” diseases being HIV/AIDS (33.8 per cent), TB (17.3 per cent) and malaria (18.4 per cent). This leaves only slightly more than 30 per cent of funding in the neglected diseases area available for carrying out research on all other neglected diseases (Moran et al., 2012). Significantly more money is spent on development of new medicines than on vaccines. As little as under 5 per cent of the total annual R&D budget spent on addressing neglected diseases is reported to be spent on diagnostics (BIO Ventures, 2010). Funding comes predominantly from the public sector. In 2011, the public sector provided almost two thirds (US$ 1.9 billion, 64.0 per cent) of global funding with high-income countries contributing 95.9 per cent of this share. The philanthropic sector contributes US$ 570.6 million (18.7 per cent) and industry invested US$ 525.1 million (17.2 per cent) (Moran et al., 2012).

2. New approaches to innovation for neglected diseases

This section presents some of the currently discussed innovation models for neglected diseases. It includes information on various WHO developments, including the report of the CEWG (WHO, 2012a). This section also reviews the role of PDPs and the efforts of research-based pharmaceutical companies in this regard.

Recent years have seen a drive to find alternative and innovative ways to undertake needs-based research. New initiatives aimed at increasing R&D to find effective treatments for neglected diseases are under way, involving a diverse group of actors, and a large number of collaborative partnerships are at work to address the lack of medical innovation for neglected diseases. While many proposals are still under discussion, various new measures are already being used to fill the research gap. One such innovative model set up in cooperation between multiple stakeholders is WIPO Re:Search Sharing Innovation in the Fight Against Neglected Tropical Diseases (see Section C.6 below).

One important concept that evolved from this discussion is the concept of delinking price of the final product from the costs of R&D. This concept is based on the fact that patents allow developers to recoup the costs and make profits by charging a price in excess of the costs of production. This way of financing R&D is viewed as constituting a barrier to access to medicines in countries where populations pay out of their own pockets for medicines and thus cannot afford to pay high prices. The principle of delinking is based on the premise that costs and risks associated with R&D should be rewarded, and incentives for R&D provided, other than through the price of the product. This type of delinking is particularly advocated in the case of financing R&D for neglected diseases.

Delinking can be facilitated by push mechanisms and by pull mechanisms. Push mechanisms are incentives that include such initiatives as grant funding and tax credits for investment in R&D. Pull mechanisms are incentives that offer rewards for the final outcome of R&D of certain products. Mechanisms in the latter category include milestones or end prizes. The following section, while not exhaustive, describes some of these approaches. Assessments of many related proposals can be found in the reports of both the EWG1 and the CEWG.

(a) Open source drug discovery and development

Open source drug discovery and development builds on two principles borrowed from open source software development. First, open source drug discovery is based on the idea of collaboration, i.e. organizing and motivating groups of independent researchers to contribute to research projects. Second, it is based on an open approach to IP which makes the outcome of that research generally available, either through the public domain or through the use of customized licences (Maurer, 2007; Masum and Harris, 2011).

The success of open source models in the information technology (e.g. web technology and the Linux operating system) and biotechnology (e.g. human genome sequencing) sectors highlights both the need and the potential to initiate a similar model in health care, such as an open source model for drug discovery. Several open source drug discovery projects are currently under way.2 Most have secured financing either in the form of government grants or from philanthropic sources. These funds are used to cover administrative expenses and may also be used to fund access to laboratories, computer facilities and payment to researchers.

To date, open source initiatives have had only a minor impact on public health in developing countries. While they seem ideally suited to promote pre-competitive research, they do not as yet have the capacity to ensure delivery of finished health products to patients or to ensure that products are steered through costly development phases. Biopharmaceutical firms have used different organizational modes (i.e. licensing agreements, non-equity alliances, purchase and supply of technical and scientific services) to enter into relationships with different types of partners, with the aim of acquiring or commercially exploiting technologies and knowledge. These relationships can include large pharmaceutical companies, biotechnology product firms, biotechnology platform firms and universities. Box 3.7 describes one recent initiative in open innovation for drug discovery.

(b) Grants

A grant may enable a small or medium-sized enterprise to finance initial research for a medicine on a neglected disease and bring a potential new medicine through Phase I trials, at which stage it may be possible to attract commercial funding. Push mechanisms operate best in the initial or upstream phase of the R&D process.

While grants can be useful for stimulating R&D, like most push mechanisms, they provide no guarantee that a viable drug will ultimately be delivered. This is because grants are paid irrespective of the results achieved. The impact of grant schemes on the development of effective treatments in the area of neglected diseases is therefore uncertain. On the other hand, evidence from some US grants schemes suggests that 60 per cent of projects supported by way of grants do eventually make it to market. Evidence also shows that funding from such schemes enabled almost 80 per cent of grantees to raise additional capital subsequently.3

Box 3.7. The council for scientific and industrial research open source drug discovery model 

The Open Source Drug Discovery (OSDD) model of India’s Council of Scientific and Industrial Research (CSIR) represents a consortium which aims to deliver affordable health care to the developing world by providing a global platform where researchers can collaborate and collectively try to solve some of the complex problems associated with discovering novel therapies for neglected diseases such as malaria, TB and leishmaniasis. In order to expedite the discovery of drugs, the consortium aggregates the biological and genetic information available to scientists. This provides a unique opportunity for scientists, doctors, technocrats, students and others with diverse expertise to work for a common cause. The CSIR has also joined forces with some research-based pharmaceutical companies in this model. The OSDD is a large community, comprising more than 4,800 registered users from 130 countries.

During the early stages of a discovery, the OSDD establishes a collaborative model with community participation. However, it collaborates with industry/contract research organizations and publicly funded organizations at the development stage.4 

 

(c) Prizes

Prizes work as a pull mechanism in R&D by increasing the rewards for success, thereby making investment more attractive and the delivery of a specific product more likely. Pull mechanisms are incentives that are likely to operate more successfully in downstream or later phase R&D. Prizes can also favourably impact the delivery of a product. For example, certain requirements relating to IP management may be imposed on the prize winner, including allowing free use of the technology by the public sector or developing countries, in order to promote competition for supply. There are two categories of prizes: the first is awarded for reaching a specified milestone in the R&D process; the second rewards the attainment of a specified endpoint (such as a new diagnostic, vaccine or medicine with a particular profile in terms of performance, cost, efficacy or other important characteristics). Prizes may be offered in the area of neglected diseases.

While the funds would provide incentives for drug development, they would also aim to delink R&D costs from the prices of medicines. The effect that such prizes could have on innovation and access would largely depend on the application and design of the medicines developed, and the manner in which they align research efforts with health priorities, while aiming to leverage access by keeping prices of finished products low.

(d) Advance market commitments

Advance market commitment (AMC) agreements aim to create greater incentives for the R&D of a specific product either through market creation or through risk reduction. AMC agreements operate as contracts between a purchaser (normally a government or an international financing agency) and suppliers. They usually contain some form of agreed guarantee with regard to price or volume. By effectively guaranteeing a market, pharmaceutical companies are incentivized to undertake R&D.5 Box 3.5 provides an example of how advance market commitments can be implemented.

(e) Tax breaks for companies

Many countries provide tax credits for R&D expenditures, enabling companies to account for expenditure on R&D against their tax liabilities. Some governments have introduced additional tax credits with the express goal of incentivizing research on specific neglected diseases, for example HIV/AIDS, TB and malaria (European Commission, 2003).

How much tax breaks could drive innovation in the field of neglected diseases R&D is open to debate. This is because tax credits cannot by themselves remedy the absence of an effective market. In other words, as long as a company has to recover a substantial amount of its investment in R&D for a drug through the selling price, tax credits cannot effectively drive innovation for products for which there is no effective demand.

Tax credits also cannot help where companies are operating at a loss – as is the case with some biotechnology companies in their start-up phase, before they have launched any approved product on the market. Another disadvantage of the introduction of tax breaks is that they may simply subsidize R&D that a company would have undertaken anyway.

(f) Patent pools

A patent pool is an agreement between at least two patent owners to group their patent rights relating to a specific technology and to license the rights to use these patents to each other and to third parties, subject to certain conditions such as the payment of royalties. Pooling the relevant patents necessary to use a technology, or to produce downstream products, allows licensees to only enter into one licence agreement with one legal entity and has been advocated as a tool to be used in R&D for neglected diseases. Patent pools have been used since the 19th century in different industry sectors. Early patent pools were aimed at fixing prices and keeping competitors out of the market, and thus came into conflict with competition law. Today, most patent pools aim to enable access to new technologies and to foster downstream competition. By reducing transaction costs for licensees, patent pools provide easy access to all patented technologies needed to produce standardized products. The audio-visual industry, for example, has adopted pooling as an instrument to facilitate licensing of standard technology and has established a number of successful patent pools.6 In the field of pharmaceutical inventions, with funding from UNITAID,7 a Medicines Patent Pool Foundation was established to pool patents regarding ARVs (see Chapter IV, Section C.3(b)(i)).

Patent pooling was also discussed as a possible solution to clear patent thickets to facilitate a response to the severe acute respiratory syndrome (SARS) (see Box 3.8).

Box 3.8. Patent pools 

After the outbreak of SARS in 2002, the WHO set up a collaborative network of laboratories to help determine the cause of the disease. Ultimately, this led to the identification of the responsible pathogen, a member of the coronavirus family.8 Collaborating laboratories involved in the decoding of the genome of the virus filed a number of patent applications covering the genomic sequence of the SARS coronavirus. This caused concern that diverse ownership of patents claiming all or parts of the genomic sequence of the virus might impede development of medical products, including vaccines and diagnostic tests. To counter this concern, and also to facilitate the development of needed medical products, a patent pool was suggested. This involved placing all essential patents in a pool to be licensed among the participants in the pool and to third parties on a non-exclusive basis.9 As a result of implementing this proposal, some of the entities who are expected to be granted a significant number of patents relating to the SARS virus have signed a letter of intent in relation to creating such a patent pool. The next step would have been to determine which patent applications were essential for the pool and to draft the patent pool agreement.10 However, as no new SARS outbreaks were recorded, there was no economic driver for the patent pool and it was decided not to pursue the project any further. 

 

(g) Priority review voucher

A priority review voucher (PRV) is a scheme which aims to reward companies that develop health products that address small markets or limited patient groups as is the case also with neglected diseases. The PRV entitles a company to receive priority review (i.e. quicker review by the responsible regulatory authority) for any additional health products that would not otherwise qualify for priority review. A company can use this scheme to advance the marketing date of a potential “blockbuster” product, thus generating increased and earlier revenues from that product.

A PRV scheme was introduced in the United States in 2007. Under this scheme, companies that obtain marketing approval from the FDA for a product to treat or prevent one of 16 neglected tropical diseases are entitled to receive a PRV. The PRV can be used by the recipient or it can be sold to another company.

The average difference in approval time between a priority review product and a standard review product was estimated to be about one year, and the average value of a PRV was thought to exceed US$ 300 million (Ridley et al., 2006; Grabowski et al., 2008). Since this scheme was introduced in the United States, two PRVs have been issued – in April 2009 for the development of an antimalarial drug and in December 2012 for the first anti-TB drug in 40 years. The first company used the voucher in February 2011 to accelerate FDA review of a drug for arthritis. It is to be seen what the second company does with the voucher.

Some argue that the value of the voucher is too small to have meaningful impact on the allocation of R&D resources by large pharmaceutical companies. A voucher might be attractive for smaller companies, but these companies are less likely to progress a health product through to development phase in view of the large costs of that phase. The value of a voucher is uncertain since it does not guarantee that an additional company product will, in fact, ultimately be approved by the regulatory authority, nor does it guarantee that the time saved by a priority review will actually exceed one year (Noor, 2009).

(h) A global binding framework for R&D for neglected diseases

The proposal to negotiate an international treaty on R&D for neglected diseases has been discussed for some time. In 2005, the CIPIH received a proposal regarding an R&D treaty and it concluded that “recognising the need for an international mechanism to increase global coordination and funding of medical R&D, the sponsors of the medical R&D treaty proposal should undertake further work to develop these ideas so that governments and policy makers may make an informed decision” (WHO, 2006b).

In the GSPA-PHI, the World Health Assembly (WHA) called for “further exploratory discussions on the utility of possible instruments or mechanisms for essential health and biomedical R&D, including, inter alia, an essential health and biomedical R&D treaty”.11

Several different proposals have been made for an international treaty on R&D. One of the latest submissions regarding such a proposal was presented to the CEWG. The proposal was “to create a new global framework for supporting priority medical R&D, based on the fair and equitable sharing of costs, access to benefits of R&D, and incentives to invest in needs-driven R&D consistent with human rights and with the goal of all sharing in the benefits of scientific advancement” (WHO, 2012a).

3. WHO Expert Working Groups on R&D financing

The GSPA-PHI as well as WHA61.21 required the WHO to “establish a results-oriented and time-limited expert working group under the auspices of WHO and linking up with other relevant groups to examine current financing and coordination of research and development, as well as proposals for new and innovative sources of financing to stimulate research and development related to Type II and Type III diseases and the specific research and development needs of developing countries in relation to Type I diseases”.12 Two WHO expert working groups (the EWG and the CEWG) have examined the current financing and coordination of R&D, as well as proposals for new and innovative sources of financing to stimulate R&D directed at the specific needs of developing countries.

The EWG assembled 109 proposals on how to increase the level of R&D on neglected diseases. It then developed a methodology to assess the feasibility of the proposals. The EWG report was presented to the WHA in 2010 (WHO, 2010g). Subsequently, member states decided to establish the CEWG to further progress the work of the EWG.13

The CEWG carried out an in-depth analysis of the proposals contained in the EWG report, considered additional submissions and proposals from relevant stakeholders, and also examined the appropriateness of different R&D financing approaches and the feasibility of implementing these approaches in each of the six WHO regions. The CEWG agreed on criteria for assessing the proposals. Such criteria included: public health impact; efficiency/cost-effectiveness; technical, financial and implementation feasibility; IP, delinking, access, governance and accountability aspects, as well as capacity strengthening potential.14

The CEWG concluded that the proposals that came closest to meeting its criteria were: a global framework on R&D; open approaches to R&D and innovation; pooled funds; direct grants to companies; milestone prizes and end prizes; and patent pools. The proposals that did not meet the CEWG criteria included: tax breaks for companies; orphan drug legislation; green IP; PRVs; transferable IPRs; the Health Impact Fund; and purchase or procurement agreements. A detailed presentation and analysis on each of these proposals is set out in Annex 3 of the 2012 CEWG report (WHO, 2012a) (see Box 3.9).

Box 3.9. 2012 CEWG report: key recommendations 

Approaches to R&D:

  • Open knowledge innovation; pre-competitive R&D platforms, open source and open access schemes, and the utilization of prizes, in particular milestone prizes
  • Equitable licensing and patent pools

Funding mechanisms:

  • All countries should commit to spend at least 0.01 per cent of GDP on government-funded R&D aimed at addressing the health needs of developing countries in relation to product development.

Pooling resources:

  • Between 20 per cent and 50 per cent of funds raised for health-related R&D aimed at addressing the needs of developing countries should be channeled through a pooled mechanism.

Strengthening R&D capacity and technology transfer:

  • Address the capacity needs of academic and public research organizations in developing countries.
  • Utilize direct grants to companies in developing countries.

Coordination:

  • Establish a global health R&D observatory and relevant advisory mechanisms under the auspices of the WHO.

Implementation through a binding global instrument for R&D and innovation for health:

  • Formal negotiations on an international convention on global health R&D should be initiated.15 

 

The CEWG recommended that WHO member states negotiate a global convention or a treaty under the auspices of Article 19 of the WHO Constitution. The proposed convention would be aimed at providing effective financing and coordination mechanisms to promote R&D. It would bind all governments to invest 0.01 per cent of gross domestic product (GDP) in R&D for Type II and Type III diseases and in R&D for the specific needs of developing countries in relation to Type I diseases. Part of these contributions would be collected in a pooled fund at global level. The CEWG report was presented to the 65th WHA in May 2012 for further consideration by member states. In November 2012, an open-ended meeting of member states agreed to establish a global health R&D observatory within the WHO Secretariat in order to monitor and analyse relevant information on health R&D for neglected diseases. Member states also agreed to explore and evaluate existing mechanisms for contributions to health R&D for such diseases and, if there is no suitable mechanism, to develop a proposal for effective mechanisms, including pooling resources and voluntary contributions, as well as a plan to independently monitor their effectiveness.16

4. Product development partnerships: new pathways to innovation

The term public–private partnership (PPP) is usually used to describe an initiative that consists of a partnership between government and at least one private-sector company. Today, such partnerships manage a large proportion of all neglected diseases drug development projects worldwide. PPPs have common characteristics:

  • They integrate public-sector and private-sector approaches, and generally use industry practices in their R&D activities.
  • They manage neglected diseases R&D portfolios and they target one or more neglected disease.
  • They are created in order to pursue public health objectives rather than commercial gains, and also in order to provide funding to cover existing research gaps.
  • They ensure that the developed products are affordable (WHO, 2006b).

It is difficult, however, to clearly identify the common denominator in all initiatives that are identified as “PPPs”. Some may not be true “public–private” partnerships, in the sense that they may not have partners from both private and public sectors (Moran et al., 2005). The broader category of product development partnerships (PDPs) embraces such initiatives that do not necessarily have a public-sector or private-sector partner, and thus do not qualify as PPPs in the strict sense. It therefore encompasses equally public health-driven, not-for­profit organizations that use private-sector approaches to develop new products in conjunction with external partners. This study uses the term PDP, not PPP, as it is more descriptive of new structures for medical innovation.

The emergence over the last 15 years of PDPs drawing together actors from the public and private sectors has been a major development in efforts to focus R&D towards diseases that disproportionately affect low- and middle-income countries (LMICs). These new partnerships have been constituted in a number of ways, but usually with the involvement of non-profit organizations, foundations and industry. The non-profit philanthropic sector provides most funds for such PDPs, notably the Bill & Melinda Gates Foundation (Grace, 2010). These partnerships have significantly increased the number of products in development for diseases and conditions that predominantly affect developing countries, and they play an important role in identifying pathways and overcoming bottlenecks in research for neglected diseases.

A 2005 study, which examined the portfolios of five PDPs as well as the portfolios of a selected number of pharmaceutical companies, identified  new drug development projects for neglected diseases (including tropical diseases, malaria and TB). A significant finding was that one quarter of development projects came from the pharmaceutical industry working alone; one quarter from the pharmaceutical industry together with PDPs; and the balance from PDPs working with a diversity of small companies, developing country companies, academics and the public sector. Thus, PDPs were involved in three quarters of all identified neglected diseases drug development projects in 2005 (Moran et al., 2005).

PDPs form alliances with stakeholders drawn from the public and private sectors because PDPs and these entities have the potential to capitalize on the opportunities that each may offer the other. PDPs are performing the service of integrating inputs from different branches of a very diverse industry. PDPs also seem to have lower research costs than research-based pharmaceutical companies for a number of reasons. PDPs benefit from lower capital costs as a result of their capacity to leverage in-kind inputs. They also benefit from the fact that they do not have to fund a fully loaded development pipeline. Instead, they select their projects from a pool of existing public and private domain projects. On the other hand, their costs could be expected to increase substantially as more projects enter large-scale Phase III trials. In this case, the PDP cost-efficiency profile would probably change, since late-stage failures are more expensive than early-stage failures (Moran et al., 2005). Some examples of PDPs organized to tackle solutions for neglected diseases are given in Box 3.10. A concrete example of a needs-driven partnership is the Drugs for Neglected Diseases initiative (DNDi) (see Box 3.11).

Box 3.10. Public–private partnerships and product development partnerships

In 2011, funding to PDPs involved in research into neglected diseases totalled US$ 451.4 million. This represented 14.8 per cent of global funding for research on neglected diseases. Four PDPs – Programme for Appropriate Technology in Health (PATH), Medicines for Malaria Venture (MMV), the International AIDS Vaccine Initiative (IAVI) and the Aeras Global TB Vaccine Foundation – accounted for over half of all PDP funding (Moran et al., 2012).

One of the first of such new PDPs was the IAVI, founded in 1996, but many more have been created since then, including:

Hiv/Aids

  • IAVI
  • International Partnership for Microbicides
  • South African AIDS Vaccine Initiative

Malaria

  • Malaria Vaccine Initiative
  • MMV

TB

  • Aeras Global TB Vaccine Foundation
  • Foundation for Innovative New Diagnostics
  • Global Alliance for TB Drug Development
  • Tuberculosis Vaccine Initiative

 

Other partnerships include

 

  • Drugs for Neglected Diseases Initiative
  • Institute for OneWorld Health
  • PATH
  • International Vaccine Institute
  • Infectious Disease Research Institute
  • Innovative Vector Control Consortium
  • Sabin Vaccine Institute
  • European Vaccine Initiative.17

 

5. Research for neglected diseases: a growing role for pharmaceutical companies

Research-based pharmaceutical companies are increasingly engaged in philanthropic research. Aggregated contributions make the industry in 2011 the second largest sponsor of research for neglected diseases, after the US National Institutes of Health and ahead of the Bill & Melinda Gates Foundation (Moran et al., 2012). A number of companies have established dedicated research institutes to develop new products targeting diseases that disproportionately affect developing countries, or participate in cooperative projects and PDPs, thus sharing assets and knowledge. Table 3.2 gives details of some industry-supported R&D centres that are dedicated to research in neglected diseases. In total, research-based pharmaceutical companies were reported in 2012 to be engaged in 132 projects aimed at developing new medicines and vaccines for diseases which have been prioritized by the WHO Programme for Research and Training in Tropical Diseases (TDR). Of these projects, 112 are being carried out in collaboration with PDPs. A further 20 are being run by individual research-based pharmaceutical companies without the involvement of third parties (IFPMA, 2013).

Box 3.11. Drugs for neglected diseases initiative: a concrete example of a needs-driven partnership 

DNDi is a collaborative patients’ needs driven, non-profit R&D organization that aims at bridging gaps in existing R&D in essential drugs for neglected diseases.18 To ensure access to medicines and medical technologies in endemic countries, DNDi negotiates non-exclusive licenses with any right holders to have the final product registered and sold on an affordable and equitable basis in all endemic countries. In addition, DNDi secures contractual commitments from its industrial partners to sell the products on a cost-plus basis (e.g. the costs of production plus a reasonable margin to sustain long-term production). By negotiating access commitments at a very early stage in the R&D process, DNDi is paving the way to access through delinking the costs of R&D (financed with DNDi funding) from the final price of the product (maintained at the lowest possible sustainable level by the manufacturing partner).

The example of ASAQ, a new fixed-dose combination of artesunate (AS) and amodiaquine (AQ) for the treatment of uncomplicated malaria, illustrates this approach. DNDi coordinated the development of ASAQ with various public-sector and private-sector partners while retaining ownership of the related IP. DNDi then licensed IP to a pharmaceutical company for the industrial production, registration and distribution of ASAQ in Africa and other developing countries. Under the agreement, the pharmaceutical company committed to supply ASAQ to the public sector of endemic countries at a “no-profit-no-loss” maximum price of US$ 1 per adult treatment. In the private sector, the pharmaceutical company is free to sell the product at market price and pays a 3-per-cent royalty on sales to DNDi, which is reinvested in further research. The various public-sector and private-sector partners have agreed not to file any patent on ASAQ. As a consequence, ASAQ can be freely produced and distributed by any other pharmaceutical company in the world. The results of this approach are conclusive: ASAQ is registered in 30 countries in sub-Saharan Africa and India. It is pre-qualified by the WHO, and more than 130 million treatments have been distributed to date. In addition, DNDi is also facilitating technology transfer to an African manufacturer. 

 

Table 3.2 Industry R&D centres dedicated to research on diseases that disproportionately affect developing countries

 

Company

 

Centre

 

Location

 

Disease

 

Since

 

AstraZeneca 

 

Bangalore Research Institute 

 

Bangalore, India   

 

Tuberculosis

Malaria

2003

2009

GlaxoSmithKline 

 

Tres Cantos Medicines Development campus 

 

Tres Cantos, Spain 

 

Malaria

Tuberculosis

Kinetoplastids 

 

2002

MSD/Merck & Co. 

 

MSD Wellcome Trust Hillemann Laboratories 

 

New Delhi, India 

 

Rotavirus 

 

2009

Novartis

Novartis Institute for Tropical Diseases (NITD) 

 

Singapore

Dengue Fever

Malaria

Tuberculosis

 

2002

Novartis

Novartis Vaccines Institute for Global Health (NVGH) 

 

Siena, Italy

Diarrhoeal diseases

Salmonella 

 

2008

Novartis

Genomics Institute of the Novartis Research Foundation (GNF) 

 

La Jolla, USA 

 

Chagas disease

Leishmaniasis

Malaria

2010

Novartis     

Novartis Institutes for Biomedical Research (NIBR) 

 

Horsham, UK 

 

Infectious diarrhoea 

 

2009

Source: IFPMA (2013)

On 30 January 2012, pharmaceutical companies together with a range of public and private partners met in London and agreed to unite for a new, coordinated push to accelerate progress toward eliminating or controlling 10 neglected tropical diseases. They confirmed their commitment to expanding current programmes that ensure the necessary supply of medicines and other interventions and advance R&D through partnerships and provision of funding to develop next generation treatments, and providing continued financial support to accelerate progress towards eliminating or controlling these diseases by 2020. These commitments were laid down in the “London Declaration on Neglected Tropical Diseases”.19

Box 3.12. WIPO Re:Search 

 

In October 2011, WIPO, in collaboration with public-sector and private-sector researchers and BIO Ventures for Global Health, launched a new consortium called WIPO Re:Search. Public-sector and private-sector organizations share IP and expertise with the global health research community to promote development of new medicines, vaccines and diagnostics to treat neglected tropical diseases, malaria and TB. Selected IP assets are available under royalty-free licences to researchers anywhere in the world. As products come to market, licences for sale will be royalty-free in all least-developed countries, with royalties subject to negotiation for other developing countries.

This commitment of resources is expected to accelerate the development of medicines, vaccines, and diagnostics for neglected diseases, malaria and TB, and resources is aimed at facilitating new partnerships. The WHO supports the project through the provision of technical advice. WIPO Re:Search is grounded in voluntary agreements and operates on the basis of voluntary licenses. It is based on the belief that intellectual property and knowledge can be used creatively to stimulate more investment in R&D for new health solutions. By October 2012, WIPO Re:Search had 62 members and had facilitated 11 research collaborations or agreements between WIPO Re:Search members.20 

6. WIPO Re:Search: a new partnership to use intellectual property in public health

WIPO, working together with multiple stakeholders in the private sector, academia, and civil society, created a new partnership – WIPO Re:Search Sharing Innovation in the Fight Against Neglected Tropical Diseases (see Box. 3.12). WIPO Re:Search provides an innovative model of IP sharing and management. It is based on the belief that IP and knowledge can be used creatively to stimulate the invention of new health solutions while ensuring access for the most disadvantaged populations and to demonstrate that IP can serve the needs of countries at all levels of development.

WIPO Re:Search aims to foster collaborations to advance and stimulate research and development for new and better treatment options for those suffering from neglected tropical diseases (NTDs, see Section C.1 above), malaria and TB. In addition to pharmaceutical companies, members of WIPO Re:Search include universities and research centres from all over the world. Of particular importance are the several research centres from the African continent whose participation is an important component to the development of new and better treatments for NTDs.

The approach of WIPO Re:Search is novel in that public-sector and private-sector organizations around the world are making valuable IP available to qualified researchers anywhere in the world seeking to develop new solutions for NTDs, malaria and TB. All licenses granted for R&D and manufacture must be royalty-free to any user anywhere in the world. Any products developed for these diseases under a WIPO Re:Search Agreement must be sold on a royalty-free basis in all least-developed countries (LDCs). Access terms for other, non-least developed, developing countries are subject to agreement between the parties. Services, such as access to company research facilities, screening of compounds as well as the sharing of expertise and hosting of scientists, are also offered through WIPO Re:Search. The principal implementing tools developed by WIPO Re:Search are: the Public Database, to guarantee transparency and accessibility of information; and the Partnership Hub to facilitate collaboration and cross-sector partnerships.

The Public Database is composed of IP assets that providers have chosen to make available through WIPO Re:Search. All the information is publicly available and can be accessed without registration. Providers to the database submit summary information relevant to: hits, leads, lead series, pre-clinical candidates, clinical candidates, enabling technologies, IP, formulation, diagnostic tools, vaccines, new biological entities, know-how, or other services for the purpose of facilitating R&D.

Because collaborations are critical to success in science, the Partnership Hub is a key component of WIPO Re:Search. The Partnership Hub Administrator, BIO Ventures for Global Health (BVGH) is a non-governmental organization based in Seattle, United States. BVGH actively engages with members – including major pharmaceutical and biotechnology companies, academic and other non-profit research institutions, government, and non-governmental organizations – to facilitate NTD research collaborations among members.

Through the Partnership Hub, WIPO Re:Search connects providers and potential users so that assets and knowledge are shared to accelerate the development of products in the fight against NTDs. As WIPO Re:Search develops over time, WIPO and BVGH are collecting and analysing feedback in order to ensure that the consortium’s operations, in particular the Database and related services, are useful to the global health research community.

For example, the first WIPO Re:Search agreements were made between industry and research institutions to study novel treatments for Chagas disease, sleeping sickness, schistosomiasis (snail fever), and TB. Specifically, these first agreements concern:

  • Cathepsin inhibitors, originally developed for osteoarthritis, will be tested for activity in biochemical and phenotypic screens for two parasitic diseases: schistosomiasis and kinetoplastid diseases that include leishmaniasis, sleeping sickness and Chagas disease.
  • Researchers will test a selection of glycogen synthase kinase (GSK)-3 inhibitors, which were originally developed for a potential treatment of Alzheimer’s disease, against parasites responsible for Chagas disease, leishmaniasis and sleeping sickness.
  • Isocitrate lyase inhibitors will be developed intended as a novel treatment for tuberculosis.
WIPO Re:Search is a results-oriented project that, through the creative and innovative use of IP, facilitates the research and development and technology transfer needed to find concrete solutions to one of the most challenging issues of global health today.

1. See WHO (2010g). back to text

2. The Synaptic Leap’s Synthetic Praziquantel Project at www.thesynapticleap.org/node/286. CSIR India’s Open Source Drug Discovery Project at www.osdd.net/. EWG Submission: “Open Source Drug Discovery” at www.who.int/phi/public_hearings/second/contributions/ZakirThomasCouncilofScientificIndustrialResearch.pdf. Sage Bionetworks at http://sagebase.org/back to text

3. CEWG Submission: New Investment Strategy: Innovative Developing Country Research Awards Global Forum for Health Research 2011, at www.who.int/phi/news/cewg_2011/en/ index.htmlback to text

4. Source: www.osdd.netback to text

5. For the use of AMC in the area of vaccines, see Chapter III, Box 3.5. back to text

6. For examples, see: www.mpegla.com; www.vialicensing.com; and www.sisvel.comback to text

7. See Chapter I, Section B.2(a), and Annex I, Sections A.8 and B.9. back to text

8. See www.who.int/csr/sars/goarn2003_4_16/en/back to text

9. Simon et al. (2005). See also the presentation at www.who.int/intellectualproperty/events/en/JamesSimon.pdfback to text

10. Correa (2009) and Verbeure et al. (2006). back to text

11. GSPA-PHI Element 2.3(c). back to text

12. GSPA-PHI Element 7.1(a). back to text

13. WHA, Resolution: WHA63.28: Establishment of a consultative expert working group on research and development: financing and coordinationback to text

14. A detailed presentation and analysis on each of these proposals is set out in Annex 3 of the 2012 CEWG report (WHO, 2012a). back to text

15. Source: Røttingen et al. (2012); see also WHO (2012a). back to text

16. See http://apps.who.int/gb/ebwha/pdf_files/EB132/ B132_21-en.pdfback to text

17. Sources: WHO (2006b); Widdus and White (2004). back to text

18. See also Annex I, Section B.4, for more background on objectives and approach to IP. back to text

19. Uniting to Combat NTDS, “London Declaration on Neglected Tropical Diseases”, 30 January 2012. back to text

20. Source: www.wiporesearch.orgback to text