Vested Interests in Counterfeit Drugs

The following article by Bright Simmons appeared in Business Daily Africa and deals with the complicated politics of global anti-counterfeiting initiatives.

Apparently many countries are not convinced that a collaborative international initiative is advantageous for all in respect to global pharmaceutical supply chain security.

February 23, 2009:
Counterfeit drugs are flooding into Africa, where up to one in three medicines can be fake, causing widespread suffering and death.

The World Health Organisation wants an international agreement to tackle the threat but is being thwarted by members such as India and Brazil, more concerned with vested interests than African patients.

To fight counterfeits, the WHO’s International Medical Products Anti-Counterfeiting Taskforce (IMPACT) first needs to define them—but this new definition is opposed by an unholy coalition ranging from global anti-corporate activists to Indian and Brazilian pharmaceutical associations and heavily-lobbied governments.

They claim the definition would covertly introduce stricter patent protection and prevent generics manufacturers from exporting cheap drugs to Africa (generics are copies of drugs whose patents have expired, although some are in dispute). They accuse IMPACT of being a front for Western “Big Pharma.”

But IMPACT principally consists of and is led by national drug-regulatory authorities. Participation is open to every WHO member, so power lies mainly with developing countries that have negligible pharmaceutical sectors—and where counterfeit drugs are most common. A leading light in IMPACT has been Nigerian cabinet minister Dora Akunyili, the famous fighter against counterfeit drugs.

Moreover, there is no basis in the accusation that the new definition of “counterfeit” would stifle the trade of good quality generic medicines through tougher patent enforcement. The new definition states: “disputes concerning patents must not be confused with counterfeiting.”

This seems clear enough. If IMPACT threatens the global trade in quality generics, as its opponents claim, why do international generics associations support it?

In December the European Generic-medicines Association (EGA) welcomed the new definition, specifically because it “puts an end to any confusion with alleged patent infringement products which have nothing to do with counterfeiting.” The International Generic Pharmaceuticals Alliance was a founder of IMPACT.

Indeed its fundamental principles match those of reputable Indian organisations such as the Confederation of Indian Industry (CII): fakes and sub-standards have “tainted the image of many Indian brands,” it notes, “…placing patients’ health at risk.”

The Organisation for Economic Cooperation and Development (OECD) estimated last year that up to 75 per cent of the world’s counterfeit drugs come from India, most of which end up in Africa.

Strange alliance
But a strange alliance of anti-business activists and business associations purporting to represent India’s best interests has successfully lobbied the government to oppose IMPACT. The Indian Pharmaceutical Association says the counterfeit definition would harm the drug industry.

The SME Pharma Industries Confederation (SPIC), called “for safeguarding the export interests of the SME (small- and medium-sized enterprises) sector” by opposing it.

Indian delegates subsequently blocked IMPACT’s progress at the recent WHO Executive Board meeting and are threatening to prevent progress at May’s World Health Assembly (WHA): all the horse-trading will be done in coming months because WHA decisions are based on consensus.

But India’s own world-class and brand-conscious major producers stand to lose from India’s opposition to IMPACT. Fake versions of successful Indian generics have begun to flood the market, not least in India itself, losing them money, damaging their image and increasing disease.

Another fake argument is that “counterfeiting is an issue of trademark violation and has no bearing on public health,” to quote anti-patent campaigner KM Gopakumar of the Indian Centre for Trade and Development (CENTAD) think-tank.

IMPACT’s definition makes no specific mention of trademark violation but does of course outlaw “false representation” and “fake packaging”: if the packet is fake, do you really expect to find real medicine inside?Without trademark protection, manufacturers cannot protect against counterfeits.

Cheap drugs are a boon to health but they must be of a high standard, lest they do more harm than good. IMPACT cannot save Africa but nor does it set out to do so. It merely provides guidance to countries.

IMPACT’s definition can serve as a template for an African legislature tightening laws against counterfeiting--or improving trademark law to help genuine brands compete. African governments must not allow fake accusations to obstruct the campaign against fakes.

Simons is an executive of Ghana’s IMANI and is also involved in developing SMS verification for medicines.