Wednesday, September 30, 2009

Necessity is Apparently NOT the Mother of Invention: More about “Orphan Drugs”

In last week’s discussion of the controversy surrounding patents and their tendency to sometimes inhibit innovation, we came across the example of “orphan drugs”. Our conversation sparked my interest and I did some research to learn more about this concept of market and profit-driven innovation, specifically related to one of the world’s greatest health problems: malaria.

I found that the US passed an Orphan Drug Act in 1983, meant to encourage pharmaceutical companies to develop drugs for diseases that have a small or unprofitable market by providing them enhanced patent protection, marketing rights and tax incentives. However, this act has not gone far in promoting the development of drugs for harmful diseases that are having catastrophic effects in our world and on its economy.

In the attached article, renowned economist Jeffrey Sachs discusses how diseases like malaria are leading poverty-stricken Africa more and more towards economic disaster. Sachs stated that while big pharmaceutical companies have the scientific ability to develop a malaria vaccine, they lack motivation because of the low potential for profit, danger of competition, and the royalty stack. To help create a larger, more profitable market for the malaria vaccine, Sachs proposed that ‘rich countries’ such as the US, along with agencies like the World Bank, should commit to buying vast quantities of the vaccine on an annual basis at a guaranteed price.

Such an approach, Sachs states, has the potential to significantly change the world we live in today in many ways: most importantly, low-income countries would benefit profoundly and could more easily climb the economic development ladder. The ‘rich counties’ today have enormous scientific ability and financial capability to make a huge impact on the rest of the world, and as Sachs puts it: “In a world in which science is a rich-country prerogative while the poor continue to die, the niceties of intellectual property rights are likely to prove less compelling than social realities.”

1 comment:

  1. There was an argument made- I forget where, maybe by a guest on NPR- during the most contentious part of the healthcare debate, that even in a capitalist country, some things just shouldn't be solely dictated by capitalist markets. I think that if there ever was an example of that, it would be here, in the case of malaria. Although, I do think that the U.S. and other countries could probably commit to buying the vaccine for distribution through organizations like USAID or JICA, they really shouldn't have to.

    Thanks for posting this Nida.