Next steps in Colombia--Time for a Compulsory License
February 25, 2010--Last week we reported that drug giant Abbott Labs had finally acceded to a Colombian order to cut the price of HIV/AIDS drug Kaletra (lopinavir+ritonavir, or LPV/r). This is a victory - and a beginning. Now it's time the government follow with simple measures that will bring drug prices to competitive levels.
Colombia recently declared a Social Emergency “to avert the grave crisis affecting the [financial] viability of the General System of Social Security in Health.” The declaration has public health advocates questioning why their government has yet to use available cost-controlling tools.
On February 8, NGO representatives Francisco Rossi, Luz Marina Umbasia and German Holguin wrote to suggest the ministry of health reopen a compulsory license request for Kaletra. A compulsory license would authorize price-lowering generic competition with Abbott's patented product.
The letter presents three concerns:
* Price. Even under the government order, Kaletra's Colombia price is several times greater than available generic prices. The order sets prices at $1067 for the public sector and $1591 for the private sector. But generic LPV/r is now commonly available at prices well under $500, including a low of $396 in neighboring Peru. Only competition can take prices to a comparable level in Colombia.
* Increased use. The number of people taking Kaletra in Colombia has quadrupled over the past five years, including prescriptions for first-line treatment, even though Colombia's treatment guidelines list Kaletra as a second-line drug - raising costs and questions about Abbott's aggressive marketing practices.
* System disorder. High drug costs exacerbate failures in Colombia's complex and imperfect health system, and increase incentives for care providers to pass costs on to patients - from coverage gaps to treatment exclusion, from partially-filled prescriptions to stockouts.
On February 16, the Archbishop of Bogota, Cardinal Pedro Rubiano Saenz, wrote to Colombian President Alvaro Uribe in a letter joined by Colombian NGOs and the President of the Colombian Medical Federation. The Archbishop disagreed with government assertions that the health system crisis was unforeseeable or the result of a sudden acceleration in claims. Rather, cost burdens have grown consistently since at least 2003, and drug monopolies are a key factor.
Citing cost figures and provisions of law, the Archbishop suggested the government make use of three policy tools "inexplicably" left out of the government's recent Legislative Decrees:
* Permit the registration of generic versions of new medicines. Colombia's data exclusivity law gives multinationals control over test data for many new medicines, keeping affordable generics off the market. But Article 4(c) of the same law allows for exceptions to protect public health - a basic protection the Colombian government has yet to use.
* Issue compulsory licenses on patented medicines, starting with Kaletra.
* Shop on the world market for best prices. Overturn a 1995 decree that has kept Colombia from using parallel importation since the inception of the TRIPS Agreement. In other words, import medicines that are already on sale in other countries, at prices often several times lower than prices in Colombia.
Meanwhile, Abbott told the National Medicines Pricing Commission (CNPMD) that its compliance with the price order "does not imply our agreement with it." But is Abbott getting the best of Colombia anyway?
The government intends its price order to bring Colombia Kaletra prices in line with other countries in the region. (Putting aside, for the moment, the better generic prices available regionally.) But countries like Brazil and Ecuador rely primarily on public purchases for HIV treatment. Colombia relies on many private purchasers, as well - likely skewing the average price Colombia pays for Kaletra toward the higher private sector price of $1591. In this case, Colombia will still pay more for Kaletra than its neighbors.
Colombia's President Alvaro Uribe recently complained that medicines in Colombia are "among the most expensive on the continent." The Technical viceminister for health commented, "prices have risen a great deal, especially for medicines that have no competition."
But what will Colombia do about it?
Back to Colombia's action page