COLOMBIAN MINISTRY OF HEALTH AND SOCIAL PROTECTION VIOLATED HEALTH RIGHTS


Colombian Administrative Tribunal: Ministry of Health and Social Protection violated health rights by not regulating the price of Kaletra  


Bogotá D.C. October 2012. By failing to adopt the necessary measures to regulate the domestic prices of Kaletra, in accordance with its international reference price, the Ministry of Health and Social Protection breached the collective right to public health.

The Administrative Tribunal of Cundinamarca Section One-Subsection B, made this declaration on September 27, 2012, in its ruling on the “acción popular.”[1] IFARMA, Misión Salud, la Mesa de Organizaciones con Trabajo en VIH/SIDA[2] and RECOLVIH[3] had filed the case in 2009 to obtain a compulsory license for Kaletra.

Prior to the “acción popular,” the groups had sent a compulsory license request to the President of the Republic, the Minister of Social Protection and the Superintendent of Industry and Commerce, on the grounds of public interest. The request claimed that the high price of the medicine—enabled by patent privileges—affected access for patients in need of the medicine and negatively impacted the financial balance of the health system. In 2009, the Ministry of Social Protection declined to issue a declaration of public interest and compulsory license.

Nevertheless, the pressure exerted by civil society organizations paved the way for government-ordered price reductions of approximately 70%. The state took measures to regulate the price and established a baseline cost, which during the crisis of the health system in 2010, became mandatory by Presidential Decree.

 

What is Kaletra®?

Kaletra is a medicine used to treat HIV / AIDS and therefore, is an essential medicine for preserving lives. In Colombia, the drug is patented, meaning that the pharmaceutical company can maintain a monopoly on the product. The patent on Kaletra, whose active ingredients are lopinavir and ritonavir, is valid until December 12, 2016. This means that the exclusive right to exploit and market the drug is in the hands of the multinational company until said date.

The civil society organizations that filed the “acción popular” sought a declaration stating that this violated the collective right to public morality and denied access to an infrastructure of services ensuring public health. They requested that the Superintendent of Industry and Commerce issue a non-exclusive compulsory license for lopinavir / ritonavir (known commercially as Kaletra) to remedy the alleged violation.

 

The written decision of the Court states:

It is important to remember that the National Social Security System for Health is an essential and mandatory public service, which, in accordance with the provisions of the Political Constitution, must be provided and guaranteed by the state, at all levels, in terms of efficiency, universality and solidarity. Therefore, it is considered, as established in the ruling of the lower court, that the lack of enforcement of price regulations by the state can affect patient access to an infrastructure that guarantees public health, and thus constitutes an infringement of that collective right. The fact that price savings related to this medicine may not be directly reflected in a patient’s finances, since the HIV/AIDS treatment is covered in the Compulsory Health Plan, does not imply that these savings lose importance as they translate into additional resources for the entire health system. In addition, the right to health has been elevated to the status of a fundamental right given its nexus with the right to life, which is inviolable from every perspective.

Notwithstanding the above, although property rights derived from the recognition of pharmaceutical patents for its holder cannot be ignored in the interest of the preservation of the economic and financial balance of the national health system, it is viable to impose limitations on retail prices such as those currently established by the National Medicines Pricing Commission, especially in the case of medicines used to treat diseases such as HIV / AIDS in developing countries like Colombia, where there is a lack of sufficient resources for this purpose.

 

Why was the compulsory license not ordered?

In the opinion of the Court, the state’s failure to enforce price controls affects patients’ access to an infrastructure guaranteeing public health and affects this collective right. However, with regards to Abbott Laboratories, prior to the Presidential Decree 126 of 2010, the reference prices for the country were simply a recommendation that the patent holders could follow. After the decree was issued, it was not sufficiently demonstrated that this company charged prices that exceeded those set by the National Medicines Pricing Commission.

According to the Court, intellectual property rights, specifically those derived from patents, are protected by international treaties that are accepted and ratified by the Colombian government; internal decisions cannot ignore or affect them. So far, the Ministry of Health and Social Protection has not declared the medicine to be in the public interest. Under this circumstance, it is not possible to issue a compulsory license.

The Court further states that, despite the fact that the fight against HIV/AIDS has been declared an interest and a national priority, this declaration cannot be extended to a specific medicine, such as Kaletra, and much less so to limit the rights of the patent holder thereof. Given the facts presented by the plaintiffs, the “acción popular” does not meet the conditions for issuing a license that would permit generic competition.

According to the Court, the obligation to ensure the individual and collective health of citizens, and to ensure the sustainability of the system designed to this effect, lies mainly in the hands of the state, and not of private companies engaged in the production and distribution of pharmaceuticals. This argument precludes the responsibility of Abbott in ensuring the collective right to public health, but recommends that Abbott pursue strict compliance with price regulations.

According to the Court, the obligation to implement and enforce policies that facilitate government procurement of medications that are used to treat serious diseases is that of the state. While pharmaceutical companies have a social duty, for now, their rights to exploit their patents cannot be disregarded until domestic laws provide clear measures on this.




The plaintiff organizations applaud the Court for recognizing the threat and violation of the rights and interests of public health by the Ministry of Health and Social Protection.

However, they note that a compulsory license allows for generic competition, which can transform monopoly prices into competitive prices. The price reductions generated by licensing would provide a remedy for the violations to the collective rights invoked in the “acción popular”—the right of access to an infrastructure of adequate health services and the right to administrative morality.


Colombia will continue to pay a higher price for lopinavir / ritonavir (marketed under the brand name Kaletra ®), compared to neighboring countries regardless of any price controls, because these countries allow for generic competition. Medicines do not constitute a common commercial good; instead they play an essential role in the full exercise of the right to health and, as such, should be considered as public goods.


It is worth considering: how much the system would have saved if proper price controls had been enforced since 2006, the year that Abbott obtained its patent on Kaletra in Colombia? The figure is huge and would be equivalent of the annual cost of patented Kaletra for 16 years.

 
The tables below use data from the Ministry of Social Protection (2009) to demonstrate the price changes for Kaletra (2008-2012) won by civil society groups.



NATIONAL HEALTH SYSTEM EXPENDITURES ON ABBOTT’S KALETRA-- INSTITUTIONAL CHANNEL, 2008

Number of Patients

Price per person per year $US

Total per year $US

Total per year $ col. pesos

5429

3.443

18,692,047

$37,384,094,00


NATIONAL HEALTH SYSTEM EXPENDITURES ON KALETRA WITH PRICE CONTROLS

Number of Patients

Price per person per year $US

Total per year $US

Total per year $ col. pesos

5429

1,000 

5,429,000

 10,858,000,000

 

Although the compulsory license was not granted, the action taken by civil society organizations led to government-ordered price control measures which generated savings for the Colombian society and the National Social Security System for Health of 26,526,000 pesos in 2009, 2010, 2011 and 2012, about 100,000 million Colombian pesos in total (assuming no increase in the number of patients treated).

COSTS OF PATENTED KALETRA® VERSUS COSTS OF GENERICS

Number of Patients

Price per person per year $US

Total per year $US

Total per year $ col. pesos

5429

1,000

 5,429,000 
ABBOTT

10,858,000.,000 ABBOTT

5429

470 

2,551,630
generics

5,103,260,000.00 generics

DIFFERENCE

2,877,370

5,754,740,000



However, if the license had been granted in 2008, the year it had been requested, the savings to the health system could have been double, ie, 200,000 million, about 0.2 billion pesos, which is none other than the "extra" cost of the patent on Kaletra that Colombians have paid and contributed to Abbott’s global commercial success.


Luz Marina Umbasia, IFARMA



[1] An “acción popular” is a mechanism under Article 88 of the Colombian Political Constitution to protect collective rights to public health and administrative morality.

[2]  Group of NGOs working on HIV/AIDS

[3] The Colombian People Living with HIV/AIDS Network (RECOLVIH: Red Colombiana de Personas con VIH)




Read the original version of the statement in Spanish


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