Public Hearings on the Medicines and Related Substances

Amendment Bill[B44 – 2008]

Presentation to the Portfolio Committee on Health

Cape Town

6th August 2008

AGENDA

1. NAPM - Who we are

2. NAPM Position on Proposed restructuring

3. NAPM Concerns:

I. IP

II. Two Tier Registration Process

III. Expediting the registration of generics

IV. Transition period/phase

4. Conclusion

5. Way forward

6. Q & A

1. NAPM – Who we are

Vision

The Association aims to champion affordable healthcare by promoting generics

Mission

Promote the Use of Generics

Promote the development of the  South African  Pharmaceutical Industry

NAPM Membership

Abex Pharmaceutica Arrow Pharma SA

Austell Be-Tabs

Biovac Bodene

Columbia Dr Reddy’s Laboratories

Enaleni/Cipla-Medpro Ferring

Medreich SA Merck Generics / Mylan SA

Omnimed Pharma Dynamics

Pharmafrica Ranbaxy

Sandoz Sekpharma

Thebe Medicare

 

2. NAPM Position

• Restructuring of the RA - supported by industry

• Why??

8

123

42.8

12

113

24.92

6

113

22.43

11

63

28.4

10

57

23.7

0

20

40

60

80

100

120

140

Minimum Maximum Average

Mo

nth

s

Average registration time - routine

Survey 1 (incl screening) Survey 2 (incl screening) Survey 2 (excl screening) Survey 3 (incl screening) Survey 3 (excl screening)

Mandate of the Regulatory Authority

• In line with Medicines Act: Safety QualityEfficacy

• Issues... Public interest → constitution / government

policies √

Pricing → PC - well-established, up & running √

Intellectual Property → Patent Act:

~ conducive to emerging economy √

~ Support public health issues √

Functioning and processes of SAHPRA

• Should be: Transparent

Independent

Accountable

Fair

Consistent

• How ??

Role of MoH → Policy setting, commitment = important

Scientific process → international standards /

best practice = safety, quality & efficacy

Conflict of interest → important for good governance - legislate

Role of the Regulatory Authority

• What ??

Public → guarantee safety, quality & efficacy of all medicines

Industry → guarantee certainty in terms of registration timelines/processes

Government → support access to medicines

~ timely availability

~ fast track registration

~ National Drug policy

- generic medicines

- mandatory generic substitution

~ educate patients/health professionals

What is an Effective & Efficient RA ?

• Is defined by:

Timely registration of medicines

Timely availability of medicines

Well resourced

Open 2-way communication

Transparent decision making

Independence

Scientific Principles

Safety

Quality

Efficacy

3. NAPM Concerns

2-stage registration process

Intellectual Property

Expediting the registration of generics

Transition Phase / Period

2-Tier Registration Process

• Inefficient and Costly An expensive scientific process could result at the end a

completely wasted exercise Safety, Quality and Efficacy does translate into public

interest Defies principles of transparency Will create uncertainty for industry

• Complicates registration process

- mixes scientific evaluation with broader issues covered elsewhere in legislation

Pricing within the PEEU IP covered in the Patent Act Industrial imperatives covered in Industrial Policy within DTi

Intellectual Property - Introduction

Access to affordable healthcare is a worldwide challenge

Generic medicines play a major role in facilitating access to affordable medicines

Introduction & availability is dependent and influenced by the patent term of the innovator, whose abuse or misuse can present a barrier to entry

MTT (no generic representation on task team) recommended:

“It will be the responsibility of the industry applying for registration of its products to certify that it does not infringe IPR of the country.”

“Where the RA receives an application that contains confidential supporting information of an innovative product, the authority has the obligation to keep that information confidential, not to use that information to grant another license.”

Patent System in SA

Current Patent Act

ProgressiveTRIPS compliantProtects public health - Supportive of DOHA

declaration Balance between innovation and access

Current Patent Filing System

Patents not examined or evaluated – granted as applied for

Open to abusive ever-greening practices

Generic companies respect valid patents, provided public benefits at the end by full disclosure & ability to freely use invention once the patent expires (wrt marketing not reg).

Intellectual Property and RA

Affidavit of patent non-infringement contravention of section 69A of the Patents Act

~ allowed to develop, research but not make available for sale prior to patent expiry

~ How will the RA deal with non-patent infringing products introduced prior to patent expiry? This will delay introduction of a generic with huge cost implications for the country. question of the validity of patents and/or patent

infringement is the sole preserve of the Commissioner of Patents

sensitive to abusive ever-greening practices●Patent Term Extensions

Of no benefit to SA since R&D minimal to none & focus not on diseases of the poor

Clinical trials done out of convenience rather than investment need

●Data Exclusivity Not a requirement of TRIPS

NAPM Position on IP and RA

• Regulatory delays affect both generics and originator medicines & will be addressed by restructuring of RA

• IP = complex~ will complicate registration process~ will divert much needed resources away from core

function of RA ~ will delay registration and entry of generic medicines

• Generics industry unequivocally supports IPR for as long as the patent is in place and is valid but must allow immediate competition once patent expires

hence

• IPR inclusion is unnecessary - RA cannot be held liable for “patent infringement” when their role is to assess safety, quality and efficacy

• RA must stick to Scientific Principles - Safety, Efficacy and Quality

Expediting the registration of generics…. National Drug Policy

• Why ??

promotes access to medicines increases competition

• How ??

Ensure timely availability of generics Provide for fast track registration with strict timelines Create a dedicated Office for Generic Medicines in the

Authority Support National Drug policy

~ encourage use of generic medicines → mandatory generic substitution

Educate patients/health professionals

Ciprofloxacin 250mg Tabs after Generic introduction

0.0%20.0%40.0%60.0%80.0%

100.0%120.0%

GenericPricing

OriginatorPricingA

B

C D

E

C

X1

Y

R 78.00R 65.00R 52.00R 39.00R 26.00

SAVINGS

SAVINGS

D

X2

Generic Lifecycle

Further generic entry reduces price of generics and originator drugs

• A reduction of up to 90% for the 250mg Ciprofloxacin• Originator price reduced as the effect of genericisation began to take effect.

Volume split between generics and originators (S3 –S7)

35.3

39.4

44.3

49.7

64.7

60.6

55.7

50.3

46.553.5

0 10 20 30 40 50 60 70

MAT DEC/02UN %

MAT DEC/03UN %

MAT DEC/04UN %

MAT DEC/05UN %

MAT DEC/06UN %

GENERICS % of Rx Market* ETHICALS % of RX Market*

Ratio progression in volume terms bet originator & generic which is within a range of 35.3% up to 53.5 % evidences the significant volume growth for generics compared to that of originator & the relative pedestrian value growth for generics

Value split between generics and originators

(S3 – S7)

77.4

75.3

76.1

77.3

75.0

22.6

24.7

23.9

22.7

25.0

0 10 20 30 40 50 60 70 80 90

MAT DEC/02R TRD%

MAT DEC/03R TRD %

MAT DEC/04R TRD %

MAT DEC/05R TRD %

MAT DEC/06R TRD %

ETHICALS % of RX Market* GENERICS % of Rx Market*

77.4

75.3

76.1

77.3

75.0

22.6

24.7

23.9

22.7

25.0

0 10 20 30 40 50 60 70 80 90

MAT DEC/02R TRD%

MAT DEC/03R TRD %

MAT DEC/04R TRD %

MAT DEC/05R TRD %

MAT DEC/06R TRD %

ETHICALS % of RX Market* GENERICS % of Rx Market*

Ethical = originatorMAT is the Moving Average Total from December of one year to December of the next

yearTRD is the Trend in Percentage Rand

Ratio progression in value terms between originators & generics which is within a range of 22, 6% to 25% evidences the reasonably static growth of generic uptake in value terms.

Transition Phase from MCC to SAHPRA

Proposed changes = wide reaching - could lead to further registration delays if it is not managed appropriately

Management of transition phase/period = vital

Existing arrangements and commitments must be honoured Registration queue is maintained

Pending registrations are completed

Consider phased approach

Set Time-lines for implementation

Adequate resources should be available and vacancies should be filled

4. Conclusion

• What needs to be done to facilitate restructuring process:

Bill must be clear

Bill must contain more detail

Non-core functions to be removed:

~ 2-step process must be removed

~ Intellectual Property (IP)

Must enable necessary regulations that give effect and support process

5. Way forward

• Finalise Amendment Bill

• Enact necessary regulations

• Direction on transition process

6. Q & A

Thank you….