Saul Walker Senior Access to Medicines Policy Advisor Berkeley Law, 19 February 2009 Global Public...
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Transcript of Saul Walker Senior Access to Medicines Policy Advisor Berkeley Law, 19 February 2009 Global Public...
Saul WalkerSenior Access to Medicines Policy AdvisorBerkeley Law, 19 February 2009
Global Public Health Product Innovation: Theory and Practice
1 Palace Street, London SW1E 5HEAbercrombie House, Eaglesham Road, East Kilbride, Glasgow G75 8EA
Page 2
Outline
• DFID, health and product innovation
• Challenges for Bilateral Agencies
• Designing incentives• One Size Fits All?• Push and Pull
• What DFID has done
• Where next?
1 Palace Street, London SW1E 5HEAbercrombie House, Eaglesham Road, East Kilbride, Glasgow G75 8EA
Page 3
DFID, Health and Innovation
• DFID’s mission: reduce poverty
• Health has reflexive relation to poverty• Commission for Macroeconomics and
Health
• Systems based approach (plus priorities) including access to medicines
• Numerous places to intervene along the medicines value chain
• Not a given that development money should fund R&D
Discover Develop & Test
Approve & Register
Scale-up & Manufacture Procure
Prescribe & Dispense
DistributeDemand & Use
• Low commercial incentives• Limited product development
expertise in public sector• Limited R&D/trial capacity in
developing countries• Limited ID and Dev Country
expertise in private sector
• Unclear pathways for first launch in DCs
• Multiple approvals and registration (little harmonisation)
• Standards for new classes• Very limited capacity at country
level – approval, quality, pharmacovigilence
• Affordability/ lack of social financing
• Limited access• Social barriers• Poor information• Low health
literacy• Poor adherence• No utilisation data
• Weak logistics, infrastructure and information
• Poor coverage• Leakage• Mark-ups• Inefficiencies
• Poor demand data
• IP challenges• Limited technical
capacity for some products
• Regulatory
• Limited and/or unpredictable financing
• Multiple channels• Poor use of
pricing info• Non-transparent• Poor demand
forecasting
• Lack of EML and STG
• Limited HR (MDs and pharmacists)
• Informal sector• Limited regulation• Unethical
promotion• Poor practice
Breaks in the ATM Value Chain
Value Chain: DFID Responses
Innovation
Enabling Environment
Health Systems
Discover Develop & Test
Approve & Register
Scale-up & Manufacture Procure
Prescribe & Dispense
DistributeDemand & Use
Push Investment
Pull Mechanisms
Regulatory Paths and Capacity
TRIPS Flexibilities/Patent Pools/IP
Industry Good Practice
Global Funds
Affordable Medicines Facility Malaria
Medicines Transparency Alliance
International Health Partnership
Bilateral Country Programmes
Page 6
Bilateral Support for R&D
• Development agencies have accepted R&D is a legitimate investment• Innovation necessary for sustainable
health improvement• Accept ‘market failure’ argument
• Increase in number of donors and scale of funding
• Political commitments• G8, CIPIH/IGWG, Expert Working Group
Page 7
Global ND R&D Spending
George Institute for International Health. ‘G-finder neglected disease research and development: how much are we really spending?’ Feb 2008
Page 8
Global ND R&D Spending
George Institute for International Health. ‘G-finder neglected disease research and development: how much are we really spending?’ Feb 2008
Page 9
Bilateral Support for R&D: Competing demands and challenges
• Limited technical capacity• Public health not innovation backgrounds• Unfamiliar partners, activities and costs
• Politics of opportunity cost• Increase coverage of existing
interventions• Risk of failure – particularly if funds go to
non-traditional partners
Page 10
Bilateral Support for R&D: Competing demands and challenges
• Cost-effectiveness difficult to calculate• Limited data on attrition rates• High-risk/high-impact, low-risk/low-impact
etc• Impact dependent on uptake and
coverage
• Managing risks and timeframes• Political cycle requires quick results• Risk, money and speed trade-offs
Page 11
Bilateral Support for R&D: Competing demands and challenges
• Strategic coordination• Share technical capacity• Reduce transaction costs • Promote collaboration• Spread risk
• Barriers• R&D fits with broader health ‘priorities’• Funding instrument constraints• Biggest players aren’t traditional
development partners• Weak country voices/capacity
Page 12
Global ND R&D Spending
George Institute for International Health. ‘G-finder neglected disease research and development: how much are we really spending?’ Feb 2008
76.55%
Page 13
Global Disease Burden
Mathers CD and Loncar D. ‘Projections of Global Mortality and Burden of Disease from 2002 to 2030’ PLoS Medicine Vol. 3, No. 11
Page 14
How much is enough?
• Know what is being spent but don’t know if it’s enough
• Variable risk and cost structures across different technologies
• Various costing exercises but very different methodologies
• Focus resources or risk ‘fair’ but insufficient allocations?
Designing Incentives : Top down or bottom up?
Page 16
One size fits all?
• General support for innovation• Funding levels, political commitment• Policy environment
• Currently - design the mechanism then fit in the innovation• Public health experts• Macro-economists• Need innovators, engineers etc
Page 17
One size fits all?
• Technology specifics and innovation:• Scientific challenges/risk profile• Target Profile – NCE or adaptation?• Entry costs and investment profile• Who has necessary skills• Regulatory and ethical issues• Capacity for research• Forecasting demand
Page 18
Technology ChallengesHIV vax & Malaria Drugs
HIV Vaccine Malaria Drug
Science challenge High Low/medium
Clinical material High cost/low capacity Low cost/good capacity
Cost of trials High (large) Low
Stage/Scale $$ High/Early Moderate/Even
Regulatory High – biologicals Moderate – pharma
Ethics Prevention trial/incurable disease
treatment/curable
Skills distribution Big pharam – process/manfPublic – clinical trials
Widespread manufacturingPublic – clinical trials
Research Infrastructure
Limited – prevalence Good
Demand forecasting No existing product Existing product
Manufacturing Long lead time/$$$ Short lead time/$
Page 19
Technology Challenges:Microbicides
Discover Develop & Test
Approve & Register
Scale-up & Manufacture Procure
Prescribe & Dispense
DistributeDemand & Use
AcademicPharma
(Comp Lib)
PDPsGovt
FDA?EMEA?Other
Generics?
GenericContract
OriginatorFormulation MoH
AgentSoc Marketer
etc
PublicSoc Market
Private (generic)
SRH/HIV?
Prescription?OTC?
Gatekeepers
No historicdata
Page 20
PushPush PullPull
Effort-focused
Recipient countries
Amount of R&D
Decision-maker
Better at getting
project
Capital at risk
Reward
PDP, ADIP, donor
Effective at increasing R&D
Started
Donor’s
PDPs have credibility
Outcome-focused
Companies not invest if reward is not attractive
Private companies
Completed
Private companies
May be suspicion of private sector
A.Towse, Office of Health Economics 2008
Push and Pull Characteristics
Page 21
• Combine push/pull along value chain
• Technology specific combos
• DFID pushes via PDPs
• DFID supports pull via AMCs and GHPs (GAVI etc)
• Limited collaboration on: • priority setting• technical evaluation of best
push-pull mixes• performance evaluation for
R&D investments
*A.Towse, Office of Health Economics 2008
Combining Push and Pull
*
Page 22
DFID Push - PDPs
• First government donor to PDPs • IAVI (1997)
• Currently fund 5 PDPs ~£25m p.a• IAVI, MMV, IPM, TB Drug Alliance & DNDi
• Increase commitment to £220m over 5ys• Renewals• Expand portfolio to increase
Page 23
DFID Push - PDPs
Limited Technical Capacity
Expertise – science and industry
Picking winners Portfolio Mgmt
Unfamiliar Partners Partner Mgmt
Cost-effectiveness Target profilesLeveraging inputs
Politics & Opp Costs Advocacy & country engagement
Impact = Uptake Explicit access focus
Strategic Coordination Business CasesDonor management
Donor Challenge PDP Model
Page 24
DFID Pull – AMCs and GHP
• Establish viable markets in LIC/LMICs• Existing and new technologies
• GAVI, GFATM, UNITAID etc already impact market (originator and generic)
• AMC pilot to test pull for development• Shift risks and need to pick winners• Only pay if successful development,
supply capacity and demand• Engage industry (scarce expertise)• Mobilise new donors• Pneumo vax as pilot
Page 25
25
AMC - Pneumo Pilot
• Technical Product Profile (TPP) - www.who.int/immunization/sage/target_product_profile.pdf
• $ 1.5bn - Italy, UK, Canada, Norway, Russia & BMGF
• Tail price cap: $ 3.50
• Purchase price: $ 7 (tail + AMC funded price)
• Demand forecast: 200M doses by 2020
• Stakeholders: AMC Donor Committee, GAVI, GAVI-countries, suppliers, UNICEF, WB, WHO
Page 26
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AM
C
Pri
ce
TailPrice
AMC Period Tail Period
AMC Envelope
GAVI
$7
$2.00
Example:
• Firm A commits to supply 50M = $375M of the total $1.5B AMC
• $ 375 M disbursed at a rate of $ 5.00 per dose (top up)
• $375 M/$5.00 = 75M doses at $7 • 75M/50M = 1.5 years AMC period• 8.5 years of supply at $2.00 = tail period
Top up: + $ 5.00
Tail Period
GAVI Country Co-pay
$2.00
AMC - Pneumo Pilot
Source: Tania Cernuschi, AMC Manager, GAVI
Page 27
AMC Commitments and Incentives
• Companies make 10 year supply commitments
• Frontloading by making initial “AMC price” sufficiently high
• Provide limited demand assurance • At the time of signature donors & GAVI
commit to purchase 20, 15 and 10 % of the supplier’s dedicated capacity in years 1, 2 & 3, respectively
27
Source: Tania Cernuschi, AMC Manager, GAVI
Page 28
28
Serious pneumococcal diseases are the primary
vaccine-preventable cause of death in children under 5.
The AMC will save 900,000 lives up to 2015 & 7.7 M lives up to 2030
Pneumo AMC Cumulative Deaths Averted ($M)
Source: Tania Cernuschi, AMC Manager, GAVI
Page 29
Where Next?
• Proof of concept – PDPs, AMCs etc
• Bespoke incentives
• Sustainable financing – WHO Expert WG
• Priority setting, governance and country participation
• Coordination continuum • Informed investments• Coordinated informed investments• Pooled investment
Page 30
Where Next?Market Monopoly Paradigm
• UK recognises importance of IP for R&D
• Support rights of countries to use TRIPS flexibilities
• PDPs, patent pools and prizes opening up uses of IP to support access
• Long-term prospects for IP paradigm?• Health care costs in north• India and China development
Page 31
Additional Slides
Voluntary Licenses with No Pool
Medicines Patent Pool
Drug 1 Drug 2
Manufacturer 1
Country 1 Country 2 (patent)
Country 3(no patent)
Country 4 Country 5 (patent)
Distributor 1
Distributor 2
Manufacturer 2
Distributor 3
Manufacturer 1
Country 1 Country 2 (patent)
Country 3(no patent)
Country 4 Country 5 (patent)
Distributor 1
Distributor 2
Manufacturer 2
Distributor 3
Drug 1 Drug 2
Adapted from E. Richard Gold & Jean-Frédéric Morin, IPDS July 2007
Voluntary Licenses with Patent Pool
License
RoyaltyProductSale
Intellectual Property: Patent Pools