Pharmaceutical Patent Protection and Public Health: Problems and Possibilities

Despite the provision of substantial foreign aid to developing countries over the past few decades, economic growth in many of these countries has been slow and, concurrently, indicators of health status have worsened. Infectious diseases, many of which are preventable or treatable are estimated to kill 14 million people every year, mostly in developing countries. In many developing country households, the largest expense is for the purchase of medications. New drug development is expensive, highly regulated and time consuming and is typically conducted by for-profit companies. Often these companies lack incentives to develop, produce and market pharmaceuticals needed in developing countries where pharmaceutical markets are weak. Patent protection and the protection of international intellectual property rights confer monopoly power on pharmaceutical companies which results in market inefficiencies. The first potential solution for this problem is differential pricing, achieved through market separation. The challenges to successful implementation of differential pricing include the possibility of parallel imports and external referencing. The second potential solution is the production of pharmaceuticals under compulsory license. These and other alternatives will be discussed in the presentation. The poor health status of individuals in the developing world can be viewed as a threat to global health and security, an impediment to economic development and morally iniquitous. Strategies to increase access to needed pharmaceuticals have the potential to improve social justice.