George Laking: Talks lose-lose for cancer patients

Pharmac's decision to limit funding for herceptin prompted widespread public protests. Photo / Glenn Jeffrey

Opinion

Remember Herceptin? Pharmac's funding of it became a political football in 2008, even becoming an issue at the election. Pharmac would subsidise it for only nine weeks, rather than the 12 months used in the largest clinical trials. It questioned the drug's cost-effectiveness - whether the health benefits from the longer term would justify it taking such a bite out of the total Pharmac budget for medicines. The National government overrode Pharmac and Herceptin was funded for the 12-month course.

Once Herceptin comes off patent, it will become cheaper because generic forms can be made. Pharmac relies on such generic medicines to make its budget stretch further.

That is the good news for cancer patients. Even better news is that new medicines that have fewer side effects and greater efficacy are being developed all the time. That means more people will get through the treatment with less pain and distress.

Cancer patients will obviously want access to the latest and most effective drugs. That will be a challenge for Pharmac, because it will have to pay more money for cancer drugs, which means less money for other medicines.

The worse news is that the cost of new "generic" versions of Herceptin and other such pharmaceuticals looks likely to become a casualty of the Trans-Pacific Partnership agreement.

The new drugs will stay expensive for longer, because access to generic versions will be delayed between eight and 12 years.

How might this happen? The United State is rumoured to have secured agreement to new rules in the TPP on exclusivity over the clinical trial information for at least eight years.

That delays the entry of generic products to the market, because their producers rely on the trial data to demonstrate safety and efficacy.

These extended monopoly rights go far beyond existing international norms. The pharmaceutical companies have been pushing very hard to secure them through binding and enforceable free trade treaties. Their latest vehicle is the TPP negotiations.

These talks are said to be nearing their conclusion this week in Singapore. The pharmaceutical industry is reportedly present en masse as the officials prepare "landing zones" for trade ministers to consider at a meeting that begins tomorrow.

This would be the first time in the history of such agreements that exclusive long-term monopoly rights over these "biologic" medicines will have been guaranteed.

There are reports that the US may pull back from the 12 years it initially proposed and accept eight years of exclusivity. Several of the 12 TPP countries already provide for that in their laws, although they could decide to change that.

Some provide protection for shorter terms. Australia, for example provides exclusivity for five years.

New Zealand has no such provision in its law. Neither do most of the developing countries involved in the negotiations.

Three years ago, a leaked document showed New Zealand's intellectual property negotiators were arguing that the TPP should not go any further than the existing World Trade Organisation agreement on trade-related intellectual property rights. In other words, no exclusivity over the data for cancer drugs.

In the intellectual property chapter that was leaked two months ago, it seems New Zealand's negotiators were holding firm. The US had still not tabled its position. But we were reassured that our negotiators would make the health of New Zealanders their priority.

If current reports are correct that has now changed. New Zealand will have to make the biggest changes of any of the TPP governments. Developing countries may be allowed to phase in their new obligations over varying periods. New Zealand does not even have that flexibility.

In September last year Trade Minister Groser assured New Zealanders that the TPP would have a marginal effect on Pharmac.

"It certainly won't result in higher prices for pharmaceutical products for New Zealanders," he said. "This is really about protecting the model of Pharmac to ensure that they're in a tough negotiating position with international pharmaceutical companies, and we've got some very good negotiators who are doing just that."

The pharmaceutical companies do not seem to be walking away from their interest in new monopoly rights that will make major inroads into Pharmac's budget.

Getting the US to reduce its demands from 12 years to eight will not be a victory for New Zealand. Whether it is eight or 12 is just a question of how bad the changes will be.

Each additional year of exclusivity will cost Pharmac, consumers and taxpayers many millions of dollars.

This will be profitable for the pharmaceutical industry, but not so good for cancer patients and their families.