Life-saving Hepatitis C drug costlier than gold

Amongst the many diseases that can harm the human liver, Hepatitis C is a major contributor. It is caused by a virus known as Hepatitis C virus (HCV). Once the liver is infected by the virus, over the years the disease may progress to cancer or cirrhosis. Around the world, 3.3 per cent (around 200 million people) are infected with the virus.

In India, it is around 1.5 per cent, while few countries like Egypt have as high a rate as 14.5 per cent. So, it is indeed a global problem. An estimated 10 to 30 per cent of all those who are infected with HCV may develop major liver damage within the next 15 to 30 years. HCV mostly spreads through blood – often by intravenous route used by drug abusers, and very frequently due to needle sharing.

However, there is a great news for HCV infected patients as a miracle drug has entered the market. The drug known by the name ‘sofosbuvir’ ensures almost complete cure, and it is here that it totally differs from the treatment that is advocated for HIV/AIDS, where patients need to be under life-long medication. The duration of treatment with this drug varies from 12 to 24 weeks. No doubt, the medicine has attracted media attention not just in India but all over the world. Before the advent of the drug into the market, the options for treating such patients were very poor (mostly consisting of pegylated interferon therapy which is expensive, difficult to tolerate and has a poor cure rate).

But there is huge catch to all this and that is the cost of the drug! The manufacturer of the drug, Gilead, a US-based company, is charging US $1,000 (around sixty thousand rupees) for each pill, meaning the cost of a 12-week course of treatment will amount to US $84,000 (around fifty lakh rupees). The drug is almost forty-five times costlier than gold itself, thus making it unaffordable to most. Why is the drug so costly? Is it because the drug company has invested such huge money in research or is the cost of manufacturing too much? None of this logic is true.

Gilead never spent any money on research because it had simply acquired the assets, along with the drug, from another US company Pharmasset for around US $11 billion. Ever since sofosbuvir has come into the market, Gilead is earning roughly US $200 million every week. Thus, the company totally fails to justify the cost either on research or manufacture. Instead, its justification is that sofosbuvir offers value for money i.e. it is cheaper than liver-transplant. According to a study done by Andrew Hill of Liverpool University, UK, the predicted production cost of this drug would be around US $68 to US $136 (around six to eight thousand rupees). It is obvious that the high cost of this drug is because Gilead has a patent on it which will expire only in 2029.

There is another twist to the story of the drug. In September 2014, Gilead announced ‘voluntary licences’ to seven

Indian generic drug companies (Cadila Healthcare, Cipla, Hetero Labs, Mylan Laboratories, Ranbaxy Laboratories, Sequent Scientific and Strides Arcolab). This ‘voluntary licensing’ promises to make the drug at an affordable price in India and export it to 91 countries where the Indian firms will be allowed to sell it, as well.

This, however, came at a very high cost with these companies agreeing to abandon India’s partners in its fight against Big Pharma for access to affordable medicines. For example, the Indian companies will not be allowed to sell the drug in Brazil, Russia, China, Thailand and many other middle-income countries where the disease burden of HCV is huge.

Strangulation of drug firms

The anticipated ‘voluntary licence’ will set precise terms on which Indian generic companies can make the drug and where all in the world it can be sold. In other words, Gilead makes all the decisions and uses its enormous power, through the license, to decide who does and does not get the life-saving medicines. All these efforts by Gilead were, in a way, aimed to “strangulate” the Indian generic drug manufacturing companies.

One needs to recollect that India is known as the “Pharmacy of the Developing Countries,” as Indian generics supply medicines to around 200 developing countries all over the world. The ‘voluntary licence’ agreement in India was announced amid protests from activist groups which said that the licence failed to cover key high-burden nations like China, Brazil, Mexico and Thailand.

Gilead in its pursuit of profits had patented sofosbuvir in 17 countries including China, Indonesia and Israel, thereby gaining global monopoly. Similarly, it had applied for grant of patents in India as well and the same was opposed by several groups under the Pre-Grant Opposition.

Luckily for patients the world over, the Indian Patent office in Kolkata, in late January this year, rejected the patent claim of Gilead under section 3(d) of Indian Patent Act and opened the door for more Indian drug companies to produce the same.

More companies will start manufacturing the drug which will set in greater competition and thus the drug price of sofosbuvir will soon come down. Gilead has announced that it will approach the Supreme Court. And the battle continues...

(The writer is President, Drug Action Forum, Karnataka)