Generic Drugs Issue

Generic Drugs Issue

Big Pharma is receiving sharp criticisms due to their unethical business practices. Besides the controversial animal testing, they limited the distribution and production of generic drugs. An investigation by an EU task force reveals that drug firms structurally abuse the rights for intellectual property in the Western World. In the process, they hurt innovation and limit generic business competition. Not only does this discourage budding medical entrepreneurs but also, it costs billions of dollars in losses to the healthcare system (Angell, 2015). It is even worse in the third world countries, where thousands of people suffer high incidences of diseases and pandemics otherwise curable or preventable through the provision of less expensive generic drugs.

The majority of drug manufacturers support the limited government interference in the business world. However, people in the developing countries (Asia, South America, and Africa) face deadly diseases and can hardly afford expensive treatment solutions.  Over the past decade, Big Pharma has completely ignored this, thus triggering a backlash from human rights activists and advocates. The large medical organizations cast a blind eye to such a market since the population cannot afford the services. Therefore, it is arguable that Big Pharma focuses on profitability rather than improving healthcare.  

Statistics show that annually, people in Africa and South East Asia die of curable diseases like tuberculosis and malaria. More than six million lives have been lost because the patients the available drugs are not effective. The governments in such developing states announce drug donations publicly yet they do not provide exclusive details such as the expiry dates or the side effects.

Poor nations are taking significant steps to produce cheap generic alternatives to brand medicine. They use the readily available tools such as local labor, raw material and government subsidies to minimize the cost of medicine. However, the multinational firms such as GlaxoSmithKline launch a fierce competition and immense pressure despite the legitimacy of generic drugs under international law. The majority of such large corporations have spent billions of dollars in research and development hence consider the business patent as an effective tool for protecting their long-term investments.

What Big Pharma does not realize is that remote issues such as intellectual property rights and patents mean life or death for poor developing nations.  For instance, during the early 2000s, American pharmaceuticals pushed for the federal government to threaten sanctions on South Africa should it produce HIV/AIDS generic drugs. Eventually, their legal team dropped the case after a sustained public outcry.

            One of the main reasons for establishing WTO (World Trade Organization) was to impose Western-style intellectual property rights across the globe (Scherer, 2013). In fact, the regulators introduced such rules to minimize the production and distribution of generic medicines and they succeeded. In particular, African countries paid a high price for the accord. In return, drug firms commit their resources to branding and marketing instead of research and development. They focus on producing lifestyle drugs rather than life-saving medicine. Even worse, Big Pharma hardly produces medication for treating diseases affecting the third world countries only. This is unsurprising, given that poor citizens cannot afford costly drugs, hence the corporations will not generate income in this market segment. Instead, they focus on improving production in the wealthy countries where the return on investment is high.

In the United States, startup medical research companies complain that Big Pharma misuse the current medical regulations. The brand-name drug firms team up to prevent generic drug manufacturers from penetrating both local and international market. As a result, the generic firms cannot get the drug samples to create cheaper versions of drugs for use in the developing world. In addition, these generic firms also complain that the regulatory authority restricts their drugs from sharing safety protocol, hence making it harder to be introduced in the market.

            Indeed, it is difficult to balance between the availability of low-cost prescription medications and the development of lifesaving drugs. However, it is unfortunate that big pharmaceuticals exploit this weakness by engaging in anti-competitive tactics to delay the entry of generic drugs to the US market. The federal government, on the other hand, has failed to recognize the valuable role of generic drugs in driving medical savings.

Each year, dozens of Big Pharma join the list of the most powerful brands on the planet. In the year 2012, more than 20 large drug companies constituted 5% of the top firms globally with a median profitability of 10.6% (Joseph, 2013). If medical professionals attempt to introduce new drugs for chronic diseases such as cancer and HIV, big pharmaceuticals gang up to protect their status as monopolistic corporations.

Today, the emerging market such as India expect to double spending on medicines due to the governments’ plan to improve healthcare access. It is projected that the branded drug market in such nations will increase significantly. Nevertheless, the successful lobbying and increased awareness result in the production of generic drugs. It is a similar case in the United States and EU, where a sluggish economic growth has led to a rise in healthcare costs. Consequently, small pharmaceuticals spend resources in developing cheaper generic drugs.

In summary, despite the gradual progress, the US pharmaceutical industry is heavily criticized for employing delay tactics to discourage generics. In other instances, Big Pharma pays off generic drug makers while pushing for patent extensions. Still, there are divisions in the industry, as a section of advocates warns against the importation of generic drugs. In spite of a potential erosion of safety standards, generic drugs can save lives, especially in the developing world.  

References

Angell, M. (2015). The Truth about the Drug Companies: How They Deceive Us and What to Do About It. New York: Random House Trade Paperbacks.

Joseph, S. (2013). Pharmaceutical Corporations and Access to Drugs: The" Fourth Wave" of Corporate Human Rights Scrutiny. Human Rights Quarterly,25(2), 425-452.

Scherer, F. M. (2013). The Pharmaceutical Industry-Prices and Progress. New England Journal of Medicine, 351, 927-932.