Options for national/regional production of generic medicines Wilbert Bannenberg, MD MPH Zambia TRIPS workshop 3 Oct 2013

Make or buy? Difficult policy decision! – Government promotes local production – But at the same time wants to have them cheap! Medicines are being made in Zambia – Even though raw materials need to be imported Buying imported generics is often cheaper – Government allows 15% domestic preference Both have to be good quality (PRA assessed) Are all locally produced medicines all essential?

Barriers for local production Zambia is a small market – needs export for economies of scale Unpredictable all or nothing tenders Infrastructure (power, water) Skilled staff Investments, sustainable market, tech transfer Cost-effectiveness - make or buy?

There are niches for local production! Local packaging / labelling / embossing Special dosage forms (HCT 12.5mg, paediatrics) Heavy products (water based) Special climatic zone 4 packaging Neglected essential medicines Urgent supplies Popular “nice to have” products (cosmetics?) New generics that India can no longer make! – Joint venture with an Indian company?

What can government do? Drug Policy supports national production Domestic preference 15% Stable infrastructure (energy, water, skills) Capital, soft loans, duty free zones, no VAT/tax Predictable market (better qualification) Longer term commitments/ split tenders Strict quality/GMP assessment, harmonisation Regional Pharmaceutical Collaboration – SAGMA, SARPAM, SADC Export subsidies

Is there a patent? Most medicines on EML are off-patent New medicines are however often patented – ARVs, cancer, cardiovascular, diabetes, antibiotics Is there a patent? (PACRA, ARIPO?) If no (valid) patent – no problem If patented, ask patent holder for voluntary licence on reasonable grounds (contract) If refused, consider – Applying paragraph 7 Doha Declaration (ignore patent) – Issueing compulsory or government use license (+royalty)

Production under voluntary license Contract needed with patent holder Better chances for transfer of technology Quality requirements (inspection by originator!) Registration dossier support Generic equivalent: bio-equivalence studies! Negotiate terms, compensation, export allowed? Examples: GSK/Aspen Pharmacare South Africa; Gilead’s tenofovir from India

Production under Compulsory license Terms of compulsory license? No support from originator! (royalty 1-5%) Own development of dosage form Own development registration dossier Bio-equivalence studies Drug Regulatory Approval TRIPS: predominantly domestic market – Zambia exempted as LDC – SADC can apply art 31bis for regional circulation

Regional production SADC has majority LDCs – seen as one “country” under TRIPS art 31bis (same as EAC, COMESA) LDCs exempted from TRIPS obligations until 2021 – No problem with patents or export (para 7 Doha) Mozambique, Tanzania, Malawi can also produce Zimbabwe and Uganda have WHO prequalified manufacturing plants – Will Zambia plants pass WHO inspection? Insecurity after 2021? – Zambia can import using government use or compulsory license

Regional production SADC member states need to ratify 31bis Need regional strategic agreement on – Who makes what? – Investment – Market – Technical support – Quality / drug registration harmonised EAC products (Cipla Kampala factory) can reach Zambia through Tanzania

Summary Current procurement prices should still be lowered (more sources, intelligence, regional PP) Get all essential medicines registered with PRA Local production capacity available (4 plants) – But needs viable market (export! Zambia too small) – Good quality (GMP), registration (PRA) – Technology transfer, innovation, competent staff – From where to get the APIs patented elsewhere? Ensure that public health TRIPS flexibilities and art 31bis are included in new Zambian Patents Bill Think regional!

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