1. Options for national/regional production of generic medicines Wilbert Bannenberg, MD MPH wilbert@sarpam.net Lesotho TRIPS workshop 14 Aug 2014

2. Make or buy? Difficult policy decision! – Government promotes local production – But at the same time wants to have them cheap! Medicines were being made in Lesotho – MOH would like to restart national production Buying imported generics is often cheaper – Majority < India; then SA, Europe Both have to be good quality (LMRA assessed) Are all locally produced medicines all essential?

3. Barriers for local production Lesotho is a very small market – LPC needed export for economies of scale Unpredictable “all or nothing” tenders NDSO Global Fund / donors have high quality standards (requires stringent GMP inspection, LMRA) Infrastructure (power, clean air & water) Skilled staff Investments, sustainable market, tech transfer Cost-effectiveness - make or buy?

4. There are niches for local production! Local packaging / labelling / embossing / patient ready packs Special dosage forms (paediatrics) Heavy products (e.g., IV fluids) Urgent supplies Popular “nice to have” products (cosmetics?) New generics that India can no longer make! – Joint venture with SADC and an Indian company?

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

6. National Medicines Policy (2005) “To manufacture good quality essential medicines at an affordable cost, the Ministry of Health and Social Welfare will ensure that local manufacturers have appropriate infrastructure meeting GMP requirements, appropriate qualified personnel and a technical partnership”.

7. 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

8. Production under Compulsory license Terms of compulsory / Government use license? No support from originator! (royalty 1-4%) Own development of dosage form Own development registration dossier Bio-equivalence studies Drug Regulatory Approval Example: Varichem (Zimbabwe)

9. Local or regional production? The market is SADC, not Lesotho Needs joint venture or technical collaboration Existing generics: too much competition! New generics is the future – But this really needs a regional SADC strategy – Can Lesotho offer its services to SADC? – LMRA is needed to confirm GMP! – Otherwise no WHO prequalification

10. Regional production SADC has majority LDCs – seen as one “country” under TRIPS art 31bis/30 August waiver LDCs exempted from TRIPS obligations until 2021 – No problem with patents or export (para 7 Doha) Zimbabwe, South Africa and Uganda have WHO prequalified, GMP approved manufacturing plants Mozambique, Tanzania, Malawi can produce

11. Regional production SADC member states need to develop a regional strategic agreement on: – Who makes what? – Investment – Market – Technical support – Quality / drug registration harmonised Competition: EAC products (Cipla, Kampala factory) can reach Lesotho through Tanzania

12. Summary Local production capacity theoretically possible – But needs viable market (export! Lesotho too small) – Good quality (GMP), registration (LMRA) – 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 Lesotho’s IP Order Think regional!

13. Yes, we can!

14. THANK YOU wilbert@sarpam.net skype: wilbertb1 www.sarpam.net wilbert@sarpam.net www.sarpam.net