Cost-Containment Mechanisms for Essential Medicines, Including Antiretrovirals, in China - Health Economics and Drugs Series No. 013: Concluding comments

Cost-Containment Mechanisms for Essential Medicines, Including Antiretrovirals, in China - Health Economics and Drugs Series No. 013
(2003; 30 pages) [French] [Spanish]

Table of Contents

	Acknowledgements
	Terms of reference
	Introduction
		Cost-effective medicine selection
		Price information
		International open tendering
		Voluntary discount agreements
		Voluntary licensing
		Compulsory licensing
		Local state production
		Government price controls
		Reduction of import and other taxes for essential medicines, and rational dispensing practices
		Public investment in R & D for new medicines: A mid- to long-term strategy
	Background and experiences with voluntary agreements
	Country rights to be protected in voluntary agreements for reduction of prices of medicines
	Compulsory licensing - practical aspects and procedures
		Identify relevant patents
		Explore possible sources of supply based on local production
		Identify possible sources of importation of the required medicine
		Marketing approval
		Request for a compulsory licence
		Granting of the compulsory licence by the Patent Administration Department
		Negotiation with patent holder about fee
		Determination of fee by the Patent Administration Department
		Appeal
		Other considerations
	Concluding comments
	List of persons contacted
	Further reading

Concluding comments

1. In seeking to contain costs for ARVs and other essential medicines, China should consider the full panopoly of available policy tools, and examine closely how the various tools may complement one another.

2. In making policy choices related to cost-containment, including use of TRIPS flexibilities and safeguards, China should prioritize public health considerations. Affordability of essential medicines is a public health priority.

3. Voluntary negotiations can lead to substantial price reductions for on-patent medicines in developing countries. China will be strongest in negotiating for voluntary discounts if it has reviewed its options for compulsory licensing and domestic production, and can credibly present these approaches as an alternative to deep discounts.

4. Voluntarily offered price reductions may be accompanied by limiting conditions. These may limit the number or type of beneficiaries of the price reduction, impose significant burdens on the government, or limit the government's ability to deploy varying policy tools. The government may or may not decide that these limitations are an acceptable trade-off for the benefits of price discounts; but it should be aware both of the costs, and its options.

5. WHO supports measures which improve access to essential medicines, including application of TRIPS safeguards.

6. By introducing competition, compulsory licensing may significantly reduce the price of ARVs and other essential medicines.

7. Compulsory licensing is widely used in some industrialized countries, and is an integral part of the intellectual property system. If China chooses to proceed with the issuance of compulsory licences for some essential medicines, it will be showing its commitment to the patent system. That is, rather than ignoring patents or engaging in underground counterfeiting, the government would be addressing access concerns from within the patent system. The government would be indicating its respect for the patent system, even where crucial public health matters are at stake.