How friendly can Big Pharma be to developing countries in a down economy?
The head of GlaxoSmithKlein (GSK), Andrew Witty, apparently caused a stir at Harvard Medical School last month by promising that his company would make essential medicines accessible to developing countries and commit more resources to research on neglected diseases. More precisely, GSK will take 20% of its profits from sales in developing countries and reinvest back in local health care infrastructure, and patented medicines produced by GSK will be sold at 25% of their market value in the 50 poorest countries of the world. In addition, there was talk of a 'patent pool' for neglected diseases, i.e. an agreement between various patent-holders to share (for some fee) those patents with each other and with third parties.
These promises may make GSK look saintly, but the impression largely fades on reflection. 20% of GSK's profits in developing countries does not amount to much; an editorial in the Lancet calculates it as less than 0.1% of GSK's total profits, and the folks at Policy Innovations see this as boiling down to about $50,000 per country, hardly a generous investment in local health infrastructure. Selling patented medicines at a quarter of the usual (bloated) price may not be of much help either to those who live on a few dollars per day. And while giving access to patents sounds nice, the road from possession of patent information to research to marketing is a long and winding road paved by a great deal of money. Who has that kind of money? The big pharmaceutical companies, like GSK. But they won't really invest to create drugs for conditions affecting developing countries because the profit margin would be meagre. We come full circle.
Gestures of philanthropy towards the world's poorer nations, on the part of aggressively profit- seeking pharmaceutical companies, is to be taken with a grain of salt at the best of times. In a down economy, when pharmaceutical companies are merging for their own survival, full-blown skepticism is in order.