SocialismToday           Socialist Party magazine

Issue 185 February 2015

The right to life and the pharmaceutical multinationals

The Big Pharma companies wield colossal power and an ever tighter grip on the world market. And in the countries like India, with a large generic drugs industry, successive governments have undermined past gains in medical and health provision. SAJITH ATTEPURAM writes.

The US visit of Indian prime minister Narendra Modi, and his high-profile meeting with some of the most prominent corporations and their influential lobbies, brought the issues of patents and intellectual property rights into the media glare. Even Congress Party vice-president Rahul Gandhi told a rally in Haryana that cancer medicines have got costlier after Modi met the pharmaceutical company officials. This was vehemently denied by Modi’s government, headed by the right-wing Hindu-nationalist BJP (Indian People’s Party).

The generic drugs industry of India is widely viewed as the ‘pharmacy of the developing world’. However, the protectionist measures, implemented by previous Congress governments to rein in the daylight piracy of the multinationals, although limited, are under threat. This, in turn, will have a devastating impact on millions of lives in the underdeveloped and developing countries.

It is not that long ago that international drug maker Bayer AG provoked shock and outrage when it callously demanded over Rs 280,000 (roughly £3,000) per 120-capsule pack of the cancer drug, Nexavar – just one month’s therapy – when the annual income of an average Indian is just above Rs 50,000 (less than £550). This pushed India to issue its first ever compulsory licence, to Hyderabad-based Natco Pharma. These licences enable a company to use another’s intellectual property without seeking the patent holder’s consent, with an agreement to pay the company a set fee. Natco Pharma then produced the generic version of the cancer drug for around Rs 9,000 (less than £95) – a 97% cost reduction. Immediately, Bayer AG tried to stop the cheaper generic version of Nexavar, but the patent appeals office in India rejected its claim. This ruling was upheld by the High Court in Mumbai.

The Indian Supreme Court also upheld the patent office’s rejection of the patent application of Gleevec, a cancer drug produced by Novartis. Clearly, these rulings have stalled the western pharmaceuticals’ profit drive. They also show that the Indian ruling class has been compelled to make some concessions in the interests of ordinary people – particularly because of the potential for mass protest action – and against global big business, which is backed by the World Trade Organisation (WTO) and the legal scaffolding it erects to impose unrestricted corporate capitalism in India.

In 2012, the EU-India summit in Delhi sparked popular discontent over the potential provisions of the ‘free trade’ agreement. This gives multinationals a lot more scope to sue the government for damages against the state regulation of intellectual property rights, and more leeway to impose sky-rocketing pricing mechanisms. Now, the government led by Modi, a ruthless executioner of the interests and demands of big business, is threatening to overturn the existing remnants of those hard-won gains of the ordinary people.

The denial of life-saving drugs

After the collapse of the Stalinist regimes in Russia and eastern Europe 25 years ago, capitalism and its neoliberal agenda proclaimed victory, not just over the planned economy – bureaucratically imposed as it was – but also against state intervention of any kind. It was seen as an undesirable hindrance to the interests of big business. This pushed the bureaucratic state-controlled ‘mixed’ economies like India to open up to the interests of the multinationals. Heavy bureaucratic control, corruption and the inability of the state to expropriate and distribute the resources from the landowners and affluent Indian businesses had brought the Indian economy to the verge of bankruptcy. By the late 1990s, successive neoliberal aspirant Indian governments had agreed to join the WTO and to abide by worldwide intellectual property standards under the Trade-Related Aspects of Intellectual Property Rights (Trips) agreement. This changes the patent laws to accommodate the multinationals’ drive to make obscene profits.

Patenting encourages monopoly in producing and trading the invented product for the complete patent term of 20 years from the date it is registered. Furthermore, generous legal provision is made for patent holders to extend their intellectual property rights after the expiration of the patent. ‘Evergreening’, as it is called, covers a range of obscure practices, particularly used by drug manufacturers to restrict competition from possibly cheaper generic equivalents.

However, virtually all nations, including the US, have enacted anti-evergreening legislation because of the increasing strain on public health provision due to their colossal spending on pharmaceutical drugs. Even the right-wing Con-Dem coalition government in Britain has been compelled to curb to a limited degree the drug companies in order to contain the spiralling costs of branded (patented) drugs as they cost the National Health Service a staggering £12 billion in 2013. The constant rise in the price of drugs swells NHS costs by 5% annually.

Many health activists and humanitarian organisations, such as Médecins Sans Frontières (Doctors without Borders), have spoken out against the big pharmaceutical companies and their abuse of patent rights. The persistent pressure of those organisations and the clear potential for escalating mass protests were the reasons leading to the 2001 Doha declaration on the Trips agreement. This led to WTO member states eschewing some patent rights to improve the access to some essential medicines. Even these limited measures have had an impact, contributing to a 99% reduction in the cost of anti-retroviral therapy for HIV-positive and Aids-related illnesses, and to a 30% increase – from a low base – in the anti-retroviral coverage in Sub-Saharan Africa.

Buying and selling knowledge

"Could you patent the sun?" was the response of Jonas Salk in a television interview in 1955, when asked who owned the patent for the first effective polio vaccine. Salk, a leading contributor to the development of the vaccine, could have hardly imagined that the present Big Pharma mafia would, if possible, try to patent an eclipse!

Diabetes, a metabolic disease often characterised by high blood-sugar levels, was a deadly and untreatable disease caused by discrepancies in the production or uptake of the insulin hormone by the body. The ‘discovery’ of insulin by Frederick Banting and his team in 1921 was an important milestone in the history of disease treatment – and for which Banting was awarded the Nobel Prize (although, controversially, not his co-founder Charles Best). Banting and his research team sold the patent rights for insulin to the University of Toronto for a dollar, requesting that the university use any income from the patent to fund new research. There are many striking examples of scientists and researchers who have pursued science out of wider interests.

Nonetheless, social relationships and relations to production change as the productive forces and the mode of production develop. As pointed out by Karl Marx and Friedrich Engels in The Communist Manifesto, capitalism effectively converted ‘the man of science’ into its paid wage labourer. Developments in science and technology are appropriated by the massive corporations which recruit leading scientists to their well-funded state-of-the-art research environments. Their market-driven projects aim, not so much to cure diseases, but to develop new formulations of drugs for chronic conditions, mostly targeting well-off populations which reward them with rich profits.

Many reports have shown how several pharmaceutical companies only took up the mission to find a treatment for the deadly Ebola virus when the US Centre for Disease Control and Prevention confirmed the first case of the virus in the US. Previously, Big Pharma had virtually ignored the epidemic in poverty-stricken west Africa. Unsurprisingly, the share prices of those companies surged when they set out to find the cure as Ebola appeared in the affluent US market.

The progress made by any field of science does not come out of thin air. It is based on the knowledge and understanding accumulated over centuries of collective human endeavour. Attempts by pharmaceutical multinationals to monopolise drugs and treatments represent a colossal theft of the intellectual wealth of humankind. Of course, this is logical from the point of view of the profit-driven capitalist system. This pits company against company – and fuels nation state rivalry – in relentless competition to be first to the market. In the process, there is an obscene waste of money and resources in the duplication of research, wealth squandered in marketing, etc.

Lives not profits!

Working-class and oppressed people do not have to be a mere audience watching this big-business onslaught. Far-reaching gains in living standards and conditions have only been won through struggle. These include the healthcare systems in western Europe and Canada. The mass struggle in Sri Lanka, led by the Lanka Sama Samaja Party (LSSP) – before it moved to the right, collaborating with the capitalist ruling class – was instrumental in the establishment of the State Pharmaceuticals Corporation in 1970. This distributed drugs at affordable rates, by generic name instead of by proprietary trade name. Those gains were attacked by the brutal, neoliberal Rajapakse regime.

The world’s first universal healthcare system was developed in the Soviet Union following the Russian revolution in 1917. Even under the grotesque distortion of socialism under Stalinism – with a top-down plan imposed by a dictatorial bureaucracy – health and other social services were maintained on the basis of a nationalised, planned economy. The healthcare system and the state pharmaceutical infrastructure in Cuba is also the result of the planned economy, introduced after the revolution in 1959. In spite of the constraints imposed by the lack of genuine workers’ democracy, it is seen as a beacon throughout the Caribbean and South America.

All those historic gains are under threat because of the lack of a revolutionary perspective to change the system fundamentally, from the rule of capital and big business to a society where the productive forces are commonly owned, controlled and run democratically by the working class.

In India, at present, most of the ‘left’ and the Communist parties do not put forward such an alternative. Their strategy is limited to defending existing patent laws from the assaults of the Big Pharma lobby, or demands for the introduction of statutory bodies to ensure affordable drug pricing. Although these can be important issues in mobilising working-class and poor people, they can only be temporary, sticking-plaster measures. Indeed, sometimes they are advocated by those with a vested interest in safeguarding this system – state bureaucrats, part of the ‘licence raj’ machinery – or by those who underestimate the might of the multinationals, their lobbies, and their backing by the world’s major economic (and military) powers.

Big Pharma’s drive for huge profits has a massive impact over millions of lives – not only their health. They are based on super-exploitation, paying poverty wages and refusing to provide any social safety net to the wider population. Privately-run hospitals do not admit those who cannot afford their bills, regardless of their medical needs. Private medical institutions do not provide potentially life-saving education unless they receive handsome donations.

Of course, Indian pharmaceutical companies would also demand patenting rights for drug innovation and discovery, lobbying the government to increase incentives at the expense of the affordability of the millions of patients. It is important to build a mass party of working-class people to struggle against oppression and exploitation. It would need to put forward the alternative of a socialist society where everyone will have access to good quality healthcare and living standards as the basic starting point for a fulfilling life for all human beings. It would orient technology towards people’s needs, freeing up science and research from the stranglehold of the corporate empires. A world where medicine, healthcare and science are harnessed for the needs of people is possible.

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