Nothing reflects pharma's response to public-health crises in sharper detail than the industry's efforts to fight the AIDS epidemic.
With more than 40 million patients infected worldwide—most of them poor residents of countries with underdeveloped healthcare systems—the call to action has never been louder. Drug companies are expected to take bold, creative steps to develop new medicines and ensure access to existing ones. If they do not, they not only fail in society's eyes, they endanger the system that finances innovation and protects intellectual property.
The Interfaith Center on Corporate Responsibility (ICCR), a nonprofit group of faith-based institutional investors, defined best practices for access to drugs in the developing world, based on a consensus of government, NGO, and industry sources. (For definitions of these best practices.) To help companies—and socially conscious investors—understand where pharma's major players stand in relation to these best practices, ICCR compiled a report to benchmark pharma companies' individual responses to the AIDS epidemic and a host of other neglected diseases.Each company has its own story, to be sure, but several trends emerge from the data. Pharma companies across the board have implemented differential pricing—charging lower prices in less developed parts of the world. Philanthropy is another broad strength of the industry's AIDS strategy.
On the other hand, most companies deal poorly with the epidemic outside of Africa. Few have been willing to relax patents in hard-hit countries that need better access to drugs. And although American firms are better than their European counterparts,companies obscure the relationship between political contributions and their public position on developing-world issues.
The ICCR report compares companies head-to-head to show, for instance, how Gilead spearheads R&D for fixed-dose combinations, but has been hesitant to issue voluntary licenses, while GSK licenses enthusiastically, but lags in fixed-dose combinations. Executives should first take time to understand the rankings. Then, they can dig into the data, which reveals the companies that are moving the needle by transforming theories of best practice into reality.
The Interfaith Center on Corporate Responsibility defines best practices for all of the following aspects of company policy, from research to pediatric treatment. Together, they represent a formula for access to drugs in the developing world.
• Fixed-Dose Combinations (FDCs)
Company is taking a lead role in development or production of FDCs with other companies.
• Neglected Diseases
Company has robust programs to research and develop drugs for a range of neglected diseases.
Company produces a range of child-friendly formulations for each age group throughout its entire clinically appropriate product line.
• Price Cuts
Pediatric treatment costs are equivalent to adult treatment costs.
• Licensing & Technology Transfer
Company has issued three or more non-exclusive licenses for its full range of products, allowing for sales in a wide range of markets. The company provides training and technology to licensees and encourages co-formulation with other brands to develop appropriate fixed-dose combinations.
• Patent Enforcement Relaxation
The company has no patents in countries that are major generic exporters or in Least Developed Countries (LCDs).
• Differential Pricing