July 18, 2011
Gilead Sciences Joins the Medicines Patent Pool
by Robert Kropp
Gilead becomes the first pharmaceutical company to form a licensing agreement with the Pool, and
will provide its HIV and Hepatitis B drugs at low cost to developing countries.
The Medicines Patent Pool was
created by UNITAID in December 2009, to
increase access to drugs for the tens of millions of people afflicted with HIV/AIDS in developing
countries. Last week, the organization, which became a separate entity in November 2010, announced its first licensing agreement, with Gilead Sciences, to improve
access to HIV and Hepatitis B treatment in developing countries.
with Gilead provides for the supply of HIV drugs to up to 111 countries. Royalties for Gilead are
set at three to five percent of generic sales, and royalties for any new pediatric formulations
will be waived by the company.
Ellen 't Hoen, executive director of the Medicines Patent
Pool, stated, "Today marks a milestone in managing patents for public health. The license agreement
with Gilead Sciences will help make medicines available at a lower-cost and in easier to use
formulations without delays."
"People in developing countries often have to wait for years
before they can access new health technologies," 't Hoen continued. "Today's agreement changed
Members of the Interfaith Center on
Corporate Responsibility (ICCR) has been engaging with pharmaceutical companies to improve
access to medicines for years. In response to Gilead's licensing agreement with Medicines Patent
Pool, Rev. David Schilling, the director of human rights for ICCR, said, "When companies recognize
access to affordable life-saving medicines as a basic human right they also acknowledge their
responsibility to make whatever adjustments are necessary to their business models to protect this
right. Joining the Medicines Patent Pool is a crucial step in that direction."
told SocialFunds.com, "ICCR held a roundtable of pharmaceutical companies, nongovernmental
organizations, and investors earlier this year, and that was critically important." In one panel
discussion, Schilling said, 't Hoen discussed the Medicines Patent Pool's goals for improving
access to HIV medicine in developing countries.
Following the roundtable, ICCR issued a
summary report which stated, "Investors believe that companies that engage all aspects of their
business model to respond to the global public health crisis will be better positioned for future
growth. It is expected that pharmaceutical companies will thoroughly examine and take advantage of
the opportunities to provide people in developing countries and emerging markets access to the
medicines they need in the most cost-effective way. Investors believe a key innovation with the
potential to increase access to medicines is the Medicines Patent Pool."
Judy Byron of the
Northwest Coalition for
Responsible Investment (NWCRI), an ICCR member, has been engaging with pharmaceutical companies
on access to medicine since 1998. She told SocialFunds.com, "ICCR members were the first to engage
pharmaceutical companies on HIV/AIDS." In recent years, she continued, "I've seen a move from
filing resolutions to having serious dialogues with companies."
"ICCR started addressing
pharmaceuticals on the HIV pandemic in Africa in 2001, asking them how they were going to give
access to medicines to 40 million people living with HIV/AIDS at the time," Byron said. "In 2004,
our coalition wrote to Gilead and did not get a response, so we filed a resolution and got over 30%
of the vote. After a resolution filed the next year also got over 30% of the vote, we met with
Gilead, and in 2005 they issued their first generic license for two of their AIDS drugs to be
distributed in 95 resource-limited countries and Africa. Since then Gilead has established over a
dozen partnerships with Indian generic companies, and they created a tiered pricing system based on
"Right from the beginning, a stumbling block has been patents on these drugs,"
Byron continued. "We have ongoing dialogues with all the companies, and when the idea of the
Medicines Patent Pool came up we brought it to them. We've been very involved in lobbying for the
Patent Pool and getting it started."
One of the most important features of the agreements
with pharmaceutical companies is the Medicines Patent Pool's insistence upon complete transparency,
Byron noted. Stating in its Transparency Policy that it was established "to
facilitate access to intellectual property in order to improve access to quality, safe and
efficacious health products in low- and middle-income countries," the Pool stated further that it
"will operate in a transparent manner, in recognition of the critical nature of the public health
issues at stake and the widespread public interest in its work."
Gilead's agreement with
the Pool is a critically important first step, Byron observed. However, "Other companies have
critical HIV/AIDS drugs too, which would be important to put into the Patent Pool," she said. "Of
the 6.6 million people receiving AIDS drugs in the developing world, 1.6 million are on Gilead
medications. There are about 16 million with IV who should be on treatment but are not, and within
the next five years those numbers are only going to increase."
"There are concerns over
what countries will be eligible," Byron continued. "The agreement doesn't include middle-income
countries, and that has been another stumbling block. Pharmaceutical companies are looking at
middle-income countries as new sources of income, but in countries like Brazil there are segments
of the population where there is great need."
While ICCR members have focused on access to
medicine for HIV/AIDS, Byron told SocialFunds.com that they also engage with pharmaceutical
companies on access to other drugs in low-income countries as well. "We've been asking
pharmaceuticals to develop global access to health policies," she said, "and this spring Merck
became the first to do that." As a result of Merck's agreement, ICCR members withdrew a shareowner
resolution addressing the issue with the company.
In its Statement of Principles,
Merck agreed to expand its low-cost manufacturing network through local and regional partnerships,
use differential pricing frameworks that account for economic development and public health needs,
and form partnerships with private, government, or non-profit resources and distribution channels.
"Merck also works with the GAVI
Alliance to get their vaccines to the developing world as soon as they're produced," Byron
Since 2000, GAVI has committed $5.7 billion to immunizations for children in
developing countries, and by the end of 2010 had supported the immunization of 288 million children
and prevented over five million future deaths.
Following its agreement with Gilead, the
Medicines Patent Pool announced
that it has begun negotiations with Boehringer-Ingelheim and Bristol-Myers Squibb on licensing
agreements for patents on HIV medicines. The Pool is also in negotiation with five other patent