Industry Committee on Oct. 26th, 2010

[Dr. Frank Plummer]

Canada has been a leader in research on understanding epidemics and on prevention technologies. I would like to see emphasis on that, both on prevention with simple strategies that are available now and on HIV vaccines and microbicides.

[The Chair, Conservative, David Sweet]

Okay. Thank you, Mr. Plummer.

Now we're on to Mr. Masse for five minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

That's why this bill is so important, because it actually facilitates the strengthening of the global fund and the ability for the global fund to be used more comprehensively. This bill would accomplish that through the increased competition and making sure there would be strength out there for that competition.

I would like to ask Mr. Taubman a quick question. Mr. Taubman, you mentioned the WTO and that it would require another country or member to make a charge against Canada if someone felt that we're having intellectual property violations. Is that correct?

[Antony Taubman]

Yes, that's correct. We don't have any process that the WTO, as such, initiates. We're simply the adjudicator, if you like, in the event of a dispute.

[Brian Masse, NDP, Windsor West, ON]

How often does that happen, not necessarily to Canada but among member states?

[Antony Taubman]

Of course, the rules of grievance of the WTO cover many fields of trade, and intellectual property is just one component of them. There have been over 400 disputes altogether, but there have been less than 30 concerning TRIPS or intellectual property as such. Canada in the past has been involved in two of those disputes, but this has been spaced over 15 years, so it's a comparatively rare occurrence. We've only had one such dispute in the last five years, for example.

[Brian Masse, NDP, Windsor West, ON]

If there is a dispute between a compliant country and another country—I guess the one that is charged—it has an opportunity to correct matters if it so chooses before it goes to any official proceeding, hearing, and adjudication. Is that correct?

[Antony Taubman]

Most certainly. It's a requirement of our members, that if any country has a problem with another country's system, to enter into consultations beforehand anyway. If those consultations aren't successful, then there is a possibility of what we call a “panel proceeding”, which over time may result in a finding that the relevant law is not consistent with WTO obligations. Then what results is a recommendation that the law be brought into line with WTO obligations.

There is then, in legal terms, a “reasonable period” for the appropriate amendments to be made. There is a process of consultation, a process of fact-finding, and, on rare occasions, an actual determination as to whether the law is compliant or not. Then there'd be a reasonable period—typically 12 months or thereabouts—to bring the law into compliance.

[Brian Masse, NDP, Windsor West, ON]

Thank you very much, Mr. Taubman.

That really debunks the Chicken Little theory that we have about how the sky is going to fall if there is a challenge and a violation, and we've heard that so often with this bill.

Madam Akugizibwe--I hope I'm getting that right, and I apologize if it's wrong--could you please outline how important it is for the drugs to be procured without having to negotiate first with the country coming forward? There seems to be a pattern in the past of some intimidation. We've seen that in Thailand and in other places. Can you highlight what it means for agencies?

The other thing too is that there seems to be a kind of paternal suggestion or a choice of either/or, that the infrastructure is not there, so we can't just send it over there. Can you talk a little bit about those two things, please? I think if we have this bill moving forward, it has a little more flexibility. It also allows groups and organizations even outside the global fund to be able to target specific areas where there is good cooperation.

[Paula Akugizibwe]

Yes, I think removing the necessity for a country to first express intent to procure from a Canadian company will certainly cut through a lot of the inhibitions, as I mentioned.

First, the tender process is the process through which a company decides which company it wants to procure from. So it's a bit irrational for countries to be required to express interest in a particular company if no other company is able to offer. So I think if that requirement is removed from this legislation, as you say, it will give companies more flexibility. It will also give them flexibility to respond to countries' needs as they change over time, and having a maximum quantity that a company is able to provide for a particular country is also not always a realistic thing for a country to do, if the epidemic changes significantly over the time in which the licence has been granted.

With regard to what I refer to as a false dichotomy, because that's really what it is, between infrastructure systems versus availability of medicines, I really think the two need to go hand in hand. One of the things we have seen is that clearly the ARV treatment, especially in southern Africa, contributes significantly to strengthening health systems, to strengthening infrastructure.

So it's obvious that if we don't have infrastructure, the drugs themselves cannot achieve their full potential, but it's really clear that without the drugs, there's very little we can do with the infrastructure. For someone who is living with HIV in southern Africa, the difference between life and death is really whether they have affordable medicine they can get access to in order to live. I think one of the things that discourages many governments from making the investment in infrastructure is not knowing whether they will be able to afford the treatment that will go with the infrastructure over the next five years or 10 years, especially with the threat to generics that we are currently experiencing.

I would emphasize that the role of access to affordable medicine is really what triggered the greatest degree of progress in the HIV response over the past decade, and it needs to be sustained.

[The Chair, Conservative, David Sweet]

Thank you very much.

Now on to Mr. McTeague for five minutes.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Thank you, Chair. Thank you, witnesses.

Mr. Keon, very quickly to you.

It would appear that you have a very significant, involved, cumbersome process by which you get applications, by which you have to negotiate with the brand-name holder, understandably. Except for the provision you referred to as far as ensuring there is absolute certainty and approval from Health Canada, you've suggested you would support the legislation. I'm wondering if you could give us an example specifically of where quantity and time may have a lot to do with the fact that no generic would dare try to reproduce what happened in Rwanda.

[Jim Keon]

I think generic companies are businesses. They look at developing products, typically as patents expire. They have a timeframe for that, and with this bill, you'd be looking at developing a product or a developing country market, not a Canadian market, not a U.S. market, not a European market, at an earlier point.

What I'm saying is they would need to develop the product as Apotex did, to do the testing, to get approval from Health Canada, and as the speaker from South Africa has said a couple of times, the system is all backwards. They have to do that before they can go to a country and indicate they have the capacity to provide the product. So for a developing country to come to Canada or Apotex or Teva or anyone and say they'd like them to bid on a particular product, that is a very backward process, as I said. They don't have the right to do that. They would have to start that process. It's going to take some time to develop the product, to get approval, let alone to negotiate the licence with the brand company.

So I think it's very important that the companies have a clear right under this legislation, if it's going to be effective, to make a product that will get a licence, and if they follow the rules on where it's shipped, etc., and diversion, that they can continue to make the product. Then we'll have a much greater chance of having products made under our legislation.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Perhaps Mr. Jenner or, Madam Akugizibwe, you could give us an explanation.

Mr. Jenner, you suggested the number of patients now being helped has grown significantly. I'm wondering how you square that, sir, with the 8,000 people who die every day in Africa directly or indirectly as a result of AIDS, tuberculosis, malaria, etc. What are your member organizations doing to specifically address the issue of second-generation needs for drugs to address these problems, and more specifically, pediatric drugs?

[Andrew Jenner]

Thank you very much for the question.

I think there are a lot of different issues that come out of this particular discussion, but if I can, I'll address the number of concerns. When you think about the need for developing countries in relation to access to medicines, I don't think we are here talking about primarily access to patented medicines. I think if you have a look at the research done on the ground, access to any medicines is a problem in any of these places. I attended a presentation in Geneva by the World Health Organization that highlighted that poverty remains a significant problem. If you cannot afford to buy the cheapest generic, buying generic or patented medicines is particularly problematic. The other problem they mentioned specifically in relation to this problem is access to clean water.

So all of these things feed into the general health and well-being of the individual people. The call, as has been mentioned significantly, is that governments really do need to pay attention as to how much money they are putting into their health budgets. If governments are not willing to put in sufficient amounts to guarantee access to the most simple non-patented generics, then it would be a very significant challenge for them to get access to generics of patented versions of medicines, because these are not cheap medicines, by and large. They still have some costs. They are cheaper, but there is a cost associated with that.

That is why I think it is important for us to think about the generic access to medicines debate rather than simply looking at a very small subset of the tools available. Compulsory licensing has been proven in some countries to be a short-term fix. It's not seen by many as being a sustainable solution to the access to medicines problem and access to medicines debate. I mean, I can submit for you for the record the massive expansion of our industry efforts in relation to access to medicines. I think I've submitted a short statement on that, but I can give you a little bit more detail on the rapid expansion of the effort that our companies are putting into achieving access to medicines. Simply—

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

Mr. Jenner, I'm sorry, my time is very brief, and I appreciate that—

[The Chair, Conservative, David Sweet]

It's actually up, but if you want Madam Akugizibwe to answer, then we'll have her answer.

Paula, I know all the members want to be able to pronounce your name properly, so if you could just begin with that and then answer the question, we'd really appreciate it, because we'd like to respect that.

[Paula Akugizibwe]

Sure. It's “Akagizeebway”.

[The Chair, Conservative, David Sweet]

“Akagizeebway”. Thank you.

[Paula Akugizibwe]

“Akagizeebway”, yes, phonetically. It's quite long.

In response to the question, I think we need to recognize also that we have made tremendous progress with regard to access to HIV treatment, but the number of people who are still in need greatly outreaches the people who have actually accessed treatment. So if you're looking at the figures of people who are dying daily from HIV, TB, and malaria, they're shocking, but it would be a lot worse in absence of the progress that has been made.

I agree that access to medicines in general is a challenge in most countries in the region. Underinvestment in health is a challenge, and it really underpins a lot of these problems with getting medicines to people who need them the most. But I think we need to recognize that this doesn't take away from the need to ensure that medicines are affordable.

What we've seen also with the funding crisis that I mentioned earlier is that where in the past people were guaranteed they would get the HIV treatment paid for by government, because of funding constraints now, that guarantee does not exist in many places. You are finding people having to pay for ARVs out of pocket. In that case, the price of the drug on the shelf in the pharmacy really is the most determining factor in whether someone accesses the treatment or not.

So just in terms of crucial...rolling out HIV treatment has been one of the most vital ways that we've strengthened supply to management systems in the region, and additionally, the platform that HIV activism has created has had ripple effects across the drug management system. We are seeing prosecutions happening, we're seeing reorganization of organizational structures in countries like Swaziland, recently this week, for example, to improve the way the drugs flow. That is a direct result of HIV treatment advocacy. So instead of trying to say that we can....

Okay, I'll leave it there.

[The Chair, Conservative, David Sweet]

Thank you. We're way over time, and we just have a couple of minutes.

Mr. Wallace, it looks like you have about four minutes. I'm sorry.

[Mike Wallace, Conservative, Burlington, ON]

Thank you.

My colleagues are happy that my time is limited.

[Voices]

Oh, oh!

[Mike Wallace, Conservative, Burlington, ON]

There you go. I might be the last speaker before we go line by line on this, and I want to thank my colleagues around the table for dealing with this issue. I was one of the members on the government side who voted for this bill to move forward to committee. I've been very clear with the folks who have come to see me in my office that it was to be given to committee so we could have a discussion on the issue.

I frankly don't believe it will ever pass in its present form, but that doesn't mean it is not an issue we need to resolve. I don't really have a question for Mr. Schwartz, but I want to thank him for his description. It was very clear. I think we've heard from a number.... It's like anything in the law; that's why there are always lawyers on both sides of the table.

There is some risk here. I don't necessarily agree with Mr. Masse's approach that just because there are no penalties, we can go ahead and do something and then fix it after. I think that would be a bad message for my children, and it is for the Government of Canada. So I'm not buying into that.

I do have two questions, and maybe Mr. Jenner can answer one of them for me. What's bothering me most is that we've heard that there are a number of these CAMR regimes all over the world. There are 30 or 33 of them, and none of them seem to be working. Since he's representing an international organization, does he have any comment on why they're not working at present, or is there something we should be doing from an international perspective that we haven't heard yet to make these regimes...?

[Andrew Jenner]

Thank you very much for the question.

I think there are 54 WTO members who have actually implemented the paragraph 6 decision, and 27 of those are the countries of the EU. I think it's worth bearing in mind the context that if countries aren't implementing CAMR provisions, they cannot be utilized.

I think in relation to the countries that have done it--I think I referred to that in the comment I made some time ago, and certainly you might find that true here--the cost of generics from developed countries is significantly higher than is the cost of generics from somewhere like India, for example. That's something we need to be aware of, and that's something we need to bear in mind. The idea behind the August 2003 decision was that we are going to use an existing system that is based upon national experiences and established processes that are in place, but we are going to use this old system in a new way.

That has great advantages, and for some there can be some perceived disadvantages, but that is essentially what the system tries to do: it uses an old system in a new way. In response to the question about why we haven't seen mass use of it, I think there are other ways you can achieve access to medicines, but if you think about how long the provision has actually been there, it's not actually been in place for that long. If we were to do any form of legislative review, you'd have to look at a significant period of time and numerous cases before you could reach a conclusion that there was a problem.

Now, I think in relation to India, they have implemented protection for patent products since 2005. Previous to that, it would not have been necessary to issue compulsory licences for export. Now, there may be, in years to come, situations in which India would take advantage of their system as those new patent medicines are generally going through the regular due process in India, and then generics may wish to copy them upon request from a country.

I think that any review of any legislative process—by the EU or Canada, for instance—is far too premature in relation to how young this piece of legislation really is. As I have said, it is based upon established legal practice, which is why we have the number of provisions—there is article 10, if you want to see the EU regulations—that are in place that people will understand and people can use. From our perspective, these are reachable requirements; they are not burdensome. For those generics who are involved in this area, I think going through the process is not overly cumbersome, but I don't know that there is significant evidence to support that.

Thank you.