Introduction to Hepatitis C Patent Strategies

Initiative for Medicines, Access, & Knowledge1 June 2015

Who we are

I-MAK is a non-profit organization of lawyers and scientists representing the rights of low-income patients worldwide. We believe all people have the right to access affordable, life-saving medicines for HIV/AIDS and other diseases.

We expand access to lower-cost generic medicines by addressing legal and policy barriers:• Challenging unmerited drug patents• Partnering with stakeholders to achieve law and policy reforms• Conducting advocacy• Generating evidence-based research on intellectual property (IP)

We believe the patent system is broken and disproportionately represents private interests over patient rights. Our mission is to change this.

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Where we work

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I-MAK founded; began working on HIV/AIDS in India

Working in > 48 countries and additional disease areas (HCV, malaria, TB, avian flu, vaccines, non-communicable diseases – focus on scaling HCV work to multiple middle- and high-income countries)

Argentina

Brazil

Russia

China

Ukraine

India

PhilippinesIndonesia

VietnamThailand

Egypt

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2006

2014

European Patent Organization

Pricing Issues: – Launched at $1000 per pill in HICs, totaling $84,000

for 12 week course– $7500 for 12 week course in some MICs (Note: 73%

of people with HCV reside in MICs)– Limited $900 price in Egypt and selected country

programs, along with donations in Georgia, provide misleading picture to the public about Gilead’s pricing structures for the majority of people with HCV

Sofosbuvir (Hepatitis C Medicine)

Patent Issues: • Not a new drug• Not inventive (obvious)• Based on an old compound + routine science

Bilateral Licenses: Gilead + Indian drug manufacturers• Exclusion of 50 middle-income countries (50 million

people)• Supplier Lock-Up: Generics prohibited from supplying

these countries even in absence of patents

Sofosbuvir (Hepatitis C Medicine)

InterventionTypes of Intervention:

- Patent Challenges Filed in Argentina, Brazil, China, Europe, India, Russia, Ukraine

- Dialogue with Patent Offices Conducted in Egypt, Morocco, Thailand (Note: Egypt has rejected patent)

- Compulsory Licensing - Drug Pricing Advocacy

Rationale: - Open the door for generic market entry,- Incentivize generics- Serve as leverage in price negotiations

Sofosbuvir: Interventions (2013-2015)

How we work: patent challenges

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Potential benefits:• If every person with hepatitis C in these five

countries would be treated - that is 40 million -the cost savings would be $270 billion.

• If these governments treat just 8 million people with hepatitis C in these five countries, based on current percent HIV treatment coverage rates, the cost savings are $50 billion.

Impact Analysis

Assumptions:– Gilead price for 3,000 patients, 12 week course

$900 USD– Remaining 1,861,840 patients purchase from Gilead

at middle-income country price of $7,500 (price given to Brazil used as proxy)

– Generic price available at $515 (see Methodology slide)

Difference between purchasing directly from Gilead, and purchasing generics is $13 billion

Scenario 1: Sofosbuvir Cost Savings for Ukraine

Assumptions:- Gilead offers $900 price to all 1,864,840

people with HCV in Ukraine. - Generic price is available at $515.

Difference between purchasing directly from Gilead, and purchasing generics is $718 million

Scenario 2: Sofosbuvir Cost Savings for Ukraine

Impact Analysis: I-MAK Methodology

I-MAK’s analysis of potential savings from access to generic sofosbuvir in five MICs - Argentina, Brazil, China, Russia and Ukraine - is based on disease prevalence numbers from the paper "Evolving Epidemiology of Hepatitis C" (Lavanchy, 2010). To calculate full potential cost savings, we multiplied the number of HCV infections by the current percent treatment coverage for HIV, as a proxy for what HCV treatment levels could reach in each country, then multiplied that number by the estimated difference in price between generic and branded SOF.

For branded prices, we assumed $900 for a 12 week course of treatment in Ukraine, and $7,500 in all other countries, based on actual quoted prices from Gilead to Ukraine and Brazil. Prices for the other three countries were unavailable at the time of publication, but reports thus far suggest that only Ukraine will be offered Gilead's lowest access price of $900. The price in Russia may be even higher given that it is a high income country. For generic pricing, our estimate of $515 took into account experts’ projections of the generic launch price in India ($770) and the long-term potential price (~$136)*, as well as a 7% royalty rate and 6% generic price premium (based on generic HIV drug pricing data in LICs vs. MICs).

Impact Analysis: I-MAK Methodology

International Press Coverage

International Press Coverage

International Press Coverage

International Press Coverage

Future Action:

- Targeted interventions by civil society and generic suppliers, e.g. patent challenges

- Government intervention to curb excessive pricing, e.g. issuance of government use or compulsory licenses, using local production or price caps as leverage.

- Global campaign on pricing of hepatitis C drugs

The Way Forward