CAMR changes would increase competitiveness

It was day three of the Senate Committee hearings on Bill S-232, which looks at Canada’s Access to Medicines Regime (CAMR) – the law that allows us to send cheap AIDS drugs to developing countries. This was one of the most anticipated days as we were to hear from Apotex – the only generic drug manufacturer to have accessed the CAMR provisions to send a single shipment of AIDS drugs to Rwanda. It was an arduous process that Apotex was going to describe in detail for the committee, so that they could show why the bill is necessary.

Before the hearings started, there was a press conference held with the Jack Kay, the President and Chief Operating Officer of Apotex, Bruce Clark, his VP of regulatory and medical affairs, and NDP MP Judy Wasylycia-Leis, whose parallel Bill C-393 on CAMR is currently before the House of Commons. During this press conference, I asked them about one of the issues that has come up in previous Senate hearings.

Q: It was suggested during one of the previous Senate hearings that one of the reasons why the CAMR legislation hasn’t been accessed because the drugs are on the available on the market more competitively priced from elsewhere. Can you comment on that from your perspective?
Jack Kay: There is no question that these products are available from other countries such as India, and their prices are very low. But by us providing them at cost, we are competitive. There is also a reality out there of a perception that buying drugs from a country like Canada, that the quality of the drugs that they receive will be better than some other countries. I am not saying that the quality of the product from India are no good. I am saying that these developing countries would have a preference from receiving lifesaving medicines from a country such as Canada.
Bruce Clark: One of the simple facts is that our prices can be reduced dramatically if we can increase the volume of what we can ship in terms of sourcing raw materials and providing product. One of the recommended changes in the legislation would be not to require a license on a country-by-country basis or an order-by-order basis, but if we could work out an arrangement where it could be by a region or a territory, then the issues of scale improve our pricing. Just for the record, in this past shipment to Rwanda, we won on price as well as other issues. So as Jack says, with our ability to produce the product at our cost, we’re still competitive, but the issue is we could be more competitive with the volume up.
Judy Wasylycia-Leis: Just a further comment on what we’ve been hearing during the Senate hearings, one of the reasons the government has suggested this bill is flawed is that it violates the spirit of the World Trade Organisation or TRIPS – the Trade Related aspects of Intellectual Property Rights – and I think that is on an argument based on fact. My sense is that in fact everything about CAMR is even more restrictive than TRIPS outlined in 2003, and everything about our approach is totally, according to the governing principles, set out by the World Trade Organisation. I think it’s wrong for government officials to be coming to a Parliamentary committee, putting forward an argument for which there is no basis in fact and for which there is no legal opinion.

The first witnesses before the committee were from Unicef and the United Nations Development Programme (UNDP). One of the key points that came up is that Canada’s existing CAMR legislation was a conservative interpretation of the August 30, 2003 WTO decision that allowed for CAMR to come into being. Bill S-232 allows for a more liberal interpretation, that is still within the confines of the agreement.

During Apotex’ testimony, there were a few key areas of note. One is that the current CAMR legislation requires that these generic companies approach the patent holders for a voluntary licence, and in the case of the drug Apotex developed for Rwanda, that meant approaching four patent holders. Royalty rates were never the issue, but after fourteen months, the process stalled, and they used the CAMR provisions to obtain a compulsory licence (which they then obtained in about fifteen days). What Bill S-232 would allow is for the companies to skip directly to the compulsory licence stage, bypassing much of the red tape, lawyers’ fees, and negotiation. Another key point is the current backward situation that the legilsation currently puts these companies in – when negotiating with countries to arrange for these drug shipments, they can’t tell the countries that they have the licence to manufacture those drugs, because they can’t get the licence until they have the country agreeing to purchase the drugs in question. The bill would streamline that process as well.