Oxfam has issued a highly critical report on the pharmaceutical sector and claims it is denying millions of people access to life-saying treatments but the industry has reacted angrily to the charge.

The charity’s report, called Investing for Life, looks at the world’s top 12 drugmakers, and claims to be an analysis of their drug pricing policies, “their record in developing medicines relevant to poorer countries and their stance on protecting intellectual property rights”. It starts by saying that the pharmaceutical industry is “undermining its own future because companies are refusing to change the way they do business in developing country markets”.

Oxfam executive director Jeremy Hobbs claims that more than 85% of world consumers are underserved or have no access to medicines and “the industry must recognise that charging high prices, quashing generic competition, developing medicines only for those rich enough to pay and fighting for harsher patent laws is an ineffective business strategy for new markets, as much as it is a moral outrage”. He added that companies have been responding to the challenge of breaking into emerging markets “in an ad-hoc and inconsistent way. This is bad for the industry and bad for poor people”.

The report goes on to say that some companies are offering differentiated prices “but this is extremely limited and mainly for high-profile diseases such as HIV and AIDS”. It also notes that between 1999 and 2004, “there were only three new innovative drugs targeted at diseases affecting the developing world out of 163 medicines brought to the market”.

Pharma ”narrow-minded and wrong” on patent policy
Helena Vines-Fiestas, author of the report, added that high levels of intellectual property protection have not resulted in new cures for such diseases, despite drugmakers’ claims that patent protection does not prevent poor people from accessing affordable medicines. Oxfam describes that stance as “narrow-minded and wrong” but the evidence is overwhelming that “generic competition is the most effective and proven method to reduce drug prices”.

“The industry is failing to make the systematic changes needed to serve developing country markets and meet its responsibility to make medicines universally available,” said Ms Vines-Fiestas. “Public pressure will intensify if companies continue to offer only patchy concessions, for example around high profile diseases such as HIV/AIDS and malaria”.

Drugmakers reacted quickly and the Association of the British Pharmaceutical Industry said it is disappointing that Oxfam “is continuing to frame the issue of access to medicines in terms of ‘the pharmaceutical industry is not doing enough’ – despite evidence of a vast and growing investment by companies in sustainable partnerships and initiatives.”

The ABPI says the report includes “subjective interpretation of data” and seems “strangely reluctant to acknowledge the scale of the industry’s involvement in developing world issues”. In particular, Oxfam continues to regard industry’s defence of patents, “essential for companies to be able to invest the £500 million it takes to develop just one new medicine,” as a cause of the problem. However, “the reality is that poor countries cannot afford any price, however cheap,” says the association, noting that India, “with the lowest prices for essential medicines in the world, still cannot provide them to two-thirds of its citizens”.

Richard Barker, director-general of the ABPI, said that Oxfam “should stop looking to criticise an industry that has done more than any other to help alleviate the health problems of the poorest nations on earth and look to work with us on these issues”. He added that “access to the right treatment is vital for many of the world’s poor, but this should be combined with addressing the causes of poverty.”