Background information on Innovative Medicines SA (IMSA) We provide some important background information on IMSA in Annexure A.

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1 Submissin by Innvative Medicines SA n cmpulsry licensing in natinal health emergencies t the Suth African Department f Trade and Industry Octber 2005 Backgrund infrmatin n Innvative Medicines SA (IMSA) We prvide sme imprtant backgrund infrmatin n IMSA in Annexure A. Innvative Medicines SA regards access t healthcare as a pririty IMSA is actively invlved in addressing issues f access t healthcare, as we believe that SA health care and the health system is a cllective respnsibility that demands jint slutins. IMSA has illustrated this cmmitment by, inter alia - Practive wrk n the Health Charter, bth n the issues f brad-based black ecnmic empwerment and ptins t increase access t healthcare within a Charter cntext. The IMSA chairpersn at that time, Jhn Fagan, was appinted t the Ministerial Charter Task Team (MTT) the nly persn frm the pharmaceutical industry t serve n the MTT. In this prcess IMSA has als succeeded in drawing tgether the private healthcare sectr in making a single, agreed upn and generally supprtive submissin t the MTT. Active invlvement in finding slutins in the medical schemes envirnment fr lw-incme grups (LIMS). These husehlds shuld als be able t benefit frm risk-pling and access t enhanced care. IMSA des nt supprt pr healthcare fr pr peple. IMSA supprted the medicines pricing regulatins as far as it pertains t manufacturer pricing, by taking the lead in the cnsultative prcesses that lead t the prmulgatin f the regulatins. Mrever, it std by its principles, at grave cmmercial risk t member cmpanies, by appraching the Cnstitutinal Curt as amicus curiae in rder t ensure that the single-exit pricing system is maintained and that ex-manufacturer savings already affected (at sme 21%) were nt lst. IMSA members cmpanies have taken imprtant steps in addressing access t treatment fr diseases that burden the develping wrld. These range frm vluntary licensing agreements t prgrammes relating t the dnatin f drugs fr pprtunistic infectins. The Pfizer Diflucan Partnership Prgramme cuples the dnatin f drugs (fr life-threatening pprtunistic infectins t cuntries with a prevalence f higher than 1%) with the 1

2 training f healthcare prviders t enhance the quality f diagnsis and delivery f healthcare service fr the critical medical cnditin. Eli Lilly partnered Aspen Pharmacare in 2004 t transfer Lilly technlgy t them fr the manufacture and distributin f the essential antibitics capremycin and cyclserine needed t treat the grwing cases f multi-drug resistant tuberculsis (MDR-TB) in the regin. charge t patients in the public sectr. In TB, sanfi -aventis develped fixed dse cmbinatin prducts based n the requirements f the Suth African Department f Health and the WHO. The prgramme includes the creatin f patient friendly packs t enhance cmpliance and a pssible public-private partnership t assist in DOTS training. The TB SA specific designed medicines are manufactured in a lcal facility in Mameldi and a 100% BEE partner will cmmercialise the TB range. n dses) f the antiviral Tamiflu (seltamivir) t the WHO t be used at sites fr new and ptentially pandemic utbreaks f human influenza in rder t reduce mrbidity and mrtality and t cntain r delay the spread f an utbreak. MSD expanded its manufacturing activity in Midrand fr stcrin (Efavirenz) in rder t meet grwing demand bth in SA as well as in the exprt markets in the sub-regin. MSD als granted a vluntary patent license t Aspen fr Efavirenz. All MSD s ARVs are made available t all sub-saharan African cuntries (incl. SA) at prices at which it makes n prfit. IMSA supprts the apprach f finding slutins that address the need f ppulatins in cases f health emergencies in a nn-cnfrntatinal manner that takes accunt ff the cmplexities f each case and its stakehlders. IMSA s view n cmpulsry licensing and the current mechanisms t address access t healthcare IMSA believes that access t healthcare in Suth Africa shuld be expanded and enhanced. This includes access t medicines. As stated abve, IMSA is actively invlved in finding slutins in this field. IMSA als believes that the barriers t access t healthcare are cmplex and varied, ranging frm issues f affrdability, human capacity, infrastructure, regulatry cmplexities t ecnmic inequities in sciety at large. IMSA s experience has been that even where medicines are made available fr free, ther challenges limit availability. 2

3 IMSA supprts drives by the SA gvernment t address access by varius means and mechanisms, sme f which are fund in the current dmestic regulatry framewrks, including, but nt limited t the fasttracking f medicines registratin in cases where 1 and the prvisins cntained in sectin 15C f the Medicines Act f 1965, as amended. IMSA member cmpanies supprt the prvisins relating t access in natinal, public health emergencies where cuntries have n lcal manufacturing capacity, and where attempts t address the access needs by means f dmestic prvisins and negtiatins have failed. IMSA interprets these natinal public health emergency situatins as inclusive f HIV/AIDS, TB, malaria and ther diseases f similar gravity and scpe. It is cmmn cause that, in internatinal human rights law, natinal emergencies warrant vilatins t human rights (such as prperty rights as is the case with instances f cmpulsry licensing), within certain parameters. The dergatins are t be applied narrwly and strictly [as] required by the exigencies f the situatin. Any such measure als has t be prprtinal and necessary. 2 IMSA supprts the frmalizatin f the August 30, 2003 Agreement int a TRIPS amendment and believes that the meaning and integrity f this Agreement must be preserved in any such amendment. IMSA als cnfirms its supprt fr measures intended t avid the diversin f medicines intended fr emergency situatins. It als supprts assurances that the prvisins relating t cmpulsry licences will nt be used fr cmmercial plicy purpses. In its view, cmpulsry licensing shuld be used as a last resrt and nly in the cntexts riginally envisaged by the Agreement, and where dmestic mechanisms have failed. It is nt well understd that the pharmaceutical industry discvers and develps mre t medicines nt gvernments r universities. This nging develpment f medicines is nly pssible with cnstant investment by this sectr. Supprt fr the system f cmpetitin incentivises this financial risk taken in searching fr new medicines t deal with the ever changing health demands f ppulatins. IMSA recgnises that research-based cmpanies require stability and certainty as t the prtectin f their intellectual prperty. Increased and cntinued investment in cuntries depends n the level f prtectin affrded t their cre businesses. This in turn, translates int access t innvative medicines by the cuntry at large and the existence f a vibrant generics market. 1 S15(2)(b) Medicines Act f 1965, as amended. 2 See Davis et al Fundamental Rights in the Cnstitutin 1997:

4 In Summary, in respect f the issue at hand, we supprt the fllwing prvisins t increase access t medicines: Fast-tracking f medicines registratin in cases where it is essential fr public health. Vluntary- and cmpetitive mechanisms, such as negtiatin and cnsultatin t address access t healthcare in a hlistic manner. The prvisins relating t access in natinal, public health emergencies where cuntries have n lcal manufacturing capacity, prvided that - The definitin f public health emergencies is nt interpreted expansively. The prvisin is used as a last resrt where all ther existing dmestic measures have failed. Measures are implemented t prevent the diversin f medicines. Cmpulsry licensing is nt used fr cmmercial plicy purpses. ANNEXURE A Innvative IMSA was established in direct respnse t the s-called Act 90 curt case in Cmpanies wh later frmed IMSA realised that the apprach and methdlgy f the pharmaceutical sectr have t change in a transfrming Suth Africa. The apprach t stakehlders and gvernment in particular has t be cnstructive, pen and cnsultative, rather than cnfrntatinal. IMSA believes that the challenges facing Suth African healthcare may be slved t succeed in a changing envirnment. Therefre IMSA tackles all healthcare challenges in a slutin-riented manner. IMSA is funded n the fllwing cre values: Ethics in the healthcare envirnment Engagement and cnsultatin Belief in the inevitability f- and need fr healthcare transfrmatin 4

5 MSD Lilly Rche Pfizer sanfi-aventis Nvartis # Emplyee # Pharma Prducts Value f R&D in S.A. per annum R35mi R40mi R50mi R50mi R32mi R25mi Lcal Manufacturing Plants Yes N Yes Yes Yes Yes Cmmunity Partnership Prgrammes 7mi 15mi 7mi 110mi 150mi 15mi IMSA cmpanies jintly emply sme emplyees. systems. IMSA cmpanies cntribute 442 prducts t the Suth African healthcare market and invest sme R232millin in research and develpment in Suth Africa per annum. Five f the six IMSA cmpanies have manufacturing plants, f which sme manufacture fr the exprt market. 5