50,000 people, mostly women and children, die every day from avoidable poverty related causes. Confronted with these statistics it is natural to despair. But is all this suffering inevitable – something we cannot fight against? Thomas Pogge, a leading political philosopher, believes not and has put forward a concrete plan to reform pharmaceutical research and drug production, showing that part of the solution to this tragedy is within our reach. If implemented, such a plan would drastically reduce the disease burden affecting the poor, as well as enhance the quality of health care for everybody. This may sound too good to be true, but Pogge convincingly argues that it isn’t. So what is the problem with the existing system?
In Pogge’s view, the answer is relatively easy: the rules currently structuring pharmaceutical research and trade drive the interests of pharmaceutical companies and those of patients apart. The risks and costs involved in developing new drugs are extremely high. Because of this, it would seem that the only way to incentivise pharmaceutical research is to guarantee the companies’ ownership of their newly developed drugs through a system of international patents. The patent works by giving each company a 20-year monopoly on the production of the drugs. This arrangement has two negative effects. First, it results in massive inefficiency: by preventing free competition within the pharmaceutical market it drives prices up, often to 400 times the marginal cost of production. Second, it directs research away from prevention: under the present system, the ‘most profitable’ patient is one who never gets better and never dies, but keeps buying drugs all the way through her life, rather than, for example, buying a vaccine only once. Needless to say, this is not the most desirable situation for the patients themselves. Can the system be made to work for all?
Pogge thinks it can, through a reorganization of incentives in the field of medical research. He proposes that, alongside the current system, pharmaceutical companies could opt for another form of patenting, whereby the reward for drug-innovation would come out of public funds in proportion to the impact of their new drugs in reducing deaths and illnesses world wide. Under this alternative scheme, the healthier the patients become, the more money the company makes. Moreover, for each additional patient cured the money multiplies. Companies would therefore have a strong incentive to make the drugs effective, cheap and as easily available as possible. In this way, their interest in making a profit and the public interest in better health for all would converge. In short, ‘the most profitable patient’ would also be ‘the fittest’.
And you would probably think: ‘This is all well and good, but where does the money come from?’ It should be obvious by now that we would all greatly benefit from this reform, but it is just as obvious that, given current global economic conditions, only some of us could afford the costs of implementation. By this we do not mean multi-billionaires such as Rupert Murdock or Bill Gates. Despite the massive scale of the reform Pogge envisages, the expense for wealthy countries would amount to 0.22 percent of their aggregate gross national incomes, or 70 dollars per person, per year. If they were offered the chance to save millions of lives and obtain better health care for all for 70 dollars, the citizens of most wealthy countries, including Australia, would think it was worth it.
Another added advantage, of course, is that Australia would be contributing in proportion to its size and wealth, but would benefit form the research results of the aggregate of the expenditure by all rich countries, including big players such as the United States and the European Union.
What would it mean for Australia to take part in this important reform plan? The specifics of the implementation of the proposal are currently being worked out. In very general terms, like other nations and international agents, Australia’s participation would involve allocating some resources to the financing of an international fund, which would probably also be administered internationally, as well as adjusting the domestic legal system to accommodate the new patent regime, while of course retaining the current patent system as well.
For anyone interested in finding out more, Pogge together with a multi-disciplinary team of experts is currently developing the details of the project at the Australian National University. Despite the global scope of the reform and its cosmopolitan spirit, it would be a source of great pride for Australia to think that the blueprint of such an important and greatly beneficial project originated here.