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New research published today by Roger Bate and me addresses the issue of drug quality in developing and emerging markets by looking at the first point of drug regulation—registration systems—in a variety of countries, including India, Brazil, China, and many African nations.

Not only is drug quality important to the health of citizens of those countries, but—since as much as 80 percent of active ingredients in U.S. drugs are made overseas—Americans should also be concerned about drug regulation abroad.

Looking at 12 countries, our research provides an idea of how stringent authorities are in registering drug products. There are major differences in registration costs, pre-quality testing requirements, evaluation timelines (see chart), and other areas. Such differences are often important: For instance, just how thorough can the review of a new drug be when conducted in seven days, when the process takes at least three months elsewhere?

With a four-fold increase in U.S. drug recalls from 2008 to 2009, there is more pressure on the Food and Drug Administration (FDA) than ever to protect the pharmaceutical supply chain from unsafe or adulterated products. But the FDA only has the capacity to inspect foreign production plants once every 13 years.

Unable to do the job alone, the FDA should put more pressure on foreign regulatory authorities. While a general lack of human and financial resources impacts many foreign authorities’ ability to regulate, not all perform equally badly. Countries with stronger political commitment to regulation stand out from their counterparts. Recent efforts in Nigeria to tighten registration and clarify procedures are in stark contrast to efforts of countries like Uganda, where corruption continues to occur in the open, or Kenya, where huge gaps in product registration exist. But it’s India and China that Americans should watch, as most of our drug ingredients come from there, and in both countries the news is mixed—as we discuss in our report.

Ultimately, many nations may not have the capacity, or even the experience, necessary to adhere to Western regulatory standards. But with the global pharmaceutical supply chain expanding, it is important that regulatory authorities in emerging markets strengthen regulation where they can, and our research highlights an area where they can start that is manageable and makes sense.

Emily Putze is a research assistant at AEI.

The September edition of the Lancet conferred upon New Delhi the dubious distinction of having a bacterium named after it. The “Indian Superbug,” or New Delhi metallo-β-lactamase 1 (NDM-1), is a bacterium carrying a newly recognized gene that is extremely immune to antibiotics. The Lancet study identified 143 cases of NDM-1 isolates in India (and Pakistan and Bangladesh) and 37 in the United Kingdom. The study claimed that many of the UK cases involved people who had traveled to India or Pakistan within the past year, or “had links” with these countries. However, the broader message being drawn from the study—that Indian hospitals are unsafe for surgery and health tourists should beware—lacks any foundation and makes us suspicious that this hype is instead an attempt to stigmatize the nation’s burgeoning medical tourism industry.

In fact, within days of the publication of the report, the paper’s Chennai-based lead author, Karthikeyan Kumarasamy, dissociated himself from parts of it, claiming that while he did the scientific work, inferences were made and published by his British counterparts without his consent. He told the Hindustan Times:

It’s all hype and not as bad as it sounds. The threat of the NDM-1 is not that big as, say, H1N1 (swine flu). The conclusion that the bacterium was transmitted from India is hypothetical. Unless we analyze samples from across the globe to trace its origin, we can only speculate.

This statement, in addition to the fact that the Lancet report was funded in part by competing pharmaceutical company Wyeth, has Indian hospitals and doctors up in arms about associating the enzyme with New Delhi. They believe that the move had more to do with decelerating the “outsourcing” of healthcare services to India rather than well-founded concerns among the Western medical research community.

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Image by the Center for Disease Control and Prevention.

The World Health Organisation has granted Sanofi Aventis an increased shelf life from two to three years for its flagship antimalarial product ASAQ, a combination therapy of artesunate and amodiaquine. This is great news since drug distribution systems in the key markets in Africa are often woeful and the longer the shelf life the better chance that the drugs will get where they’re required. Some products were either being incinerated or were being allowed to be stolen from national drug stores because they were close to expiry.

Eighteen months ago I co-wrote a study on ASAQ’s main competitor, suggesting that its shelf life could probably be increased to three years. It will be interesting to see if manufacturers of that product now push harder to establish a longer shelf life for their product—after all, I suspect they’ll now lose market share to the longer lasting ASAQ.

Image by e-MagineArt.

Today the journal Research and Reports in Tropical Medicine published my study on diverted drugs and the problems they cause. There are a variety of definitions of drug diversion but the one used in the paper applies to stolen public-sector drugs being diverted into the private sector. Western taxpayers have been subsidizing anti-malarial drugs for Africans in large volumes (roughly 120 million treatments in 2009) for the past few years, and this practice has undoubtedly saved thousands of lives. But it has led to all sorts of unintended consequences, and in some places these may even undermine the good being done.

Essentially, some countries’ health departments unofficially encourage diversion of public-sector medicines, since there is a de facto acknowledgment that the government cannot distribute medicines to where they are required. Senegal does this more overtly than most; while other governments generally don’t practice this unofficial policy, some unwittingly let it happen.

Among older therapies and those not donated we found very few diverted products, no more than a few percentage points. But roughly 30 percent of the private market samplings of the most important new (and most donated) artemesinin combination therapy was in fact stolen and diverted public-sector product.

The most charitable interpretation of why this is happening is that managers of understaffed government stores know the entire distribution system is dysfunctional. They watch as the millions of treatments ready to be distributed are picked up too slowly and in too small an amount, with the clock ticking to drug expiration for those that remain. They turn a blind eye as the drugs close to expiration disappear from the stores. No doubt, they hope the drugs will be distributed amongst the poor, or at least will be sold before expiration in myriad informal drug markets.

It might sometimes happen that way, but a vast amount seems to be traded across Africa, and some—from our samplings maybe 10 to 15 percent—has already expired. I suspect that non-governmental organizations (NGOs) will point out that this is a further example that Africans need even more help, that Western taxpayers should be supporting the medical stores and FDA-equivalents in Africa further. This argument has some validity, and USAID and others are helping countries improve public-sector drug oversight. But it also ignores the importance of private-sector drug delivery in Africa, where maybe 60 percent of drugs are procured. Understanding private-sector drug distribution better, rather than decrying it as immoral as many NGOs do, is critically important.

While donors throw money at the public sector, they may unwittingly support the unacceptable face of the private sector—criminal distributors of the stolen drugs from government stores, a counterproductive and costly tragedy.

Image by kittenpuff1.

At long last, the Indian government has published the results of its survey of fake drugs. It confirms the headline it has been pushing for nearly a year, that almost none of the 24,136 samples collected were fake. Only 11 drugs were fake, according to the Report on Countrywide Survey For Spurious Drugs, published by the Central Drugs Standard Control Organization (CDSCO).

The report is remarkably detailed on the statistical modeling involved, and stresses that the “sample collection and its verification was a mammoth task and involved strenuous day and night work on part of NGOs, CDSCO officials, and laboratories over a period of 7 months.”

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A new study finds public- and private-sector efforts having a positive effect on poor quality medicines in two West African cities. Substandard and counterfeit drugs can be lethal to patients and accelerate drug resistance across at-risk populations. This is a major problem for diseases like malaria with few high-quality treatments available. Some African governments, notably Nigeria and Ghana, have responded to this challenge, often with help from donors, and have deployed an array of technologies to assist them. Both countries have uncovered fake drugs in their markets: In Nigeria, after finding myriad fakes, the authorities banned imports from many small and mid-sized producers in India and China. Last year, one of the drug quality monitoring sites in Ghana, supported by the U.S. government, was the first location anywhere to discover a counterfeit version of the leading artemisinin-based combination therapy (ACT), Coartem (artemether-lumefantrine). But while some dangerous perpetrators are now in jail, the question is: have these efforts have improved quality for the wider population?

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Some time ago, I pointed out that the anti-counterfeit drug bills, either provisionally passed or proposed in several East African nations, were poorly crafted. Now it appears that the European Union may be behind it. The laws are likely to be amended so they don’t harm trade in generic drugs, but it does call into question what the EU thought it was doing. The EU is right to support intellectual property rights, but bolstering patent protection in legislation about fake drugs is idiotic and immoral—patents have nothing to do with whether a drug is fake or of poor quality. The EU appears to be contributing to the confusion about how to combat poor-quality drugs, which is unfortunate at a time when action is urgently required.

Allegations of corruption in the Ugandan health sector have been widely discussed and occasionally documented, but until today there had been virtually no action against those involved. The arrests of three top malaria officers allegedly engaged in procuring and distributing medicines illegally, and probably involved in substandard drug delivery, is a step in the right direction.

Starting Monday, Google will prevent web pharmacies dispensing drugs from abroad from advertising on its search engine. Google claims this move will lower the risk of people buying counterfeit drugs, and Western drug makers agree. But it’s bad news for patients who struggle to pay U.S. prices for drugs. What’s more, it won’t noticeably improve drug quality.

Google’s new policy means fewer than 20 web pharmacies can advertise online. Many are brand-name organizations like Walgreens, CVS, and Rite Aid, companies that built an online presence as their bricks-and-mortar operations lost some business to small U.S. and Canadian web-based outfits. Most of those competitors are not on Google’s new list, yet many of them sell good-quality drugs.

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Last month HIV watchers were pleased to hear that a HIV vaccine had done pretty well in trials. But not so fast. Data supporting the notion that the vaccine was partially effective are not statistically significant. This WSJ story (“Data Call Into Question HIV Study Results”) may not appear a big deal, but it has me worried. It is true that at least the secondary analysis of data has come to life, but when scientists, in this case conducting an HIV vaccine study, are more worried about continued funding than presenting results in a legitimate way to other HIV researchers, then we prolong the search for a possible vaccine!

This new anti-counterfeiting drug initiative announced in Time is a great idea, but the last paragraph worries me: officials will

avoid using the word counterfeit since this term is often associated with intellectual-property issues and could lead some to believe that the initiative is aimed at protecting pharmaceutical companies’ profits, not safeguarding public health.

Counterfeiting is a legal term with legal consequences, which are, in most countries, known. A key reason this is important is that counterfeit drugs can be lethal but testing drugs to prove they don’t work is hard, and often counterfeits are intercepted because the owner of a corporate trademark makes a complaint. In other words there is an intellectual property/trademark breach, which is opposed by the trademark owner. It is important to realize this has nothing to do with patents, and some people have conflated the two, but simply not using the word “counterfeiting” is no answer to their ignorance.

Broadening any effort to tackle all substandard drugs, which is the right thing to do from a public health standpoint and something I have advocated for several years, requires far broader efforts (educating pharmacists about drug storage, improving production techniques, monitoring transportation standards for drugs, etc.) that are not discussed in the article and that I fear are not understood by the author, or perhaps those behind the French initiative.

Whether they call drugs fakes or counterfeits is irrelevant, they’ll need to decide exactly what they’re prepared to tackle.

LONDON — While the U.S. Congress debates the importation of pharmaceuticals from Europe, a key decision has been handed down by the European Court, as reported by the New York Times. The court said that regulators should reconsider whether efforts by drug makers to prevent traders from exploiting price differences across Europe should be allowed. The decision makes perfect sense from an economic standpoint. Market segmentation is economically efficient and equitable—essentially making richer people pay more for their drugs than poorer people—for low marginal cost, high upfront cost industries such as pharmaceuticals. Until now the governments of richer Northern European nations could buy drugs from poorer nations in Southern Europe to save money. While this made sense to Northern electorates, it destroyed the segmentation of markets. Yesterday’s decision may yet restore that segmentation.

This is important for deliberations in Congress. In the future companies may be able to prevent the United States from buying from the poorest EU countries and further undermining market segmentation (currently U.S. patients pay more than any Europeans).

As if to counter the publicity for Norman Borlaug, the father of the Green Revolution, who died earlier this month, a British panel of eco-catastrophists has just announced that “unchecked population growth is speeding climate change, damaging life-nurturing ecosystems and dooming many countries to poverty.” (Surprise!)

One expert pondered, “how Niger is going to feed a population growing from 11 million today to 50 million in 2050 in a semi-arid country that may be facing adverse climate (change) is unclear.” The favored solution, of course, is to make sure all those poor people in developing countries have lots of condoms to, well, prevent the births of more poor people. Creative thinking, that. Logicians will note that this confuses a necessary condition for a problem (the existence of poor people) with the cause of the problem (poverty). With this reasoning, the best cure for poverty would be human extinction.

Even the reporter of the story linked above felt obliged to point out that we’ve been hearing warnings like this since Thomas Malthus first got it completely wrong in 1798. And in his little slice of time, it really did look like the human population was growing exponentially—and he mistakenly extrapolated. This panel of Malthus-wannabes doesn’t have that excuse. The human population is not expanding exponentially. It’s already starting to level off, will probably level off at around 9 billion in 2050 according to the UN, and is declining in most of the Western world.

There are lots of problems with the panicky predictions. The core fallacy, to oversimplify only a bit, is in failing to account for the fact that, given the right institutional setting (rule of law, free markets, etc.) human beings can produce more than they consume, even if they happen to live in a “semi-arid” country or on a bunch of rocky islands. The expert quoted above imagines that those extra 39 million Nigerians would be 39 million extra mouths to feed—nothing more. That’s a blinkered imagination. Anybody ever heard of Hong Kong? Last time I checked, it was pretty crowded—and booming. So what’s the difference between Hong Kong and Niger? Most ordinary folks know the answer to that question the moment it’s asked, but apparently it eludes some experts.

After Nigerian imams refused Western polio vaccines, which they claimed they were part of a Western plot to sterilize Nigerian muslims, the vaccine itself has now mutated and caused numerous deaths. It is impossible to know exactly, but it’s likely that polio would have been eliminated from Nigeria before this mutation occurred had the imams not prevented vaccination. I hope new vaccines can be introduced to Nigeria in the next year or so and we see the end of this disfiguring disease.

Earlier this year EU detection agencies and customs agents in Holland and Germany stopped legal generic drug shipments in transit to Brazil and African nations because, if imported to the EU, they would have breached intellectual property laws in the EU. These interceptions were unwise and created arguments between health activists and EU customs officials.

Interestingly, a UK high court has just ruled that customs authorities cannot continue to detain counterfeit goods at UK ports en route from Hong Kong to Colombia if there is no evidence that they will permanently enter the UK or another EU market. The case is about counterfeit Nokia cell phones, but it might inhibit efforts to capture counterfeit drug products, too. It seems odd that legal generics can be stopped while obvious counterfeit products cannot. Nokia is appealing the decision; one has to hope it wins.

According to the WSJ, Pfizer has settled a lawsuit in Nigeria for $75 million. I’m sure the senior management at Pfizer considers this a reasonable decision and just the cost of doing business (the claim against them—for allegedly harming children during a clinical trial—ran into the multiple billions of dollars). But no one will care that the company protests its innocence, and from my reading of the case it was not guilty of anything. It will be the people of Nigeria who suffer most directly by having fewer clinical trials conducted there in future on drugs they need, and the rest of us indirectly for the inflated costs of Pfizer’s drugs to cover the cost of this settlement.

USAToday and the New England Journal of Medicine (NEJM) carry an interesting story about the use of the entire malarial parasite to prevent malaria transmission by acting as a pseudo vaccine. While it is interesting science, as the stories note, it is not a feasible large-scale method for combating the disease. It gets coverage because it is a novel story; the vaccine lobby is incredibly effective at getting its message out and increasing its funding and this episode will no doubt help. For 40 years people have failed to develop a malaria vaccine, and it is good that researchers have increased funds to keep up the attempt, but it’s a shame the same amount of funding is not made available to buy insecticides—which could save lives today—or for research into new insecticides and particularly alternatives for DDT. While new drugs are making it to the market, it is 23 years since a new class of insecticides was introduced for public health.

In another article in NEJM the authors discuss the building of malaria resistance to the antimalarial drug artemisinin in Thailand and Cambodia. This is a worrying phenomenon and deserves coverage. But again, poor allocations of resources by the malaria authorities from WHO on down have worsened the situation. They have not done enough to combat the spread of substandard and counterfeit malaria drugs in that region, which exacerbate the problem.

India is one of the main global producers of generic drugs, but its production of artemisinin monotherapy to treat malaria has been a major problem because it encourages drug resistance of the malaria parasite. Many companies from India—but also from China, Africa, and the EU—have previously said they would cease production of monotherapy yet they still produce these drugs. My research has unearthed numerous versions in Africa from companies that have alleged they had ceased production. That’s why this announcement from the India drug regulator to stick to an end-of-the-month phaseout is good news. One has to hope that the regulator actually enforces this ruling.