Illustration: Yogendra Anand / CSE
Illustration: Yogendra Anand / CSE

The squalid history of medical patents

Bringing medicines into the global intellectual property regime was a triumph of corporate skulduggery led by Pfizer

Some drug companies are forever in the headlines for all the wrong reasons. Nefarious reasons, in fact. One such company is Pfizer. It describes itself as one of the world’s premier biopharmaceutical companies that “prioritises the health and well-being of people and the planet to deliver breakthroughs in a responsible way”. If that were, indeed, true, it is unlikely that the company would be facing so many lawsuits as it does from patients and governments.

In recent days, the state of Texas in the US has filed a lawsuit against the company, accusing it of intentionally misrepresenting the efficacy of its COVID-19 vaccine. Attorney-General Ken Paxton said Pfizer’s claim that its vaccine was 95 per cent effective was misleading because it offered a “relative risk reduction” based on only two months of clinical trial data, while the vaccine recipients’ “absolute risk reduction” showed the vaccine, Comirnaty, to be just 0.85 per cent effective.

The more serious charge levelled against the American multinational is that it “censored persons who threatened to disseminate the truth in order to facilitate fast adoption of the product and expand its commercial opportunity”. The lawsuit, according to a Reuters report, seeks more than $10 million in fines for violating a Texas law protecting consumers from deceptive marketing, as well as Pfizer being barred from making alleged false claims and silencing “truthful speech” about its vaccine. Pfizer has reported revenue of over $74 billion in 2021-22 from Comirnaty.

Misrepresentation appears to be a constant failing with Pfizer. One of the biggest payouts it made was $2.3 billion in partial settlement of criminal charges it faced for misbranding the painkiller Bextra “with the intent to defraud or mislead”, according to the US Department of Justice. In 2009, Pfizer paid $1 billion to resolve allegations of civil wrongdoing under the False Claims Act for illegally promoting Bextra and three other drugs, the antipsychotic Geodon, the antibiotic Zyvox and the anti-epileptic drug Lyrica. The company has not admitted wrongdoing in any of these settlements. It is not as if other drugs giants are blameless—almost all of Big Pharma has been charged with malpractices and fined—but Pfizer stands out for the many criminal charges brought against it and the huge settlements it has worked out.

It is this multinational that played a stellar role in bringing intellectual property rights (IPRs) into the global trade regime through aggressive campaigning. Till the early part of the 20th century, most European countries were not in favour of IPRs, and the concept of owning ideas remained favoured only by the US and Britain. It is another matter that the Americans flourished industrially only by stealing ideas and knowhow from their former coloniser, the UK. Doron Ben-Atar, professor of history at Fordham University, provides a fascinating account of how the US patent office was handing out patents liberally for devices that were in use elsewhere in his book Trade Secrets: Intellectual Piracy and the Origins of American Industrial Power. In an interview with this columnist some years ago, Ben-Atar said that while the US was encouraging its citizens, voluntary associations and government officials to smuggle European inventions and artisans to the New World, it was at the same time holding up the young republic as an exemplary protector of innovation by enacting legislation that surpassed standards elsewhere. But most European countries were unimpressed. The Netherlands, for instance, was determined to uphold what it termed “free trade in inventions” until the early decades of the 20th century.

But our focus is narrower —how patents have dug their claws into the medical sphere, which is considered a public good, and undermined its ethical foundations, and how the legal right to produce life-saving medicines has been circumscribed by monopolies granted by the patent system.

Investigative journalist and author Alexander Zaitchik, who has written extensively on the power games of Big Pharma, says the inclusion of IPRs in the rules of the World Trade Organization (WTO) was primarily the handiwork of Edmund T Pratt Jr, CEO of Pfizer, who took an alarmist view of the rise of a Global south-based generics industry and growing assertiveness by the G77 (Group of 77) bloc of developing countries in the UN starting in the 1970s. An inflexion point was the push for transfer of medical technology from developed states to poor countries that gained traction with the appointment of Danish doctor Halfden Mahler as director-general of the World Health Organization (WHO). Mahler threw his weight behind the G77 and at a WHO-sponsored conference in the Soviet city of Alma-Ata in 1978, he unveiled an agency programme to help poor countries reduce their drug spending by building up their domestic drug industries. The declaration at the end of the conference committed WHO to the affirmation of “health as a human right based on equity and social justice.”

Zaitchik says this alarmed Pfizer that saw the development as a threat to the multinational’s “ambitious plans for dominating global markets for drugs and agricultural products, especially in Asia”. Pratt, he reveals, gathered a group of drug industry executives to discuss a plan to counter the influence of the G77 and the rise of the generics industry. Pfizer was the natural leader of the counter-attack because its “bulldog patent lawyers were legendary for launching kamikaze infringement suits around the world”. Its most infamous patent suits were against the UK government after the National Health Service purchased an Italian generic version of a Pfizer-patented antibiotic, tetracycline. Never mind that Pfizer had capitalised during World War II on the production of penicillin that had been discovered and developed at Oxford and left in the public domain! Although Pfizer lost the lawsuit, Zaitchik believes it served as “a sobering introduction to the modern ‘post-ethical’ US drug industry” throughout Europe, where medicine patents were still widely banned.

Pratt relentlessly pushed the industry’s idea of a binding agreement on iprs at other forums such as World Intellectual Property Organization (WIPO) before finding a foothold in the Uruguay Round of negotiations for the General Agreement on Tariffs and Trade (GATT) that preceded the setting up of WTO in 1995. GATT was far from being democratic as the UN was and its sweeping agreements that favoured the richest countries were binding on all members. It was in WTO that the stranglehold of IPRS was formalised as the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

It is hardly surprising that when the worst pandemic in 100 years hit the world in 2019, Pfizer and its cohorts backed by the developed countries refused to allow a waiver of trips even as a life-saving measure.

This was first published in the 1-15 January, 2024 print edition of Down To Earth

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