Trade, foreign policy, diplomacy and health

Pharmaceutical Industry

The global pharmaceuticals market is worth US$300 billion a year, a figure expected to rise to US$400 billion within three years. The 10 largest drugs companies control over one-third of this market, several with sales of more than US$10 billion a year and profit margins of about 30%. Six are based in the United States and four in Europe. It is predicted that North and South America, Europe and Japan will continue to account for a full 85% of the global pharmaceuticals market well into the 21st century. Companies currently spend one-third of all sales revenue on marketing their products - roughly twice what they spend on research and development.

As a result of this pressure to maintain sales, there is now, in WHO's words, “an inherent conflict of interest between the legitimate business goals of manufacturers and the social, medical and economic needs of providers and the public to select and use drugs in the most rational way”. This is particularly true where drugs companies are the main source of information as to which products are most effective. Even in the United Kingdom, where the medical profession receives more independent, publicly-funded information than in many other countries, promotional spending by pharmaceuticals companies is 50 times greater than spending on public information on health.

To tackle this problem, the World Health Assembly adopted, in 1988, the WHO Ethical Criteria for Medicinal Drug Promotion, dedicated to the rational use of drugs. However, many observers complain that these guidelines have been largely disregarded - as has the voluntary Code of Pharmaceutical Practices developed by the industry's own International Federation of Pharmaceutical Manufacturers' Associations (PharMA).

A similar conflict of interests exists in the area of drug research and development (R&D) particularly in the area of neglected diseases. The private sector dominates R&D, spending millions of dollars each year developing new drugs for the mass market. The profit imperative ensures that the drugs chosen for development are those most likely to provide a high return on the company's investment. As a result, drugs for use in the industrialized world are prioritized over ones for use in the South, where many patients would be unable to pay for them.

Some large pharmaceutical companies support health development through public-private partnerships. In a number of cases, international corporations and foundations have contributed drugs or products free of charge to help in disease eradication. SmithKline Beecham has made a US$500 million commitment to WHO of its drug albendazole, used to treat lymphatic filariasis (elephantiasis). American Home Products has provided a non-toxic larvicide and the DuPont Company has contributed free cloth water filters for the eradication of guinea-worm disease (dracunculiasis). The Japanese Nippon Foundation has enabled WHO to supply blister packs containing the drugs needed for multi-drug therapy (MDT) of TB in sufficient quantities to treat about 800 000 patients a year in some 35 countries. The patients receive the treatments free of charge.

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