THE chairman of one of the world's largest pharmaceutical companies has attacked generic drug manufacturers from the developing world for failing to focus on making medicines affordable in their own countries.
Jean-Francois Dehecq, the chairman of Sanofi-Aventis of France, said he was "scandalised" by generic groups producing low-cost medicines in poor countries to sell to patients in rich nations. Citing examples from India, Thailand and Indonesia, Mr Dehecq criticised generic companies for paying wages of "three times nothing" to employees in the developing world and then exporting rather than selling their low-cost medicines locally.
"They make drugs very cheaply and bring them to the north for people who can already pay," he told the Financial Times. "It's a scandal. They are exploiting people in the south. They should deal with their own countries first."
Mr Dehecq's comments come at a time of increasing international activity by generic producers, notably from India, which are threatening the sales of Western pharmaceutical groups by expanding their sales and challenging patents in Europe and the US.
The US, as well as European governments and insurance funds, have encouraged greater use of generic medicines to cut medicines bills as the costs of healthcare grow. Mr Dehecq said he was disappointed with CNAM, the French national health insurance fund, which has been pushing towards a target set at the start of this year for 70 per cent of all off-patent drugs to be generics, up from 63 per cent at the end of 2005.
Generic drugs are chemically equivalent to patented drugs, approved by regulators and sell at a significant discount to branded but off-patent drugs, which IMS, the healthcare statistics consultancy, estimates still account for 15 per cent of sales.
Even generic drugs provided by European companies have traditionally been offered for sale at relatively modest discounts to the branded equivalents, spurring fresh competition and consolidation in the generics sector, which has led to Indian companies buying European counterparts and vice versa.
Mr Dehecq also attacked those people who criticised pharmaceutical companies for charging high prices for drugs, warning that lower prices would push them away from innovation. He said industry-sponsored estimates suggesting that each new drug cost $US1 billion ($1.27 billion) to develop were too low. Given that it typically took several years to develop a "blockbuster" drug, pharmaceuticals companies' accumulated spending on research and development on each represented "several billion dollars per product". |
