Foreword: Globe-Hopping Pharmaceuticals

Abstract

Each spring incoming editorial staff at American Journal of Law and Medicine chooses focus for following year's Symposium Issue, and well-known scholars in field are asked to contribute to its publication. Since these authors are already experts in area, we give them free rein to explore whatever aspect of overall topic interests them most. We thought that this year's subject, GLOBALIZATION OF PHARMACEUTICALS: INTERNATIONAL REGULATORY ISSUES, might produce papers exploring high-profile international controversies related to direct-to-patient advertising, pharmacovigilance or regulation of dietary supplements increasingly consumed all over globe.3 We also expected articles dealing with regional and international efforts to achieve greater regulatory harmonization, such as those involving European Medicines Agency,4 nascent Trans-Tasman Pharmaceutical Products Regulatory Authority,5 or International Committee on Harmonisation. Two of our authors chose to examine one of those latter predicted subjects tangentially, but only one focused squarely on achieving more regulatory congruence on an international scale. This symposium topic drew forth a series of nine articles from our twelve experts that fell-somewhat surprisingly-into four seemingly disparate categories; intellectual property dilemmas affecting global pharmaceuticals, parallel trade of licit drugs between US and Canada, increasing threat presented by counterfeit pharmaceuticals, and inadequate regulation of manufacturer conflicts of interest likely to compromise human subject and patient safety. These categories encompass a wide range of subjects, but on close examination articles share a common subtext. The increasing globalization of pharmaceutical markets-trade in pharmaceuticals now constitutes approximately 3% of total world commerce7-means that no single nation can hope to resolve countless dilemmas related to drug development, safety, efficacy, access, and pricing alone. Moreover, no one-size-fits-all regulatory or market solution to these global problems exists. Instead, articles that follow attempt to grapple with second-best remedies from distinctive points of view, offering a mix of regulatory and market solutions to these complex issues. INTELLECTUAL PROPERTY DILEMMAS The first article in this collection offers Kevin Outterson's innovative approach for delivering essential medicines at low cost to developing world-where most of global disease burden lies-without depriving manufacturers of their expected return on investment in patented pharmaceuticals.8 He proposes patent buy-outs of these drugs followed by marginal cost pricing in middle and low-income nations (which he defines broadly as non-OECD countries). Treatments for chronic and infectious diseases would then be available to all residents of targeted countries, rather than just few who could afford to pay patented price. His win/win proposal would compensate manufacturers in amount of their expected patent rents from product sales in underdeveloped countries, in exchange for licenses to make generic versions of drugs available to their citizens at marginal cost. Outterson acknowledges that this scheme would over-include beneficiaries in some non-OECD countries with larger middle class populations (China, India, and Brazil, for example). He nonetheless posits that his solution would help to relieve disease burden in developing countries, while adequately preserving innovation incentives for manufacturers. John A. Vernon, Joseph H. Golec and W. Keener Hughen's paper elaborates on pricing/regulation interplay by exploring the links between prices, profits and R&D, from viewpoint of economists rather than policy analysts.9 Because (generally higher) U.S. drug prices are determined primarily by market mechanisms, while almost all other developed countries regulate (usually lower) prescription drug prices, some social scientists have advocated price regulation and parallel trade to reduce disparity for American consumers. …