Transcript Affordability of HIV/AIDS treatment in developing countries

Affordability of HIV/AIDS treatment in
developing countries: modeling ARV drug
price determinants for a better
understanding of the market functioning
Luis Sagaon Teyssier; Yves Arrighi;
Boniface Dongmo Nguimfack; Jean-Paul Moatti
Aknowledgements
This study is part of a project funded by UNITAID and
developed by:
The French National Agency for Research on AIDS and
viral Hepatitis (ANRS-SESSTIM)
AIDS Medicines and Diagnostics Service (AMDS/WHO)
Objectives
– To investigate in which extent originator and
generic prices react differently to the same
factors
– To study the evolution of prices through the
life-cycle of patents
• Originator drugs
• Generic drugs produced under license and/or
taking advantage of TRIPS flexibilities
Data
• Global Price Reporting Mechanism (AMDS/WHO)
http://apps.who.int/hiv/amds/price/hdd/
• Period of analysis: 2003-2012
• 30.904 transactions of Adult ARVs
– 126 countries
– 21 ARVs ; 15 FDC/Co-blisters (57 formulations)
• 12 Sources providing information on transactions:
– Global Fund (35.8%); SCMS (22.1%); UNICEF (14.3%); UNITAID (7.3%); IDA
(9.7%); PEPFAR (5.6%); Mission Pharma (2.5%); CHAI (1.1%); JSI (0.4%);
WHO/CPS (0.4%); MSH (0.4%); WHO (0.4%)
ARV market structure
• Demand-side
– Donor funded ARV transactions (80%)
• Supply-side
– Originator segment
• 8 manufacturers
• 21 single and 6 co-formulations
• Production: 30.5% in USA; 19.3 UK; 12.2 NL; 10.1 FR
– Generic segment
• 25 manufacturers
• 15 single. 11 co-formulations. and 4 co-blisters
• Production: 92% in India
Methods: Price descriptives & OLS
Econometric analysis of price determinants:
• Dependent: price of patient-year treatment log(PYD)
• Explanatory:
–
–
–
–
–
–
–
Year & Geographical group dummies
Purchased quantity of yearly doses: log(QYD)
Formulation type (single=ref., co-blister, FDC)
Target group (pediatric=1. adult=0)
Number of observed suppliers
Present in 1st line (yes=1, no=0)
Segment (originator=1, generic=0)
– Gross National Income per capita (World Bank): log(GNIpc)
– Drug age since FDA approval
– Expiration of the reference patent (Medicines Patent Pool)
RESULTS
Quantities: procurement of generic yearly
treatments by region
Generic segment controlled by only 6 manufacturers (out of 25)
Prices: ARVs recommended in 1st line by region
Prices: ARVs recommended in 2nd line by region
Multivariate analysis
TIME TREND
(ref: 2011-2012)
Estimate
Intercept 5.7966***
Years
2003
0.6839***
2004
0.5617***
2005
0.5887***
2006
0.4747***
2007
0.3117***
2008
0.3310***
2009
0.1730***
2010
0.0508***
Significant at: ***1%; **5%; *10%; Ad-R²=49,6%
Multivariate analysis
Estimate
Intercept 5.7966***
Years
2003
0.6839***
2004
0.5617***
2005
0.5887***
2006
0.4747***
2007
0.3117***
2008
0.3310***
2009
0.1730***
2010
0.0508***
REGIONS (ref: Sub-Saharan Africa)
20%
Average price
differential
TIME TREND
(ref: 2011-2012)
15%
18%***
15%***
12%***
10%
5%
0%
-5%
-10%
Significant at: ***1%; **5%; *10%; Ad-R²=49,6%
-5%***
EA&P E&CA LA&C MENA
-6%**
SA
Multivariate analysis
Estimate
Intercept 5.7966***
Years
2003
0.6839***
2004
0.5617***
2005
0.5887***
2006
0.4747***
2007
0.3117***
2008
0.3310***
2009
0.1730***
2010
0.0508***
REGIONS (ref: Sub-Saharan Africa)
20%
Average price
differential
TIME TREND
(ref: 2011-2012)
15%
18%***
15%***
12%***
10%
5%
0%
-5%
-10%
-5%***
EA&P E&CA LA&C MENA
-6%**
SA
Originator prices are 60%(p< 0.001) higher than generics
Significant at: ***1%; **5%; *10%; Ad-R²=49,6%
Multivariate analysis by segment
Stratified estimation fits better the data (F-test=79.2 > 1.6)
REGIONS (ref: Sub-Saharan Africa)
Average price differential
100%
91%***
80%
71%***
56%***
60%
40%
Originator
Generic
39%***
13%
20%
0%
-20%
-17%***
-19%***
EA&P
E&CA
-40%
-10%***
LA&C
-1%
MENA
-12%***
SA
Significant at: ***1%; **5%; *10%, Ad-R²(originator)=39.3%; Ad-R²(generic)=34.6%
Multivariate analysis by segment
Other significant differences:
•
Price differential in the generic segment according to the
economic situation of the countries: 10% increase in the
GNIpc is at the origin of an price increase of 0.7%
•
Originator prices are more sensitive to the presence of an
additional supplier in the market: prices decrease in
average 3.6%, while the decrease of generic prices is 2%
•
Generic 1st line drugs are 109% cheaper than generic 2nd
line drugs; while originator 1st line drugs are only 81%
cheaper than originator 2nd line drugs.
•
Originator drugs for potential 3rd line are 54% more
expensive than originator 2nd line drugs.
Ref: purchase the
same year of
patent expiration
62%
66%
42%
31%
Years before/after expiration of the reference patent
Originator-specific regression
5
3
1
-1
-3
-5
-7
-9
-11
-13
-15
1%
-17
80%
70%
60%
50%
40%
30%
20%
10%
0%
-10%
-20%
-19
Price differencial
Price differentials through patent life
cycle
Price differentials through patent life
cycle
Ref: purchase the
same year of
patent expiration
230%
186%
115%
105%
80%
71%
66%
62%
42%
31%
-1
-3
-5
-7
-9
-11
-13
-17
-19
-20%
3
1%
-5%
1
30%
Years before/after expiration of the reference patent
Originator-specific regression
Generic-specific regression
5
130%
-15
Price differencial
180%
Main conclusions
 Procurement policies should account for the
different functioning of originator and generic
segments
The important price-differentials between
geographical regions highlight different strategies
adopted by originator and generic manufacturers
Fluctuation of the price of generics under license
through the patent life-cycle demonstrates that patent
protection may also impair the delivery of newer
generics
Thank you!
Contact:
[email protected]