Intended for healthcare professionals

Editorials

Scrooge and intellectual property rights

BMJ 2006; 333 doi: https://doi.org/10.1136/bmj.39048.428380.80 (Published 21 December 2006) Cite this as: BMJ 2006;333:1279

The Swedish Pirate Party agrees

This proposal is entirely in line with what the Swedish political party Piratpartiet (The Pirate Party) is suggesting as a way of funding pharmaceutical research without having to rely on the patent system. [1]

The Pirate Party was formed on January 1, 2006, and nine months later got 0.6% of the votes in Sweden's September 2006 national elections. The party's political platform consists of three issues only: respect for personal privacy, reform of copyright legislation, and the gradual abolishment of the patent system, including pharmaceutical patents [2].

Pharmaceutical patents are not only highly immoral, by depriving people in third world countries access to life saving drugs that they would have been able to afford, had it not been for the patents. They also make drugs unnecessarily expensive for the developed world. If a system like the one Dr. Stiglitz is proposing was adopted for all pharmaceutical research, it has a great potential for saving money, in addition to saving lives.

The standard argument for granting patent monopolies and allowing the pharma companies to charge whatever they want for the patented drugs, is that they spend the excess revenues on research for new drugs. But this is not true.

As an example, we can look at the annual reports for Novartis [3], Pfizer [4], or AstraZeneca [5]. They all spend around 15% of their revenues on research. The number is typical for the industry. The other 85% go to other things, according to their own figures. More than half their revenues are spent on marketing and profits.

Particularly from a European perspective, sustaining this system simply does not make sense. In Europe, over 80% of the pharmaceutical companies' revenues come from the public sector, thanks to various systems for universal medical coverage [6]. In other words, it is already the public sector that pays for most of the research that goes on within the pharmaceutical companies. But as can be seen from the annual reports, at least half the money spent neither goes towards research nor the actual manufacturing of the drugs.

If the governments of Europe would instead take 20% of what they currently spend on drugs, and allocate that money directly to pharmaceutical research, there would be more money than today for the research. If the results are made freely available, generic drug manufacturers would be able to produce modern drugs without spending any money on research themselves. And as experience shows, this would radically lower the prices.

A conservative estimate would be that we could cut the pharmaceutical bill in half, while still giving more money than today to research. And as a free "bonus", we could give the developing world unfettered access to the knowledge that would save lives, just as Dr. Stiglitz proposes.

Exactly how to administer the public sector research money under such a system, is of course something that needs to be discussed. A medical prize fund is one method, but it need not be the only one. Direct funding of research done at universities and similar institutions might also be a method, as well as allowing private research companies to make tenders for specific research projects. Considering the substantial amount of money that would be available for research under a scheme like this, a combination of all of these methods (and others as well) may turn out to be the best solution.

But the important thing right now is to open up a global discussion about the effects of pharmaceutical patents, and the alternatives. Today's system is not only grossly immoral, it is also expensive and wasteful.

What arguments are there for keeping the pharmaceutical patents, and rejecting the cost savings and other benefits possible if we choose a different approach?


References

[1] Piratpartiet: An Alternative to Pharmaceutical Patents

[2] Piratpartiet: Introduction to Politics and Principles

[3] Novartis: Financial Highlights 2004

[4] Pfizer: Financial Highlights 2005

[5] AstraZeneca: Financial Highlights 2005

[6] The Pharmaceutical Industry in Figures 2006 by EFPIA, The European Federation of Pharmaceutical Industries and Associations. Figure in page 37 of the pdf: Pharmaceutical Reimbursement

Competing interests:
None declared

Competing interests: No competing interests

31 December 2006
Christian Engström
Vice chairman, The Pirate Party (Sweden)
Stockholm