Global Health and Foreign Policy Blog

Bill and Melinda Gates (their foundation, I should declare, funds our Global Health and Foreign Policy Initiative) are not lacking in ambition for global health. On October 17th, they called for malaria to be eradicated.

As the Gates’s acknowledged, the goal of eradicating malaria is nothing less than audacious. But is it practicable? The answer is no, given current technology. But that’s their point: to eradicate malaria, new technologies are needed. The Gates’s are saying that innovation in this area should be developed with eradication, and not only control, in mind.

The drive to eradicate polio, which began in 1988 and which was to have finished by 2000 but is still ongoing, demonstrates the importance of technology. Should we succeed in eradicating the wild polioviruses (more on this below), we will only face a new challenge. The vaccine being used to eradicate the wild viruses contains live viruses that can mutate and evolve to resemble the wild viruses. Stopping use of this vaccine thus creates risks. The alternative vaccine does not have this problem but it is much more expensive; it will not be used by the poorest countries. In short, the vaccines we have today are ideal for controlling polio but not for eradicating polio. Had we to do over again, the world might have wanted to undertake R&D for new tools before embarking on the quest to eradicate polio.

Technology, however, is only a necessary condition for eradication to succeed; it is not sufficient. A program to eradicate guinea worm has been underway since 1981. The technology for doing so is very simple. Education and water filters alone can do the job. However, civil war in Sudan has blocked progress. That’s the problem with eradication: its success depends on the weakest link in the chain, not the sum total of the effort. For eradication, the weakest link is often a failed state.

Polio suffers the same problem. It is still endemic in the border region between Pakistan and Afghanistan. Even with the right tools, it may not be possible to interrupt transmission in these areas.

Eradication not only rids the world of a disease; it also saves money in the long run. This is because, once a disease has been eradicated, control of the disease can be stopped. Eradication is thus the ultimate form of sustainable development. Indeed, as I explain in my new book, Why Cooperate?, the eradication of smallpox is probably the best single public investment the world has ever made.

However, smallpox may yet prove the exception. Other eradication efforts, including an earlier effort to eradicate malaria, all failed.

The challenge in moving forward is thus to develop technologies and institutions—including institutions that can address the challenge of failed states—that yield real benefits in the near term while at the same time creating opportunities for achieving even more in the future. As Melinda Gates said, malaria eradication “is a long term goal; it won’t come soon.”

The story of Andrew Speaker, the handsome newlywed who put the public’s health at risk by traveling to Europe to attend his wedding, has been headline news. Speaker has Extensively Drug-Resistant Tuberculosis (XDR TB), a form of TB resistant to nearly all drugs used to treat TB.

In traveling, Speaker put other people at risk. That an educated person could do this—a person whose father-in-law is a TB expert—only adds to the vulnerability people feel now.

The situation is not unique. Remember the SARS epidemic of 2002-2003? That disease was spread outside of China by a doctor who had been treating SARS patients in Guangdong province. He probably infected others by coughing. It is known that he infected at least 16 other people, all of whom spent at least some time on the ninth floor on the Metropole Hotel in Hong Kong.

People are right to be worried about spread. As one passenger on board the same flight as Mr. Speaker put it, “How many other people can do this or will do this? It’s hard to think about what this means for the future of air travel.” See full article here.

Policy, however, has to think about much more than border controls, travel restrictions, and quarantine. How did Mr. Speaker get infected? How did the person who infected Mr. Speaker get infected? How, especially, did the first person to acquire XDR TB get the disease? This person is especially important. Epidemiologists call this person the “index case.”

Newly emerging diseases can be prevented—or at least their chance of emerging can be reduced. The exotic wildlife markets in China played a role in the emergence of SARS. Similarly, a mutation of the avian flu virus H5N1 capable of human-to-human transmission is more likely to emerge where large numbers of people come into contact with large numbers of birds. In the case of XDR TB, emergence is likely to have been made more likely because of inappropriate drug use. The index case for XDR TB has not been identified, but this disease is almost certain to have emerged outside the United States.

There is a tendency for policy to respond to a situation like this by focusing on the need to throw up border controls. Such controls are needed, but so are other measures. In particular, we need better surveillance worldwide for emerging diseases like XDR TB. We also need policies that make emergence much less likely. Global standards for TB exist. Lacking are the carrots and sticks that create the incentives for countries worldwide to abide by these standards.

To protect the U.S. population, United States policy needs to look outwards and not only inwards (border controls). The U.S. cannot address risks like this unilaterally. A global approach is needed, but that will not be forthcoming without U.S. leadership—a reason why the intriguing case of Mr. Speaker should be a priority for U.S. foreign policy.

A great summary of Scott’s talk at Harvard on working through the “final inch” of eradication programs. Read it here.

In late 2006, Thailand issued a “compulsory license” order for efavirenz, an HIV treatment drug. In January 2007, Thailand issued a similar order for lopinavir/ritonavir, another anti-HIV drug. Earlier this month, Brazil followed Thailand’s lead, issuing a compulsory license order for efavirenz. Does this mean we on the verge of a cascade of compulsory licensing orders? And, if we are, is that a trend to be welcomed?

First, some facts. A compulsory licensing order allows a country to make or import a generic version of a drug. It is essentially a huge bargaining chip in negotiations over price with patent holders. It is also legal. The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) allows countries to issue such orders. Normally, they should do so only after negotiations with the patent holder have failed. However, in the event of a national emergency, the state can issue the order directly. Either way, the patent holder needs to be paid “adequate remuneration.”

So, will there be a cascade of such orders? The answer depends less on multilateral trade law than on the bargaining power of the parties. Though compulsory licensing is allowed, the option need not be exercised. Bilateral trade agreements provide an opportunity for rich countries to arm-twist poor countries into accepting tougher intellectual property arrangements, including stricter restrictions on compulsory licensing. “TRIPS-plus,” such provisions are called.

Are compulsory licenses a good or bad thing? Patents provide an incentive for innovation by awarding a monopoly to the patent holder. Monopoly pricing, however, can mean that some countries are priced out of the market, even when they are willing to pay more to obtain a drug than that drug costs to produce. So, there is a tradeoff between dynamic efficiency (innovation) and static efficiency (distribution). However, this tradeoff is partially false for two reasons.

First, only “enough” of an economic surplus is needed to spur innovation. The Thai market may have no bearing on the decision of a pharmaceutical company to invest in R&D when the market in North America, Japan, and Europe is sufficiently big. Second, pharmaceutical company profits can actually increase when poor countries are charged less than rich countries. The difficulty is that this can only work if rich countries agree to pay more.

Ideally, the poorest countries willing and able to pay the least for a drug should be able to procure it for a small fraction of the price paid by rich countries. Since compulsory licensing orders give poor countries the ability to negotiate such low prices, they are thus to be welcomed. But the incentive for pharmaceutical companies to innovate will then depend on rich countries paying a high enough price to stimulate R&D. This is the rub. A cascade of compulsory license orders will materialize only if the rich countries do not take away with the one hand (the hand that negotiates bilateral agreements) the authority they gave poor countries previously (in multilateral talks) with the other.