Colombia fights to cut drug prices

Nation threatens pharmaceutical giant’s patent

BOGOTA, Colombia — Colombia’s government is giving pharmaceutical giant Novartis a few weeks to lower prices on a popular cancer drug or see its monopoly on production of the medicine broken and competition thrown open to generic rivals.

Health Minister Alejandro Gaviria’s remarks in an interview Tuesday are the strongest yet in an increasingly public fight with the world’s biggest drugmaker that could set a precedent for middle-income countries grappling to contain rising prices for drugs.

Memos leaked last week to a nonprofit group, written from the Colombian Embassy in Washington, describe intense lobbying pressure on Colombia, a staunch U.S. ally, from the pharmaceutical industry and its allies in Congress.

In one memo, the embassy warns that breaking Novartis’ patent for the leukemia drug Gleevec could hurt U.S. support for Colombia’s bid to join the proposed Trans-Pacific Partnership trade zone and even jeopardize $450 million in U.S. assistance for a peace deal with leftist rebels.

The memos followed meetings between Colombian diplomats and officials from the Office of the U.S. Trade Representative and a Republican staffer on the Senate Finance Committee whose chairman, Sen. Orrin Hatch of Utah, has close ties to the pharmaceutical industry.

Gaviria, an economist by training, said the pressure shows the forceful steps that the pharmaceutical industry is willing to take to protect its commercial interests.

“They’re very afraid that Colombia could become an example that spreads across the region,” he said.

Government health programs in many countries are being squeezed by high prices for newly launched drugs and by annual price hikes of 10 percent or more for medicines long on the market, and they are increasingly pushing back by demanding big discounts or setting price caps on ultra-expensive drugs.

Gaviria denies he is trying to set a precedent in the global fight for lower prices.

“For us, it’s a question of survival,” he said. He noted Colombia’s health care system guarantees patients’ access to all approved drugs and the budget is straining after years of price rises. In 2009, the government declared a public health emergency after spending on sophisticated drugs had risen tenfold in just a few years.

President Juan Manuel Santos weighed in on the debate Wednesday, saying he supports a “healthy balance” between respect for intellectual property rights and private investment and more access to lower-cost drugs.

“When free competition becomes distorted, or abuse takes place, that’s when the state has to intervene,” Santos said at a generic drugs factory.