When Novo Nordisk announced a deal last year with local drug manufacturer Aspen to produce human insulin in vials on its behalf for Africa, human rights lawyer and founder of the Health Justice Initiative Fatima Hassan slammed the deal.
“They’re trying to frame this licence as progressive, but Novo Nordisk’s restrictions are taking us to the dark ages,” Hassan said.
Other experts have urged the government to get proactive, saying it can’t afford to dilly-dally, particularly with the critical shortage of insulin pens, and that it was time to force the hand of Big Pharma as it did two decades ago with ARVs, writes Christina Pitt for Bhekisisa.
Novo Nordisk says it aims to make enough insulin for just more than 1m people in Africa (about 16m vials) by 2026, at roughly R45 a pop.
About 24m people in Africa have diabetes, with numbers expected to at least double in the next 20 years, but only about 1% of what the world pays towards diabetes care is spent in Africa.
The snag, though, is that the medicine will be made available in vials, not pre-filled injection pens, stocks of which are now critically short in South African public hospitals and clinics after Novo Nordisk decided to stop supplying the Health Department because of “capacity limitations”.
This means many of diabetes patients have no choice but to switch to syringes and vials, with public hospitals rationing the remaining pen supply to people who can’t safely make the switch from pens to vials.
Putting patients in this position is “unconscionable, unconstitutional and a clear abuse of intellectual property rights”, said Hassan.
What is SA going to do about it?
Aspen’s contract with Novo Nordisk is to complete the fill-and-finish stage of insulin production, meaning it will fill the vials with medicine and finish packaging it.
Aspen will get the insulin in powder form from Novo’s Denmark facilities, dissolve it in a watery solution that has a chemical makeup similar to blood, pour it into vials, do quality checks and finally label and pack the bottles in boxes. Novo Nordisk will then collect the boxes and distribute them, said Aspen CEO Stavros Nicolaou.
After the announcement of the deal, the Department of Trade, Industry & Competition (DTI) said it was an “excellent first step” to manufacturing refills for the reusable insulin pens.
However, for South African manufacturers to do that they may need permission from the company that holds the patent to make and supply them: a voluntary licence.
In response to Bhekisisa’s questions about the further licensing for insulin pens, Nicolaou said he could not predict whether Aspen would be able to make pens in the future.
Vice-president and general manager of Novo Nordisk South Africa Sara Norcross said the focus of their new partnership with Aspen was to increase the supply of affordable insulin in Africa.
Novo Nordisk has a strong stance on intellectual property rights, and already sells “human insulin at low prices through large government tenders” in many low-income countries, which is why it is against voluntary licensing.
This is where the Patents Act may come in, where if companies abuse their patent rights by not meeting the country’s demand for a specific product, for example, insulin pens, or refusing to grant a licence on reasonable grounds, the commissioner of patents can issue a compulsory licence to other manufacturers via a court process allowing them to make the product without the inventor’s permission.
These laws are based on the international World Trade Organisation’s Agreement on Trade-Related Aspects of Intellectual Property Rights (Trips Agreement), giving governments tools to tackle intellectual property issues – and which Hassan says South Africa needs to use.
“This deal is insufficient to meet South African needs (for insulin pens). Both Aspen and Novo Nordisk are remiss in their obligations to the people of this country. The real question now is: what’s the government going to do about it?”
Recipe for success
Compulsory licences, however, aren’t a silver bullet, said senior lecturer of pharmacology at the University of KwaZulu-Natal Andy Gray.
These licences have never been issued in South Africa, though, partly because it’s a long, complex court process, and the high cost that comes with it blocks people from filing applications for them.
But even with such forced permissions, local manufacturers would still need a supplier for the insulin.
In 2019, more than 90% of this country’s insulin supply came from three multinational companies: Novo Nordisk, Eli Lilly and Sanofi, none of which has manufacturing sites in southern Africa. “There is no production facility for insulin in South Africa, so we mostly import the product,” Gray said.
Insulin used as medicine is a biologic drug, and differs from a chemical one because it’s made by a living cell rather than through a series of chemical reactions. It is produced by putting the gene for insulin into a ring of bacterial DNA, inserting the altered DNA into a specific type of microbe (like bacteria) and then using them as tiny insulin-producing machines.
This results in recombinant insulin, which is difficult to copy because of the way it’s put together.
But with the 2021 launch of the mRNA Vaccine Technology Hub in Cape Town, which makes biologic vaccines by using short lab-made gene sequences to instruct the body to make proteins to fight a particular virus, Gray said insulin production could one day be on the cards for South Africa.
However, Big Pharma companies that make insulin keep their recipes for the process secret.
The general method for making insulin is well known, but it is tricky to mix it into a final drug form that can be used as medication. That means any small changes in the steps or materials used in this process can affect how well the medicine will work in someone’s body.
The method followed in this process belongs to the original pharmaceutical company and is protected by trade secret laws, which, unlike patents, never expire, Gray said.
Producing insulin in injection pen format adds another layer of complexity, as many international drug companies, like insulin pen producer Sanofi, have patents on the injection device itself, meaning local drug makers must either design their own injection pen or get a licence to make it.
Don’t bite the hand
Some countries have used compulsory licensing not only to sidestep the excessive pricing of life-saving drugs, but also to negotiate voluntary licences for a reasonable fee.
In 2007, for instance, Brazil prepared two compulsory licences so that generic manufacturers could make antiretrovirals (ARVs) to treat HIV and sell the drugs to the government cheaply for them to be dispensed freely through a national HIV treatment programme.
One of these licences resulted in generic versions of Efavirenz being made available at about R1 200 per person per year instead of the R5 400 deal offered by Merck.
But the Brazilian Government decided to hold off on issuing a compulsory licence for the other ARV, lopinavir. The threat of a compulsory licence alone was enough to get the manufacturer, Abbott Laboratories, to offer a 57% discount on the price, down from about R23 300 per person per year to just under R10 000.
It may be difficult for other countries to get the same results, though, because Brazil is a fairly rich middle-income country with bargaining power, thanks to its pharmaceutical manufacturing facilities and knowledge about reverse engineering drugs and producing copies of them.
Some countries may also shy away from compulsory licensing from pharmaceutical companies because it could lead to backlash from rich countries.
“Pharmaceutical companies have a lot of power in terms of wealth and influence,” said Phumudzo Munyai, head of the mercantile law department at the University of Pretoria.
“If a government is going to force companies in the Global North to give up their property without asking their permission, it could cause damage to our trade relationships and the economy in general.”
For example, in 1997, South Africa passed new laws allowing allow the government to use compulsory licences and import more affordable generics of ARVs from other countries to fight the Aids epidemic.
This led to an application by the Pharmaceutical Manufacturers Association and 41 drug companies at the Gauteng High Court (Pretoria) in 1998 to oppose these new measures, arguing that it violated the constitutional right to not be deprived of property.
The US Trade Representative then placed South Africa on a “watch list” for countries that needed to change their intellectual property rules which could result in their trade relationship ending.
Eventually, public pressure from international media and civil society, most notably South Africa’s Treatment Action Campaign, forced the US and the pharmaceutical companies to back off.
By August 2001, the price of original branded products, which at the time cost more than R80 000 for one year’s treatment per person, dropped to about R6 000 after competitors were allowed to make low-cost versions.
“The threat of compulsory licensing marked the beginning of reasonably priced ARVs. It was basically a gun to their head,” said adjunct professor of the Wits School of Governance Alex van den Heever.
“This is what the Department of Health should be doing to provide access to insulin pens. In times like these, the government can’t afford to just sit on its hands.”
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