Access to Medicines Conference speech

Issued 2 May 2018

Speech by Labour Party Leader Brendan Howlin TD at Access to Medicines Conference, Wednesday 2nd May, 2018

Thank you for asking me to speak today.

The discovery and development of new drugs has dramatically changed our lives for the better.

The revolution in health care over the last century has extended our lives and made what were once life-limiting and fatal diseases into chronic conditions that can now be managed or cured.

The discoveries in biotechnology that are being harnessed into immunotherapies have the potential to offer personalised treatments for the most incurable cancers.

The application of the cutting edge DNA technology CRISPR holds out the hope of cures for genetic diseases like Huntington’s that will cell by cell, edit out the defective DNA.

Of course this all comes at a cost, but a price we have been willing to pay up to now.

The most difficult question we can be faced with as politicians and policy makers is how can you put a price on a life?

Pharmaco-economics can arrive at evidence based figures, but morally, it a question none of us want to have to answer.

Because how can any politician or policy maker tell a patient to their face, that the costs of the drug does not match the quality adjusted life year (QALY) as determined by the National Centre for Pharmaco-economics.

Ethically, we will always want to ensure that if there is a cure, a treatment or a medicine that we will do all we can, to get it to those who need it.

We are all aware of the public controversies that have surrounded access to medicines in recent years.

When Irish people with cystic fibrosis asked for access to Orkambi and Kalydeco, who were we to say no to those who need these to survive – if even for another year.

The agreement with the drug maker Vertex to fund these drugs for 900 cystic fibrosis patients will cost €650 million over 10 years.

When I was Minister for Public Expenditure during our toughest economic crisis the amount we spent on drugs was always that far away pot of gold that could be mined if only we took on the drugs companies.

Of course, like finding oil in the Irish sea, it’s a lot easier to preach solutions then to actually deliver on it with no other knock-on consequences.

One of the reforms I made as Minister was to establish the Irish Government Economic and Evaluation service.

It provides a cross-Government service to look at the role of economics and value for money analysis in public policy making.

Before last year’s budget they carried out a number of spending reviews.

One of those was on the Future Sustainability of Pharmaceutical Expenditure.

It is essential reading for anyone with an interest in our health service.

Some key figures really jump out from that report.

€2 billion was spend on pharmaceuticals by the State in 2016

Expenditure on high tech drugs increased by €250 million from 2009 to 2016 and is over €600 million a year now.

In 2014 Ireland ranked among the highest in the world on per capita pharmaceutical spend.

The biggest effort to tackle these costs was the framework agreement in 2016 for the supply and pricing of medicines

However, we already know that the savings this will deliver will most likely be eaten up by the costs of new treatments.

Mid-way through 2017 the HSE had essentially run out of money for nine new high tech drugs that had been approved by the NCPE, meaning that patient access was delayed.

When heart failure patients ask for the costs of Entresto to be reimbursed after their trial has ended, the money has to be found.

We cannot countenance a preventable death.

This will continue to be a challenge for the State, the Health Service and politicians.

And it is not just cures for diseases that we have to consider.

There are preventative treatments and vaccines that have a substantial role to play in improving population health.

With the incidence of HIV rising in Ireland the question must be asked if providing free access to the generic TEVA form of PrEP to all who seek it would deliver substantial long term health savings.

And as the cervical check scandal has reminded us, the HPV vaccination programme will in the long term reduce the numbers of Irish women with cancer.

We know that with many more high tech treatments in development that the costs of medicines will continue to rise.

Of course, as a small country with less than 5 million people our ability to negotiate is limited.

A low purchase price in one country becomes the reference then for all others, so there is always an incentive for drug companies to achieve the highest price possible, that public health services can pay.

There have also always been other political factors at play.

Ireland is home to 24 of the 25 largest biotech and pharmaceutical companies in the world.

The life sciences sector directly employs 30,000 people across a range of industries so there are policy trade-offs – we need a profitable pharma sector that can successfully develop drugs and provide decent jobs, but we need to ensure that those drugs are affordable.

There should and must be transparency on the costs of research and development, and how those costs then impact on the price of a drug.

But Ireland can’t achieve that alone.

We know that for every drug that makes it to the pharmacy counter, that there were hundreds of failed prototypes, dead ends and failed clinical trials.

But those costs can be written off against profits.

In Ireland for example the R&D tax credit allows for a 25% credit against corporation tax, in effect subsidising the private costs of research with public money.

In our universities and research centres, not just in Ireland but across the world, the public sector subsidises, supports and commissions blue sky research that lays the foundation of basic scientific knowledge that can then be exploited and applied to develop new medicines by pharmaceutical companies.

In the US for example, the National Institutes of Health funds $32 billion dollars of research and development a year.

As shown in an investigation by the British Medical Journal in 2016 on two drugs developed to treat Hepatitis C the revenue from sales of €12 billion in 2014, was far in excess of the costs of development for each.

The public shouldn’t pay twice – for the subsidised discovery and then for the high price of the drug.

So how do we address these problems?

As I said, Ireland is a small fish,

But as we’ve seen in the Brexit negotiations, our voice is hugely amplified as a member of the European Union.

There we are one of 28, soon to be 27 and as we’ve seen with tax reforms through BEPS, in a globalised economy, collective international action can drive transformative change in a way that measures in Ireland alone can’t.

Ireland has sought to forge alliances with other EU countries. By joining the BeneluxA initiative, it would allow us to negotiate together with Belgium, the Netherlands, Luxembourg and Austria on drug pricing and supply.

But maybe it’s time to ask can we be more ambitious?

Should there be a pan-European effort to negotiate price and supply, so that individual countries can’t be picked off, or left out?

The EU market is one of the largest and wealthiest in the world. The potential market of 450 million is one that drug companies couldn’t afford to ignore.

If an EU agency was responsible for ensuring transparency in drug pricing, in negotiating access, and ensuring a suitable return would the prices being charged change? I think they would.

Taxation is always a thorny subject but should R&D tax credits be linked to future pricing of the products developed? And should we seek to increase the taxes applied to the profits of pharmaceutical companies?

Do we need to radically rethink how publicly research can be used? Public health is a concern for every state in Europe. Finding cures and treatments to save the lives of our citizens is a goal we all share.

And taking that one step further, is it time that countries decided to invest in, and even take minority stakes in the companies conducting the research and producing the drug, not just providing research funding and tax credits but putting real skin in the game.

The French government has holdings worth over €100 billion in nearly 2000 public and private companies. The Ireland Strategic Investment Fund has a discretionary portfolio of €8.5 billion with over €5.5billion of that available to invest.

Ireland has a higher prevalence of cystic fibrosis than nearly any other country – should we seek to secure holdings in the companies developing treatments and drugs?

If prices continue to soar, and budgets can’t keep up we will reach an inflection point where what was once unthinkable will become necessary.

These are not easy questions to ask, and there are no simple solutions.

But there are levers we can apply.

Transparency is the greatest tool we have.

Prices should be justified, and publicly accountable.

Again, I believe that can be best achieved at a European level.

Much can be done to reduce the prices of drugs already being purchased and the IGEES outlined a number of solutions I their 2017 paper I referenced earlier.

But the key challenge is how to reduce the price of future treatments and whether they will be cost effective.

In reality, it is the taxpayer that will pay for these treatments. So it is incumbent on us to get the best value for money, with the most impact for our people who need medicines. I look forward to your discussions providing the solutions we will need.