Funding for Fake Drugs

Ministers at the World Health Assembly in Geneva next week will be spending unprecedented amount of money for fighting diseases in Africa. The US Congress has just committed $50 billion over the next five years to combating HIV/AIDS, TB and malaria, while the Global Fund for these diseases will probably add $25 billion. This is a lot of money and a lot of talking. But what won't be discussed is the fact that many of the drugs that will be bought will end up doing AIDS, TB and malaria patients more harm than good.

Part of the problem in poor countries is the alarming amount of fake drugs. In 2007, the WHO reported that 30 per cent of all medicines sold in Africa were counterfeit, "killing thousands". An Indian pharmaceutical association said this week that 20 per cent are fakes in India itself while the OECD says India supplies 75 per cent of the world's fake and sub-standard drugs.

The WHO established the International Medical Products Anti-Counterfeiting Taskforce in 2006. The problem, however, is not limited to outright fakes. IMPACT needs to turn its gaze towards sub-standard drugs manufactured in Africa and Asia that rarely meet the very high standards of safe and effective medicines. Nor are they tested by independent regulatory authorities.

If an AIDS, TB or malaria drug is sub-standard, it allows the virus to mutate and drug resistance to develop. This will eventually make the drug useless for the entire population and even fatal.

The outrage is that the Global Fund and WHO have been knowingly promoting sub-standard drugs.

When procuring drugs, the Global Fund follows WHO guidelines so the Fund's "Option C" rule allows the procurement of drugs that have not been reviewed and tested by a credible regulator (such as the US Food & Drug Administration). These are "investigatory" drugs, which no doctor in a rich country would ever prescribe because of the risk to patients and of drug resistance.

When the WHO and the Global Fund approved Option C, they reasoned it would allow them to buy from mainly Indian companies at a cheaper rate than branded generic (copied, off-patent) and patented drugs.

But what they skimped on price, they lost in quality: According to a February 2007 report by the Global Fund, half the drugs purchased under Option C did not comply with the Fund's Quality Assurance Policy.

Option C is used to procure drugs for millions of AIDS, TB and malaria patients all over the world. When patients develop drug resistance, their medical costs increase exponentially, often requiring hospitalisation and always more specialist care. These extra costs dwarf the original price of the drug and have the potential to bankrupt entire healthcare systems.

Drug resistance is already on the rise globally. For AIDS, a World Bank study showed that the increase in drug resistance in the UK was 17 per cent for 2001-2003 and 24 per cent in the US between 2001-2002. Lacking data from the developing world, one can estimate that at least 20 per cent of the two million patients (some 400,000 people) under treatment in developing countries are now drug resistant.