1What is an original drug?
Original Drug is an international term used for new drugs which have been proven in lengthy studies and clinical trials to have beneficial effects on a disease, are based on a patented molecule, and have no similar product before it.
2What is a generic drug?
After expiration of the legal protection period for an original drug, other pharmaceutical companies are allowed to place on the market products which are similar to the original drug. These similar products are called “Generic Drugs.” A generic drug must contain the same active substance in the same quantity as the original drug; it must have the same formulation and the same pharmaceutical form; and its bioequivalence to the original drug must be demonstrated.
3Do non-AIFD members not undertake research?
Those companies are mainly engaged in manufacturing generic drugs, i.e. they manufacture proven bioequivalent generics of products developed by research-based companies. Of course this does not mean these companies undertake no research, but R&D is not as central to their operations as it is for research-based companies.
4What efforts is AIFD undertaking to encourage ethical promotional practices?
Ethical promotion principles are a main topic on the pharmaceutical industry’s agenda. Ethical promotion has always been a top priority for AIFD since its inception. In April 2003, three months after AIFD was established, we began working on a Draft Regulation on Promotion, upon the Ministry’s request. We have developed AIFD Code of Promotion, taking account of the Regulation on Promotional Activities for Human Medicinal Products, published in Official Gazette on October 23, 2003, and also EU Directives (2001/83 and 2004/27/EC) providing basis for the Regulation, World Health Organization Ethical Promotion Principles, Turkish Medical Association Physician and Drug Promotion Principles and codes published by international organizations of drug manufacturers (IFPMA and EFPIA), which we are a member of. Our work also took into consideration the knowledge accumulated in the Promotion Guideline of Pharmaceutical Manufacturers’ Association of Turkey (İEİS) since 1990. We were guided and are continuing to be guided by successful promotional practices undertaken in Turkey since early 1960s, publication, warnings, complaints and advice from professional organizations including Turkish Medical Association and Turkish Pharmacists’ Association, promotion principles of Association of British Pharmaceutical Industry (ABPI) reflecting 50 years of experience, and the EU regulations. The first version of the AIFD code was approved by the AIFD Board of Directors on January 28, 2004 and gained effect on April 01, 2004. The Code was revamped in August 2004 to contain far broader explanations and stricter rules on promotion. In November 2005, we published the second edition of AIFD Code of Promotion, incorporating the new rules of the European Federation of Pharmaceutical Industries and Associations (EFPIA) published in November 2004, and the relevant EU Directives published through 2004, as well as suggestions and warnings from our members. The Code was published in Turkish and English. Moreover, an abridged pocket version of the code for promotion associates was provided in September 2004 for easy reference, printed in 11.000 copies and distributed to the sales teams of all member companies.
5Who are the Associate of Research-Based Pharmaceutical Companies (AIFD)?
AIFD was established in 2003 by research-based pharmaceutical companies operating in Turkey. The Association of Research-Based Pharmaceutical Companies (AIFD) represents 38 multinational research-based pharmaceutical companies.
6What is the mission of research-based pharmaceutical companies?
Our mission is to help provide access to new and original drugs for the Turkish people and develop effective solutions to health industry’s problems in Turkey. We continue working for a health industry landscape where the results of research and development are used for the benefit of patients, and innovative and effective healthcare services are provided to the entire society.
7What is a research-based pharmaceutical company?
Research-based pharmaceutical companies focus on discovering new drugs and treatments. This effort entails provision of resources, technology and a work environment to tens of thousands of scientists for years of investigations.
8What is bioequivalence?
Bioequivalence means two medicines with the same or a similar pharmaceutical form having equivalent effects. To demonstrate bioequivalence, products are subjected to disintegration and dissolution testing to compare plasma concentrations (Cmax), time to reaching Cmax (tmax), and the area under the plasma concentration over time curve for the products (AUC0-∞) usually in 24 healthy subjects.
9What is bioavailability?
Bioavailability is a measure of the percentage of a drug administered to a person which is enters in systemic circulation without changing. To determine bioavailability, usually 12 healthy subjects receive a single dose of each product, and the plasma concentration over time curve is plotted from administration of the drug through complete elimination.
10Why is it important to implement Intellectual Property Rights and Data Protection?
Pharmaceutical companies take an increased risk, for research and development is both a very costly process and it requires long-term and burdensome efforts. The pharmaceutical research and development takes 12-13 years on average, and involves screening of tens of thousands of molecules, and a very lengthy and burdensome development process. From discovery of the molecule and placement on the market, a medicinal product costs approximately EUR 900 million on average. To cover their millions of dollars in R&D investments and derive funding for new research, research-based pharmaceutical companies vitally need legal protection for their intellectual property rights. Affording patent and data protection, as part of intellectual property rights, is a key driver of R&D in the pharmaceutical industry. Patents protect products from generic competition for a maximum of 20 years, whereas data protection bars competent authorities from sharing the product’s data with other companies for 6 years from initial application. Data exclusivity does not add to the 20-year patent protection. If a patent-protected product is granted marketing authorization after 14 years, the 6-year data exclusivity is activated, which is then considered as being included in 20-year patent protection. Intellectual property rights must be afforded protection in Turkey to a level on par with international standards so that pharmaceutical companies can make long-term investment plans and Turkey can attract direct global investments. China and India are two striking examples in this area. China has introduced significant incentives in recent years to attract international investments, while adopting international standards for protecting intellectual property rights. In recent years, India similarly centered greater attention on intellectual property rights and has almost become a center for clinical trials. This rapidly growing industry attracts close to USD 100 million in investments, which is projected to increase to USD 1.5 billion over the next four years.
11Is it justified to perceive legislation protecting intellectual property rights as “having to pay more for medicines”?
On this point, we believe the first consideration should be whether a paid-for product can actually achieve the treatment targets and improve the quality of life for the patient. Because generic drugs can be manufactured without incurring massive R&D costs, original products are naturally priced higher then generics and copies. Discovery of an original medicinal product requires a lengthy and costly research and development process. Data protection means, the data of a product, which has been discovered through such a lengthy and burdensome research and development process, cannot be shared with other pharmaceutical companies for a period of six years from the marketing authorization application date. Data protection does not equal more expensive drugs.
12Why is protection of intellectual property rights important for patients?
Providing robust protection for intellectual property rights is a key driver of innovative drug and treatment development. It also strengthens patient access to these drugs and treatments, whereas lack of protection for intellectual property rights slows down R&D, and impairs patient access to new drugs and treatments.
13What is your view of the steps that the government has taken in recent years in the pharmaceutical industry, and what are the key changes?
As a result of the changes introduced in year 2005, substantial improvements were achieved in the provision of healthcare services, and patients access to medicines was significantly enhanced. Favorable changes included the following: o Close to 10 million green card holders gained access to outpatient care and medicines, and 34 million SSK beneficiaries could get their medicines from unaffiliated pharmacies. This increased access to medicines and treatments for 44 million people in total. o Medicine consumption increased by 17% in 2005 and 13% in 2006 in sales volume. o Thanks to voluntary discounts granted by the Turkish pharmaceutical industry, the real increase in public drug expenditure was 3% in 2005, and 5% in 2006. Significant savings were achieved by the public authority on their drug spend. o The government could procure a larger volume of medicines at a lower cost in YTL for patients. This both helped provide important public health gains and reduced the burden on public finances. Moreover, with the transfer of control over SSK hospitals to the Ministry of Health and private hospitals becoming available to SSK and other insurance beneficiaries played a key role in generalizing the availability of healthcare services to the entire society.
14What is drug promotion and what does it involve?
Drug promotion involves promotion of a recently launched medicinal product’s basic characteristics to physicians and pharmacists. This role is performed by pharmaceutical representatives and helps physicians and pharmacists update and improve their knowledge of new treatments and developments in the pharmaceutical sector. In this respect, it is a crucial function that serves an important public health interest.
15How are pharmaceutical research and development and the investment landscape are connected?
Looking at the examples around the world, we can see that the pharmaceutical industry and R&D are gaining a more and more prominent role in national economies. Governments are implementing various policies that incentivize these activities and in turn, pharmaceutical industry investments increase in countries that offer these incentives. R&D has a more central role in the pharmaceutical industry compared to other sectors. For example, the total volume of investments in pharmaceutical R&D exceed USD 60 billion in 2004. According to estimates, this figure will be doubled by 2010. The very high costs and the lengthy and burdensome nature of the research and development process increases the risks taken by research-based pharmaceutical companies. The pharmaceutical research and development process takes 12-13 years on average, and thousands of molecules must be screened and undergo a lengthy development process for a product to finally reach pharmacies. New drugs, which are discovered through this massive process, provide patients with a newer, more effective and safer treatment option. The economic value and economic contribution of new drugs which are more effective and safer, can be substantial. By a close estimate, the entire journey of a product, from discovery of the molecule through the finished product, costs an average of EUR 900 (Source: European Federation of Pharmaceutical Industries and Associations (EFPIA) website). Long-term R&D investments can only continue if policies are not solely focused on supporting generics. These policies hinder innovation and may impair investments of innovative and research-based pharmaceutical companies in Turkey in the medium and long run, and over time, it will ultimately result in blocking patient access to more effective and safer innovative medicines. Currently, Turkey is able to attract merely a thousandth of global investments in R&D. Attracting investments into Turkey will bring about transfer of knowledge and technology. Policies developed with a strategic approach and vision are essential for advancing the pharmaceutical industry. A good example is Ireland, which adopted transparency and innovation in pharmaceutical policies, and incentivized long-term investments. Providing a transparent, conducive and effective regulatory environment, and even shaping national education policies to provide infrastructure for industries which are targeted for attracting investments are powerful indicators of Ireland’s vision and commitment. Today, with exports exceeding USD 48 billion, Ireland is a major manufacturer of pharmaceuticals in Europe. The annual per capita income of Ireland has reached USD 36,000. The total drug expenditure of Ireland is around EUR 1.21 billion, while total taxes paid by pharmaceutical companies to the Irish Government is close to EUR 3 billion, meaning that, in taxes paid, the pharmaceutical industry in Ireland has created added value three times that of the medicines consumed. The government is covering domestic drug expenditure using the taxes collected from the industry. In 2004, the imports alone of Ireland, excluding chemicals, was EUR 17 billion, compared to EUR 316 million pharmaceutical exports of Turkey. Today, pharmaceuticals constitute more than a third of Ireland’s total exports. In Ireland, the share of total R&D investments in the GDP is 1.1, compared to 0.6 for Turkey. Ireland, once known to be Europe’s poorest country whose citizens continually emigrated to other countries, has become Europe’s second richest country after Luxembourg. And there is no reason why Turkey cannot replicate Ireland’s example. The Turkish pharmaceutical industry is poised for a significant leap, if only an environment can be provided where R&D is incentivized, fair competition is assured, and transparency is the rule.
16What is a generic drug or a copy drug?
After the patent protection and data protection of an original drug expires, similar products with the same active substance meeting the legal and scientific requirements can be manufactured. And imitations of a product which is manufactured before the data protection period has expired may be designated as copy drugs. For these drugs, bioequivalence is often not demonstrated and they may pose a health risk.
17Why does AIFD prioritize intellectual property rights?
Turkey has been hindered in not only pharmaceuticals but in various other sectors also, due to lack of protection to international standards for intellectual property rights. This was a main reason why Turkey failed to attract foreign investments to a satisfactory degree and why permanent investments were not forthcoming in the past. In recent years, the 19th Administration has taken a number of steps in the right direction, but there is still a lot to do to achieve the level of international standards for protecting intellectual property rights. It is not possible for pharmaceutical R&D investments to grow and a fair competitive environment to be established until this problem has been eliminated. Protecting intellectual property rights of innovative medicines (including patents, trademarks and all protection of all marketing authorization data) is a key requirement for high quality healthcare services. Unless patent rights are properly protected, clinical trials cannot make much headway and many life-saving medicines cannot find their way to pharmacy shelves.
18What does it mean for an original drug and generic drug being equivalent?
Generics are medicines whose placement on the market is authorized by regulatory authorities based on their conviction that the product exerts a similar effect compared to the original product. A generic drug must contain the same active substance in the same amount, it must be in the same formulation (in tablet, capsule or ampoule form), and it must have the same effect on the patient as the original product. Until around 20 years ago, it was considered that the same amount of active substance would exert the same effect and in that sense, that the products are equivalent. Today, however, a generic drug must demonstrate that it has the same distribution (bioequivalence) and accumulation (bioavailability) characteristics as the original product to receive marketing authorization. Many medicines which received generic marketing authorization in Turkey in the past have been removed from the market by the Ministry of Health, for they were unable to submit studies demonstrating bioequivalence. Moreover, it remains debatable whether biotechnological drugs, which are derived from latest advances in biology and genetics, can actually have generics. It is still under discussion whether generic biotechnological products should undergo the same marketing authorization procedure as the original drug, even if it contains the same active substance.
19How can falsified drugs be detected?
If a drug is sold for significantly lower price, caution is advised. It is also useful to check the product for signs of label removal or alteration, for example whether the expiration date has been changed. A common practice by falsifiers is to replace the original label with a fraudulent one. They use lighter fluid, acetone or other solvent that may leave a sticky residue on the container. Also, the contours of the label may be discolored or disintegrated due to solvent use. Falsifiers often buy products which are close to expiration and replace their labels to resell them. Therefore, it is necessary to check the product for signs of subtle alterations, and compare to previously purchased products. Packaging may be checked for differences in paper texture, label size and thickness, glossiness and lacquer of the paper. Font type and size, print color or changes in embossed imprints are other signs of falsified drugs. Any falsified drugs detected should be reported to a physician, the pharmacy of purchase, the product’s legitimate manufacturer and the Ministry of Health.
20What is a falsified drug?
Medicines which are impure, which contain less or the wrong active substance, or which have expired but are sold by concealing that the product has expired actual, are considered a falsified drug.
21How can I avoid buying falsified drugs?
Patients should buy their medicines from their regular pharmacies and never buy drugs on the Internet. Also, drug distribution channels must be closely inspected, and unreliable wholesalers should be avoided. Finally, legal penalties for falsifying drugs should carry a greater deterrent value.
22How widespread is the falsified drug problem in the world?
According to World Health Organization, 6 percent of all drugs in the world are falsified. In the US, falsified drugs were detected in a wide spectrum, from lipid lowering drugs to cancer drugs. In Turkey, drug distribution is generally safe, but in some developing countries it is estimated that 50 percent of drugs are falsified, and it can be as high as 80 percent in Africa. In particular, products which are top sellers are targeted for falsification. For example, most anti-malarial drugs have been the target of falsification. Most of these falsified drugs are manufactured in India and China.
23What may be the undesirable affects of falsified drugs?
Global health authorities report numerous cases of death and illness from using falsified drugs. Fake substances or undertreatment, unexpected adverse reactions or toxicity or anaphylaxis can result and harm individuals. These life-threatening products have caused deaths in Africa and Asia. Also, when falsified drugs infiltrate the legitimate supply chain they may also imperil the credibility of national health systems, as patients can develop aversion to completely safe treatments.
24Is drug expenditure high compared to other healthcare expenditures in Turkey?
This issue remains a topic of debate and lack of clarity. There are some difficulties in comparing and prorating drug expenditures to total public health expenditures. In Turkey, total drug expenditure is around 25% of known overall healthcare expenditures (based on National Healthcare Calculations using OECD methodology). This figure appears to be high compared to OECD criteria. In Turkey, the ratio of public health expenditures to total health expenditure grew by 41.2 percent over the past 4 years, yet with an annual per capita public health expenditure of USD 232, Turkey is second to only Mexico in lowest healthcare expenditure among OECD countries. Among OECD countries, the countries with the highest per capita public health expense are Luxembourg with USD 5,360 and Norway with USD 4,512. The average public health expenditure by OECD countries is USD 2,023. A main reason why pharmaceutical expenditures appear to be high in Turkey is the subsidization of general healthcare services. Key causes included the following: o Clearly, Turkey has a far lower number of physicians and hospital beds per capita compared to OECD countries, and therefore the number of doctor visits are less than it should be, and the number of patients per physician is too high, which results in healthcare service needed being compensated by obtaining medicines from pharmacies. o The costs and prices of healthcare providers in Turkey (particularly labor, services, laboratory, etc.) are far lower than the global averages. o In Turkey, public health accounting shows hospital medications within the drug expenditure, contrary to OECD practice. Yet, in OECD countries, this item is considered separately under the hospitalized care expense. Also, hospitals purchase drugs at lower prices through tenders, whereas invoices are issued at the market prices. This causes the share of drug expenditure to appear artificially high in total health expenditure, and also in public health expenditure. o In other OECD countries, the medications used for “inpatients” are procured by the hospital and administered to the patient, whereas in Turkey, 30% of inpatients procedure their drugs from unaffiliated pharmacies. Considering that inpatient medications are recognized under general health expenditure and not under drug expenditure in OECD countries, this is another reason why drug expenditure appears statistically higher in Turkey. o Public payors reimburse public health providers (MoH and Universities) at highly subsidized prices for hospital services. Roughly, the subsidy rate is estimated to be at least 35%. The burden of these subsidies is covered from the general budget by the Ministry of Health and universities. However, this burden is not shown in healthcare expenditures of public payors, which in turn causes the ratio of drug expenditure to total health expenditure to be higher. o Different from other OECD countries, Turkey continues to reimbursing a large majority of OTCs to the same rate as prescription medicines, despite recent legislations. This situation artificially raises public health expenditures in Turkey, compared to other countries.
25Are original drugs expensive in Turkey?
In Turkey, original drugs have the lowest prices in Europe. Our patients are able to access original drugs at a lower price than their counterparts in Europe. A “reference-based pricing system” was introduced in February 2004. With a new regulation, issued for harmonization with the EU regulations, the lowest price applied in 5 EU countries where the prices are the lowest are used as reference for determining the drug prices in Turkey. Currently, these countries are Italy, Spain, Greece, Portugal and France. Turkey uses the lowest of the prices applied in these countries. In Turkey, original drugs are priced at an average of 26% lower than the lowest price in the 5 reference countries.
26What is your view of the current status of the Turkish pharmaceutical industry?
Today, Turkey has one of the leading pharmaceutical markets in the world. In 2006, the drug market grew by ~10% in USD currency, reaching USD 9.9 billion at consumer prices. Clearly, the market volume will continue growing in the years ahead, considering the growing health needs and the need to provide broader access to larger segments of the society in a growing population. Remarkable economic performance of Turkey in recent years has favorably impacted on the development of the pharmaceutical industry, like many others. The opportunities and the potential offered by the market have motivated several international pharmaceutical manufacturers to seek partnerships with Turkish companies. Particularly on the generics front, we have witnessed a massive wave of acquisitions and mergers over the past few years. Today, it would be fair to say our national pharmaceutical industry has achieved a solid manufacturing base, which has an output capacity far larger than the domestic demand, and which is on the verge of a substantial growth leap. International research-based pharmaceutical companies comprise approximately 53 percent of the industry. Other than these, the industry also includes reputable generics manufacturers and copy manufacturers who exploit insufficient protection afforded to intellectual property rights in Turkey. The Turkish pharmaceutical industry exports products to more than 100 countries. 3,000 different drugs are manufactured in Turkey, which, with various strengths and pharmaceutical forms, reach around 7,200, depending on patient age or course of disease. Drug output grew to USD ~4.4 billion in 2005 from USD ~3.4 billion in 2004. In year 2006, drug exports increased by 11 percent, reaching USD 336 million, compared to imports which totaled USD 3.2 billion. The Turkish pharmaceutical industry needs more investments in R&D and advanced technologies to speed up its growth. On this point, attracting international investments into Turkey is highly important. An environment where the investment landscape has been further improved, transparency and predictability of policies are provided, innovation is incentivized, and intellectual property rights are protected to international standards would provide Turkey with greater power and opportunity. Long-term, right strategies will help Turkey develop a globally competitive pharmaceutical industry and benefit from its potential.
27Is patent protection sufficient in Turkey?
In Turkey, a patent law was enacted in 1995 and entered into force in 1999. This law protects only those products which obtained a patent after 1995, yet most product patents were obtained prior to 1995, and this deprives them of patent protection in Turkey.
28There are talks of the need for a National Pharmaceutical Agency. What would be this agency’s mandate?
AIFD believes the Turkish pharmaceutical industry needs such an agency. A National Pharmaceutical Agency could play a crucial role in helping the pharmaceutical industry achieve international standards and develop abilities to compete globally, on the way to opening up to the world and harmonizing with the European Union. This would rapidly increase the institutionalization rate in the industry. However, this agency should be established in consultation with the entire industry, and the approach used should not disregard international standards and norms. If established and operated correctly, a National Pharmaceutical Agency could catalyze the implementation of international standards, accelerate harmonization with the EU, and remove the bureaucratic obstacles in the way of foreign capital.
29How do you oversee practices?
For oversight, we have a supervisory board which accepts and assesses complaints regarding practices. A complaint reporting procedure has been in place since April 2004. 120 complaints have been received to date, mostly comprising complaints by member companies regarding other companies. The AIFD Promotion Supervisory Board has also reviewed and resolved complaints received from physicians (2) and the media (2). The Promotion Supervisory Board consists of 7 persons, two of them independent and five of them representing companies. The AIFD Secretary General heads this board and is independent, i.e. does not vote. The Board is composed of individuals who are reputable in the pharmaceutical industry, who are not doubted for their objectivity, and who were elected with the votes of companies. Complaints may be received from companies, individuals or media organization, or from anyone based on an issue reported in the media. For example, a member company may file a complaint about another company’s actions, which they view as being unethical. Primarily, we advise establishment of contact at the general manager level. The two general managers discuss the issue, and if an agreement cannot be reached, the matter is escalated to the Promotion Supervisory Board. At this stage of handling the complaint, the AIFD Secretary General activates the mechanism. The Board’s rapporteur examines the matter and issues a report. We raise the issue at the next meeting, where the company representatives are heard and Board members discuss and reach a decision. If company representatives are members of the Promotion Supervisory Board, they abstain from involvement in the decision-making process to secure impartiality. Complaints may also be received from İEİS or members of İEİS. Similarly, our members can also file a complaint about an İEİS member. We have no mandate over nonmembers, but we raise the matter with İEİS, who can warn their members. We also have a joint supervisory board, which, in a sense, functions as an appeal mechanism. Disputes which cannot be resolves are escalated to the joint board of the two parties for review. This board has not been needed until now, but it is available should it be needed.
30Is there sufficient data protection in Turkey?
There are two important problems in practice. As a member of the World Trade Organization (WTO), Turkey is under obligation to implement data protection from January 01, 2000, according to the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). And Decision 2/97 of the EU-Turkey Association Council and the Council Directive 87/21, referenced in the decision (amended to become Council Directive 2001/83) required Turkey to introduce data protection for at least 6 years, at the latest by yearend 2000. But Turkey introduced data protection after a four year delay. Accordingly, it remains unclear whether marketing authorization applications submitted between 2000 and 2005 would be eligible for data protection. Another problem is that the date of marketing authorization application in any European country is considered to be the beginning date of data protection in Turkey. Considering that conclusion of marketing authorization applications can take up to 2 years in Turkey, this policy clearly represents an actual shortening of the data protection period.
31What is data protection? What are the penalties? What is the duration?
Data protection is a form of intellectual property right, aimed at providing an incentive to research-based pharmaceutical companies, who spend most of their patent protection period for research and development. It protects companies developing innovative products which raise the quality of life from unfair competition, by prohibiting the data that research-based companies submit to competent authorities to support their marketing authorization applications from being used as reference by or otherwise being disclosed to other companies. Data protection period is 5 years in the US, and it was 6 – 10 years in the EU, until the end of 2004, after which point the EU adopted 8+2+1 years. In Turkey, data protection is 6 years, effective since January 01, 2005.
32How does data protection encourage development of new drugs?
It takes 12 to 13 years to develop and deliver a new drug. Therefore, a product can enjoy patent protection in reality for only 7 or 8 years by the time it is placed on the market. This applies in developed markets such as the US and European countries. In other countries, for example in Turkey, it may take more than two years for a new medicinal product to gain marketing authorization. In that case, the actual patent protection period becomes that much shorter. Yet, having invested close to a billion Euros for developing a product, a company must earn a return on its investment. Funding of new research and development efforts, and development of new drugs crucially depend on this. Therefore, protecting the product data which a company generates after years of labor and funding for a reasonable period of time against unfair commercial use, even after the patent protection period, provides a breathing space for achieving a return on investment and an incentive to continue undertaking these efforts.
33What are the phases of developing a new drug?
The initial stage of drug research involves identifying one molecule that can exert a useful effect on a disease or favorably affect quality of life, out of thousands of molecules derived through lengthy laboratory studies. A patent application is then filed for the newly discovered molecule (to the US Patent and Trademark Office). If the application is approved, a patent protection is granted for 20 years. An application for the new molecule is then filed with the pharmaceutical regulatory authorities (in the case of US, to Food and Drug Administration – FDA) to obtain approval for initiating research. First, the molecule is examined for toxicity and pharmacological effects in the laboratory. If found safe in the laboratory setting, another application is filed with the competent authority to initiate clinical trials in humans. Participation in clinical trials is voluntary. Clinical trials are conducted in three phases and take a very long time. In the first phase, so called Phase I, 20 to 80 healthy subjects are enrolled in a controlled hospital setting, with a view to determining the right dose of the drug, collecting data on how it is metabolized and excreted, and identifying any acute side effects. In the second phase, so called Phase II, 100 to 300 patient subjects are enrolled from the target population(s), with a view to collecting data on the safety and efficacy of the drug. In the third phase, so called Phase III, 1000 to 3000 patient subjects are enrolled to determine the efficacy and side effects of the drug, and compare it with the standard treatment. In some cases, clinical trials continue after the product has been approved and placed on the market. In this phase, so called Phase IV, the goal is to collect data on the long-term risks and benefits of the drug, as well as the appropriate dosage. This process takes an average of 12-13 years (Source: European Federation of Pharmaceutical Industries and Associations – EFPIA website).
34How much does developing a new drug cost to research-based pharmaceutical companies?
Research-based pharmaceutical companies invest approximately 15 to 20 percent of their budgets to research and development. This is higher than in other high technology industries, including electronics, aviation or automotives. Latest studies have shown that discovering a new molecule and developing it into a medicinal product can cost as much as an average of EUR 900 million (Source: European Federation of Pharmaceutical Industries and Associations – EFPIA website).
35What is the value of innovative drugs for the society?
Innovative drugs prolong and improve the quality of life. However, this is not their sole value to the society. Correct and appropriate use of these medicines enables individuals to perform their jobs, and reduces disabilities, surgeries, and hospitalizations. They reduce the treatment expenses, and decrease healthcare costs while increasing their quality. They also help develop and strengthen the pharmaceutical industry and increase investments. Innovative drugs benefit the social in all respects.