Novartis

Focus on a Member - July/August 2009

This month's interview explores how Novartis, a global healthcare company, is contributing to the multi-faceted problem of access to medicines around the world. Thomas Wellauer, Ph.D., Head of Corporate Affairs and a member of the company's Executive Committee, answers our questions.

What is Novartis doing to ensure that those in need have access to medicines?

Thomas Wellauer

Providing access to medicines is the core of our business - to research, develop and market life-saving and life-improving medicines. We are proud of the fact that during 2008, medicines and vaccines from Novartis were used to treat and protect nearly 850 million people around the world according to internal estimates.

The scope and complexity of providing access to medicines requires a multi-stakeholder approach involving many actors including the international community, governments and policymakers, non-governmental organizations, health professionals, patients and the private sector.

We have a proven track record of working with many stakeholders to improve access to medicines for poor and disadvantaged patients. In 2008, our access-to-medicines programs, valued at USD 1.26 billion, reached 74 million patients globally. This represents 3% of Novartis Group net sales.

In the developing world, we provide free leprosy and tuberculosis treatments. Since 2000, we have helped to treat more than 4.5 million people affected with leprosy, and we have committed to donating 500 000 treatments against tuberculosis.

We are also active in the fight against malaria. Since 2001, we have provided over 235 million malaria treatments without profit for public sector use in Africa, helping to save an estimated 600 000 lives.

Vaccines research in Novartis laboratory

Our commitment to enhancing access also includes research and development (R&D) for neglected diseases (tuberculosis, dengue fever and malaria) at our Novartis Institute for Tropical Diseases (NITD), as well as R&D for vaccines against diarrheal diseases of the developing world at our Novartis Vaccines Institute for Global Health (NVGH).

In the oncology field, we have created one of the most comprehensive and far-reaching cancer access programs ever developed on a global scale, the Glivec International Patient Access Program (GIPAP). GIPAP operates in 80 developing countries and has provided Glivec® free of charge to more than 36,500 patients since it was launched in 2002.

Our efforts are not limited to the developing world. In the United States, for instance, where almost 50 million people lack health insurance, the Novartis Patient Access Program provided USD 185 million worth of free products to more than 80,000 patients in 2008. In addition, close to 2 million people are currently enrolled in the Together Rx Access program (co-sponsored by pharmaceutical companies including Novartis), resulting in USD 86 million savings.

What types of models are developed to ensure that access to medicines is achieved in very different regions in the world each with their own specific challenges?

We are working with a number of different models tailored to local conditions. In some low- and middle-income markets, for instance, we are testing a cross-divisional model, offering healthcare solutions from our four divisions (innovative medicines, high-quality generics, vaccines and over-the-counter medications).

This is not just the right thing to do, it also makes good business sense. Today, low- and middle-income countries generate about USD 90 billion in pharmaceutical sales, a market expected to more than double by 2020. Reaching patients in markets like Brazil, Russia, India or China will be crucial for the long-term success of our business.

Do you have concrete examples of where a given model to reach patients at the base of the pyramid has been successful? What has the impact been?

Success in the healthcare world is best measured by the number of patients treated and lives saved. We have many examples of successful initiatives. In the KwaZulu-Natal province of South Africa, for instance, malaria-related deaths decreased by 97% in just one year after the introduction of our anti-malarial drug together with a bold program of insecticidal spraying.

Another successful initiative - based on an innovative social business model - is our Arogya Parivar ("healthy family" in Sanskrit) program in India. This initiative addresses the neglected health needs of rural populations through the use of health advisors in rural areas of India. These healthcare service professionals provide general disease and Novartis product information for conditions ranging from tuberculosis and skin infections to asthma, allergies or diabetes, with a special focus on health needs of women and children.

The initial phase of Arogya Parivar addressed 18000+ villages and by the end of 2008 around 25 million villagers were covered. The aim is to double this reach in 2009.

Does Novartis have programs to train nurses and doctors in developing countries?

Educating those in local communities about malaria as part of the commitment of Novartis to the WHO to deliver Coartem, an antimalaria treatment, at no cost to developing countries

Novartis is involved in several programs to train healthcare personnel, including nurses and doctors. For instance, in collaboration with the World Health Organization (WHO), the Novartis Foundation for Sustainable Development (NFSD) has developed a computer-based learning program to train health professionals in developing countries about childhood diseases.

Another example is the Tanzanian Training Center for International Health in Ifakara, a high-quality public training center for clinical officers and other healthcare workers in rural Africa. The center is supported by the NFSD, the Tanzanian government and the Swiss Tropical Institute.

Training of healthcare workers is also at the center of our Malaria Initiatives program. Activities include training for nurses and educational materials for healthcare workers. These have been translated into 25 different languages and African dialects.

Novartis is also working to provide training to doctors and nurses in the developed world. For instance, in Germany, Novartis partnered with a university hospital to train nurses on how to properly give infusions. In Spain, we supported a conference to update doctors with the latest data on diabetes and cardiovascular diseases from top experts in the field. We support similar continuing medical education initiatives in many countries across the globe.

Is Novartis involved in Public-Private-Partnership to improve prevention of illnesses?

In the area of prevention, the Novartis Vaccines and Diagnostics division partners with WHO, United Nations Children's Fund (UNICEF) and others to deliver hundreds of millions of vaccines every year to help protect children from diseases such as diphtheria, tetanus and polio.

Another example in the developing world is our partnership with Crucell and the United Nations for the development of a fully-liquid, pentavalent vaccine that helps to protect infants and toddlers against diphtheria, tetanus, pertussis (whooping cough), hepatitis B and Haemophilus influenza type b.

We also engage in partnerships to educate the public on important health issues, including influenza prevention. "Spread the Word-NOT the Flu!" is an educational campaign we launched in the United States together with Families Fighting Flu (FFF) Inc. and Weekly Reader to teach children and their families the importance of influenza prevention and vaccination.

Novartis Diagnostics partners with blood centers to increase donor recruitment and create greater awareness around the ongoing need for blood donations and a safe blood supply.

Access to medicines is also linked to pricing. What is the Novartis view on this?

Some argue that drug prices (and patents) are the main barriers to access to medicines in the developing world. Yet the problem is much more complex. Pricing cannot by itself remedy conditions of absolute poverty, poor-quality health systems, lack of appropriate diagnosis, inefficient drug procurement, storage and distribution systems or the difficulties of compliance often faced by impoverished patient populations.

Governments need to understand that spending money on health is one of the best routes to economic development. Yet, in many developing countries where the disease burden is disproportionately high, health is under-funded. In 2006, health expenditures in India represented 3.6% of GDP, in Brazil 7.5% while in the United States, they amounted to 15.3% according to data from the WHO. Governments in developing countries need to scale up their public health spending in order to improve their healthcare systems and stimulate economic growth.

In addition, the public may not realize that the prices of medicines often include high mark ups from taxes and other distribution costs. A 2006 study by the American Enterprise Institute found that countries like the Democratic Republic of Congo and Zimbabwe put tariffs of around 8% on pharmaceutical products and active ingredients. Tariffs in India were double that. Even drugs that are donated for free can sometimes include tariffs - South Africa and Armenia included a value-added tax (VAT) of 14-20% on such products. Along with tariffs, drug prices also often include mark ups from distributors and pharmacists. In Europe, these costs plus taxes add up to about 1/3 of the average total costs for medicines.

The success of our business enables Novartis to make significant contributions to increasing access to medicines in the developing world through far-ranging access programs, innovative pricing models for developing countries, not filing or maintaining patents in least-developing countries, and donating drugs where necessary... but this is not enough. This is why sustained access to treatment cannot be assured by a single organization or sector, and requires the cooperation of many parties.

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