Unprecedented complaint to the Brazilian Antitrust Authority (CADE) denounces abuse on hepatitis C drug pricing

Based on a study conducted by researchers of the University of São Paulo, civil society organizations call for action to punish violations by the pharmaceutical company Gilead.

Nine civil society organizations, including Médecins Sans Frontières/Doctors Without Borders (MSF) and the Brazilian Institute of Consumer Protection (Idec), together with the Federal Public Defender’s Office (DPU), filed a complaint to the Brazilian Antitrust Authority (CADE) on 21 October 2019, against the pharmaceutical company Gilead for the abuse of its dominant position in relation to the drug sofosbuvir. The action is groundbreaking as it is the first one based on excessive prices and the first proposed by patient and consumer groups in CADE´s history. According to the organizations, abusive prices charged for medicines that include sofosbuvir in their composition have prevented thousands of people from accessing effective hepatitis C treatment.

The action is groundbreaking as it is the first one based on excessive prices.

The entities call upon the Brazilian antitrust body to fine Gilead and to impose, through an injunction, the compulsory licensing of sofosbuvir. The measure would suspend Gilead’s drug patent and allow the production and commercialization of the medicine by other companies, increasing competition and thereby expanding access to the cure for hundreds of thousands of people suffering from the disease in Brazil. The Ministry of Health estimates that about 700,000 people need hepatitis C treatment in the country, but by June 2019, only 102,000 patients had been treated with the newest and most effective drugs, including sofosbuvir. Among all kinds of hepatitis, type C is the most prevalent and lethal in Brazil.

The Ministry of Health estimates that about 700,000 people need hepatitis C treatment in the country, but by June 2019, only 102,000 patients had been treated.

Along with MSF, Idec, and DPU, the document is signed by our partner, the Brazilian Interdisciplinary AIDS Association (ABIA), alongside the Human Rights Advocacy Collective (CADHu), Grupo de Incentivo à Vida (GIV), São Paulo State AIDS NGO Forum (Foaesp), Rio Grande do Sul AIDS NGO Forum , AIDS Prevention Support Group (Gapa / BA), Grupo Solidariedade à Vida and Universities Allied for Essential Medicines (Uaem – Brazil).

The complaint submitted to CADE is based on a study conducted by researchers of the Law and Poverty Group of the University of São Paulo, and coordinated by professors Calixto Salomão Filho and Carlos Portugal Gouvêa. The study concluded that since the launch of the drug in Brazil, in 2015, Gilead has been systematically abusing its dominant market position, with severe economic and social consequences.

Since the launch of the drug in Brazil, in 2015, Gilead has been systematically abusing its dominant market position, with severe economic and social consequences.

Between 2015 and 2018, the study points to a “de facto monopoly” period when Gilead supplied 99.96% of the sofosbuvir sold in the country. During this period, the average price charged ranged from R$ 179.41 (US$ 45) to R$ 639.29 (US$ 160) per pill of sofosbuvir-containing drugs, resulting in a revenue of R$ 1.4 billion (US$ 350 million) for purchases made by the Brazilian Government alone.

In the same period, however, treatment was rationed because of high prices, preventing a huge contingent of people from being treated and cured. Between 2015 and 2017 there were almost 6,000 deaths from hepatitis C in the country.

Between 2015 and 2018 a “de facto monopoly” resulted in a revenue of $350 million for purchases made by the Brazilian Government alone.

Between 2015 and 2017 there were almost 6,000 deaths from hepatitis C in the country.

Between July 2018 and January 2019, the researchers point to a brief period of competition, during which the amount charged by Gilead fell 89.9%, to R$ 64.84 (US$ 16). After the patent was granted up until June 22 of this year (the end of the period analyzed by the study), the average price rose to R$ 986.57, an increase of 1,421.5% per pill of sofosbuvir-containing drugs. This is considered a period of a formal monopoly, in which “arbitrary price increases” were observed.

After the patent was granted the average price increased by 1,421.5% per pill.

“The study shows how a brief period of competition was able to drive prices down significantly, which made clear how the company has the capacity to practice more affordable prices and does practice them when there are other options on the market”, warns Idec’s lawyer and health researcher Ana Carolina Navarrete. “As a consumer protection entity, we know that competition is a powerful tool for price reductions. In this case, the monopoly, besides being unjustified, results in high prices that benefit nobody other than the company”, she reinforces.

The study shows how a brief period of competition was able to drive prices down significantly.

The text of the complaint explains that “the unlawful conduct carried out by Gilead” is serious and clearly affects the public interest. “There are hundreds of thousands of infected people with poor access to treatment or totally deprived of it, disrespecting the principle of universal access, that is a pillar of the Brazilian public health system. We have a history of deaths, rationed distribution and waiting lines for a medicine that can cure the disease and is effectively recommended by WHO to address a serious global health threat,” says attorney Eloisa Machado of the Human Rights Advocacy Collective (CADHu), one of the civil society entities. 

There are hundreds of thousands of people with poor access to treatment or totally deprived of it, disrespecting the principle of universal access.

One of the authors of the representation, the humanitarian organization Médecins Sans Frontières/Doctors Without Borders (MSF) has been successfully treating hepatitis C in 18 projects in 14 countries. MSF uses drug combinations that often include generic versions of sofosbuvir. This year, MSF purchased complete treatments containing sofosbuvir for US$ 0.89 per unit, about R$ 3.60. “MSF is a witness that high prices are behind the limited or non-existent supply of medicines in many countries. More than 65 million people are still untreated in the world. We defend access for all,” said Ana de Lemos, MSF-Brazil Executive Director.

At the current pace, Brazil will not meet its goal, in alignment with WHO’s global strategy to fight the disease, that is to treat 657,000 people by 2030. The next purchase of hepatitis C treatments by the Ministry of Health will take place in 2019.

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