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Intellectual Property and Innovation … The Virtuous Cycle
Khaled MansourArea Managing Director, Janssen, Middle East, West Asia and Africa
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The Value of Innovation
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Innovation is important
• Pharmaceutical innovation has accounted for 73 percent of the total increase in life expectancy between 2000 and 2009
• Increases in life expectancy resulting from better treatment of cardiovascular disease alone have been conservatively estimated as bringing benefits worth more than $500 billion a year.
• According to Harvard health economist David Cutler, Virtually every study of medical innovation suggests that changes in the nature of medical care over time are clearly worth the cost.
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Innovation isn’t easy or inexpensive
• Once a lifesaving drug or treatment exists, it’s easy to take it for granted.
• We sometimes forget the years of toil these things take to develop; the millions spent to bring a new drug or treatment from theory to actuality.
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Innovation is Risky, Slow an Expensive
- New drug development takes an average of 10–15 years.- Innovation cost have risen from an av. of $800M per drug in 2003 to $2.6B in 2014
INDEFINITE
Drug Discovery
Preclinical Clinical Trials FDA Review Scale-Up to Mfg.
Post-MarketingSurveillance
ONE FDA-APPROVED DRUG
0.5 – 2 YEARS6 – 7 YEARS3 – 6 YEARS
NUMBER OF VOLUNTEERS
PHASE 1
PHASE 2
PHASE 3
5250~ 5,000 – 10,000
COMPOUNDS
PR
E-D
ISC
OV
ER
Y
20–100 100–500 1,000–5,000
IND
SU
BM
ITTED
ND
A S
UB
MIT
TED
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The Virtuous Cycle of Innovation
| Nelson working document | March 2015 | Business Use Only
6
Discovery R&D
ReferenceProduct
IP Expires
GenericProduct
Clinical TrialsSafety & Efficacy
GenericDevelopment
Resources free
to Innovate
DocumentBioequivalence,
Quality & Integrity
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The Value of
Intellectual Property
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Importance of Strong IP Rights
United States, 52.6%
European Union, 25.9%
Japan, 9.9%
All Others; 7.3%
Asia,* 3.6%
China; 0.7%
U.S. Patents Granted in Pharmaceutical Technology, Selected Years 1997–2012,
Location of Inventor by Region/Country
IPR is the incentive to Invest and Innovate
Where do new drugs come from?
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Biopharmaceutical IP Benefits Developing Economies
• Strong, positive, and well-recognized correlation between foreign direct investment inflows and reliable IP regimes1
• High-quality and high-quantity tech transfers leading to faster growth in domestic firms
• The presence of innovative pharmaceuticals provides increased benefits to a country’s economy and the health of its population: speedier drug diffusion3, decreased costs of hospitalizations and non-drug expenditures with new medicines4, and increases in longevity5
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MYTH: “IP is Unfair to Developing Nations”
• FACT: Few of the approximately 400 drugs on the World Health Organization’s model essential drug list have ever been patented in the world’s poorest countries.
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Intellectual Property Protection – Incentive for Innovation
Intellectual Property
Patent System Patent Enforcement
Regulatory Data Protection
• 3 Key Components of Effective IP Systems
– Patent System• Patentability Standards• Term of Protection
– Patent Enforcement• “Linkage”• Effective resolution of patent issues
before an infringing product is allowed to enter the market (including an effective judicial system)
– Regulatory Data Protection (RDP)• Protection independent of patents
that prohibits: (1) disclosure of commercially valuable data by governments; and (2) reliance on commercially valuable data for approval of third party products for a fixed time period
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Conclusion
• Patients benefit most from IP rights – drug breakthroughs and advances.
• We can have both IP and access.
• But erosion of IP rights globally threatens to undermine future drug development.