Colombia’s Imatinib Actions Create Stir in Global Market

Since its launch, imatinib has represented the great promise of the pharmaceutical industry – a clinically successful drug for use in a high-need population. Yet, since its arrival, Novartis’ therapy for chronic myelogenous leukemia and other oncology indications has been a target for global payers seeking to access the drug but at a lower price; in India, for instance, the Supreme Court previously denied a patent to Glivec.

In the latest market access-shaping move, Colombia’s Ministry of Health on June 14, 2016 issued a resolution declaring imatinib (the active ingredient of Glivec/Gleevec) a medicine of public interest. This controversial decision brought an end, at least for now, to the battle between Novartis and the Colombian Ministry of Health. As a result, Colombia will now unilaterally define a price for Glivec, but Novartis will maintain the exclusive rights to produce the drug. But what drove this decision, and how can a decision made in Colombia impact other countries?

To understand where it all started, we need to go back to 2003, when a patent request for the beta-crystal form of imatinib was rejected by the Superintendencia de Industria y Comercio, claiming that although novel, it wasn’t inventive enough. Nine years later, after an appeal by Novartis, the Consejo de Estado overturned the decision, and the patent was granted. During this nine-year period several generic versions of the molecule (both alpha and beta-crystal forms) were launched in the Colombian market; in 2012, generic versions were priced approximately 50% lower than Glivec, and had a market share (in units), of approximately 45%. As a result of this decision, those manufacturers violating the patent were forced to remove their products from the market, and Novartis obtained the exclusivity of the drug’s beta-crystal form until mid-2018. Following this decision, some manufacturers of generic imatinib pulled from the market – a decline from a maximum of seven manufacturers to only three reporting sales at the end of 2015. These three represented 15-20 % of the total value and 60-70% of the units sold. It is important to note that although the number of competitors decreased as a result of the patent, the average price difference between Glivec and generic versions available remained very similar (generic versions remained 70-80% cheaper).

However, the process by which the patent was granted raised multiple objections, and in November 2014, Fundación Ifarma, Misión Salud Veeduría Ciudadana, and the Centro de Información de Medicamentos de la Universidad Nacional requested the Ministry of Health to declare imatinib of public interest, and that a compulsory license was issued. They cited the high cost of Novartis’ drug and the economic burden it represented to the public health system, where it was offered since 2011. Initially expected to last a few months, the evaluation of the request took over a year to complete, in a somewhat tumultuous process. In February 2016, the committee created to analyze the process recommended the Ministry of Health announce there were reasons to declare the drug of public interest and issue a compulsory license. However, it stated that before initiating the process for a compulsory license, the Ministry of Health and Novartis should negotiate the price of the molecule to a value similar to the expected value if there were generic versions available. After Novartis’ rejection to participate on price negotiations, the Ministry of Health in June 2016 issued a resolution declaring reasons for public interest for pricing purposes, and the Comisión Nacional de Precios de Medicamentos y Dispositivos Médicos (CNPMDM) was directed to establish a new price for Glivec. If the CNPMDM follows a similar methodology to the one used by the Health Ministry to negotiate with Novartis, it is expected that the current price of Glivec will decrease by 40-50%.

The decision was something of a mixed bag for Novartis. On the plus side, the Ministry of Health did not issue a compulsory license, respecting Novartis’ intellectual property rights. However, it nonetheless decided to unilaterally adjust Glivec’s price. One of the main concerns raised with this decision is that Glivec’s price is already regulated since 2013 (which led to a 17% price cut), under the modality of direct control (in this modality the price is established based on international reference pricing). While it is true that the publically available international prices are seldom the real acquisition prices, it is also true that Glivec’s price was following the rules determined by Colombia’s government. The new price will have to necessarily follow a new methodology, different from the current one, which raises questions:

  • Will we see a new pricing mechanism being created and applied in Colombia?
  • Will the current pricing mechanism be maintained, and exceptions will be made for situations such as Glivec?
  • It is noteworthy to recall that in November 2015, Fundación Ifarma, one of the demandants for imatinib, requested that the new treatments for hepatitis C be declared of public interest. At a time when the prices of hepatitis C drugs have been under intense scrutiny and controversy worldwide, are those drugs next in line for the same treatment as imatinib?

In recent years Colombia’s Ministry of Health has been focused on controlling healthcare spending, and the country’s regulatory landscape will experience significant changes in the future. Among other changes, it is expected that the pricing methodology will experience modifications. While public details are still limited, the registration and registration renewal of medicines selected by the Health Ministry (likely the most expensive) will be associated with HTA evaluation and price setting. As such, it is possible, and likely, that the determination of a new price for imatinib is a onetime event, and that other medicines will not experience the same fate.

While at the moment there are more questions than answers about the downstream implications of Colombia’s decision, it is not hard to imagine that with expenditure in health being a major concern worldwide, other countries are looking closely at this issue. Colombia may have opened Pandora’s Box, and set an important precedent that may entice other countries to adopt similar mechanisms as a tool to force manufacturers to decrease their prices.