Even
if there is no patent on a medicine, generic versions still cannot be approved
by the Pharmacy and Poisons Board in Kenya for a period of five years. The cost of the branded drug covered by the exclusivity clause can then be raised multiple times.
On
fourteenth January of this year, President William Ruto and His Highness Sheikh Mohamed bin Zayed Al Nahyan, President of the United
Arab Emirates (UAE) signed a Comprehensive Economic Partnership Agreement
(CEPA) between their respective countries.
The agreement has
been hailed as being the first agreement of its kind signed by the
UAE with a mainland African country. According to the Ministry of Foreign
Affairs, it represents a “transformative step in enhancing trade, investment,
and economic cooperation”.
However,
for trade agreements, experts will tell you that the devil is always in the
details. One could go on for a while about the Kenya/UAE CEPA but to begin
with, it must be acknowledged that is a strange agreement even for one related
to trade.
Standard
trade agreements usually have market access provisions where tariffs on goods
are gradually reduced. This one does not. One is tempted to ask what benefit
the country is going to get for all the concessions it is giving under the
CEPA. If it doesn’t dismantle tariffs, then it means Kenya can still trade
under the World Trade Organizations (WTO) framework and still export to the UAE
without having to open up under the CEPA with minimal benefits.
Putting
aside all the implications for the agreement, one must home in on the potential
impact the trade agreement has on the health sector. It may not be possible to
examine the entire health sector but let’s take the disease burden for HIV/Aids,
tuberculosis and cancer by way of example.
Kenya faces
a significant disease burden that costs the country a lot of money. According
to the National Aids and STIs Control Programme, over 1.4 million people live
with HIV/Aids in Kenya.
The country
has about 18,000 annual HIV/Aids related deaths and has about 1.2 million
people on antiretroviral therapy accounting for about 86 per cent of people living with
HIV. This is without factoring in the cancelation of the United States
Presidential Emergency Plan for Aids Relief (PEPFAR) under the recently
dismantled United States Agency for International Development.
In the case
of Tuberculosis (TB), estimates put the annual cases of TB infections at about
133,000 cases for all forms of TB cases every year. In 2022, the country reported 90,841 TB cases
accounting for about 68 per cent case detection. Drug-resistant TB cases are
about 1,200 annually. The TB-HIV co-infection rate stands at 20 per cent with
that percentage of TB patients also being HIV-positive. The TB deaths in 2022
were about 12,000. For cancer, the case is also dire. According to the Kenya
National Cancer Registry, the country has an estimated 42,000 new cancer cases
every year. Annual deaths are 27,000.
The
treatment for these diseases is not cheap. In the case of cancer, for example,
the cost of generic chemotherapy drugs such as Doxorubicin, Cyclophosphamide or
Paclitaxel is estimated at between Sh5,000- 30,000 per dose depending on the
drug and dosage. In the case of branded
or targeted therapy drugs such as Herceptin, Trastuzumab, Keytruda or Pembrolizumab,
the cost is estimated at between Sh100,000-500,000 per dose while some can
exceed Sh1 million for immunotherapy drugs. For hormonal therapy drugs such as Tamoxifen
or Letrozole, the cost is between Sh500 – 10,000 per month.
Cancer
patients also need pain management and supportive drugs such as morphine and anti-nausea
medications, whose cost is estimated at between Sh200 -10,000 per month depending
on brand and dosage. These are heavy costs for patients at a time when the
economy is not doing very well.
The Kenyan Government
has been subsidising some of these drugs to make them affordable to patients. When
considered against a backdrop of a far-reaching fiscal consolidation programme
by the International Monetary Fund (IMF), these subsidies may not be kept for a
long time.
President William Ruto and His Highness Sheikh Mohamed bin Zayed Al Nahyan, President of the United Arab Emirates (UAE), when the two governments signed a Comprehensive Economic Partnership Agreement (CEPA) on January 14, 2025.
When the cancellation of the PEPFAR programme by the US Government
is added to the mix, then you have a powerful cocktail of trouble coming for
the health sector in terms of managing the healthcare costs for the country
even before you put the Kenya/UAE CEPA into play with its significant impact on
healthcare costs. Now picture this: the Government has actually signed a trade
agreement that is going to make these drugs even more costly!
I am
shocked to see that this Kenya-UAE CEPA has included clauses that entail
obligations for market exclusivity and linkage. In simple terms, market
exclusivity places an obligation for market exclusivity for a period of five
years for a particular medicine from the latest possible date for both the
information in the dossier and the fact of the marketing approval.
This means
that even if there is no patent on a medicine, for example, because it is not a
new invention like insulin, and therefore not eligible for patent protection,
generic versions still cannot be approved by the Pharmacy and Poisons Board as
safe and effective and so reach Kenyan patients for a period of five years. A
hard linkage obligation on the other hand, prevents compulsory licences from
being effective.
A compulsory license is when a government allows someone else
to produce a patented product (such as a medicine) or process without the
consent of the patent owner or plans to use the patent-protected invention
itself. It is one of the flexibilities in the field of patent protection
included in the WTO’s Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS). It should be noted that the India-UAE CEPA, which was
signed in 2022, does not have provisions on exclusivity and linkage because
India expressly rejected their inclusion to protect its public health
interests.
There are
countless examples from across the globe on how these provisions have made
medicines expensive. Colombia has had data exclusivity legal obligation between
2002. In a 2012 study, it was found that these data exclusivity requirements
would cost Colombia an additional US$ 396million in additional expenses for its
public health system from 2003-2022.
Another real life example of the impact of
data or market exclusivity is when an old medicine to treat gout (Colchicine) was given three years of market
exclusivity in the USA as a new indication for this medicine and the company
which received it sued to remove existing versions of colchicine from the
market and then raised the price by more than 50 times adding $50 million per
year to the cost of providing this medicine in the USA. It was also given seven
years of market exclusivity for colchicine to treat a rare disease (familial
Mediterranean fever), even though this was already a known use of the medicine.
This is the reality that Kenya faces if the Kenya/UAE CEPA is ratified in its
current form.
Fortunately
for Kenya, the 2010 Constitution has put in place fail-safe mechanism to
protect against such decisions. Article 21 of the Kenyan Constitution places a
fundamental duty on the State and all its organs to ensure that the rights and
fundamental freedoms enshrined in the Bill of Rights are upheld.
This duty
encompasses observing, respecting, protecting, promoting, and fulfilling the
rights and freedoms. Specifically, Article 21 includes the right to health
within the scope of rights and freedoms that the State must uphold. The
right to health, as recognized in the Kenyan Constitution, includes the right
to the highest attainable standard of health, which encompasses access to
healthcare services, including reproductive health care.
Since all
treaties have to be ratified by Parliament before coming into force in Kenya,
the ball is now in the court of the legislature to observe and respect the
Constitution and protect Kenyans from this predatory agreement. The
Parliamentary Caucus on Business and the Economy has been a force for good
during such moments.
Following
the controversy during the ratification of the Kenya/United Kingdom EPA, the
Caucus proposed amendments to the Parliamentary Standing Orders with respect to
ratification of treaties especially given the weakness in the Treaty-Making and
Ratification Act with respect to economic treaties. With these new standing
orders, Parliament can approve the ratification of the agreement, approves ratification
with reservations, or rejects the ratification. Therefore, I propose that our
legislature proposes reservations to the Treaty and insist on removal of
obligations that go beyond the TRIPS Agreement and insist on the inclusion of a
market access chapter. Over to Parliament!
Edgar Odari is the Executive Director, Econews Africa