With Frugal Public Resource Allocation Quo Vadis Healthcare In India?

The memory is still afresh in India. A new political dispensation took charge of the governance of the country, riding on the tidal waves of people’s hope and aspirations, with presumed credibility to ‘Walk the Talk’. The expectations were skyrocketing for a change…better days for all, sooner. This covered the public healthcare space, as well.

Responding to such genuine public expectations, when in May 2014, the then new Union Health Minister Dr. Harsh Vardhan reportedly announced that his ministry would soon start working on distribution of free medicines through public hospitals across the country, a hope for a long-awaited healthcare reform in India, sooner, was rekindled.

This happened despite the fact that similar promises were made by the immediate past Government too.

The Cost and the Span:

The erstwhile Planning Commission of India had estimated that a countrywide free generic drug program would cost Rs 28,560 Crore (roughly around US$ 5 Billion) during the 12th Five-Year Plan period. The Centre will bear 75 percent of the cost while the states would provide the rest.

Under the previous government plan, 348 drugs enlisted in the National List of Essential Medicines 2011 (NLEM 2011) were to be provided free at 160,000 sub-centers, 23,000 Primary Health Centers, 5,000 community health centers and 640 district hospitals of the country.

Previous action:

Late 2012, the previous Union Government made its first move in this regard by formally clearing Rs. 13,000 Crore  (around US$ 2.2 billion) towards providing free medicines for all through government hospitals and health centers.

To facilitate the process, in November 2013, the then Union Health Ministry by a notification reportedly made the public drug procurement system in the country through ‘Central Medical Services Society (CMSS)’ formally operational. For different flagship program of the Government such as, National Health Mission, the drug procurement was planned through the CMSS.

The notification said:

The CMSS will be responsible for procuring health sector goods in a transparent and cost-effective manner and distributing them to the States/UTs by setting up an IT enabled supply chain infrastructure including warehouses in 50 locations.

Unfortunately, due to resource constraint of the previous Union Government, the program of distribution of free medicines for all through public hospitals across the country could not be translated into reality.

The fresh hope scaled greater heights:

In the first Union Budget Proposal (2014-15) of the new Government, some high impact healthcare areas were addressed as follows:

A. Access improvement:

- “Health for All”: Free drugs and diagnostic services for all would help improving ‘Access’ to healthcare by manifold.

- Universal access to early quality diagnosis and treatment to TB patients would again help millions.

- Deeper penetration of health insurance and its innovative usage would also help a significant number of populations of the country having adequate ‘Access’ to healthcare.

B. Affordability:

- HIV AIDS drugs and diagnostic kits were made cheaper through duty rationalization.

- “Health for All” – Again, free drugs and diagnostic services for all would help answering the issue of ‘Affordability’, as well.

C. Capacity building:

- Two National Institutes of Aging (NIA) at AIIMS, New Delhi, and Madras Medical College, Chennai to come up.

- Four more AIIMS-like institutions in Andhra Pradesh, West Bengal, Vidarbha in Maharashtra and Purvanchal in UP, for which Rs 500 Crores were set aside.

- Additional 58 government medical colleges, including 12 colleges where dental facilities, were also proposed.

- The fund for 15 Model Rural Health Research Centers (MHRCs) in states for better healthcare facilities in rural India was provided.

- Central assistance to strengthen the States’ Drug Regulatory and Food Regulatory Systems by creating new drug testing laboratories and strengthening the 31 existing state laboratories was announced.

D. Innovation:

- Cluster-led biotech development was announced.

E. Ease of doing business:

- Number of common pan-industry initiatives enlisted in the Union Budget 2014-15 proposals, would improve overall ‘Ease of Doing Business’ in the healthcare sector too.

A concern remained…even at that time:

Despite all these, there was a concern. In the Union Budget proposals 2014-15, the health sector attracted a total outlay of Rs 35, 163 Crore, which was a very low increase from the previous year’s Rs 33, 278 Crore. I wondered at that time also, whether this increase would be sufficient enough to meet all healthcare commitments, as it does not even take inflation into account.

Draft ‘National Health Policy’ further boosted the expectations:

In the midst of growing expectations for healthcare reform in India, the Union Ministry of Health and Family Welfare through its draft National Health Policy, 2015 (NHP 2015) proposed making health a fundamental right.

The draft policy reiterates, “Many industrialized nations have laws that do so. Many of the developing nations that have made significant progress towards universal health coverage, such as Brazil and Thailand, have done so, and … such a law is a major contributory factor. A number of international covenants to which we [India] are joint signatories give us such a mandate – and this could be used to make a national law. Courts have also rulings that, in effect, see healthcare as a fundamental right — and a constitutional obligation flowing out of the right to life.”

The draft NHP 2015 even states, “The Centre shall enact, after due discussion and on the request of three or more states a National Health Rights Act, which will ensure health as a fundamental right, whose denial will be justiciable.”

The new draft policy acknowledges that primary healthcare of date covers not more than 20 per cent of the health needs and that a very high ‘Out of Pocket’ health expenditure (over 61 percent for of that is on medicines) is pushing nearly 63 million people into poverty every year.

One of the key features of the draft NHP 2015 is a universal medical insurance scheme that will be virtually free for the poor and affordable for the rest.

To translate all these good intents into reality, speedy implementation of a robust healthcare reform roadmap, backed by adequate budgetary support, is critical. Only such well coordinated and comprehensive action plan, when effectively put in place, would be able to send strong signals to the stakeholders about the seriousness of the Government to fulfill its much-hyped promises and obligations towards healthcare reform in India.

Required budgetary allocation:

The 12th Fiver Year Plan of the erstwhile Government of India, the fate of which is still not clearly known, acknowledged that the health sector expenditure by the central and state governments, both plan and non-plan will have to be substantially increased during the plan period. It also stated that the health expenditure was increased from 0.94 per cent of GDP in the 10th Plan to 1.04 per cent in 11th Plan and it should be increased to 2.5 per cent of GDP by the end of 12th Five Year Plan period.

That said, the bottom-line is, the current public spending on healthcare (excluding water and sanitation) is stagnating around 0.9 percent of the GDP.

Instead of increase, a steep cut in health budget of 2014-15:

Despite prevailing lackluster public healthcare scenario, in December 2014, just prior to the proposal of Union Budget 2015-16, the new Government reportedly ordered more than Rs 6,000 Crore or US$948 million cut (20 percent) from its own budget allocation of around US $5 billion for the financial year ending March 31, 2015, due to fiscal constraints.

The finance ministry reportedly also ordered a spending cut this year (2014-15) for India’s HIV/AIDS program by about 30 percent to US$ 205.4 million.

A report from Reuters, quoting one of the health ministry officials, stated that this budget cut could crimp efforts to control the spread of diseases. More newborns die in India than in poorer neighbors such as Bangladesh, and preventable illnesses such as diarrhea kill more than a million children every year.

India’s public healthcare expenditure one of the world’s lowest:

It is worth mentioning that at around 0.9 percent of GDP, India’s public health expenditure is already among the lowest in the world, as compared to 2.7 percent in China, 4.2 percent in Brazil, 1.4 percent in Bangladesh, 1.6 percent in Sri Lanka, 2.9 percent in Thailand and 8.5 percent in the United States.

It is noteworthy that the public sector is the main source of health funding in nearly all OECD countries. However, in India, only 33 percent of health spending was funded by public sources in 2012, a much lower share than the average of 72 percent in OECD countries.

Moreover, health accounted for only 4.8 percent of total government spending in 2012, significantly lower than the 14.4 percent across OECD countries.

Similarly, ‘Out-of Pocket’ costs accounted for over 60 percent of health spending in India in 2012, higher than in any other OECD country.

Are the successive Governments ignoring healthcare in India:

Despite such worrisome scenario in the healthcare space, India’s healthcare budget has already witnessed a 29 percent decline over the past year, from Rs. 29,165 Crore in 2013-14 to Rs 20,431.4 Crore (post cut) in 2014-15.

This assumes even greater significance, when India, contributing 21 percent of the global disease burden, accounts for just a fraction of global spending on health.

The hope flickers:

As stated earlier, to meet its fiscal deficit target the Government has slashed the health budget by 20 percent for 2014-15.

Despite the above huge budgetary cut, the hope of the stakeholders continued to flicker, expecting some major announcement on healthcare related financial allocation in the Union Budget of 2015-16. The stakeholders expected, at least this time the new Government would ‘Walk the Talk’ to fulfill its own promises, made thus far, on healthcare.

Very surprisingly, even from the reform oriented new Government, the Union Budget 2015-16 came as a dampener for the healthcare space in the country. The budgetary allocation for healthcare has been proposed as Rs. 33,152 Crore, a tad more than Rs. 30,645 Crore of 2014-15, with no visible indication for any healthcare reform measure in the country, any time soon, adequately backed by commensurate budgetary allocation.

It is worth noting that in the first three years of the 12th Five-Year Plan, the total health spend has been round Rs 70,000 Crore. This is significantly less than Rs. 2,68,000 Crore allocated for 2012-17 period.

‘Health’ is a State subject:

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Would “Digital Health Equity” Augment Healthcare For All In India?

Would “Digital Health Equity” Augment Healthcare For All In India?

 June 2014 report titled “Digital Health Equity: Humanizing e-Health” published by ‘ZeroDivide’, which helps transform communities through technology in the United States, highlighted that the digital revolution of daily life has significantly impacted healthcare in many parts of the world.

As a result, the relationship between the consumers and healthcare providers has just begun to change significantly, though in bits and pieces at present. Wherever it is happening, the consumers expect to get highly engaged in managing their own health, primarily using online and mobile tools and other devices.

“Digital Health”/ “e-Health” to ensure equity in healthcare:

Advancement in e-Health is currently restricted mainly to economically and socially privileged populations. Those with the access, resources and basic digital skills are reaping disproportionate benefits from the technology and other associated infrastructure available for this purpose.

Unfortunately, underserved population, mostly in rural hinterland and some in urban areas still do not have much access to this technical advancement in the healthcare space.

Ensuring “Digital Health” in the new age digital India, would help augmenting quality healthcare support with equity to all in the country.

A beginning has been made:

It is good to note that key stakeholders in health related areas both in public and private sectors are now exploring the ways in which the Internet, digital devices and other related applications can improve patient care, reduce the cost of care and improve overall population health.

Central and State Governments, policymakers, technologists and health insurance providers are eager to connect underserved consumers to online health services and other e-Health applications. Regrettably, few digital tools have been designed with these consumer populations in mind, to date. The nascent field of e-Health research has thus far poorly characterized the impact of race, ethnicity, gender and socioeconomic status on e-Health adoption and use.

General barriers to e-Health:

The previous policy paper of ‘ZeroDivide’ titled, “e-Health and Underserved Populations,” identified 8 barriers, though in the US perspective, that underserved communities face in accessing and utilizing e-Health tools. These are as follows:

• Lack of health literacy

• Lack of linguistic and cultural competency in e-Health

• Access limitations for people with disabilities

• Privacy concerns and distrust in the health system

• Lack of digital literacy

• Limited or no access to broadband and mobile data

• Limited or no access to technology platforms and interoperability

• Lack of awareness of e-Health

Very surprisingly even today all these 8 barriers are very relevant to India, as well.

A key concern:

‘ZeroDivide’ report also highlighted a key area of concern in e-health initiatives. This is ‘Interpersonal relationships’ between the healthcare consumers and the healthcare providers. Consumers’ perception in the study was that technology interfered with the patient-provider relationship.

In their view, technology can alienate providers from their patients, impeding the relationships that are important to providing quality care.

In India, it appears, this perception is equally valid and needs to be addressed effectively, in the process of implementation of e-healthcare in the country.

e-Health in India:

In August 2014, the Director General Health Services (DGHS), Ministry of Health and Family Welfare reportedly announced that his Ministry “has already prepared the white paper of the e-Healthcare service, which will be a boost to raise awareness among the people in the country, who remain completely deprived of the health services initiated by the government,”

He also said, e-Healthcare system basically being a web portal, would help the government connecting with the people on every health-related program and various schemes that would enable them getting free medical treatment.

Accenture – a global management consulting, technology services and outsourcing company, in one of its reports of 2014 titled, “Delivering e-health in India – Analysis and Recommendations” also echoed that a ‘Citizen Portal’ is expected to serve as a single point of access for consolidated health information and services.

It also recommended that keeping population diversity in mind, the web portal should have multi lingual support and be available both on web and mobile (also through an SMS/IVR gateway). People in rural areas would, therefore, be able to access citizen portal more easily through mobile applications as mobile penetration is quite significant in India.

Accenture also acknowledged that a small fraction of population now uses a web portal to interact and share information with providers. With the introduction of state health portals for the citizens, the use of health portals is likely to skyrocket in the coming years. If that happens, its impact on healthcare would indeed be phenomenal.

Moving towards this direction, some experts have also suggested the Government to set up ‘National e-Health Authority of India (NeHAI)’ immediately to formulate the National e-Health Strategy (NeHS) and chart an innovative actionable pathway in this area.

It is interesting to note that according to the Ministry of Health, over 39 million people in India still remain deprived of basic healthcare services, which in most cases lead to death.

Types of e-Health program in India and challenges:

According to a 2014 paper titled, “In e-Health in India today, the nature of work, the challenges and the finances: an interview-based study”, published in ‘BMC Medical Informatics and Decision Making 2014: 14:1’, a range of e-Health programs is currently being run in India, including point-of-care in rural and urban areas, treatment compliance, data collection and disease surveillance, and distant medical education. Most programs provide point-of-care to patients or other beneficiaries in rural areas.

The article states that technology is not a limiting factor, but the unavailability of suitable health personnel is a major challenge, especially in rural areas. Financial sustainability is also a concern for most programs, which have rarely been scaled up. Government facilities have not been very effective in e-Health on their own, just yet, but collaborations between the government and non-profit (in particular) and for-profit organizations have led to impactful programs.

Though increasing number of various e-Health service providers is coming up in India, lack of general awareness and also acceptance of e-Health among potential healthcare consumers continue to remain a critical challenge.

I deliberated on different issues with e-Health in my blog post of May 9, 2011 titled, “e-healthcare: A new vista to improve access to quality and affordable healthcare in India”

Conclusion:

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Data Protection: Needs A Clear Direction…But Is It An IPR Issue?

http://www.tapanray.in/data-protection-needs-a-clear-directionbut-is-it-an-ipr-issue/

The terminologies ‘Data Exclusivity’ and ‘Data Protection’ are quite often used interchangeably by many, creating a great deal of confusion on the subject. However, in a true sense these are quite different issues having critical impact on public health interest of a nation.

In several media reports as well, one can notice the interchangeable use of these two terms. It is especially happening when the reports are speculating whether or not the Government of India is considering putting in place ‘Data Exclusivity’/ ‘Data Protection’ along with ‘Patent Linkage’ through administrative measures, without making any amendments in the Patents Act 2005 of the country.

Tracking this development, the last week, I wrote about ‘Patent Linkage’. In this article, I shall dwell on the same area, but from ‘Data Exclusivity’/ ‘Data Protection’ perspective.

A brief overview:

Close to a decade ago, Government of India constituted ‘Satwant Reddy Committee’ to recommend a direction that India should follow on ‘Data Protection’ in the country involving pharmaceutical and agricultural products.

In 2007 the Committee submitted its report recommending ‘Data Protection’ in the country to be introduced for pharma products in a calibrated manner. However, the report did not specify a timeline for its implementation.

Interestingly, even this committee did not differentiate between the terminologies ‘Data Protection’ and ‘Data Exclusivity, as we now see in the first draft of the ‘National IPR Policy.’

According to available reports, after due deliberation, the erstwhile Government decided not to take any action on the committee’s recommendations for ‘Data Protection’ in India.

Difference between ‘Data Protection’ and ‘Data Exclusivity’:

In an article published in ipHandbook, titled “Data Protection and Data Exclusivity in Pharmaceuticals and Agrochemicals”, the author Charles Clift with a great deal of experience in the U.K. Department of International Development (DFID) and a former Secretary, Commission on Intellectual Property Rights, Innovation and Public Health, World Health Organization; differentiated these two terminologies as follows:

Data Protection (DP): Protection of commercially valuable data held by the drug regulator against disclosure and unfair commercial use.

Data Exclusivity (DE): A time bound form of Intellectual Property (IP) protection that seeks to allow companies recouping the cost of investment in producing data required by the regulatory authority.

Arguments in favor of ‘Data Exclusivity’:

International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), Geneva, in its website argues in favor of ‘Data Exclusivity’ as follows:

- Health authorities require, as part of a submission for a marketing authorization, that proprietary information be disclosed in order to ensure public health and patient safety.

- The innovator assumes the entire risk for the generation of the data, what requires expensive and lengthy clinical trials.

- ‘Data Exclusivity’ is necessary to provide a measure of certainty to the innovator that they will be provided with a period of protection for their efforts of testing a drug.

- Patents and ‘Data Exclusivity’ are different concepts, protect different subject matter, arise from different efforts, and have different legal effects over different time periods

Arguments suspecting the intent of ‘Data Exclusivity’:

The above paper of Charles Clift highlights the following on DE:

- The effect of DE is to prevent entry of generic competitors, independent of the patent status of the product in question.

- DE law, wherever applicable, prevents generic manufacturers from using innovators’ test data, though it would allow the drug regulator to analyze this data prior to market approval.

- Even if the patent period has expired or there is no patent on a product, DE will act independently to delay the generic entry until the period of DE is over.

- In that way DE compensates innovators for delayed market entry and concomitant loss of potential profits.

- DE is a much stronger right than a patent, mainly because, unlike patent law, there is no exceptions or flexibilities that allow the governments to provide the equivalent of Compulsory License (CL).

- DE acts as a barrier to CL of a patent on the same product by preventing marketing approval for a CL.

TRIPS Agreement talks about DP, but not DE:

Article 39 of TRIPS Agreement on “Protection of Undisclosed Information” contains a general clause on the obligations of the members of the WTO, where Article 39.3 specifies three obligations for its member countries as follows:

- To protect data on New Chemical Entities (NCE), the collection of which involves considerable effort, against unfair commercial use.

- To protect these data against disclosure, except where necessary to protect the public

- To protect such data against disclosure, unless steps are taken to ensure that the data are protected against unfair commercial use

According to Charles Clift, Article 39.3 only articulates widely accepted trade secret and unfair competition law, and is not an invitation to create new IP rights per se for test data. Nor does it prevent outside parties from relying on the test data submitted by an originator, except in case of unfair commercial practices.

Some developed countries, such as the United States and the European Union have argued that Article 39.3 of TRIPS requires countries to create a regime of DE, which is a new form of time-limited IP protection. However, it is worth noting that in both these countries DE regime was adopted prior to TRIPS Agreement. Hence, many experts construe such approaches and pressure, thus created for DE, as ‘TRIPS Plus’.

What is ‘TRIPS Plus’?

The ‘TRIPS-Plus’ concept would usually encompass all those activities, which are aimed at increasing the level of IP protection for the right holders, much beyond what is required for conformance of TRIPS Agreement by the World Trade Organization (WTO).

Some section of the civil society nurtures a view that ‘TRIPS Plus’ provisions could significantly jeopardize the ability, especially, of developing countries to protect the public health interest adequately.

Some common examples of ‘TRIPS Plus’ provisions:

Common examples of ‘TRIPS Plus’ provisions could include:

- Extension of the patent term beyond usual twenty-year period

- Introduction of provisions, which could restrict the use of CL

- Delaying the entry of generics

Is ‘Data Protection’ an IPR issue?

In my view, the issue of ‘Data Protection’ is more a drug regulatory than an IPR related subject and should be treated as such. This is because ‘Data Protection’ is more related to the ‘Drugs and Cosmetics Act’ of India rather than the ‘Patents Act 2005′.

Thus, it is quite intriguing to make out why ‘Data Protection’, which will be governed by ‘Drugs and Cosmetics Act’, is featuring in the IPR Policy of the country.

I wrote on the draft National IPR Policy in my blog post of January 19, 2015, titled “New “National IPR Policy” of India – A Pharma Perspective”.

Conclusion:

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