The influence of Pharmaceutical corporations in health policies

The Pharmaceutical industry -Pharma in short- plays an important role in health policies. Through Trade Agreements they impact the price of, and access to, medicines in developing countries. By lobbying national and regional legislators and regulatory agencies approving medicines, they influence health services and the quality of medicines and by suing governments they prevent the protection of public interests.


In 2010 the global pharmaceutical market reached 875 billion dollars thus making Pharma powerful and influential in health-related policies. In order to increase its turnover and capture new markets, Pharma’s lobbying spreads beyond national and regional policies to multilateral organisations.


Influencing international organisations

During the Uruguay Round negotiations (1986–1994) the Pharma lobby pushed strongly for strong Intellectual Property Rights (IPRs). The resulting TRIPS Agreement on Intellectual Property imposes on all World Trade Organization (WTO) members the requirement to grant 20-year patents on medicines. 


Pharma is behind the current trend in the European Union (EU) and USA to strength the IPRs beyond TRIPS demands. This results in huge benefits to the mighty Pharma, but delays access to cheap generic medicines. 


During the 2008 World Health Assembly of the World Health Organization (WHO) where public health and intellectual property were discussed, more than 80 representatives of the Pharma industry were present to influence the decision makers.


In 2009, WHO, under the influence of Pharma, raised the level of pandemic alert pushing countries to spend $18 billion from national budgets on insufficiently tested vaccines despite the potential safety risks. Antigen fragments of the H1N1 virus could have been added to the existing stocks of flu vaccines - but as some of the additives in the vaccine are patented the industry was not interested in this[1].


To maintain the benefits that patents represent and to ensure control of the market, companies indulge in scams such as making minor changes to the drug. When the drug Lipidor was under patent protection, its sales provided Pfizer, the patent owner, with $11 billion. In 2011 when the patent expired in EU countries, in order to get a six-month patent extension worth $770 million, Pfizer launched a weaker version for children. In the USA when the patent ended, Pfizer dealt with insurers, pharmacies and hospitals to prevent the entrance of generic versions, requiring pharmacies to substitute prescriptions for low-cost generics with their name-brand[2].


In 2008 the sales of Zyprexa[3] worldwide earned $4.7 billion[4] for Eli Lilly & Company. The medicine under patent was sold in Peru at $6 a tablet. In 2011 when the patent ended, Olanzapine, its generic version, appeared on the market lowering its price to $0.30 a tablet.


Towards the end of the trade negotiations between the EU, Colombia and Peru, the EU dropped the extension of data exclusivity beyond the patent life[5]. EFPIA[6], a major Pharma lobby in the EU, reacted by pressing the European Commission to strengthen the IPRs[7].


Influencing the making of legislation

Pharma lobbies the national legislative bodies to ensure that legislation protects their own interests. The consequences can be disastrous for public health.


In July 2001 the Kenyan parliament passed the IP[8] Act that made it possible to buy the cheapest medicines on the international market. In April 2012, under pressure from Pharma and taking advantage of the absence of most parliamentarians, an amendment to the IP Act was passed. This amendment blocked commercial importation of cheaper medicines. The action of the Kenya Coalition for Access to Essential Medicines[9] made the Parliament reverse the amendment in July 2002.


Between 1998 and 2004 in USA, the top twenty Pharmaceutical companies lobbied on at least 1,600 pieces of legislation[10]. The EU lobby is less transparent, but it is clear that Pharma interests are often reflected in the legislation.


On 23 July 2003 the House of Representatives in Washington took a vote on a bill proposing the authorisation of imports of cheaper drugs (drugs are much more expensive in the US than in Europe). The bill was a blow for Pharma. Surprisingly, numerous democrats voted against. Those voting against had received campaign five times more funding than the others for the 2002 election[11].


At the insistence of a company holding a patent, generic drugs in transit through the EU, patented in an EU country but not in the countries of origin and destination, are being seized. In October 2008 at Amsterdam airport, Dutch Customs, on behalf of Sanofi, seized a shipment of the generic Clopidrogel coming from India and in transit to Colombia. In May 2009, the generic drug Amoxicillin en route from India to Vanuatu was seized at Frankfurt airport by German customs on behalf of GSK, the patent owner. The examples are numerous. The 2011 EU customs regulation enforces this trend. The commercial rights and interests of companies should not impede the free movement of legitimate goods that are not destined for the EU market and that can save lives in developing countries.


Companies suing countries

Investment agreements between countries allow companies to sue governments in national courts or at international arbitration courts. This puts companies on par with countries and empowers them to avoid domestic laws and courts and to challenge public policies when these harm their interests. This weakens the sovereignty of countries when deciding on their own public health regulations.


In 1997 South Africa (SA) passed the Medicines and Related Substances Act allowing generic substitution of brand-name drugs and importation of cheaper generic drugs to reduce ARV prices for the 4.2 million of SA citizens infected by HIV/AIDS. In 1998, 42 Pharmaceutical firms sued the South African government trying to stop this law. Under huge international pressure, the Pharma companies dropped their case in 2001.


In 2012 Eli Lilly sued Canada’s patent rules under NAFTA[12] at international arbitration World Bank tribunal, demanding $500 million in compensation for the ruling of the Canadian Patents Office against two Eli-Lilly patents. Canada patentability standards demand that a drug's usefulness be demonstrated, a requirement that the drugs, Strattera and Zyprexa, did not fulfil.


Pharma influence on the regulatory medicines agencies

Another area of influence is on the Regulatory Medicines Agencies. In the USA where according to law Pharma may only lobby the government on tangential issues related to drug approval and monitoring, the influence of Pharma is reflected in the big number of industry-friendly legislative proposals[13].


In 2012, 85% of the revenues of the European Medicines Agency (EMA) came from fees from the industry, the rest coming from the EU budget[14]. This obstructs the independence of EMA and makes it a service provider for Pharmaceutical companies, at the expense of their public health mandate.


In 2012, EMA started providing data from clinical trials and intends to put into force in January 2014 a policy on the prospective release of clinical trial data. In 2013 the companies AbbVie, InterMune-UK and others sued EMA over its data releases while PhRMA[15] and EFPIA submitted pleas to back the secrecy of clinical trials[16]. The General Court of the UE ordered EMA to stop the release of data until the final ruling.


Invitation to act to defend public health

The strong influence of Pharma on health policy is real and the industry is trying to increase it. However the lobby of patient groups, health care institutions and civil society defending public interests has been behind the health revolution of the last two decades. The main achievement has been to bring on board policy makers who are passing legislation favouring access to treatment and medicines for all. The battles won over the industry raise hope for future public health care services of quality for all. But to reach universal health care, personal and organisational, continued commitment is needed.


Begoña Iñarra

AEFJN Executive Secretary

[2] Time, Josh Sanburn, Dec. 01, 2011.

[3] A patented  medicine for schizophrenia and bipolar disorder sold under the brand name of  Zyprexa is manufactured and marketed by the Pharmaceutical Eli Lilly & Company

[4] Lilly 2008 Annual Report.

[5] Data exclusivity protects the clinical test data required by regulatory agencies to prove the efficacy and safety of a new medicine. The extension of data exclusivity obliges generic producers to do new clinical tests thus eliminating them from the market.

[6] European Federation of Pharmaceutical Industries and Associations 

[7] HAI Europe, 2011

[8] Industrial Property (IP) Act dealing with Intellectual Property Rights.

[9] Coalition formed by patient groups, health care organizations and civil society promoting generic medicines. 

[11] Comment of Steven Weiss, editor of, specialist in analysing electoral contributions.

[12] the North American free-trade agreement

[13] Drug and Medical Device Companies have outsized influence on FDA from Union of Concerned Scientists website.

[14] European Commission – Health and Consumers Directorate-General “Introduction of fees to be charged by the EMA for Pharmacovigilance” Concept paper submitted for public consultation. Ref. Ares(2012)723154 – 18/06/2012)

[15] PhRMA, the Pharmaceutical Research and Manufacturers of America, represents the country’s leading biotechnology companies.

[16] The Guardian On July 2013 Sunday reported that it had seen a leaked e-mail with this information. 




Go back