Background FAQ on Chile compulsory licensing request for HCV and prostate cancer treatments

For more information, contact:
(U.S.) James Love, KEI: or +1 (202) 332-2670

(Chile) Luis Villaroel, Innovarte: or +56 9 9827 9673

Chile FAQ

What is happening in Chile with regard to HCV medicines and Xtandi, for prostate cancer?

[Last updated October 2018]

In March of 2017, patients, members of the Chilean congress, and NGOs submitted a petition to the Ministry of Health requesting compulsory licenses for expensive medicines for the treatment of hepatitis C and prostate cancer, and focusing on the problems of access that high prices for the patented versions of those medicines create for patients and on the Chilean health budget. This process is still pending.

On January 2017 the Cámara de Diputados of the Chilean Congress called on the government to implement compulsory licenses as a mechanism to reduce prices. On January 2018 resolution 1014 from the Cámara de Diputados declared that the public health problems created by the lack of access to hepatitis c treatments constitutes sufficient justification to grant a compulsory license. Corporación Innovarte played a key role in advocating for both of these resolutions.

On March 2018, then Chilean Health Minister Carmen Castillo Taucher announced that there are sufficient public health reasons to support a compulsory license on hepatitis c drugs. This satisfied the requirement under Article 51(2) of the Chilean Law of Industrial Property No.19.039, allowing the grant of non-voluntary licenses for reasons of public health. In a resolution adopted on June 2018 the Cámara de Diputados expressed support for the March 2018 resolution, and asked the Ministry of Health to take, in an “urgent manner”, all the necessary steps to obtain the compulsory license.

A July 2018 report published in a Chilean newspaper shows, with an impressive level of detail, that the compulsory licensing efforts led by Corporación Innovarte are now being met with aggressive lobbying by a number of pharmaceutical companies, including Gilead, J&J, Novo Nordisk, Sanofi, GSK, AstraZeneca, Novartis; and trade associations, such as AMCHAM, PhRMA, EFPIA. They are currently engaging with governments such as the United States, Canada, Belgium, France, the UK, Switzerland, Denmark, Sweden, Germany and the European Union. This report shows that high-level industry representatives, including PhRMA Associate Vice President Carl Meacham, are directly involved in this aggressive lobbying operation.

Gilead filed a formal opposition to the March 2018 resolution by the Ministry of Health, arguing that it did not met legal grounds, particularly because the March 2018 resolution took into account the price of the drugs as part of the justification for granting a compulsory license under public health grounds. Innovarte and Chilean legislator Giorgio Jackson rebutted this claim. With a resolution published on August 2018, the current Minister of Health Emilio Santelices rejected the Gilead’s allegations, upholding the March 2018 resolution adopted by the previous Minister of Health.

What is Xtandi?

Xtandi (inn: enzalutamide) is an important prostate cancer medicine that is marketed by Astellas Pharma, a Japanese company. The drug was developed at the University of California Los Angeles with the support of the U.S. government via grants from the National Institutes of Health and the Department of Defense.

The drug was the subject of a petition in the United States by KEI and UACT, requesting that the U.S. Government use its rights under the Bayh Dole Act to permit the entry of affordable generics either via march-in right or use of the government’s perpetual royalty-free license. That petition was denied.

India’s patent office denied the patent on Xtandi in November 2016, but UCLA is pursuing an appeal with the Delhi High Court. UACT has pushed for UCLA to drop its pursuit of an appeal of that decision.

What are the HCV medicines at issue?

The Chilean petition mentions the following drugs, but requested that the Chilean government issue compulsory licenses on any other sofosbuvir combination drugs for the treatment of HCV:

sofosbuvir (U.S. brand name Sovaldi)
sofosbuvir + ledipasvir (U.S. brand name Harvoni)
sofosbuvir + ravidasvir (Drugs for Neglected Disease initiative (DNDi) combination drug)
sofosbuvir + daclatasvir (U.S. brand name Daklinza)
sofosbuvir + velpatisvir (U.S. brand name Epclusa)

How much do these medicines cost in Chile?

In Chile, the private market price of sofosbuvir at the time of the compulsory licensing request was approximately $36,000 USD per patient. The private market price of Xtandi was approximately $45,000 USD per patient per year. Both of these prices are well in excess of the GNI per capita of $14,100 USD (2015 GNI per capita, Atlas method, current US$, World Bank World Development Indicators). The Ministry of Health currently pays $7,000 USD for a three-month treatment of sofosbuvir.

How much do the generic versions of these drugs cost in other countries?

The prices of generic HCV medicines have plummeted following the introduction of voluntary licenses of Gilead’s products in approximately 100 countries, as well as the voluntary license of Bristol Myers Squibb’s product to the Medicines Patent Pool. At the World Health Organization’s World Health Summit in October 2017, MSF announced it had procured generic versions of HCV drugs at the price of $120 USD for a 12-week treatment, or approximately $1.40 per day.

Xtandi has yet to be developed as a generic, but it is a small molecule drug and could be manufactured extremely cheaply. Biolyse, a Canadian company that specializes in oncology medicines, offered in April 2016 to supply generic enzalutamide for patients in the developing world at $3 per pill, an approximately 95% discount compared to Astellas’s Medicare price.

What is a compulsory license?

A compulsory license is a legal procedure that allows a government or a judge to authorize the non-voluntary use of a patented invention. A compulsory license does not result in the invalidation of a patent, and in most cases, the patent holder is entitled to receive a royalty or other compensation or remuneration for use of the invention.

For examples of compulsory licenses, see:
2014:1 KEI Research Note: Recent European Union Compulsory Licenses. March 1, 2014
2014:2 KEI Research Note: Recent United States Compulsory Licenses. March 7, 2014
2007:2 KEI Research Note: James Love. Recent examples of the use of compulsory licenses on patents.

In 2017, Malaysia announced compulsory licenses for sofosbuvir.

In 2016, the German Federal Patent Court issued a compulsory license permitting Merck to continue selling Isentress (inn: raltegravir), an HIV drug. This decision was affirmed on appeal by the German Federal Supreme Court in 2017.

The United States judicial system frequently allows de facto compulsory licenses as a limitation on remedies in patent infringement cases by denying permanent injunctions under the test from eBay v. MercExchange. These have included cases involving medical technologies.

Who requested this compulsory license?

The petition was submitted by Luis Villaroel of Innovarte NGO with members of civil society and patient groups including Fundacion Nuevo Renacer of cancer patients led by Antonia Toledo, the Colegio de Quimico Farmaceuticos y Bioquimicos de Chile, and members of the Chilean Congress, including Diputados Giorgio Jackson, Karla Rubilar, Miguel Angel Alvarado, and Gabriel Boric, Juan Luis Castro, Victor Torres, and Senator Eugenio Tuma.