Examination of Witnesses (Questions 600
- 618)
MONDAY 21 APRIL 2008
Dr Gaudenz Silberschmidt
Q600 Chairman:
You talked about the struggle to get that document produced because
of disagreement, but you also talked about it being very successful.
Do you think people have learnt from that that the cooperation
was worth it?
Dr Silberschmidt: The cooperation with foreign
affairs has significantly improved. The attention has improved
especially. My colleagues in the Development Cooporation are currently
at an interregnum, where the head of the Swiss Agency for Development
and Cooperation has just retired and has not been replaced. Health
is not well-placed, you do not even see it on the organigram.
In recent discussions with colleagues in the Development Cooperation
I was asked why I was in favour of a coordination unit within
the Ministry of Foreign Affairs. My answer was that, while I am
in favour of one coordination person for Health, I would be against
five or seven people, which is what they have in Environment and
Culture, where it has led to conflict between the foreign affairs
and sectoral ministries. In the Development Cooporation they have
one or two half posts currently and I would be in favour of seven
posts. A lot of the conflict there is due to the fact that they
are overwhelmed by the task and there are too few staff; they
did not manage to get the funding increase where other countries,
notably the UK, have been heavily increasing health funding. There
I would be in favour of having a strengthening of Health and also
having an interlocutor at senior level, which currently I do not
have.
Q601 Unallocated
Q602 Lord Jay of Ewelme: Thank
you very much. I just wanted to focus for a moment on the WHO's
Global Outbreak Alert and Response System, which is clearly a
crucial element in responding to present and future pandemics.
You said in your written evidence, for which many thanks, that
you thought that was working quite well—I think you actually
said very well—under the International Health Regulations.
But the WHO in their evidence to us said that there was "gross
under-investment" in the system and that it depended on "strong,
capable and transparent national systems", which are again
subject to under-investment. One point that has struck us rather
is their sense that there is a need for more investment in it.
The point that I would be quite interested in your views on is
that clearly the system is only going to work if there are effective
national systems of surveillance and reporting so that the people
who are at the centre know what is going on; and clearly in a
number of developing countries those systems are very basic indeed,
in some cases absent. I wondered if you had any comments on that
aspect of it—the importance of effective national systems
if the reporting system is really going to be effective.
Dr Silberschmidt: I was commenting on the global
infrastructure, that means WHO headquarters in the structure of
GOARN, which is working excellently. I do not know if you have
had the chance to see the Emergency Room in WHO, but it is really
impressive and is working well. The IHR have really brought us
into the 21st Century on what infectious disease control is. The
strengths of the IHR are the fact that they are binding, they
are universal around the world, it has an algorithm which does
not bind them to known diseases any more but makes them relevant
to all diseases independent of their origin. Personally, I was
involved in mediating between the US and Iran on how to handle
bioterrorism. We do not name it but it is covered. It is really
broad for chemical, biological, nuclear, natural origin, deliberate
origin, and we call it occurring naturally or otherwise, a diplomatic
way of saying it is all covered. That is a strength. Another strength,
which is quite significant for an international treaty, is it
explicitly allows the use of non-state information. That means
the health intelligence efforts of WHO have the legal backing
and, when they find information from other sources, they can go
back to the country and ask what is going on. Probably the biggest
weakness is the fact that there are no resources attached to the
national capacity building. That was a point you were making,
which is absolutely true. It was tricky enough to have a package
for the 193 Member Countries of WHO in a legally-binding instrument,
so we were not able to put the capacity building and finances
in the same instrument: that was too much. We have another fundamental
problem there and I have tried to explain it in my evidence. Take
the example of financing of pandemic influenza preparedness. A
colleague from Australia has told me the same story. The Ministry
of Health has a budget of billions for domestic purposes; the
Ministry of Development Cooporation have their own priorities
and, say, it is either a humanitarian crisis nor long-term development.
But, wait a moment; we have things killing people, so we do not
look at a threat that might kill people, we have enough other
things. The Ministry of Defence should be about security but has
a different concept of security. The sector-wise budgeting of
our government means that there even it would be a win-win investment
in fighting avian flu but the prevention of a flu pandemic never
gets the same large resources. I would say we have the same dilemma
in the capacity strengthening for the IHR/GOARN system, because
it is a joint interest and it is not clearly in our Minister of
Health's competence—"I do not have a mandate nor sufficient
resources to invest in that". The Development Corporation
sees other priorities, so why should they invest in that. One
positive aspect is the fact that the international community,
WHO leadership, is starting to re-focus on the health system,
and the health system instead of a vertical disease-wise approach
is about strengthening capacities. If you have a vertical IHR
implementation approach, you plan the laboratory; but, if you
do not have the health system to provide the samples, the laboratory
does not help much.
Q603 Lord Jay of Ewelme:
That is a very interesting analysis. I suppose an answer is for
Development Ministries to see capacity building as an essential
part of their work. If they were to do that, then presumably capacity
building here and the development of health systems would be as
central as other aspects.
Dr Silberschmidt: I would go deeper than that.
Do you think that is feasible with the development mindset? We
do not have a large ministry in our government with a global public
good mindset yet. With a development logic which is appropriate
for an African developing country, bottom-up approaches and working
in the country, working strongly with NGOs, it is appropriate,
but our governments lacks the mindset of providing global public
good.
Q604 Chairman:
You mentioned the International Health Regulations, and it was
suggested to us earlier that there could be a case for extending
them to cover some of the animal health issues because of the
tipping-over between animal health and human health. Do you have
a view on that?
Dr Silberschmidt: I think they are too young
and rather need further strengthening and implementation then
have a formal revision at this point. We now have to focus on
implementing the International Health Regulations. It is already
a record that we adopted them in 2005 and they entered into force
on 16 June 2007 and are applied universally to each and every
human being on the earth. That was extremely quick. I would be
careful to enlarge, we should deepen. If you look down the road,
we are relatively clear on who is the responsible secretariat
and organisation for IHR; but, before going strongly into animal
health, you would need an in-depth analysis to see if your gain
in synergies is bigger or if you lose by creating new interfaces
with in the functioning of IHR which will not be as important.
For the time being I would be careful with opening it up.
Q605 Lord Desai:
I want to make an observation on what Lord Jay said. Even though
people think of capacity building in developing countries, they
do not think of health necessarily. Health for ministries in capacity
building is not as high a priority, there are other things to
develop, so there is a conflict there.
Dr Silberschmidt: I would go further. I have
recently had the Vice-Governor of a Chinese province coming to
visit the Swiss health system and he was not asking development
questions, he asked; what kind of public-private mix do we have?
How do we make universal coverage of health insurance by using
the private sector to make it work? I then went to my colleagues
in the WHO, the World Bank and elsewhere, asking who in the world
has significant capacity, an analytical capacity of emerging country
health systems, and the answer is nobody. Nobody can tell you
what the Indians, Chinese, Brazilians, Egyptians, Indonesians,
South Africans can learn from each other's health systems. WHO
and many other institutions know from developing countries' health
systems. In the OECD the European Observatory on Health Systems
and in academic institutions, think-tanks, we have started to
create knowledge on industrialised countries, but we are still
in the duel system, which is not a reality nowadays.
Q606 Lord Howarth of Newport:
The consequence of investing which is very real—there should
be such investment in the generation of more trained personnel,
doctors, nurses and other people who are needed in this field
in the developing world—is that there will be a large haemorrhage
of those very people coming back into the developed world.
Dr Silberschmidt: The migration question will
be the next big issue we are going to negotiate in WHO. In anticipation
of that we have been asking the WHO and OECD jointly to do a project,
which they have concluded now. One finding is the different domino
effects. As I was saying earlier, Switzerland, although it does
not import from developing countries, is still a player because
we still import indirectly. On the other hand, there was a very
clear finding that migration is not the main cause nor would its
resolution be the solution to the workforce crisis in developing
countries. While it is true for some specific countries that losing
more than 50 per cent of their personnel is a key factor, for
many other countries if we take India, the biggest exporter of
doctors worldwide, it is less than ten per cent of Indian doctors
going abroad, which means it is not a danger to the Indian health
system. If we take the Philippines, the largest exporter of nurses,
they deliberately train nurses for this situation. We are in a
complex situation. Yes, there are instances where migration is
crucial, but you have to look at all the push and pull factors,
and basically all of our countries train too few health personnel.
Chairman: Can we now move on to Intellectual
Property Rights.
Q607 Lord Avebury:
In Paragraphs 17 and 18 of the document that you gave us to draw
attention to Geneva's position as the health capital in the world,
both as a centre of excellence for public and humanitarian health
and as a generator of huge amounts of intellectual property from
the existence of the pharmaceutical companies that are based in
this country, you say that a balance has to be struck between
protecting the intellectual property of those who fund and pioneer
new drugs and getting those medicines that they generate to the
people who need them as readily and cheaply as possible. I would
like to ask you, first of all, if you have any specific suggestions
as to how that balance of interest can be struck.
Dr Silberschmidt: We have a mathematician as
a Secretary of Foreign Affairs, and therefore the intellectual
rigour of our drafting here was such that we deliberately did
not put the balance of interests within the same objective. But
Objective Nine is to improve access to essential drugs and Objective
18, where it does not say to maximise protection of intellectual
property, it says "appropriate" protection.
Q608 Lord Avebury:
What does that mean?
Dr Silberschmidt: I just comment on that because
I am quoting somebody I want to introduce. Currently I am co-chairing
an Expert Group together with the Deputy Director of the Swiss
Office for Intellectual Property, where we have Health, Intellectual
Property, Trade, Research, Development Corporation, Foreign Affairs,
Human Rights, at the table to draw up a position on this issue.
I learned from him that he is clearly saying, and industry hates
to hear this, that even for us the maximising of protection of
intellectual property is not maximising innovation, because you
have too many patents hindering the collaboration that is needed
for innovation. There is an optimal protection of intellectual
property which gives you the most innovative output. The same
applies to the big challenge of developing countries. The least
developed countries are relatively easy, because there is hardly
any industry claiming patents in least developed countries and
there is not much of a conflict. The big challenge is, once again,
in emerging economies because it starts to be a relevant market
and it is the fastest growing market for the pharmaceutical industry,
when you speak of the 20 per cent rich or middle class people
within these countries, but at the same time you have poor people;
and we have not found a system yet which accommodates both legitimate
concerns. It is absolutely legitimate that the pharmaceutical
industry wants to make profit if somebody is as rich as we are
in India, China, Indonesia, Thailand or Brazil. On the other hand,
it is unacceptable that the drugs are totally unaffordable for
the poor in these countries. This is where we have a dilemma.
You are asking for concrete examples, and I would be very cautious
in the sense that we are in the process of moving out of the "patents
are good" or "patents are bad" discussion. If you
look at the draft Global Strategy and Plan of Action on Public
Health Innovation and Intellectual Property, and the negotiations
are going on next Monday and should conclude within the next week,
it gives about 80 actions. The answer is that there is no silver
bullet as to the action we have to do. It goes from basic research
to strengthening health systems but over traditional medicine
recognition, over capacity building for research and development
in developing countries, over strengthening of regulatory capacity,
fighting counterfeit drugs (in many countries more than half of
the medicines are counterfeit), and over the intellectual property
question. Switzerland has implemented the Doha amendments to the
TRIPS Agreement on compulsory licence. It is the whole forest
and, whichever tree you pick out, you have to look at individually;
but you should not think that is the solution to the problem.
Q609 Lord Avebury:
There is not an algorithm that you could write which would tell
you how to strike this balance? It is a qualitative process of
looking at the various factors you mention, one of the most important
of which obviously is the prevalence of counterfeit drugs, which
I believe are spreading massively at the moment, which means that
pharmaceutical companies are content to give way, for example,
on the recent amendment to the TRIPS Agreement which allows for
non-manufacturing countries to import under generic licences.
Dr Silberschmidt: I would say that access to
medicine is a challenge for the pharmaceutical industry as much
as climate change is a challenge for the energy industry. Within
the industry you find a similar kind of split, with some companies
being fully aware of that being the biggest challenge for their
industry and some others being closed or wanting to totally ignore
the challenge. The tendency in both sectors is that the European
countries are more on the progressive side than the US-based companies.
There are always exceptions but that is the case. As Switzerland
we are not fundamentally against compulsory licensing but that
is a last resort. We are not happy with all of the compulsory
licensing going on. Sometimes it attracts attention away from
all the other parts of the game. What I am saying should not be
understood the other way around, as attracting attention away
from IP, because IP is one of the trees in that forest.
Q610 Chairman:
I have heard it argued that the pharmaceutical industry overstates
the case for the amount of new drugs that come from their work
alone but, in fact, a lot of the work is done by science-based
hospitals and academic institutions on the public side. Would
you agree with that? Or do you not think that is correct?
Dr Silberschmidt: Overall, the system is not
running perfectly in the sense that real innovative output is
not as it should be, especially in view of the growing investment.
Investment has been growing fast while the output has not been
growing that fast or not at all. On the basic research side, you
are absolutely right, basic research is much more government funded
than it is pharmaceutical-industry-funded. We want to re-orient
towards developing country needs but a sound basic research policy
of a government is curiosity-driven, not objective-driven. You
want to have the best research you can fund, we have to look for
mechanisms which accommodate both aspects. An example is that
colleagues from the Research Ministry, amongst others, as a consequence
of that collaboration, have helped to set up the Research Centre
of Global Health at the EPFL, the Technical University in Lausanne.
On basic research you are right; and on applied research the very
first results are now coming out of public-private partnerships,
but otherwise can you tell me of any government that has ever
developed a drug?
Q611 Lord Howarth of Newport:
The financial strength of the pharmaceutical companies in the
West derives from long-term relationships with publicly-funded
clients, publicly-funded purchasers, health services constructed
in one way or another in these various countries, and that is
another reason why I think the public interest has a very strong
claim. I think it is a false argument for the pharmaceutical industries
to say that their accountability is solely to their shareholders.
Dr Silberschmidt: I would be careful with that
argument, because they would immediately answer, "So take
the US system, we earn more from private prices". They are
against the government-set prices. We would not agree to abolish
the European model, we have to rethink it. In the OECD we are
starting to compare our systems better because, when you have
a comparison basket with other countries, they know where they
have to feed in the drug first to get the best price out. The
private model would not be better in the sense that drug prices
would tend to be higher, especially as in the US where you allow
direct-to consumer advertising, which I think we are right not
to allow. I would not go down the line of argument that it is
because of the government-set price or government purchasing,
I would rather go down the line of corporate social responsibility,
because even if energy companies do not have government purchasers
they bear a responsibility on climate change and climate mitigation;
and, if the food companies do not have government purchasers,
they have a responsibility on obesity and have to work on it.
Q612 Lord Howarth of Newport:
But the notion of corporate social responsibility recognised by
the pharmaceutical industry does not seem to extend to the needs
of the developing world. There is a market failure. They are not
willing to invest in research to find drugs and treatments that
are required distinctively in the developing world. Their interest
is in supplying more affluent markets in the advanced countries?
Dr Silberschmidt: I would say that in the last
five or ten years the picture has changed. The Novartis Institute
in Singapore, which is specifically on tuberculosis, is one example,
GSK is another, and so on. It has started to change. On the other
hand, we have to acknowledge that they can put one or two per
cent of their research into pure corporate social responsibility
and that means no return on their investment. Their argument is
that it is a market failure, so they need government intervention;
and, if we provide the market, they will do the research. We need
to find mixed solutions, you cannot just say, "Do your job".
Business is business, but it has to do it responsibly.
Q613 Chairman:
Does your Government or your Department put pressure on the drug
industry in Switzerland? Or would you not describe it as putting
pressure but would you describe it as discussing common problems?
Dr Silberschmidt: On this issue we are discussing
common problems. On the Swiss prices we put quite a lot of pressure
and they do not like this, since my boss is the one setting the
drug prices in Switzerland, and they do not like it when it starts
to go down. We are discussing issues but it does not mean we just
follow their view.
Q614 Baroness Whitaker:
This is another of these tensions which you have identified very
clearly on Page 13 of your Swiss Health Foreign Policy—that
trade can bring prosperity which leads to improved healthcare,
but also it makes it much easier for infections to travel around
the world, and you say that the WHO has made an exception in this
case. We wondered if you had any other ideas. One suggestion we
have heard is for international trade initiatives to have health
impact assessments attached to them. Do you think there is any
mileage in that? Or is there anything else we can do to bring
trade into corporate social responsibility?
Dr Silberschmidt: The quantitative health impact
assessment is an interesting but very, very complex exercise.
We need to learn more from health in all policy initiatives like
that brought by the Finnish Presidency of the EU into our own
policy. My approach would be slightly different. If you ask me
what is best done with £1 million to improve health in Africa,
I would train African health diplomats. There are very, few very
good negotiators both in the bilateral and multilateral fields
or on the recipient's side. The next step would be to link it
to trade and bring them also to the table.
Q615 Baroness Whitaker:
So you would have health advocates as well as trade advocates
coming from, say, Nigeria or Kenya?
Dr Silberschmidt: If there is a free trade agreement
negotiation and Nigeria, Kenya or whoever has a competent health
diplomat from the Ministry of Health involved in the negotiation,
the outcome will be significantly better for health.
Q616 Baroness Whitaker:
That is very interesting.
Dr Silberschmidt: If you look at the WHO negotiations,
there are very few individuals from all over the world, who have
really mastered the game of health negotiations.
Q617 Baroness Whitaker:
Who should train these people? Should it be bilateral people,
DFID, CIDA, that sort of thing? Is it an international responsibility?
Dr Silberschmidt: In another objective for implementation,
we have been helping the establishment of the Global Health Programme
at the Graduate School of International and Development Studies
here in Geneva, where we are running a summer course for the second
time and are overbooked. Brazil has started a Masters programme
in Health Diplomacy in the Fiocruz Foundation. There are other
institutions starting. In the long run it should probably be the
top diplomatic training institutions in industrialised countries
plus local training. We are already discussing with a Kenyan colleague
setting up in Kenya such courses locally to train people in negotiating
skills. The interface between technical health work and diplomacy
is tricky and then the international interface. It is tricky,
but if you can train people that is the best return on investment.
Q618 Baroness Whitaker:
I know DFID does train people in negotiations at the WHO, but
I do not know about this health diplomacy. Is health diplomacy
for trade negotiations a new concept?
Dr Silberschmidt: Overall it is a new concept.
The course we had last summer, I think, was the first overall,
and now they are starting in the US, and they have one starting
in Brazil. There should be more of this.
Chairman: If there is anything you feel
you have not covered that you think we ought to hear about, please
say so. If not, you can send it in later. If you are happy with
that, thank you very much indeed, it has been very useful. We
wish your new Department luck and good progress with the way it
is heading. Thank you very much.
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