The Competition Commission is investigating whether Johnson & Johnson’s drug bedaquiline, used in the treatment of multidrug-resistant tuberculosis (MDR-TB), is excessively priced in SA.
The drug was widely welcomed as the first new treatment for tuberculosis in more than 50 years when it was registered in SA in 2014. Before that it was first trialled in SA on drug-resistant patients who had no other treatment options left. It reduces the treatment of MDR-TB from about 18 months to six months and replaces a much older drug that often caused deafness in patients.
SA has one of the world’s highest prevalences of TB. However, this drug is for multidrug-resistant TB that according to an article in the medical journal The Lancet affects 2%-5% of SA’s TB patients and in which standard treatment does not work.
Bedaquiline is under a patent that initially ended in 2023, but the patent was extended to 2027 making Janssen Pharmaceutica, a subsidiary of Johnson & Johnson, the only producer of the medicine in SA. The patent allows Johnson & Johnson to set the pricing without competition.
Earlier this year global activists, including Médecins Sans Frontières (MSF), accused Johnson & Johnson (J&J) of “ever greening”, which refers to changing the medicine slightly to allow it to extend their patent for a few years and extend the monopoly in 66 countries.
In SA, in the latest tender running from October 2023 to September 2025, it will cost the department of health R5,577.10 for a pack of 188 bedaquiline tablets used over six months for a full course of treatment. It is estimated in the tender about 15,411 patients will be treated over the two years.
However, Johnson & Johnson has allowed an Indian generic manufacturer to make the drug in India and has lowered its price and sold it to the International NGO Stop TB Partnership’s Global Drug Facility Fund for $130 for a six-month course until December 2024. This is less than half of what it costs in SA, where it is about $300 for a six-month course. The Global Drug Facility Fund is selling the drug to 44 middle and low-income countries, but SA’s public procurement rules prevent purchases from this global fund.
Patent extension
Activists under the Health Justice Initiative, which includes a range of civil society groups including MSF, made the complaint about SA’s Bedaqualine prices. Health Justice Initiative founder Fatima Hassan said the complaint covers the price and the extension of the patent past its initial end date of 2023.
MSF Access Campaign Advocacy adviser Candice Sehoma said the patent was supposed to expire on July 18. She thinks it is the first time the commission will investigate a drug company using the patent system to extend a patent and exclude generic manufacturers.
“If it wasn’t for the patent extension, the department of health could buy the Indian generic at a lower price,” Sehoma said.
She added that because the drug was trialled in SA and evidence from local trials used to inform the World Health Organisation’s decision to recommended it as a treatment, taxpayers’ money was involved in the development of the medicine.
The commission said it has begun investigating the complaint “based on information in the commission’s possession that gives rise to a reasonable suspicion that Johnson & Johnson and [subsidiary] Janssen Pharmaceutica may have engaged in exclusionary practices and excessive pricing in the provision of bedaquiline”.
Johnson & Johnson said in response that it “has a long-standing commitment to SA’s fight against MDR-TB”.
“Today, all patients in SA who require bedaquiline, our medicine for MDR-TB, have access to it thanks to our collaboration with the government and other stakeholders, which has contributed to a steady decline in TB incidence. The company will co-operate fully with the Competition Commission in its inquiry, and cannot comment further while this is ongoing.”
While activists have complained about excessive pricing, under section 8 of the Competition Act, only one such case has succeeded in SA. The only case of excessive pricing that was upheld was against an industrial mask supplier under regulations made during Covid-19 that are no longer in force.
Industrial dust mask and workwear supplier Babelegi was found guilty in 2020 of excessive pricing of the masks in increasing prices up to 800% at the early stage of the pandemic, but the competition appeal court dismissed its fine so it faced no penalty. Babelegi sold about 76 boxes of 20 masks each at the much higher prices.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.