For the past nine years, the drug company Novartis has been selling Coartem, one of the most effective antimalarials on the market, to public-health officials in the developing world at a loss totaling more than $253 million not counting the millions spent on R&D. That's added up, the firm reports, to more than 550,000 lives saved. In late January, the company unveiled the first pediatric dose of Coartem less bitter and easier to swallow than the adult version which is expected to help in the battle against a disease that kills more than 700,000 children under 5 each year.
Novartis' foray into fighting malaria is emblematic of the ongoing debate in health care about where good public relations gives way to real corporate responsibility. True, the $42 billion firm has actively sought applause on the world stage. On the other hand, Coartem is a drug that has virtually no commercial value in the high-margin markets of the global North. "Novartis could be making a lot more money making hypertension or diabetes medications that the people in the U.S. and Europe would buy," says Awa Coll-Seck, executive director of Roll Back Malaria, a global partnership founded with the goal of halving the world's malaria cases by 2010. "Instead, it's investing real funds in finding medicines that will never be profitable." (See pictures of people fighting Malaria.)
Though malaria is both preventable and curable, many of those in the developing world struggle to get affordable treatment, particularly in sub-Saharan Africa, where the mosquito-borne disease is most prevalent. Blame for that lack of access has been laid largely at the feet of Big Pharma, long vilified for pricing medicine beyond the poor's reach and ignoring diseases that are endemic in poverty-stricken areas.
In the past, drugmakers have tried to justify high prices by the amount it takes to make major discoveries. "The critics just got louder and said, 'That's', but we've got people dying here,'" says Bradley Googins, executive director of the Boston College Center for Corporate Citizenship. "Companies have realized they can't just simply be bystanders anymore."
For its part, Novartis now spends more than $1 billion a year on ensuring better access to medicines. The firm has built two research labs dedicated to preventing and curing neglected diseases such as dengue fever and tuberculosis and has pledged to eradicate leprosy. (Read "A Vaccine That Could Help Wipe Out Malaria.")
But at the core of these programs is Coartem. Developed in 1994, the pill combines artemisinin, a compound derived from a wormwood plant, with lumefantrine, designed by Chinese scientists, which does not kill parasites as quickly but lingers in the blood longer to help prevent resistance. That Coartem was even discovered is remarkable, says Chris Hentschel, CEO of one of Novartis' partners, the Geneva-based nonprofit Medicines for Malaria Venture. "Historically, all the malaria drugs developed were for prevention that is, drugs for wealthy people going on vacation," Hentschel says. "A cure is for the common good."
Almost from the get-go, however, Coartem's high $2.40-a-dose price tag was criticized by public-health officials and activists. Dr. Daniel Vasella, CEO of Novartis, says the company realized it was pointless to try to sell a medication to people who couldn't afford it. So in 2001 the company signed an agreement with the World Health Organization to bring the price down to $1 per dose, or just about the cost of making it. Then the drugmaker went one step further, slashing that price again, to 80 cents in other words, taking a 20% loss. Meanwhile, it ramped up production, subsidizing plant cultivation in China and Kenya in order to be able to provide 100 million doses of Coartem a year throughout Africa and Asia. "We had the drug and the knowledge to help," Vasella says. "It was our responsibility to be engaged."
Making the product cheaply available isn't the whole answer. Distribution which is largely the job of health officials and NGOs has proved particularly difficult. The problem lies in how to successfully monitor the supply chain while still minimizing costs, and so far, no good solution has been found. Vasella recalls visiting a Catholic mission in a Tanzanian village recently and finding that the nuns there were still paying $1 per dose. "We have all the intermediaries marking up the price dramatically," he says. "We've heard reports of some charging as high as $8 a dose to get Coartem to remote areas."
There is also the issue of drug resistance, which makes finding the next new breakthrough antimalarial all the more vital. Until that happens, Novartis hopes its new pediatric dose which the company spent the past four years developing is the next step toward the eventual eradication of a childhood killer.