II.

INCREASING PRIVATE SECTOR Globalisation has promoted a consumerist culture, the emergence of a private sector that thrives by servicing a small percentage of the population that has the ability to "buy" medical care at the rates at which the "high end" of the private medical sector provides such care. The evidence from India is unmistakable. Over the last fifteen years, since India's economic liberalisation programme started in 1991, there has been a sharp decline in the government's commitment to public health. Thus today our country has the fifth lowest public health expenditure in the world. As the National Health Policy admitted, this is, at 0.9 per cent of the GDP; lower than the average in even Sub Saharan Africa. Along with decreasing government spending on health, policy measures have encouraged the growth of the private sector in health care so that today we have the largest and least regulated, private health care industry in the world. Medical expenditure has emerged as one of the leading causes of indebtedness.

A. IMPACT OF GENERAL AGREEMENT ON TRADE IN SERVICES (GATS) ON HEALTH CARE Historically trade agreements involved reducing tariffs, eliminating trade barriers like quotas on imports on goods produced in a country and sold elsewhere. However, this has changed drastically in recent years in as, in developed countries; manufacturing has ceased to be profitable because of global competition. As the service sectors of the economies of developed countries grew, trade in various types of services was exported. Multinational Corporations started lobbying for new trading rules that will expand their share of the global market in services as governments everywhere spend a considerable amount of their budget on social services. This is what the General Agreement on Trade in Services (GATS) under the WTO is targeting today. GATS cover some 160 separate sectors. In the WTO meeting in Seattle, the US specifically wanted to focus on free trade in services in the professions, health and education. Today private insurance companies, managed (health) care firms; health care technology companies and the pharmaceutical industry of the developed countries are looking for opportunities to expand health care markets. In the Third World, much of private health services were by and large provided by nongovernmental organisations like charities, religious societies and community oriented associations, which were not entirely profit driven. This is similar to the likes of Hinduja and Saifee in Mumbai that have now of late turned towards profiteering. The TATA Cancer centre in contrast is one of the few that is still known for its philanthropy. In fact the place outside is called Mini India as people from all parts of the country are here to access better facilities for a lesser amount. Nearly 60% of these cancer patients receive primary care at the Hospital of which over 70% are treated almost free of any charges. The developing countries have started diverting their health care resources and personnel towards foreign consumers whether in their own health facilities or abroad. This has led to an increased pressure on the national health system, with the rise of a two tier health system: a growing segment to cater to the needs of the foreign clients. The decade of the

nineties has seen another transition taking place in the private health sector. Prior to this, the private sector consisted of a large number of individual practitioners and private hospitals and nursing homes run by medical professionals. For the first time, today, we see the entry of the organised corporate sector in medical care. As the practice of medicine becomes more technology intensive, the role of the medical professional is becoming narrower. The control of technology has thus become the key factor in determining who or which entity controls private medical care. As the corporate try to maximise profits they will attempt to further push up cost of medical costs by introducing high cost technologies, and expensive diagnostic aids and medicines. (i) Medical Tourism as an Industry Medical tourism is a new trend where "tourists" from a different country travel for treatment to another country where cost of treatment is lower than in the home country. Both the private medical sector and the tourist industry have a stake in promoting this trend. In many developing countries it is being actively promoted by the Government's official policy. India's National Health policy 2002, for example, says: "To capitalize on the comparative cost advantage enjoyed by domestic health facilities in the secondary and tertiary sector, the policy will encourage the supply of services to patients of foreign origin on payment. According to a study by McKinsey and the Confederation of Indian Industry, medical tourism in India could become a $1 billion business by 2012. The Indian government predicts that India's $17-billion-a-year health-care industry could grow 13% in each of the next six years, boosted by medical tourism, which industry watchers say is growing at 30% annually. Analysts say that as many as 2 lakh medical tourists now come to India every year. The key "selling points" of the medical tourism industry are its "cost effectiveness" and its combination with the attractions of tourism. Medical Tourism is: "First World treatment' at Third World prices". The cost differential across the board is huge: only a tenth and sometimes even a sixteenth of the cost in the West. Open-heart surgery could cost up to $70,000 in Britain and up to $150,000 in the U.S.; in India's best hospitals it could cost between $3,000 and $10,000. Knee surgery (on both knees) costs 350,000 rupees ($7,700) in India; in Britain this costs 10,000 ($16,950), more than twice as much. Dental, eye and cosmetic surgeries in Western countries cost three to four times as much as in India. Medical tourism is limited to going to large specialist hospitals run by corporate entities. (ii) It is a myth that the revenues earned by them will also finance the public sector. Evidence till date is clear that these hospitals have not honored the conditionalities for receiving government subsidies - in terms of treatment of a certain proportion of in patients and out patients free of cost. Even today the top specialists in corporate hospitals are senior doctors drawn the public sector. Medical tourism is thus promoting an internal brain drain of health professionals into private corporate hospitals. It is ironical that a Government, which declares that it makes poor economic sense to "subsidise" health care for the poor, provides such subsidies to the Private and Corporate Medical Sector, which cater exclusively to the needs of the rich. Thus, after providing medical education at a very nominal cost the Government provides concessions and subsidies to private medical professionals and hospitals to set up private practice and hospitals. It may be recalled that the Apollo Hospital in Delhi was built on land provided by the Delhi Government at a throwaway price! It is the same way Seven Hills Hospital that opened in Mumbai recently with a condition for free land if a certain number of beds are provided, which it still hasnt undertaken. The Government also provides incentives, tax

holidays, and subsidies to private pharmaceutical and medical equipment industry. It allows exemptions in taxes and duties in importing medical equipment and drugs, especially for expensive new medical technologies. It has allowed the highly profitable private hospital sector to function as trusts, which are exempt from taxes, thereby exempting them from contributing to the state exchequer even while being allowed to make huge profits. Moreover, medical and pharmaceutical research and development is largely carried out in public funded institutions but the major beneficiary is the private sector. Many private practitioners are given honorary positions in public hospitals, which they use openly to promote their personal interests. (iii) Urban concentration of health care providers is a well-known fact - 59% of India's practitioners (73% allopathic) are located in cities, and especially metropolitan ones. Indi has 860 beds for it population. It is a shocking estimate that 70 % of all hospitals and 40 % of all hospital beds are all Private sector that further excluding a huge mass of people who will be unable to afford its prices. Medical tourism also promotes the movement of health professionals to large urban centres, and within them, to large corporate run specialty institutions. Clearly, Medical tourism for a country like India - the fifth most privatised health system in the world - is a misplaced priority and amounts to subsidising the medical needs of the developed countries by the use of scarce national resources. (iv) The health sector has also come under focus in bilateral and regional trade and cooperation agreements. One such prospective accord is the India-European Union (EU) Trade and Investment Agreement (TIA) currently under negotiation. The latter is India's first agreement with a major developed country bloc and extends beyond goods into services, investment, and several other issues. This agreement could potentially facilitate India's growing bilateral trade and investment relations with the EU in services, including health services. several opportunity segments exist, namely: (i) Telemedicine; (ii) Clinical trials and research in India for EU-based pharmaceutical companies; (iii) Medical transcriptions and back office support; (iv) Medical value travel; and (v) Collaborative ventures in medical education, research, training, staff deployment, and product development.

B. IMPACT OF TRADE RELATED INTELLECTUAL PROPERTY RIGHTS (TRIPS) ON HEALTH CARE While unleashing new horrors in the form of disease, globalisation has also compromised people's ability to combat them. The WTO agreement on Patents (called the Trade Related Intellectual Property Rights - TRIPS) has sanctified monopoly rent incomes by pharmaceutical MNCs. The WTO defines 'Intellectual Property Rights' as, "the rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time." TRIPS protects the interests of big biotechnology, pharmaceutical, computer software and other businesses and imposes the cost of policing on cash strapped governments, while slowing down or preventing altogether the transfer of useful technology. The TRIPS agreement required countries like India to change over to a strong patent protection regime. A regime that would no longer allow countries to continue with domestic laws that enabled domestic companies to manufacture new drugs invented

elsewhere, at prices that were anything between one twentieth and one hundredth of global prices. It may be recalled that it was the 1970 Patent Act, which, by encouraging Indian companies to develop new processes for patented drugs, also facilitated the development of world class manufacturing facilities in a developing country like India. The EDL (essential drugs list) comprises some 306 mainly generic drugs (about 15 or so are patented products) which are safe, efficacious and available at reasonable prices. Other Third World countries produce the medicines themselves eg. India, China, Brazil and Egypt allow patents on pharmaceutical processes but not the final products. That means they can produce the drug legally using a different process from the original used. This supported the development of national domestic industries to produce generic drugs, which were cheaper than the branded originals. For instance when Glaxo Wellcome launched AZT as an AIDS inhibitor, it initially cost US$10,000 per patient each year (although with increased sales the cost for treatment fell to US$ 239 per month) which was still unaffordable for many in the Third World. An Indian company then produced the generic Zidovir 100 reducing cost to US$239 per month. India then exported it to Tanzania, Uganda and Belgium at less than half the price sold by Glaxo Wellcome. Although the World Health Organization had recommended that every child be vaccinated for Hepatitis B by the early 1980s, large multinational pharmaceutical companies held monopolies on the recombinant Hepatitis B vaccine. At a price as high as USD$23 a dose, most Indians families could not afford vaccination. Shantha Biotechnics, a pioneering Indian biotechnology company founded in 1993, saw an unmet need domestically, and developed novel processes for manufacturing Hepatitis B vaccine to reduce prices to less than $1/dose. Further expansion enabled low-cost mass vaccination globally through organizations such as UNICEF. In 2009, Shantha sold over 120 million doses of vaccines. The company was recently acquired by SanofiAventis at a valuation of USD$784 million. However supporters of this trend look at it as a good thing as they say home-grown companies in the developing world are becoming a source of lowcost, locally relevant healthcare R&D for therapeutics such as vaccines. Such companies may be compelled by market forces to focus on products relevant to diseases endemic in their country. The TRIPS agreement has placed enormous power in the hands of MNCs, by virtue of the monopoly that they have over knowledge. They have generated super profits through the patenting of top selling drugs. Annual welfare losses for India (the biggest market) ranged between $162 million and $1,261 million and annual profit transfer to foreign firms between $101 million and $839 million. A national health disaster has been anticipated by the Indian Drug Manufacturers Association as a result of the implementation of TRIPs where only 30 percent of the population can afford modern medicines in spite of the fact that drug prices in India are one of the lowest in the world. TRIPs will lead to draining further the resources of the Third World as a result of the outflow of foreign exchange; increased costs in medical and health care; as well as undermine countries self reliance in drugs as is the case in India where both public sector and small drug firms have been forced to close down or taken over by the TNCs. Moreover, with the National Pharma Pricing Policy 2011, dugs eligible for price control are now turning from cost based pricing to market based pricing thus leading the way for further involvement in the market system.

TRIPs also allow for the import of medicines from countries other than the country of manufacture without the permission of the manufacturer. This is called parallel importing and is provided in article 6, Exhaustion of Rights. Countries resort to parallel imports when there are price differences for the same product in different markets. For example, a retail drug prices study for Glaxo Wellcomes Zantac (Zinetac) tablets in 11 Asian countries shows the following variations: US$9 in Bangladesh; $2 in India; $41 in Indonesia; $55 in Malaysia; $183 in Mongolia; $3 in Nepal; $22 in Pakistan; $63 in Philippines; $61 in Sri Lanka; $37 in Thailand and $30 in Vietnam. Malaysia could save a considerable sum of money if it buys Zantac from India instead of in Malaysia. Parallel importing is common in the EU pharmaceutical retail trade. Despite this, Third World countries have been pressured not to use these measures to the detriment of public health. Moreover in 2000, FDI in the pharmaceutical Industry was liberalized to 100 %. There was a spate of acquisitions of leading drug firms by foreign producers. Like Matrix labs ny Mylan, dabur Pharma by Fresncurs Kaby, Ranbaxy by Daichi Sainkyo. The implication was that domestic firms which could earlier be competitiors were now in foreign hands. Hence, a decline in the production of generic drugs. The recent example of NATCO and the cancer drug: In a momentous development, the Indian patent office issued the ever-compulsory licence in a highly contentious pharmaceutical patent case. The decision is a thumping victory for several patients and health activists who have been fighting what can only be labelled as highly inequitable pricing strategies by multinational drug firms for the past several decades. In August 2011, Natco, an Indian generic manufacturer, had applied for a compulsory licence in respect of Bayers patent covering an anticancer drug, sorafenib tosylate, meant for patients with advanced kidney and liver cancer. A compulsory licence is a legal instrument designed to force intellectual property owners to license out their statutorily granted right to interested third parties capable of manufacturing the patented product at cheaper prices. It typically issues in cases where the intellectual property owner stands accused of abusing a statutorily granted monopoly by engaging in prohibitive pricing (where a patented drug is priced out of the reach of the average consumer) or by failing to supply adequate quantities of the IP good to the public. Controller General of Patents P.H. Kurian found that all the grounds prescribed in Section 84 of the Indian Patents Act for the issuance of a compulsory licence had been met: One, Bayer supplied the drug to hardly 2 per cent of approximately 88,000 patients who required the drug. Therefore, the reasonable requirements of the public with respect to the patented drug (Nexavar) were clearly not met. Two, Bayers pricing of the drug was excessive and did not constitute a reasonably affordable price. It charged Rs 2.8 lakh for a months supply of the drug, whereas Natco was willing to supply the same quantity at Rs 8,800 a month. Three, since Bayer did not manufacture reasonable quantities of the drug in India, it could not be said to have complied with the working requirement under the Indian Patents Act. This part of the decision is likely to prove controversial, since almost 90 per cent of MNC drugs are not manufactured in India, and therefore susceptible to compulsory licences. One expects that this bold move by Natco will spur other generic manufacturers to resort to compulsory licences, particularly in instances where originator drugs are prohibitively priced. However, Natcos version of Bayers patented drug will sell at Rs 8,800 per month. Given that a sizeable proportion

of Indians live below poverty line, how many of our patients can afford even this lower generic price? Food Security: a. Patents: What this amounts to is that the process of theft is now enshrined in international law and Third World countries are forced to buy back resources that were originally taken from them. Patenting of agricultural seeds and medicinal plants prevents farmers and local communities to freely use what belonged to the community originally. For example, the neem tree of India which has been used for thousands of years as a natural pesticide; a medicine for a wide range of diseases including leprosy, diabetes, constipation and contraception was patented by several Northern corporations. Since 1985, there are over fifty US patents on neem. Others include kava, barbasco, endod, quinoa and tumeric 14 all of which are based on plants and knowledge developed and used by local and indigenous communities. b. Import Barriers: Under the WTO rules, India has to reduce all import barriers on over 27,000 items, of which over 800 are agricultural items including milk, milk products, wheat, rice, pulses, livestock, agricultural chemicals, tea, rubber and others. Over 700 items have gone off all quantitative restrictions in 2000. This has already created a crisis in the tea and rubber industry where millions of workers are unemployed as the plantations could not withstand the competition from cheaper imports. The loss to livelihoods will spread to milk and milk products where millions of women earn their livelihood as well as to those growing cereals like wheat and rice. The reduction of direct subsidies which also include sales from stocks by government at a lower price than the domestic market; and subsidized exports means that there is a pressure to lower government procurement and support price policies. The subsidy on fertilizers is sought to be lowered greatly. Indian farmers do not get direct export subsidy unlike the farmers in the North with whom they have to compete. Food consumption is the single most important determinant of good health. It is considered the cornerstone of Indias economic and political independence and food security is therefore a question of national sovereignty. This is all the more crucial as chronic hunger and malnutrition is widespread in India. There are some 320 million poor people in India. For almost 90 percent of Indians, the share of income that goes to buy food is more than 50 percent. For the poorest 50 percent of the population, expenditure on food is over 70 percent of income. Thus, any food scarcity or a rise of food prices will have a grave impact on food consumption; similarly any fall in wages will have adverse consequences on food intake. Food scarcity affects women more and threats to food security will have a grave and immediate impact on womens health. Whats worse is that nutrition is given a lower standing than medical health. Bullying by the US: In one example, the US FDA in 1992 approved the use of Monsantos genetically engineered bovine growth hormone (BgH) in cows to increase milk supply (BgH is a naturally occurring hormone that stimulates milk production in cows). Monsantos BgH forces the animal to produce between 10 and 20 percent more milk. The use of this drug had adverse health effects on the dairy cows and the milk produced was contaminated with high levels of hormones and antibiotics which poses a threat to human health. The milk is sold unlabelled to countries the world over including India, Mexico and Russia.

C. IMPACT OF WORLD BANK ON HEALTH CARE With this 1987 publication, the World Bank gave notice that it intended to play a prominent role in global health reform. The thrust of Agenda was clearly the role of health financing as conditionality in SAPs. Hence there was the promotion of the role of the market to finance and deliver health care. These conditions are: 1. Increased Amount Paid by the Patient 2. Develop Private Health Insurance mechanisms (this requires dismantling of state supported health services as if free or low cost health care is available there is little interest in private insurance). Indias first public medical insurance scheme was the Janarogy Yojna. While earlier it was largely nationalized, it is now turning largely privatised except for New India Insurance and LIC. Only 11% of the population has health insurance as of covered in 2004-2005. However this is seen as worthless as large number of people g to government hospitals that subsidies medical aid. However the overall logic of the capitalist system spells out that if LPG in reality is fully functional, everyone would manage getting a medical insurance cover, however in reality so LPG is partially implemented in most developing nations where large portions of the people cannot even afford a single medicine. 3. Expand participation of private sector- Commercialisation a. Public Private Partnership: A recent trend has seen the transferring and outsourcing functions from the public sector to the private sector like Laundry, Canteen services etc. This accrues to an indirect privatisation of public health services. This has also reached out to the insurance sector: Yashaswini Insurance scheme in 2002 in Karnataka where a mere premium of Rs. 60 p.a when government contributes Rs. 30. However it had limited coverage. b. The behaviour of private providers include: (i) Pricing health care to maximise income rather than to maximise access and benefit. (ii) Indulge in over servicing which means unnecessary and inappropriate laboratory investigations, surgeries etc. (iii) The staff is under qualified providing sub optimal health care in an unregulated environment. This well defines the recent events of a doctor leaving his surgery equipment in the stomach of a patient, or wrong blood transfusions are given causing the death of the patient. (iv) There is no check on kind of care they provide, example advocating injection when could be treated through oral medication. c. Rolling back State responsibility 4. Transnational spread: A major effect has been the resurgence of communicable diseases across the globe. Every phase of human civilisation that has seen a rapid expansion in exchange of populations across national borders has been characterised by a spread of communicable diseases. Today what incubates in a tropical rainforest can emerge in a temperate suburb in affluent Europe. However the notion is that these globalised diseases are kept in mind to be effective to prove the world. Thus, when SARS and Bird Flu occur, India moves to action. It actually kills a lesser amount of people, but

large number of resources is put in. While we celebrate Polio and its eradication we do not see more than 1000 people dying of TB. This, is primarily due to the conditions put up by the World Bank where now that we have eradicated a threatening disease as assumed by the WHO, it would favour it for loans for infrastructure. 5. Selective Health Care: There is a limited focus on certain health care interventions instead of comprehensive health care. This tends to be associated with vertical programmes with separate health structures and strong central management. Bio medical orientation results in the promotion of inappropriate technology. Example: Manufactured ORS rather than home based rehydration fluids. As the World Bank could ask for no more cuts than India already has , it suggested that the state should focus on an essential package of public health which includes immunization, family planning, selective disease control programme ( AIDS, Malaria, TB). 6. Selective cost effective analysis: The World Bank ranked health care intervention according to cost effectiveness that has led to a selective approach to health care. Example: Primary health care is cost ineffective, all investment in water supply and sanitation is cost effective and so the state will not invest in these areas. D. OTHER THEMATIC AREAS a. Climate change: In India and Colombia, a warmer climate is believed to be responsible for the spread of Aedes aegypti mosquitoes at altitudes above 2,000 metres; previously they were confined by temperature to altitudes below 1000 metres. Consequently, people in the third world are suffering from the ill effects of "development" superimposed on the problems of underdevelopment. b. Indigenous Research and technology: Current medical approaches employ western technology and their monopolistic pricing policies result in health care that is out of the reach of average Indians. There is a need to focus and fund indigenous research, which is locally relevant and appropriate to the Indian context. The Jaipur foot, the idea of a prosthetic that can be availed free of cost and was initially designed in 1969 for victims of a landmine explosion, is one such example. c. Contract research Organisation (CSO): A number of CSOs have sprung up. They are made to conduct low cost clinical trials by using Indians as guinea pigs. This is the result of misuse of lab regulation in India. d. Civil Society: Globalisation also has seen a rise in self help and Non governmental, non profit organisations, which included in the halth care sector work towards the findings, research and implementation of camplaigns for AIDS, TB. The AIDS capmpaigns have seen a drastic change from the government ads of the 1990s that explicitly pushed it towards contraception for family planning instead of the new age advertisements that build the issue of AIDS being derived from a number of sources except touch. The recent Polio campaigns encompassing Amitabh Bacchan as brand ambassador and its Bas Do Boon slogan played an effective role towards mass mobilisation and awareness.