Global Health, China's Pride On Line in Malaria Clash As Bugs Get Resistant, Pill Maker Squares Off Against U.N. Agency (WHO)
By NICHOLAS ZAMISKA in Kunming, China, and BETSY MCKAY in Geneva
Wall Street Journal
March 6, 2007
Kunming Pharmaceutical Corp. of China makes a potent drug to fight malaria, a disease that kills more than a million people a year. Business is brisk. Yet the World Health Organization calls the sale of the drug a major threat to global health. It is demanding that Kunming and makers of similar pills desist.
It's a dispute that touches on money, national pride and the dilemmas of treating infectious diseases. The WHO says resistance is emerging to the drug, based on the natural substance artemisinin, and in most cases it should only be used in combination with other antimalarial drugs. The leading combination drug is made by Novartis AG of Switzerland.
Kunming and other Chinese drug makers say the WHO is overestimating the risk of resistance -- and underestimating the urgent need for treatments. "This medicine is in huge demand, especially from African countries," says Yu Zelin, Kunming's general director of international trade. The Chinese companies also resent being boxed out of part of a market for a drug Chinese scientists invented.
Arata Kochi, a Japanese public-health veteran who heads the WHO's global malaria program, says his concern is the millions of people, mostly babies and toddlers in sub-Saharan Africa, who would die if artemisinin-based drugs lost their magic touch. "If we lose artemisinin, we are dead, basically," says Dr. Kochi.
Malaria has plagued humans for thousands of years. It is caused by a single-celled parasite that certain mosquitoes inject into the human bloodstream when they bite. Infected red blood cells can clog the circulatory system, leading to fatal complications such as severe anemia, kidney failure and shock -- particularly in children and pregnant women. The parasite has developed at least partial resistance to most of the drugs used to kill it.
In the late 1960s, as troops from North Vietnam fighting against the U.S. were beset by jungle malaria, Ho Chi Minh turned to China, which put its military scientists to work experimenting with ancient folk remedies. They found one promising remedy that had been recorded in a medicine book written on silk and buried in a tomb of the West Han Dynasty, which began around 200 B.C. It came from the leaves of sweet wormwood, a bushy green plant with fragrant leaves and small flowers known to scientists as Artemisia annua L.
After two decades of work, during which Chinese scientists isolated artemisinin as the active compound, Kunming introduced its drug in the late 1980s. While artemisinin-based therapies are generally more expensive than older treatments, because they can't be fully synthesized in the lab, they can bring quicker relief, usually within a few days.
Kunming, a Shanghai Stock Exchange-traded company, started churning out millions of doses and selling them in more than 30 countries -- mostly in Africa and parts of Asia, where malaria remains endemic. Instead of working through public-health authorities such as the WHO, which make up a big market for malaria drugs, Kunming often used private distributors. Many patients in Africa buy their drugs from shops or local pharmacies without visiting a doctor. Kunming says it's the largest producer of artemisinin-based drugs in China.
In the early 1990s, Chinese scientists developed a combination therapy that put together an artemisinin-based drug called artemether and lumefantrine, an older antimalarial drug. Ciba-Geigy, a Swiss company that later became Novartis, bought the rights to sell the combination pill outside China in 1994. Ciba-Geigy paid "a few" million dollars and agreed to pay a 4% royalty on annual sales, according to one of the Chinese negotiators.
In 2002, the WHO approved the Novartis pill, called Coartem, for purchase by United Nations agencies that dispense medicine in developing countries. Coartem remains the only fixed-dose combination therapy to receive this designation. Novartis says it sells the drug for no profit to U.N. agencies and others that dispense it in nations where malaria is endemic.
Around the same time, signs began to emerge that the malaria parasite could become resistant to artemisinin-based drugs. The WHO says artemisinin drugs failed to cure malaria in two children in Thailand, while lab tests in China suggested that the effectiveness of artesunate, an artemisinin-based drug, fell between 1988 and 1999.
Although these and other studies seemed to be scant evidence, the WHO was alarmed. Once resistance appears, it can spread rapidly. The WHO's Dr. Kochi notes that because artemisinin works quickly, many people cut short the recommended seven-day course of treatment. That leaves parasites alive and promotes resistance. "The only way to beat malaria is to be ahead of the parasite," he says. It will take at least 10 years to bring a new generation of drugs to the market, he adds.
In 2001, the WHO began promoting combination therapies. Most of the parasites that survived artemisinin thanks to a genetic quirk would be wiped out by the other medicine, the WHO figured.
The result was growing demand for Coartem. Chinese makers of artemisinin-based drugs say that when the demand caused a world-wide shortage of artemisinin a few years ago, they came under increasing pressure to act as raw-materials suppliers to Novartis, rather than sell their own drugs. "Some people think we sold our country to Novartis," says Liu Tianwei, who works for a unit of Citic Group, a state-owned investment company involved in the licensing deal.
Novartis says the WHO's pressure against selling artemisinin-based drugs alone was a "scientifically sound decision." It notes that few global companies were interested in artemisinin in the early 1990s and says it transferred significant drug-making technology to Chinese companies as they cooperated in making Coartem.
Kunming doesn't deny the value of combination therapy. In fact, it has its own combination pill, called Arco, which it is just beginning to sell in Africa. But it says it should be permitted to roll out Arco on its own schedule and shouldn't have to yank the "monotherapy" pill containing only one drug while it still enjoys a good market.
"This is not fair to China," says Ms. Yu in an interview. "We have developed the drugs ourselves. We have made so much effort. We will sell the monotherapies."
In 2004 Kunming Pharmaceutical sold around $5 million of monotherapy, according to Ms. Yu. The company declined to give more recent figures but says it sold several million doses of the drug last year. Kunming's total revenue in 2005 was $156 million.
"WHO wants us to stop, but the demand in the real commercial market is increasing," says Ms. Yu. She also says that "worries about resistance...are not fully based on solid science."
The WHO's effort took on a more urgent tone in October 2005 when Dr. Kochi took over the malaria program. The blunt-spoken 58-year-old had faced a similar problem maintaining the viability of drugs amid rising resistance as head of the WHO's tuberculosis-control program in the 1990s.
Dr. Kochi came up with a quick diagnosis of his agency's problem: passivity. It was putting out quiet requests to limit use of monotherapy drugs but "there was no reaction," he says.
In early January 2006, the WHO invited the monotherapy manufacturers to a Jan. 18 briefing in Washington, D.C. There, Dr. Kochi unexpectedly demanded that manufacturers halt sales and marketing of their monotherapy artemisinin-based drugs immediately. The next day he gave the media a list of the companies he maintained had flouted WHO warnings.
Company executives were taken aback. It was unlike the WHO to point the finger publicly at a company or government. And it wasn't clear that it would work. Most artemisinin monotherapies are sold in the private sector, over which the WHO has little sway.
In April, the WHO summoned the manufacturers again, this time to its Geneva headquarters. With several Chinese companies present, Dr. Kochi rolled out a bigger threat, according to several attendees: U.N. agencies would boycott all drugs from any company that failed to stop making artemisinin monotherapies. By the end of the meeting, many manufacturers fell into line. Overall, the WHO says 17 companies have agreed to comply, including European, Indian and some Chinese companies.
But other Chinese pharmaceutical companies haven't. They tend to share Kunming's perspective: Chinese scientists, using indigenous knowledge, developed a world-beating drug -- only to see the nation's companies blocked from getting a piece of the action.
"Just put the facts on the table," says Lu Chunming, the president of Chongqing Holley Pharm Co. Referring to artemisinin combination therapies, he adds: "The only [WHO-designated] ACT provider is Novartis. And now you only use ACTs. What do you think?"
The Holley Group of Hangzhou is the largest shareholder in both Mr. Lu's company and Kunming Pharmaceutical. David Jiang, a marketing manager for a unit of Chongqing Holley Pharm that makes malaria drugs, said last week that the company plans to stop selling monotherapy once its stock runs out, perhaps by the end of the year.
One Chinese company that says it has mostly complied with the WHO demand is Guilin Pharmaceutical Corp. Yan Xiaohua, chairman of the board, says his company is only selling monotherapy for use by pregnant women and children, who he says shouldn't be exposed to the greater toxicity of the combination drug. Still, he questions the WHO's hard line against monotherapies, saying not all of them present the same risk. "If you have three men, and one of them is a bad man, you can't say all the men are bad," he says.
On Oct. 31, Dr. Kochi and other WHO staff met in Beijing with Chinese government officials and representatives of Kunming and three other manufacturers. He warned them that the WHO was pushing governments of developing nations to ban artemisinin monotherapies. Kunming made no promises, although Ms. Yu says it will eventually stop selling its monotherapy pill once sales of its combination pill, Arco, increase.
Arco is the subject of a dispute between Kunming and the WHO. Dr. Kochi and other WHO officials call it a promising medicine and have repeatedly pressed Kunming to submit laboratory and clinical data to the agency. The WHO could then "prequalify" Arco, making it eligible for purchase by U.N. agencies. At the Beijing meeting, Dr. Kochi said the WHO wants to help Chinese companies win this designation.
Dr. Kochi says Kunming executives are hurting themselves "by selling monotherapies when they have a combination drug with great potential in the pipeline."
Kunming says it might waste years trying to persuade the WHO to sign off on Arco. It is content to sell the drug the same way it sells artemisinin monotherapy -- through commercial channels. Already it has registered it for sale in seven African countries, though it declines to disclose revenue so far.
"Why should we have to submit?" asks Ms. Yu. Arco has been doing "so well," she adds. "Why bother taking so many more years to get it out the door through the WHO way?"
Recently, Dr. Kochi has gained confidence that market forces are on his side. A growing number of companies are turning out combination therapies. Last week a nonprofit organization and Sanofi-Aventis SA of France said they will soon start distributing across Africa an affordable combination pill designed for children.
The WHO's new director-general, Margaret Chan, who is from Hong Kong, has made attacking malaria a top priority, and the agency's governing body, the World Health Assembly, will vote in May on a resolution to press ahead with the oral artemisinin monotherapy ban.
Dr. Kochi figures the Chinese companies will shortly find the market for monotherapy drying up, although it remains to be seen whether they'll let the WHO examine their combination drugs. "They have their own pride, and I can very much understand their frustration," he says. "We have to work with them and explain the rules of the game."
Kunming is still selling its monotherapy. It recently filled orders to Uganda and Tanzania, according to Ms. Yu. "We send it every month," she said.
--Juying Qin in Hong Kong contributed to this article
