Pricing and access to healthcare services

25.14 The grant of exclusive rights over patented genetic inventions could result in higher prices being charged for these inventions than might be the case in a competitive market. This could have adverse implications for access to medical genetic tests and related healthcare services. However, any assessment of the costs charged by a patent holder or licensee should take account of the underlying policy rationale for the patent system, which is to encourage innovation.

25.15 As discussed in Chapter 19, there is little evidence to date that gene patents and licensing practices have had any significant adverse impact on the cost of healthcare provision in Australia.

25.16 Internationally, Myriad Genetics Inc—which holds patents associated with testing for ovarian and breast cancer—appears to have charged prices for its BRCA1 tests at levels well beyond those charged by other laboratories. For example, in 2002 the Institut Curie and others stated that Myriad charged € 2,744 for its initial family mutation searches, while French laboratories could conduct such testing at an estimated cost of € 914.^[20]

25.17 In New Zealand, concerns have been expressed about the licensing fees charged by an Australian company, Genetic Technologies Ltd (GTG), for its patents relating to the use of non-coding DNA. A paper prepared by the New Zealand Offices of the Minister of Health and Associate Minister of Commerce noted that a number of organisations had expressed concern about the relatively high licence fees being requested by GTG.^[21]

25.18 Chapter 19 recommends several reforms to ensure that the Australian healthcare system is able to manage the introduction of new genetic medical technologies and, in particular, any problems of cost or access attributable to gene patents. For example, the ALRC recommends that the Australian Health Ministers’ Advisory Council (AHMAC) should establish processes for examining the financial impact of gene patents on the delivery of healthcare services in Australia;^[22] and should examine options for using government funding and purchasing power to control the cost of goods and services that are subject to gene patents and used in the provision of healthcare.^[23]

25.19 These measures may be sufficient to deal with pricing issues relating to gene patents in Australia. However, if evidence arises that gene patenting is having an adverse impact on the cost-effective provision of healthcare, it may be necessary to consider other options available to government, including reviews or inquiries into pricing activity within the biotechnology industry. These could help to identify the impact of pricing outcomes on healthcare, and assist in determining the appropriate policy response to this concern.