EU push for liberal patents is detrimental for us

According to a recent news report in FE, ?EU push for liberal patents finds favour with PMO?, the India-EU Free Trade Agreement negotiations are in a crucial stage.

According to a recent news report in FE, ?EU push for liberal patents finds favour with PMO?, the India-EU Free Trade Agreement negotiations are in a crucial stage. While an FTA would open the European market for Indian exports and vice versa, there are some issues which are extremely worrisome.

The most important point of concern relates to the EU demand of inclusion of Intellectual Property Rights (IPRs) and Data Protection in the FTA. In spite of an assurance from the Department of Industrial Policy and Promotion (DIPP) that they will not accept the EU Draft on IPRs to be included in the FTA, the fact is that there is great pressure on our government, especially the PMO, from the EU to accept their hidden agenda; and one cannot rule out a possibility of our government buckling down under EU and the MNC pressure. With a background of developments such as the seizures of Indian-made generic medicine consignments at foreign ports; takeover of key Indian companies and the conclusion of ACTA negotiations between Europe, US and Japan ? the insistence of EU for the creation of ?exclusive rights? over pharmaceutical test data (data exclusivity) in FTA negotiations raises big concerns in our minds.

The demand that Data Exclusivity (euphemistically called ?Data Protection?) be accepted by India as a part of the Free Trade Agreement is a matter of great concern to us because it will adversely affect our people by raising the prices of less expensive generic drugs to the level of monopoly prices which are generally very high. Monopoly prices, as is well known, can be several times more than the ordinary or ?generic? prices. This would create serious difficulties for our people particularly those below BPL.

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While TRIPS does not require data exclusivity, the EU has insisted in the FTA negotiations that India provide at least several years of data exclusivity and Supplementary Protection Certificates (SPCs). The European demand is that when any clinical data is submitted by any company to the drug regulator (in our case drugs controller general), that the company should get monopoly status or exclusivity on that product and that no other company should be allowed to work that product for a certain duration (generally 5 years). If this is accepted then generic competitors must repeat costly trials for marketing approval, which deters generic production. This may also raise ethical questions, as generic manufacturers would be forced to repeat human subject trials on medicines already known to be safe and effective.

The EU is basing its demand on Article 39(3) of TRIPS. However, the truth is that TRIPS Article 39 requires only ?Data Protection? which means it (1) does not debar other companies to manufacture that product, and (2) allows Member Countries to make their own rules in this regard. TRIPS does not support the EU demand. We feel that the demand is TRIPS-PLUS.

The most serious impact is likely to be on drugs that are not under patent. In such cases, data exclusivity will create a ?patent-like? barrier that will prevent generic entry of new formulations during the entire period of exclusivity. A classic case is of the traditional medicine ?colchinine? which cannot be patented as it has been used as a therapeutic agent in the treatment of gout for thousands of years. Its tablet formulation has been available since the 19th century. However in the US once the USFDA accepted the one week trial of the drug, the company was able to enforce data exclusivity to block affordable generics. The company enforced its exclusive rights, raised the price from $0.09 per pill to $4.85, and sued to remove other competitors off the market. Our generic producers cannot afford costly litigation against wealthy MNCs.

If this demand were to be accepted by India, the result would be that the price of that product will be decided by the monopoly holding company on which the government will have no control. The price will naturally be many times the true value.

Therefore before this demand of data exclusivity and SPCs are taken up seriously in FTA negotiations or even otherwise, the government must consider the effect and impact on local generic drug production and prices. This will be disastrous for our public as well as the Indian Pharmaceutical industry which is supplying reasonably priced and affordable medicines to our masses. If the generic industry is affected, the public will also be affected because of non availability of less expensive medicines.

It should be noted that Brazil has also not accepted ?Data Exclusivity?.

The Indian government is concerned with ensuring that essential medicines are available in an affordable manner to all patients throughout the country. In this respect the ability of generic manufacturers to domestically produce and supply medicines at prices far lower than EU and US-based pharmaceutical companies should receive support from the government. Therefore Europe?s demand for data exclusivity in the FTA negotiations should be completely rejected.

Further, according to the news report, EU is offering ?recognition of a clutch of India?s geographical indications?.?. Geographical Indications are already protected under Section 3 of the TRIPS Agreement. Hence if our government succumbs to such pressure tactics by EU, we will be severely affected.

The ability of our pharmaceutical industry to domestically produce and supply quality affordable medicines at prices far lower than EU and US-based pharmaceutical companies is universally acknowledged. This will be nullified and set back irreparably if we accept such blatant demands by EU, or MNCs of any other country or region.

?(The author is secretary general, Indian Drug Manufacturers’ Association)

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First published on: 22-01-2011 at 01:56 IST