India wants EU to stop seizure of generic drugs

Seeks protection of shipments to 3rd countries via EU in FTA clause

India wants the European Union (EU) to stop disrupting its shipment of generic drugs in transit to third countries in West Africa and South America on the ground that they infringe upon European drug manufacturers? intellectual property rights and has sought a clause to prevent this under the ?border measures? chapter of the proposed India-EU free trade agreement (FTA).

The EU, however, has not agreed to this as of yet. Instead, it has proposed a more general statement in the FTA saying both parties ?agree to cooperate with each other with a view to eliminating international trade in goods infringing intellectual property rights (IPRs)?.

To make matters worse, the EU has also sought to define pirated goods to mean anything imported (or exported) without the consent of the original copyright or patent holder, and by implication is liable to be impounded by the authorities.

While India and the EU failed to reach any consensus on the bilateral trade pact at a meeting in Brussels on April 15, they have agreed to meet again in June to continue the discussions.

India exports generics worth around $10 billion every year, a bulk of which goes to countries like Brazil, Peru, Colombia, Mexico and Nigeria.

Commerce ministry sources have said that India could never accept such ?interpretations? of intellectual property rules and would continue to negotiate with the EU on these clauses.

Sources said India has sought specific safeguard to seizure of drugs in transit by proposing a clause stating goods in transit via its territory or European territory ?are not subject to any enforcement procedures relating to infringement of IPRs?.

Commerce and industry minister Anand Sharma said in April that negotiations are progressing ?very well?. He added that the talks will see a ?meaningful closure? with an agreement which is ?both ambitious as well as balanced?. The FTA talks started in 2007 and at least four deadlines to complete the negotiations have been missed.

In 2008, following complaints by drug giants like Sanofi-Aventis, Novartis and Eli Lilly, who held patents in Europe, a large number of generic consignments of some reputed Indian firms were seized in transit. Subsequently, India filed a trade dispute with the WTO over them.

In 2011, the EU agreed to issue guidelines to customs regulatory authorities directing them not to carry out seizures merely on the basis of suspicion.

However, EU continues to pursue similar steps in the Anti-Counterfeiting Trade Agreement (ACTA)2, the EU- India FTA negotiations and in FTA negotiations with other countries. For instance, border measures that allow in-transit seizure of drugs on grounds of patent infringement are contained in Article 10.67 of the recently concluded EU-South Korea FTA.

?The border measures being pushed by the EU in the FTA with India will provide means to the multinational pharmaceutical companies to use custom authorities to seize or detain generic medicine shipments merely with claims of suspected IPR infringement and without the involvement of any court. This could also result in MNCs harassing legitimate competitors using the custom authorities,? said Hafiz Aziz ur Rehman, legal & policy advisor, M?decins Sans Fronti?res – Access Campaign.

He added that if these clauses are accepted, the impact will be felt even by countries not party to the FTA, as medicines destined for export could be delayed, seized, and destroyed due to IPR disputes.