[Ip-health] India: Bayer appeals against compulsory licence order

Baker, Brook b.baker at neu.edu
Sun May 6 06:22:59 PDT 2012

Just as Novartis appealed from an order denying its patent application on Glivec, Bayer has now appealed the granting of a compulsory license on Nexavar,  Rather than honestly state that it likes selling its cancer medicines for $67,000 to only the richest patients in India, which means that only 200 or so patients get the medicine instead of the tens of thousands who need it, Bayer still makes a nifty profit of nearly $13 million dollars on those sales.  If the price excludes the 99%, that's fine with Bayer - that's the logic of what it calls the international patent regime.

Bayer makes three claims in support of its decision to appeal.  First, it notes that there are other roadblocks to access to medicines for poor patients in India as revealed by the fact that many patients do not get access to even non-patented medicines on the essential drug list.  This is the trivial argument Big Pharma has been making for years to cover the impact of its monopoly pricing policies.  Of course, there are other barriers to access, but does Bayer want to seriously argue that medicine priced 60 times more than the newly announced Cipla price doesn't adversely impact access?  

Second, Bayer argues that one compulsory license on one hyper-expensive cancer medicines threatens the international patent regime.  Of course, there is no truly uniform international patent regime, but to the extent there is, that patent regime routinely allows for compulsory licensing.  Bayer got its 2008 patent on Nexavar fully cognizant that the India government was entitled to issue compulsory licenses whereby it would receive royalties on sales by generic licensees.  No foul play here - just the exercise of a governmental right clearly codified in India law (and in the US and most other countries as well).  

Third, Bayer makes the cynical argument the that research and development empire will crash and burn if it can't exclude sales to tens of thousands of Indians so that it can profit from monopoly sales to a few hundred.  The immoral hubris of this false claim - where Bayer makes billions in profits on sales primarily in rich countries and to rich elites in poor countries - is staggering.

Bayer can, of course, challenge the CL granted; it has the money and legal firepower to try to beat India into submission.  But India is on record that it will not be held hostage to monopoly pricing and it has the legal tools to beat Bayer's frivolous appeal.  Bayer should at least be honest in touting its attempt to hold on to the patent goose that lays the golden egg - "we want to maximize profits, India be damned, full stop."

Professor Brook K. Baker
Health GAP (Global Access Project) &
Northeastern U. School of Law, Program on Human Rights and the Global Economy
Honorary Research Fellow, Faculty of Law, Univ. of KwaZulu Natal, SA
400 Huntington Ave.
Boston, MA 02115 USA
(w) 617-373-3217
(c) 617-259-0760
(f) 617-373-5056
b.baker at neu.edu
From: ip-health-bounces at lists.keionline.org [ip-health-bounces at lists.keionline.org] On Behalf Of Jamie Love [james.love at keionline.org]
Sent: Saturday, May 05, 2012 5:12 PM
To: Ip-health
Subject: [Ip-health] India: Bayer appeals against compulsory licence order


Posted: Sat, May 5 2012. 1:00 AM IST

Bayer appeals against compulsory licence order

C.H. Unnikrishnan

German drug maker Bayer HealthCare AG has appealed against the
compulsory licence granted to Natco Pharma Ltd to manufacture and
market cancer drug Nexavar by India’s Controller General of Patents.
Bayer filed its appeal at the country’s Intellectual Property
Appellate Board on Friday.
The country’s patent office had, in a landmark decision in March,
granted a licence to Hyderabad-based Natco to make and sell a copy of
Bayer’s liver and kidney cancer medicine on the ground that the drug
patented by Bayer was not fully accessible to local patients because
of its cost and other reasons.

"We strongly disagree with the conclusions of the Patent Controller of
India and have appealed his order with the Intellectual Property
Appellate Board," said a Bayer India spokesperson.

The compulsory licensing decision, the first in the country, met with
mixed reactions. It was welcomed by some developing countries and
healthcare groups as a step towards making the costly cancer therapies
accessible to poor patents. Drug companies condemned the move as one
that would kill the incentive for drug research and didn’t respect
intellectual property rights.

It also triggered a large price cut by other drug makers, including
local company Cipla Ltd, for their cancer drugs.

"We will rigorously continue to defend our intellectual property
rights, which are a prerequisite for bringing innovative medicines to
patients," said a Bayer spokesperson.

According to Bayer, the challenges faced by the Indian healthcare
system have little or nothing to do with patents on pharmaceutical
products as all products on India’s essential drug list are not

"Rather, the order of the Patent Controller of India damages the
international patent system and endangers pharmaceutical research," it
said in an email response to queries on Friday.

Bayer’s Nexavar, which was granted a patent in India in 2008, was
priced at `2.8 lakh for a month’s treatment. Natco, in its application
for a compulsory licence, claimed it would be able to supply a copy of
the drug at `8,880 for a month’s therapy.

The patent office of India, after a series of hearings, concluded that
the foreign company failed to convincingly argue that it could make
the drug accessible to Indian patients at an affordable price. Also,
the company continued importing the product ever since it had been
granted a patent, which is another ground for allowing a compulsory

"The limited period of marketing exclusivity (patent protection) made
possible by patents ensures that the costs associated with the
research and development of innovative medicines can be recovered, and
to facilitate access for patients to innovative treatments, Bayer has
had a patient access programme in place since the launch of Nexavar in
India in 2008," Bayer said in its release.

According to the World Health Organization, India has an estimated
29,000 liver and kidney cancer patients.

P.H. Kurian, the then controller general of patents, who issued the
compulsory licence order, on Friday said that "it’s Bayer’s
prerogative to appeal against the order, and it can put its arguments
before the appellate authority".

M. Adinarayana, company secretary, Natco, on Friday said, "We haven’t
received any notice in this regard so far, and if the appeal comes up,
we will be able to file a reply and will present our case in the

Namrata Nandakumar contributed to this story.

James Love.  Knowledge Ecology International
http://www.keionline.org, +1.202.332.2670, US Mobile: +1.202.361.3040,
Geneva Mobile: +41.76.413.6584, efax: +1.888.245.3140.  Sometimes I am
using my MaxRoam number: +447937390810

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