[Ip-health] Financial Express: DIPP prescribes a dose of caution on compulsory licences

Thiru Balasubramaniam thiru at keionline.org
Thu Dec 4 00:24:42 PST 2014


http://www.financialexpress.com/article/economy/companies/dipp-prescribes-a-dose-of-caution-on-compulsory-licences/15478/

Financial Express: DIPP prescribes a dose of caution on compulsory licences

Arun S <http://www.financialexpress.com/author/arun-s/> | New Delhi |
December 4, 2014 5:13 am


--

<SNIP>

Industry sources, however, told FE that Section 92 CLs would be in great
demand as the business potential is huge in not only the Indian market but
also in foreign countries with insufficient manufacturing bases. Once the
CL is issued by the government under this route, it could take a few months
for the generic companies to develop the technology to make these drugs.

--

*SUMMARY*

In a new twist to the fuss over India’s alleged plan to grant a clutch of
patent-disabling compulsory licences…

In a new twist to the fuss over India’s alleged plan to grant a clutch of
patent-disabling compulsory licences (CL) to generic drug firms to bring
down the cost of some much-in-demand new drugs to patients, the department
of industrial policy and promotion (DIPP) has told the health ministry that
this facility can be invoked only in cases where such licensing will
doubtless stand judicial scrutiny.

The US has vehemently opposed India’s CL initiatives, saying the rewards
for innovators need to be safeguarded and the affordability question has
primarily to be addressed outside the domain of patents.

The DIPP’s move to add stringency to the grounds for invoking CLs by the
government could scupper the health ministry’s immediate plan to grant
these licences to generic companies that wish to make and sell US-based
multinational Bristol-Myers Squibb’s celebrated chronic myeloid leukaemia
drug dasatinib (branded Sprycel). The health ministry also wants to pursue
the “government route” under Section 92 of the Patents Act to grant CLs for
some other turnover-spinning drugs of patent holders, including Swiss
drugmaker Roche’s blockbuster for breast cancer trastuzumab (Herceptin).

The patented version of dasatinib costs a whopping R1.57 lakh for a month’s
dosage (60 tablets each of 20 mg), but local companies are hoping to offer
generic version of the drug at just R8,100 for a month’s dosage.

Official sources said the DIPP has sought clarifications from the health
ministry on how the aforementioned drug is a right candidate for issuance
of CLs to generic companies under government initiative. “If the CLs get
revoked by a court of law finally, it will amount to a loss of face for the
government. Such an embarrassment is best avoided,” said a source aware of
the DIPP’s views that were conveyed to the health ministry recently.

Compulsory licences are compatible with the multilateral Trade-related
Aspects of Intellectual Property Rights (TRIPS) agreement, to which India
is a signatory.

Although CL can be issued under more than one provision in the Patents Act,
there is little demand from generic firms for using the “private commercial
use” route under Section 84 because of the huge risk of litigation and
associated costs involved. Under Section 84, the patents controller can
directly grant CLs on a plea from a generic company after notifying the
patent holder and being satisfied that specified conditions are met.

However, under Section 92, which allows the government route for CL, the
controller can issue the licence only based on a central government
notification citing circumstances of “national emergency or circumstances
of extreme urgency or in case of public non-commercial use”. It is this
route that the health ministry and leading generic companies are keen on
using, and the DIPP has now developed cold feet on.

“The DIPP is a quasi-judicial body and, therefore, before a decision on the
CL notification is taken, we are going to ensure that all aspects and
material facts are carefully looked into even if it leads to a delay in
issuing the CL notification. We (the government) will not issue a CL
notification which can be questioned and we should not fail even if someone
decides to take such issues to a court of law later,” the source said.

The DIPP has asked the health ministry for details including the number of
people afflicted by chronic myeloid leukaemia, how the CL for the drug
could fall under the category of ‘public non-commercial use’, and how it
intends to ensure that the generic version of the drug can help save lives.
It sought to know whether there are already generic versions of the drug in
the market and also an explanation on why the health ministry wants to
invoke the emergency/urgency clause. It also pointed out that since many
Indian pharma companies have already been acquired by foreign MNCs or have
tie-ups with them, it will be difficult to convince them to apply for a CL.

Industry sources, however, told FE that Section 92 CLs would be in great
demand as the business potential is huge in not only the Indian market but
also in foreign countries with insufficient manufacturing bases. Once the
CL is issued by the government under this route, it could take a few months
for the generic companies to develop the technology to make these drugs.

So far, India has allowed CL for only one patented drug. In 2012,
Hyderabad-based Natco Pharma was permitted to make and sell a generic
(low-cost) version of kidney and liver cancer drug sorafenib (branded
Nexavar) patented by German major Bayer under Section 84.

“As regards private commercial use (Section 84), the experience of Natco is
a deterrent. Bayer through a series of litigations initiated against Natco
has succeeded in pre-empting others from considering this as a viable
option. Moreover, CL for India alone may not be commercially viable. Natco
was expecting that a few other countries will use TRIPS provision to allow
imports from India. This has not happened,” said DG Shah, secretary
general, Indian Pharmaceutical Alliance, a body that includes top-notch
homegrown drug MNCs.



More information about the Ip-health mailing list