[Ip-health] Bloomberg Businessweek Merck to Bristol-Myers Face More Threats on India Drug Patents

Joanna Keenan-Siciliano joanna.l.keenan at gmail.com
Wed Jan 22 06:21:10 PST 2014


Read to the end - simply stunning admission in the final sentence from
Bayer's CEO. Jaw dropping.

Bloomberg Businessweek
Merck to Bristol-Myers Face More Threats on India Drug Patents
By Ketaki Gokhale January 21, 2014
http://www.businessweek.com/news/2014-01-21/merck-to-bristol-myers-face-more-threats-on-india-drug-patents

Pharmaceutical companies from Merck & Co. (MRK:US) to Bristol-Myers Squibb
Co. (BMY:US) face fresh threats to protecting their patents in India as a
government-appointed panel prepares to evaluate more drugs for local makers
to copy.

The panel is looking beyond the cancer treatments it studied last year to
areas such as HIV and diabetes, according to two people with knowledge of
the matter, who asked not to be identified because the discussions are
private. It plans to study more than 20 drugs and recommend the government
assign about three so-called compulsory licenses to allow local firms to
make low-priced copies in India, they said.

The heightened scrutiny illustrates how emerging markets are becoming
harder to navigate for global drugmakers including Pfizer Inc. (PFE:US) and
Novartis AG (NOVN), which have struggled to defend their rights on
blockbuster therapies in India. The drugmakers are facing a rising threat
to their patents as India’s government seeks to make treatments cheaper
locally, said Ajit Mahadevan, leader of the life sciences consulting group
at Ernst & Young in Mumbai.

“Moves by policymakers like compulsory licensing result in the feeling that
you’re not very comfortable investing,” Mahadevan said. “You can’t build
predictability, and big pharma doesn’t like that.”

Compulsory licensing occurs when a government allows someone else to
produce a patented product without the consent of the patent owner, who
still owns the rights and receives payment for its use, according to the
World Trade Organization. Such licenses can therefore put pressure on
brand-name manufacturers to cut prices in response to cheaper generics.

R.K. Jain, additional secretary at the Ministry of Health and Family
Welfare, didn’t immediately respond to a call and an e-mail seeking comment
on compulsory licenses.

Wider Scrutiny

Among the therapies the committee is preparing to study or had an early
look at are two diabetes drugs, Merck’s sitagliptin medication, Januvia,
and Bristol-Myers’ saxagliptin drug called Onglyza; Merck’s HIV drug
raltegravir, sold under the brand name Isentress; and Bristol-Myers’
arthritis drug abatacept, sold as Orencia, according to the people.

The panel is also considering other drugs and it still isn’t clear which
ones will be shortlisted, the people said.

Patents provide Merck with the incentive to assume the risks associated
with drug discovery, the Whitehouse Station, New Jersey-based company said
in an e-mailed response to questions. “We encourage the government of India
to reassure investors that India respects and values innovation and the
protection of intellectual property.”
Story: Beware of Gangsters Filing Tax Returns

Bristol-Myers in an e-mailed statement said it is “deeply concerned with
the deteriorating protections for patented innovative medicines in India”
and will continue to act to protect its intellectual property rights.

Any recommendations will still need the government’s approval. The panel’s
proposals will be submitted to the Department of Industrial Policy and
Promotion, which will make a decision on whether compulsory licenses can be
awarded.

India’s Controller General of Patents, Designs and Trademarks will then
need to sign off on the compulsory licenses. Following that, a generic
drugmaker could require the patent holder to grant it a license to make a
copy in India.

Medical Needs

Besides boosting the domestic generic drug industry, cheaper copies of
blockbuster medicines would help India meet the needs of low-income
citizens. Diabetes afflicts 65 million Indians, according to the
International Diabetes Federation. The country has an estimated 2.1 million
people living with HIV, according to the Joint United Nations Programme on
HIV/AIDS.

The committee recommended compulsory licensing for dasatinib, a
Bristol-Myers therapy for chronic myeloid leukemia sold under the brand
Sprycel, last year, the people said.

Any award of compulsory licenses will take time because the process is
fraught with bureaucracy, said Leena Menghaney, a patient advocate at
Doctors Without Borders in New Delhi. India also is worried about its
international image, she said.

The U.S. International Trade Commission said in August that it would
investigate “Indian policies that discriminate against U.S. trade and
investment” at the request of the House Committee on Ways and Means and the
Senate Committee on Finance.

Trade Relationship

“What the Indian government is really worried about is the court cases that
will follow from drug companies,” Menghaney said. “It’s worried about the
international criticism it will face from developed country governments who
back their pharmaceutical companies, and the impact it will have on the
India-U.S. relationship.”

Roche decided not to pursue Indian patents for its breast cancer medicine
Herceptin because of the Indian intellectual property environment, the
company said in an e-mailed statement in August. It introduced a lower-cost
Herceptin packaged by a local drug company for the Indian market in 2012.

Under India’s patent laws, compulsory licenses can be awarded for some
products still under patent if the original isn’t available locally at a
reasonable price.

Natco Pharma Ltd. (NTCPH) applied directly to India’s patents office and
was awarded the nation’s first compulsory license in March 2012 to make a
copy of Bayer’s Nexavar cancer drug at a 97 percent discount to the
original product. In March last year, Bayer lost its bid to stop Natco from
making the generic drug and is appealing the decision at the Mumbai High
Court.

Bayer Chief Executive Officer Marijn Dekkers called the compulsory license
“essentially theft.”

“We did not develop this medicine for Indians,” Dekkers said Dec. 3. “We
developed it for western patients who can afford it.”



Joanna Keenan
Press Officer
Médecins Sans Frontières - Access Campaign
P: +41 22 849 87 45
M: +41 79 203 13 02
E: joanna.keenan[at]geneva.msf.org
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