[Ip-health] Obama & the P-word

Kajal Bhardwaj k0b0 at yahoo.com
Wed Nov 10 10:00:28 PST 2010

Obama & the P-word
By editor
Created 9 Nov 2010 - 00:00
Patralekha Chatterjee [1]
Patralekha Chatterjee [1] 
Can a US President visiting India avoid the “P” word? The answer is a resounding 
“no”, as Barack Obama learnt the hard way. His attempt to avoid a direct 
reference to Pakistan while remembering the November 26, 2008, Mumbai terror 
attack victims met with high-decibel protest in this country on the very first 

Soon, at an event meant to be a powwow between the youthful US President and 
India’s GenNext, a student popped the question: Why does the US not declare 
Pakistan a “terrorist state”? Mr Obama’s diplomatic response — Pakistan has a 
lot of potential, but has some “extremist elements within it” and it is by no 
means the only country to have such elements, et cetera — promptly became the 
prime topic of discussion in almost every TV channel and newspaper. The 
headline-grabbing “P” word surfaced several times on Monday, during his press 
conference, and in his address to the Indian Parliament.

But there has barely been a mention of the other “P” word — pharmaceuticals — 
though there are big issues between India’s pharmaceutical industries, in 
particular generic drug manufacturers, and Big Pharma in the US. In the run-up 
to Mr Obama’s visit, public health activists, both within and outside this 
country, have sounded the alarm on many of these issues.

On November 4, the US-based NGO Health GAP (Global Access Project) stated: 
“Civil society organisations in the US and India are gravely concerned that 
President Obama is seeking policies that will undermine access to affordable 
Indian generics”. Such organisations argue that India’s status as “pharmacy to 
the developing world”, its ability to make low-cost, generic versions of newer 
medicines, is under threat; even US-funded AIDS treatment programmes, heavily 
dependent on generic versions of AIDS medicines made by Indian manufacturers, 
will be forced to waste money procuring more costly medicines.

The early shots were fired months back. This May, the United States Trade 
Representative (USTR) released its annual “Special 301 Report”, listing 
countries that USTR claims are not protecting intellectual property 
sufficiently. India remains on its “Priority Watch List”, in part because 
India’s laws require patented medicines to show actual increased effectiveness 
in treating a disease.

In recent weeks, business journalists in India have reported on the warning by 
big pharma companies in the US that New Delhi could lose out in the global 
competition in attracting investment from them if the country refuses to 
strengthen regulatory protection for patented drugs.
The soaring oratory of statesman-salesman Obama and his positive message to 
India, as he addressed representatives of over a billion people in the Central 
Hall of Parliament, will be discussed and dissected for days. But predictably, 
the US President avoided the other “P” word, given its huge potential to strike 
a dissonant note. But behind the scenes, the pressure is not going away. The US 
as well as the European Union are asking India to grant monopoly protection to 
the data that drug companies use to obtain regulatory approval for a medicine. 
This measure, called “data exclusivity”, would undermine cost cutting generic 
competition by delaying the entry of generics to market. Data exclusivity is not 
required by the World Trade Organisation (WTO) — but pharmaceutical companies 
have pushed aggressively for it. India’s refusal to create a regime of data 
exclusivity was another reason for the Special 301 Report listing.

A few days back, a top official with the US drugs regulator had hinted at 
tighter regulation for generic drugs, a move that could spell trouble for the 
Indian industry that depends on the world’s largest drug market — the US — for 
about a quarter of its exports.

I caught up with James Love, director, Knowledge Ecology International, a 
US-based NGO which has been working on the issue of affordable medicines. In a 
recent article in the Huffington Post, Mr Love had flagged his key concerns 
about specific aspects of the US-India business relationship, the central focus 
of Mr Obama’s trip to India.

A number of NGOs working on public health issues, Mr Love pointed out, are 
concerned that the President may push India to adopt more strict intellectual 
property protections on pharmaceutical drugs.

India enacted legislation in 2005 to implement its WTO obligation to grant 
patents on pharmaceutical products, but with safeguards. These safeguards, which 
were allowed by the WTO rules, were praised by public health groups, but 
condemned by big drug companies.
As candidates, both President Obama and secretary of state Hillary Clinton told 
health and development groups they would change the Bush administration policy 
of pressuring developing countries over the issue of drug patents. But now, the 
Obama administration has reportedly called upon its regulators to push India 
hard to do more. Washington wants India to lower its standards for awarding 

Another provision under attack is compulsory licensing, a green signal which can 
be given by a government for production and supply of a generic version of a 
patented drug in lieu of reasonable royalty to the patent holder. It is a legal 
means of getting cheaper medicines.
Compulsory licensing has been invoked not just by developing countries such as 
Mozambique, Zambia, Indonesia, Brazil or Ecuador. Even developed countries such 
as Italy and Canada have invoked it in the past for medicines which were 
unaffordable or unavailable. The US threatened to issue a compulsory licence for 
the antibiotic Cipro following the anthrax attacks a few years ago. Drug 
companies responded by lowering their prices by as much as 40 per cent.

But such mechanisms which provide safeguards for consumers are now supposedly 
under review. The Organisation of Pharmaceutical Producers of India, a group of 
multinational drug-makers, feels that provisions like compulsory licensing can 
impact foreign investment and innovation in the country.

Are public health groups, including the Nobel Prize-winning Medecins Sans 
Frontieres (MSF) which campaigns for access to affordable medicines, being too 
idealistic in objecting to these efforts to push higher Intellectual Property 
Rights (IPR) norms for the Indian pharma industry? What about innovation? Drug 
manufacturers say they have to have a strong IPR regime to be able to finance 
research that will lead to new medicines. But strong patents are likely to lead 
to costlier drugs in the current scenario. How can innovation be made compatible 
with access to affordable medicines? These are issues too important to be left 
just to politicians and bureaucrats. If I am going to pay a lot more for 
life-saving drugs, I would want to be as informed as possible about all the 
issues on the table.
Patralekha Chatterjee writes on development issues in India and emerging 
economies and can be reached at patralekha.chatterjee at gmail.com [2]
	* Columnists
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