[Ip-health] Reuters: Indonesia acts to over-ride patents on HIV drugs

Joanna Keenan-Siciliano joanna.l.keenan at gmail.com
Fri Oct 12 08:41:37 PDT 2012

Indonesia acts to over-ride patents on HIV drugs
By Matthew Bigg
JAKARTA | Fri Oct 12, 2012 10:23am EDT

(Reuters) - Indonesia's government has taken steps to over-ride patents on
a range of HIV drugs, highlighting a growing trend by Asian states to allow
local production of cheap generic drugs that cut into sales of global
pharmaceutical companies.

President Susilo Bambang Yudhoyono quietly issued a decree last month
authorizing government use of patents for seven HIV/AIDS and hepatitis B
medicines held by the likes of Merck & Co, GlaxoSmithKline, Bristol-Myers
Squibb, Abbott and Gilead.

The international trade body representing major drugmakers said the move
set "a negative precedent". Individual companies affected did not provide
immediate comment.

The decree states Indonesia implemented the measures to "meet the urgent
need for antiviral and antiretroviral treatments".

An estimated 310,000 people are living with HIV in Indonesia, Southeast
Asia's largest economy. The prevalence rate among the 15 to 49-year-old
population is 0.2 percent, according to 2009 statistics from the U.N. Aids

Unreported cases mean that the true figure could be higher.

Under World Trade Organisation rules member countries are permitted to take
measures to over-ride patents when it is deemed necessary to protect public

Yudhoyono signed the decree without fanfare on September 3 and it was only
recently highlighted by Western groups campaigning for increased access to
drugs in the developing world.

The issuing of the decree follows a decision by India in March to strip
German drugmaker Bayer of its exclusive rights to a cancer drug.

India's highest court also heard final arguments last month in a landmark
case over drug patents involving Novartis's leukaemia drug Glivec that
could change the rules for the country's healthcare sector and potentially
curb its global role as a supplier of cut-price generic medicines.

At the same time, China in June overhauled parts of its intellectual
property laws to allow local production of patented medicines in another
initiative likely to unnerve foreign pharmaceutical companies.

The amended patent law allows Beijing to issue compulsory licenses to
eligible companies to produce generic versions of patented drugs during
state emergencies, or unusual circumstances, or in the interests of the


If implemented to the full, the measure taken by Indonesia would introduce
widespread generic competition and generate big cost savings in the world's
fourth most populous country.

It is not the first time that Indonesia has made an order giving government
control over HIV drugs but the latest decree goes further than earlier ones
in 2004 and 2007 by covering more modern medicines.

"Indonesia has set an important precedent, not just for the people living
with HIV within its country, who have been campaigning for this, but also
for other developing countries," said Michelle Childs of Medecins Sans

"This is one of the widest licences issued by a government and rightly
reflects the reality that a range of treatment options are needed," Childs

The U.S.-based group Public Citizen, which also campaigns for greater
access to medicines in poorer countries, said the move would greatly expand
access to newer and more appropriate antiviral medicines against both HIV
and hepatitis B.

However, the International Federation of Pharmaceutical Manufacturers and
Associations, representing global drugmakers, expressed concern at the
wide-ranging decree.

Andrew Jenner, its director of innovation, intellectual property and trade,
said developing countries had a right to over-ride patents by issuing
so-called compulsory licences in certain limited circumstances but this
should be a last resort.

"Systematic issuance of compulsory licenses by Indonesia sets a negative
precedent and can reduce the incentive to invest in the research and
development of new medicines, including HIV/AIDS and hepatitis therapies,"
he said.

"We believe that negotiated approaches, such as tiered pricing or voluntary
licensing, are generally more effective and sustainable, both medically and

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