[Ip-health] The Novartis case

Kapczynski, Amy amy.kapczynski at yale.edu
Mon Apr 1 07:46:32 PDT 2013

The idea that this is a blow for public health is based on arguments that
are about ten years old, and that have been refuted over and over again.
So I'll just make three brief points.

First, there's no doubt that price is an issue for access in countries
like India, and that patent status matters to price - of course not for
off-patent drugs, but for on-patent ones.   Is it a surprise that under
the spotlight of litigation of this sort, that companies ramp up access
programs?  Not at all.  But this case has always been about more than

Second, this case isn't about patent protection per se, but whether
companies can get all kinds of secondary patents that effectively extend
patent terms, and encourage innovation of an incremental sort, and that
comparatively disadvantage breakthrough innovation.  There's nothing
irrational about trying to reserve patent protection for the most
innovative inventions - in fact, the US Supreme Court has repeatedly
stepped in in the US to raise our own patent standards, because they've
recognized that too much patent protection is bad for innovation.  The
Novartis decision will, if anything, probably have positive effects on
innovation.  It diminishes incentives to spend enormous sums on patent
prosecution and litigation, reserves patents for breakthrough inventions,
and maintains a high patent standard.

Third, if we're being serious about economics, we also have to put the
Indian system into global perspective.  This is about 1% of the world's
pharma market, so that the innovation effects are likely to be marginal in
any case.  So the access benefits that come from a decision like this are
the more significant issue, economically speaking.  If we actually valued
peoples lives equally, and talked not about purchasing power but health
equity, the merits of a decision like this become even more plain.

Amy Kapczynski

Amy Kapczynski
Associate Professor of Law
Yale Law School

>It means the Indian court doesn¹t understand how pharmaceutical
>innovation happens ­ or why it¹s relevant. As any medical scientist will
>tell you, there are few "Eureka!" moments in health research. Progress
>comes step-by-step, one incremental innovation at a time. Even the
>smallest innovations are made only after large amounts of very expensive
>research is done.
>Once a lifesaving drug or treatment exists, it¹s seductively easy to take
>it for granted. We sometimes forget the years of toil these things take
>to develop; the millions spent to bring a new drug or treatment from
>theory to actuality.
>Abraham Lincoln wrote, patents ³add the fuel of interest to the passion
>of genius.²
>There is a reason why virtually all the world¹s ³miracle drugs² have been
>developed in Western countries. It¹s called incentive. Because innovation
>is honored and protected and inventors are rewarded for their work.
>Where there there is no patent protection there is no investment.  And
>where there is no investment there is no innovation.
>Minus patent protection, an innovator company can't earn back what it
>invested in R&D, ergo they can't reinvest their profits in further R&D --
>further delaying crucial incremental innovation which is how medical
>progress is made.
>(But large Indian generic manufacturers can make a bundle.)
>Not surprisingly, the usual suspects of so-called ³civil society² are
>trumpeting the Indian decision as a victory for patient access. Nonsense.
>Price isn¹t the problem.
>Obvious by its omission is the fact that about 99% of all the Gleevec in
>India is given for free. Patents have not prevented access. In fact, when
>you examine the WHO¹s model Essential Drug List, very few of the 400 or
>so drugs deemed essential are new or patented or were ever patented in
>the world¹s poorest countries.  In category after category, from aspirin
>to Zithromax, in almost every case and in almost every country, these
>medicines have always been (or have been for many years) in the public
>domain.  That is, the medicine is fully open to legal and legitimate
>generic manufacture.
>If we allow our emotions (and sloppy reporting) to trump reason, we¹ll
>end up with a lot less innovation.
>And fewer lifesaving drugs to take for granted.
>The Indian decision is a horrible blow to global public health -- and
>particularly to the Third World, because economically-driven, short-term
>decisions have deadly unintended consequences.
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