[Ip-health] Letter from MSF to the Indian Prime Minister regarding access to medicines and the EU-India FTA

Joanna Keenan-Siciliano joanna.l.keenan at gmail.com
Mon Mar 18 06:56:04 PDT 2013

Letter from MSF to the Indian Prime Minister regarding access to medicines
and the EU-India FTA


Geneva, 14 March 2013

 Honourable Prime Minister

 *Re: Access to medicines and the EU-India FTA

 Médecins Sans Frontières/Doctors Without Borders (MSF) is an independent,
international medical humanitarian organisation that provides emergency
medical assistance to populations in distress in more than 68 countries. In
order to procure quality medicines from the most affordable sources, we
rely overwhelmingly on generics produced in India, which has played a
pivotal role in supplying affordable generic versions of drugs used
throughout the developing world.

 That India has been able to play such a role is a tribute to the country’s
ability to withstand commercial pressures from developed countries. India,
as part of its obligations under the World Trade Organization’s Agreement
on Trade-Related Aspects of Intellectual Property Rights (WTO TRIPS
Agreement), was required to introduce a 20 year product patent regime in
2005. While the freedom of domestic manufacturers in India to operate and
produce affordable versions of any essential medicine has been limited
since 2005 because of its TRIPS obligations, the country’s legislators also
sought to balance the imperatives of public health, by enshrining public
health safeguards into the patent law and limiting the potential of
multinational pharmaceutical companies to abuse the patent system. This
balance is now under threat.

 Today, India is once more under pressure to cave into demands from
developed countries.  Since 2009, MSF has been closely following the
negotiations between the European Union (EU) and India on a free trade
agreement (FTA). The negotiations have now reached an intense phase, with
regular meetings to fast-track the conclusion of the agreement which,
according to recent statements from the Commerce Minister himself, will be
concluded by April 2013.

 Given India’s vital role as supplier of life-saving medicines to much of
the developing world, it is critical that the desire to conclude an
agreement in the very near future does not happen at the expense of access
to medicines. During the course of negotiations on the intellectual
property (IP) chapter over the last five years, the Indian government has
taken a clear stance against some of the most problematic IP provisions,
such as data exclusivity and patent term extensions and the hard-fought
exclusion of these provisions in 2010 and 2011 represents the greatest
achievement of the Indian negotiators. Although the text has been improved
on certain points thanks to the strength of the Indian negotiators, the
additional remaining threats to access to medicines posed by the IP
enforcement and investment provisions must be addressed.

 We therefore urge you to ensure that India maintains its strong
negotiating position without any compromise on IP enforcement and
investment provisions, particularly:

 •* IP Enforcement Provisions*: The European Commission is demanding that
India implement a range of IP enforcement provisions which go beyond the
requirement of the World Trade Organization TRIPS Agreement. The EU's
proposed enforcement measures include, but are not limited to, a stricter
injunction system, third party liability regime and strong border measures.

 These provisions could have a range of harmful effects on the production
and dissemination of generic medicines and give free rein to abuse from
multinational pharmaceutical companies. These companies would merely need
to claim - and not prove - that their IP is being infringed in order for a
competitor’s medicines to be seized or generic production halted.

 The impact of IP enforcement measures being applied in India would be felt
even by countries not party to the FTA, as medicines destined for export
could be delayed, seized, and destroyed due to IP enforcement disputes. The
enforcement net could also implicate third parties - such as suppliers of
active pharmaceutical ingredients (API) used for producing generic
medicines; distributors and retailers who stock generic medicines; and even
treatment providers like MSF - simply for buying or distributing generic

 Indian courts are currently enjoying considerable flexibility in
determining the right balance of enforcement in IP cases involving
pharmaceuticals. A formal codification of enforcement measures through an
FTA would threaten this. Once India has committed to a certain level of IP
enforcement, it would be unable to adjust it in future without the
agreement of its FTA partners.

 It is therefore very important that India take a cautious approach in
negotiating the IP Chapter in the FTA with the EU, clearly rejecting any
further consolidation of IP enforcement measures on the basis of domestic
norms, in order to safeguard the existing legal flexibility within domestic
law and the judicial system, which allows the country to balance commercial
interests with the constitutional right to life and health.

 • *Investment Chapter*: The most disturbing feature in the proposed
investment chapter of the EU-India FTA is the investor-state dispute
resolution mechanism.

 An investor-state dispute resolution mechanism typically allows foreign
investors and corporations to sue countries for compensation if national
laws, domestic policies, court decisions or other actions interfere with
the "enjoyment" of their investments – even if the government‘s actions are
in accordance with its constitution and national laws.

 Indian negotiators have so far taken a solid stance in resisting the
inclusion of "intellectual property" within the definition of investment,
meaning that the FTA could not be used by pharmaceutical companies to
subject India to the so called investor-state dispute mechanism.

 As a result of investment provisions in FTAs between other countries,
several such disputes have already been filed by corporations against
governments, in order to force a reversal of public health policies and
judicial decisions on patentability. In 2012, for example, US
pharmaceutical company Eli Lilly started proceedings against the government
of Canada through the North American Free Trade Agreement’s (NAFTA)
investor-to-state dispute mechanism, claiming that the decisions of a
Canadian court to invalidate its patent on the medicine atomoxetine
violated Canada’s obligations under NAFTA and the WTO. The company is
seeking $100 million in compensation. In separate cases, tobacco company
Philip Morris is threatening legal action against the governments of
Uruguay and Australia, following attempts by these countries to introduce
pictorial health warnings and plain packaging for cigarettes (tobacco). As
a result of the damaging implications of such clauses, Australia has gone
on record saying that they will no longer include investor-state dispute
resolution clauses in its investment treaties.

 Eli Lilly's and Philip Morris’s actions are possible because an FTA
empowers the companies to directly challenge government policies before
foreign arbitration tribunals, claiming that the policies undermine their
expected future profits. *The pro-public health stance recently taken by
Indian courts protecting against the abuse of multinational pharmaceutical
companies, as well as potential future decisions by the government to issue
price controls or compulsory licences, would be directly threatened should
India agree on an expansive definition of investment which includes all
form of intellectual property rights.

 Given the continued use of litigation by pharmaceutical companies in
India, it is vital that India uphold its principled position of not
accepting an investor-state dispute resolution mechanism which would
subject the country to the authority of private arbitrators in secret
tribunals outside of domestic courts. Pharmaceutical companies must be
given no additional avenues to pressure India on policies and laws that
protect access to affordable medicines.

There is already awareness in India of the harm such provisions, signed by
India in the 1990s as part of bilateral investment protection agreements
(BIPA), can cause. After a spate of notices, served by foreign companies
seeking to sue India in investment tribunals outside of domestic courts for
billions of dollars, were received by the Government, the Department of
Economic Affairs recently announced a review of such provisions in existing
BIPAs and a freeze on future negotiations of investment protection until a
model text is developed. This decision should be upheld and should not be
overridden by a perceived urgency to conclude the FTA with the EU.

We would therefore urge you to uphold the strong position held by India,
both in past decades and in the current negotiations of the FTA with the EU
and to recommend that all provisions tabled by the EU that harm access to
affordable medicines are rejected, so that generic competition remains
possible in India.
 Yours sincerely,

 Dr Unni Karunakara
International President
Médecins Sans Frontières

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
T: twitter.com/joanna_keenan


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