[Ip-health] Stat News/Pharmalot: India agrees to restrict generic drug licenses, business groups say

Zack Struver zack.struver at keionline.org
Wed Mar 9 12:23:37 PST 2016


India agrees to restrict generic drug licenses, business groups say

MARCH 9, 2016

In an unexpected development, the Indian government has supposedly agreed
to restrict compulsory licenses that allow generic drug makers to make
low-cost versions of brand-name medicines, according to documents filed by
two business groups with the US Trade Representative’s Office.

The disclosure represents a potentially significant victory for global drug
makers, which have complained that successive Indian governments have
favored India’s domestic pharmaceutical industry at their expense.
Compulsory licenses allow generic companies to manufacture copycat drugs
without the consent of the brand-name drug maker that owns the patent.

“Industry continues to be concerned by the potential threat of compulsory
licensing,” the US Chamber of Commerce wrote to the US Trade Rep, which
each April issues a report that features a Priority Watch list of countries
singled out for failing to protect and enforce patent rights. India is a

“While the Government of India has privately reassured industry that it
would not use compulsory licenses for commercial purposes, a public
commitment to forego using compulsory licensing for commercial purposes
would enhance legal certainty for innovative industries,” the chamber
wrote. Nearly identical language was used by the US-India Business Council
in its own comments.

Both groups submitted their remarks to the US Trade Rep early last month in
hopes of influencing the Priority Watch list. We asked the Indian commerce
ministry for comment, but have not received a reply.

Global drug makers have long accused India of upholding laws and issuing
court rulings that make it easier for their generic rivals to sell
lower-cost, copycat versions of their medicines. Many of the generic drug
makers based in India, in fact, are among the world’s largest suppliers of
copycat medicines.

Consumer groups, however, argue the pharmaceutical industry unfairly
pressures India to tighten its policies over competitive fears and has
convinced Washington to argue its case. They also note that the right for a
government to issue compulsory licenses was memorialized in a World Trade
Organization agreement known as Trade-Related Aspects of Intellectual
Property Rights, or TRIPS.

A country may cite a health emergency as a reason for issuing a license
and, over the past decade, several countries have done so. Besides India,
Thailand has taken this step, and late last month, a Colombian government
committee recommended that a compulsory license should be issued for the
Gleevec cancer treatment sold by Novartis.

“If such an agreement in fact exists, this is extremely troubling news, and
the terms of the agreement should be made public, and subject to the
outrage that it deserves,” wrote Knowledge Ecology International, an
advocacy group that focuses on access issues, in comments filed last week
to the US Trade Rep. “This sort of pressure is basically a declaration of
war on poor cancer patients, where most of the compulsory licenses have
been targeted lately.”

One expert on the Indian market cautioned, however, that the statements
from the business groups may not be revelatory. Vince Suneja, chief
executive of TwoFour Insight Group, a consulting firm that works with
Indian drug makers, noted there are two scenarios under which the
government may issue a compulsory license, and it’s not clear if any
substantive change is actually being proposed.

Under one scenario, the central government can issue a license for a
national emergency, but this would not have any commercial application. In
the other scenario, a license may be issued by the Indian Patent Office in
response to affordability and patient access. Suneja suggested the
possibility that the government may be referring to the first scenario,
which would not constitute a change in policy.

The Indian government has been reviewing its intellectual property policy,
an outgrowth of a high-level working group that was formed with US
officials in October 2014, shortly after Indian Prime Minister Narendra
Modi took office. Yet just weeks later, the Indian Supreme Court rejected a
bid by Bayer to block the government from allowing a generic version of a
cancer drug from being sold.

Two months ago, however, the Indian Patent Office rejected an application
from a domestic company, Lee Pharma, that sought a compulsory license to
make a generic version of Onglyza, a diabetes pill sold by AstraZeneca. At
the time, analysts cautioned that the rejection may have reflected a weak
case that Lee made for obtaining a license as much as any political

Zack Struver, Communications and Research Associate
Knowledge Ecology International
zack.struver at keionline.org
Twitter: @zstruver <https://twitter.com/zstruver>
Office: +1 (202) 332-2670 Cell: +1 (914) 582-1428

More information about the Ip-health mailing list