[Ip-health] First Post: India at WTO: Takes strong stand to save generic drugs industry, calls for transparent health assessment

Thiru Balasubramaniam thiru at keionline.org
Sat Nov 12 21:41:08 PST 2016


India at WTO: Takes strong stand to save generic drugs industry, calls for
transparent health assessment

Shreerupa Mitra-Jha  Updated: Nov 13, 2016 09:30 IST

#affordable medicine   #Generic drugs   #Indian generic drug industry
#intellectual property rights   #IP   #TRIPS   #UN   #WHO   #WTO

Governments engaged in bilateral and regional trade investments should
ensure that these agreements do not include provisions that impinge on the
right to health, and as a first step should undertake public health
assessments "that are transparent and made publicly available", India said
in a strong statement delivered at the WTO highlighting a longstanding
fight by India to sustain its generic drugs industry.

“These impact assessments should verify that the increased trade and
economic benefits are not endangering or impeding the human rights and
public health obligations of a nation and its people before entering into
commitments," India said on 9 November at a discussion on the report of the
UN Secretary-General's (SG) High-Level Panel on access to medicines at the
WTO's Agreement on Trade-related Aspects of Intellectual Property Rights
(TRIPS) Council.

“Governments and the private sector must refrain from explicit or implicit
threats, tactics or strategies that undermine the right of WTO members to
use TRIPS flexibilities. Instances of undue political and commercial
pressure should be formally reported to the WTO Secretariat,” an Indian
delegate said speaking in the context of proliferating mega trade deals
that often contain provisions that prevent national governments from
legislating in favour of public health measures or protecting the

What is TRIPS?

TRIPS is an international agreement administered by the WTO that sets down
minimum standards for many forms of intellectual property (IP) regulation
as applied to nationals of WTO members. This agreement contains
flexibilities that were enhanced and clarified during the 2001 Doha
Declaration on TRIPS and Public Health. It says, for instance, that for
pharmaceutical patents, there is a flexibility to interpret and implement
TRIPS provisions in a manner supportive of the government’s right to
protect public health.

Other provisions in the international agreement state that appropriate
measures may be needed to prevent the abuse of IPRs by right holders, or to
prevent resorting to practices which unreasonably restrain trade or
adversely affect the international transfer of technology. The provisions
also allow governments to amend their laws and regulations adopting
measures to protect public health and nutrition and promote public health
in sectors that are vital to their socio-economic and technological
development provided that the measures are consistent with the agreement.

TRIPS and developing nations

However, in practice, many developing countries either lack the technical
capacity to implement TRIPS flexibilities or are challenged both legally
and politically by powerful governments and multinational companies upon
using these flexibilities that are available to them through the TRIPS

For instance, a leaked memo from April — first posted by the think tank
Knowledge Ecology International — suggested that Columbian officials were
concerned that lowering the prices of a major cancer drug called Gleevec
manufactured by Novartis may jeopardise American funding for peace talks in
the war-torn South American nation.

"A slew of regional trade agreements containing TRIPS-plus standards of IP
protection and enforcement have the potential to significantly undermine
the effective and full use of the TRIPS flexibilities," India argued.

Referring to investor-state disputes under regional or bilateral investment
protection agreements as a major emerging challenge to the use of TRIPS
flexibilities in the public interest, India urged governments to "respect
the letter and spirit of the Doha Declaration on TRIPS and Public Health".

India also made a range of recommendations to enhance the use of TRIPS

“Governments should adopt and implement legislation that facilitates the
issuance of compulsory licenses,” India stated.

Compulsory licensing is when a government allows someone else to produce
the patented product or process without the consent of the patent owner. In
India, this is administered under the Indian Patent Act, 1970 under section
84, which stipulates that a compulsory license to manufacture a drug can be
issued after three years of the grant of a patent on the product if the
product is still not available at affordable prices.

India and TRIPS: A generic drugs industry

In 2012, India had first made use of this provision when the Indian patent
office cleared the application of Hyderabad's Natco Pharma to sell generic
drug Nexava to treat renal and liver cancer which was a copy cat version of
Bayer's patented anti-cancer drug, slashing drug prices by about 97 percent.

On 10 November, India denied a patent to Xtandi (Enzalutamide), a
high-priced drug for the treatment of prostate cancer, thus opening the way
for generic drugs which will be less than half the price.

Such legislation must be designed to effectuate "quick, fair, predictable
and implementable compulsory licenses for legitimate public health needs,
and particularly with regards to essential medicines" and the issuance of
compulsory licensing "must be left to the discretion of governments", India
further added.

It urged the WTO members to "adopt a waiver and permanent revision" to the
agreement in order "to find a solution that enables a swift and expedient
export of pharmaceutical products produced under compulsory license".

Indian generics account for 20 percent of global exports in terms of volume
making it the largest provider of generic drugs globally earning it the
popular moniker "pharmacy of the poor". Its patenting decisions affect
global supply of generic drugs.

In May this year, for instance, India's decision to grant a patent to
US-based Gilead’s Sovaldi — its drug for hepatitis C for which the company
charges $1,000 per pill in the US — was met with much opposition from
patient groups and international humanitarian organisations. Though the
cost of treatment for the Indian patient will not rise due to the
availability of generics, the decision will block the flow of raw materials
(APIs) for producing the drug in poorer countries, where they are most
needed like Egypt and Bangladesh.

UN on runaway drug prices

To address the problem of runaway drug prices that have come to hit
patients in the developing as well as the developed world, the UN SG
established a high-level panel (HLP) on access to medicines in 2015 to
assess policy incoherence between rights of inventors and the need to
address public health through the lack of access to essential medicines.

Its report was released on 14 September this year, which met with much
opposition from the US and the EU where many of the pharmaceutical and
technology companies are based.

The Panel recommends the establishment of a binding research and
development (R&D) treaty that delinks the cost of R&D from end prices to
promote access, more transparency in terms of production, pricing and
distribution of health technologies and R&D costs. It also sought
disclosure of unidentified data from all completed and discontinued
clinical trials, regardless whether the results are positive, negative,
neutral, or inconclusive, the establishment of a Global Health R&D
Observatory to provide data on R&D activities and allow the identification
of R&D gaps and the expansion of the WHO Global Price Reporting Mechanism
(GPRM), among other recommendations.

The US and the EU had avoided any reference to the United Nations HLP
during negotiations at multilateral forums before the report was released.

Has WHO betrayed its own goal?

India, along with 13 other countries, including Brazil, South Africa and
Iran, on 12 September had requested the WHO to include an item entitled
Report of the UN Secretary-General’s High-Level Panel on Access to
Medicines in the agenda of the upcoming 140th session of the WHO Executive
Board in January 2017.

However, WHO Director-General (DG) Margaret Chan, and five other officials
on WHO's Executive Board, on 28 September, rejected the request. The
rejection was particularly surprising because the UN SG Ban Ki-moon had
established the UN HLP and access to essential medicines is supposed to be
a core concern of the WHO.

Seventeen international humanitarian NGOs and think tanks, including
Knowledge Ecology International, People’s Health Movement, Third World
Network, Canadian HIV/AIDS Legal Network and Malaysian AIDS Council, wrote
a strong letter to the DG marking their protest at this rejection.

This rejection represents a slap in the face to the United Nations
Secretary-General Ban Ki-moon’s efforts to comprehensively review and
assess 'proposals and recommend solutions for remedying the policy
incoherence between the justifiable rights of inventors, international
human rights law, trade rules and public health in the context of health
technologies'," the letter said

“This rejection calls into question your commitment to WHO's Global
Strategy and Plan of Action on Public Health, Innovation and Intellectual
Property, the follow-up of the report of the Consultative Expert Working
Group on Research and Development: Financing and Coordination, the
Sustainable Development Goals (SDGs) and the realisation of the right to
health," it added.

India along with China, Brazil and South Africa then took the matter to the
WTO’s TRIPS Council to have two dedicated sessions on the UN HLP report on
8 and 9 November — a request that was accepted.

WHO chose to make a statement on this forum and called the conclusions of
the UN HLP report "sobering".

"The report thus echoes conclusions of previous reports done under the
auspices of the WHO, which draw attention to disparities in the R&D system
and lack of access to essential medicines," WHO said.

"With respect to R&D, production, pricing and distribution of health
technologies, we welcome the call of the Panel for more transparency of
production and R&D costs, including contributions of the public sector,"
the UN’s health agency said.

"WHO will consider expanding the GPRM to include more patented essential
medicines," the UN official added.

According to a report by IP-Watch, the US said at the TRIPS Council
discussion that it was disappointed with the report which it found
"distracts rather than benefits" the objective of achieving universal
health although it is strongly committed to increasing access to
life-saving medicines in the world.

The EU said that the Panel’s work starts with an assumption that there is a
"policy incoherence between the justifiable rights of inventors,
international human rights law, trade rules and public health".

"Due to its limited mandate, the HLP has focused its proposals exclusively
on addressing an alleged conflict between a research and development model
that (partially) relies on intellectual property rights and the possibility
of providing affordable medicines," the EU delegate said. Due to this, the
Panel has missed an opportunity to provide a "more balanced, comprehensive
and workable solutions to the problem of access to health".

No conclusions could be reached with the support of all members of the
Panel as highlighted in the dissenting commentary attached to the report,
the EU noted.

The CEO of GlaxoSmithKline was one of the members of the UN HLP on access
to medicines. He gave a dissenting commentary on the Panel report.

Switzerland, Japan and Korea also underlined the "narrow scope" of the
report, and remarked that the use of compulsory licences must not
discourage innovation, IP-Watch reported quoting a source.

First Published On : Nov 13, 2016 09:30 IST

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