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India Assures the US It Will Not Issue Compulsory Licences on Medicines -Amit Sengupta
-TheWire.in

The government appears bent on decisively abandoning the earlier consensus of adherence to public health goals.

In what is widely being hailed as an extraordinary victory for the multinational pharmaceutical industry over the Indian government, the US-India Business Council (USIBC), in its submission to the United States Trade Representative (USTR), reports that the Indian government has “privately assured” the industry that it would not use compulsory licences (CLs) for commercial purposes. Since it came to power in 2014, it has been speculated that the NDA government is keen to accommodate objections of the USTR and the US based pharmaceutical industry regarding the use and implementation of a number of health safeguards in domestic laws on intellectual property rights designed to promote affordable access to medicines in India. We now have confirmation that the government is willing to travel the extra mile in order to placate the US and that the Big Pharma’s vicious campaign after the first CL was granted in India has been a success.

Striking at the heart of India’s Patent Act

Mukesh Aghi, president of the USIBC that claims to represent “more than 350 of the largest global companies investing in India”, writes in his submission to the office of the USTR on February 5, 2016, “Overall, the U.S.-India Business Council believes there have been important developments related to the Intellectual Property policy in the last 12 months in India that have paved the way for substantive improvement in India’s IP environment”. He further adds, “…the level and frequency of engagement between the U.S. and Indian governments was encouraging and many have noted that they had not seen this level of engagement with the Government of India before”. Aghi goes on to compliment Prime Minister Narendra Modi for “several public statements reaffirming his commitment to a strong and robust intellectual property regime” and also notes with approval that “(the) Government of India has denied several compulsory license applications”. Particularly disturbing is his assertion that “the Government of India has privately reassured India would not use Compulsory Licenses for commercial purposes”. Curiously, David Hirschmann, the senior vice president of the US Chamber of Commerce, uses exactly the same phrase regarding “private reassurance” in his submission to the USTR.

That these are not isolated reactions becomes clearer when similar sentiments are echoed in the deposition by Patrick Kilbride of the US Chamber of Commerce’s Global Intellectual Property Centre. Kilbride in his deposition to the USTR on March 1, 2016 notes, “The U.S. and Indian governments have re-opened a formal dialogue through the bilateral Trade Policy Forum, with the creation of an Intellectual Property Working Group as a core element”. He goes on to say, “The election of Indian Prime Minister Sri Narendra Modi in 2014 provided an important opportunity to re-establish a collaborative and productive working relationship on intellectual property issues between India and the United States”.

One may legitimately ask if it is bad news that the US and India are talking to each other. The issue is not that they are talking but what the substance of their talks indicate. Let us not forget that the US and India are traditional adversaries in the area of IP protection and India has been on the USTR’s Special 301 ‘watch list’ for over a quarter of a century. In such a situation, a ‘private’ assurance that compulsory licences will be denied is abject surrender, not dialogue. The compulsory licensing provisions in the Indian Patents Act are a critical part of India’s attempt to prevent monopolies and assure access to new medicines of public health importance. A compulsory license allows domestic companies to produce cheaper generic versions of drugs under the patent monopoly of MNCs (many of them US based). When CL provisions are used, prices decreases can range from 50% to 97%, resulting in massive cost savings to governments and patients, and a significant increase in the number of patients able to access the medicines. This is the option, embedded in our national law, which is being gifted away by the ‘private assurances’. It is a disingenuous attempt to strike at the very heart of the legislative intent embodied in the Indian Patents Act.

Why is compulsory licensing important?

A recent study identified 140 patented products being marketed in India. Information about if they were manufactured in India was available for 92 products, but only four of these were manufactured in India and the remaining 88 were being imported. Thus, we see a growing trend of imported drugs forming a significant portion of the domestic market. The table below provides the prices of some of these.

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