US pharma gets a booster shot

| Updated on: Oct 19, 2014
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Thanks to the India-US Intellectual Property Working Group. Here’s how — and why this is bad news for India’s poor

Prime Minister Narendra Modi’s first official visit to the US included several meetings with industry representatives and a meeting with President Barack Obama. In the US-India joint statement that was issued on September 30, a brief passage under “Economic Growth” stated that the leaders had “committed to establish an annual high-level Intellectual Property Working Group with appropriate decision-making and technical-level meetings”.

It is crucial to note that the statement employed strong rhetoric to tie innovation, economic growth, job creation and foreign direct investment (FDI) with strong intellectual property (IP) rights, despite evidence that most low- and middle-income countries like India do not typically benefit economically from IP maximisation since these countries are net importers of expensively priced IP products.

R&D efforts, especially in the multinational pharmaceutical industry, are not targeted towards meeting public health challenges that predominantly impact developing countries, and this remains true irrespective of the number of patents granted or enforced.

Reading between the lines As news trickled in over the holiday weekend in India, public health interest groups that monitor the continuing controversy between access to affordable medicines and pharmaceutical patents exhorted the Government to be cautious in its dealings with the US, notably since such working groups have primarily been used as tools on behalf of the US pharmaceutical industry to pressure countries to change their approach to patent law and limit generic competition.

These IP working groups are routinely staffed with advisors who stridently favour firmer US-style patent protections for medicines and push for longer patent protections and stronger enforcement measures with the aim of restricting generic competition in medicines. For instance, in its IP dialogue with China, the US Chamber of Commerce has focused its pressure on withdrawing the requirements for improving transparency in pharmaceutical patent applications and on pushing for a more stringent IP enforcement agenda via the judicial system.

The US government’s views on India’s patent regime are not unknown. On behalf of its pharmaceutical industry, the US trade representatives have strongly opposed India’s strict standards on patentability of medicines that have, to an extent, protected generic competition. Over the past two years, several US government representatives have clamoured against the Indian patent office’s decision regarding the issuance of a single compulsory licence to a generic competitor, a measure employed to lower the ₹280,000 per month price for a liver and kidney cancer drug patented by Bayer in India. The move brought the price of the patented drug down from over ₹280,000 per month to ₹8,800 per month; a price reduction of 97 per cent.

Unwarranted criticism persists despite the fact that each country has the prerogative, as recognised by the World Trade Organisation, to define its own patentability criteria for granting medicine patents and issuing compulsory licences; a prerogative that is essential for ensuring that monopoly patent protections do not trample access to affordable medicines.

Disregard for safeguards Additionally, the US International Trade Commission recently initiated a fact-finding investigation on India’s IP regime and its use of public health safeguards in its patent laws. Several members of the US Congress requested a second investigation in 2015.

These efforts underscore the relentless pressure by the US towards governments that have supported patent policies that balance IP with public health safeguards and that increase production and access to generic medicines.

At the height of the AIDS epidemic in 1999, the USTR placed South Africa on its watch list to pressure the government about proposed amendments to the Medicines and Related Substances Control Act aimed at providing low-cost AIDS drugs to its people.

Just one week after the completion of Modi’s visit, the USTR announced the start of the special 301 watch list out-of-cycle review of India’s IP policies. The outcomes of this unilateral investigation could lead to trade sanctions against India. The coercion has now risen to a level that is deeply concerning to MSF.

Many reservations As a humanitarian medical organisation heavily dependent on the supply of low-cost generic medicines from India, MSF has serious reservations about the establishment or revival of a working group or trade forum for bilateral discussions on IP with US officials.

Such a working group will give the US pharmaceutical industry a platform for limiting patent law safeguards that play a critical role in improving access to affordable medicines across the developing world.

Measures that would threaten India’s public health safeguards include a repeal of its tougher patentability criteria, adoption of data exclusivity monopolies, patent term extensions and restrictions on the use of compulsory licences.

The PMO now faces a public challenge and is in a unique position of responsibility in global health. Its Brics peers and other developing countries, especially South Africa and Brazil, closely watch Indian legislation to reform their laws to limit abuse of the patent system.

It is evident that access to essential medicines for millions of people in developing countries in the coming years will depend on the new government’s decisions, its handling of US pressure and the kind of patent regime it endorses.

The writer is the South Asia regional head for Médecins Sans Frontières’ Access Campaign

Published on October 19, 2014

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