Mental Health Problem: A Growing Concern In The Healthcare Space Of India

Posted on January 16, 2017 by Tapan Ray

A thud!

Something fell from high above!

In no time, a bright young life of just a 32-year-old highly accomplished professional – a widely admired soul, vanished in the thin year, for good, mostly unnoticed in the quiet neighborhood, initially.

The news was more than a shock to my family. It engulfed me by the fire of impotent rage against this cruel play of destiny, where nothing can be undone, just nothing!

What prompted this so bright, successful, hugely promising and an ever-helpful-to-all guy doing what he did? No one could ferret out the answer, just yet, and possibly would never be.

Medical literatures have now established a close relationship between depression and its possible lethal outcome – suicide. Using literature data, one can estimate that 60 to 70 percent of the subjects attempting suicide were suffering from depression of various kinds. Was this young man too silently suffering from this undiagnosed and untreated mental illness?

In this article, I shall dwell on this important aspect of overall health care in India.

Depression ranks 4th in the 10 leading causes of the global burden of disease:

The World Health Organization (W.H.O) underlines: “Major depression is now the leading cause of disability globally and ranks fourth in the ten leading causes of the global burden of disease. If projections are correct, within the next 20 years, depression will have the dubious distinction of becoming the second cause of the global disease burden. Globally, 70 million people suffer from alcohol dependence. About 50 million have epilepsy; another 24 million have schizophrenia. A million people commit suicide every year. Between ten and 20 million people attempt it.”

A recent study:

Currently in India, millions of people with mental illnesses continue to remain untreated. This is vindicated by a chain of recent research studies titled, “China-India Mental Health Alliance Series”, published in ‘The Lancet’ on May 18, 2016.

The studies highlighted that: “China and India, which together contain 37 percent of the world’s population, are both undergoing rapid social changes. Because mental disorders account for a high proportion of morbidity, detailed knowledge of the mental health status of the populations in these two countries, and the evidence-base regarding the treatment of those disorders, are of paramount concern.”

“In China, mental, neurological and substance use disorders accounted for 7 percent of all (years of healthy life of the whole population) in 1990, rising to 11 percent by 2013. Similarly, in India, the proportion of all burden explained by mental, neurological, and substance use disorders rose from 3 percent in 1990 to 6 percent in 2013,” the researchers highlighted.

Greater concern in India:

In 2013, 36 million years of healthy life were lost to mental illness in China, and 31 million in India. The new research estimates that by 2025, though 36.9m years of healthy life will be lost to mental illness in China (10 percent increase), it will be 38.1m in India (23 percent increase). Anxiety and depression are the most common mental health problems among working age adults between 20 and 69 years.

Similarly, dementia is emerging as a growing mental health issue for both countries. However, from 2015 to 2025, it is estimated that the number of healthy years lost due to dementia will increase by 82 percent in India against 56 percent in China.

Interestingly, in August 2016, replying to a debate on the ‘Mental Health Care Bill’ in the Parliament, the Union Health Minister Mr. J. P. Nadda said, around 6-7 per cent of Indian population suffered from mental illnesses, while 1-2 per cent suffer from acute mental disease.

This means, over 70 million people are affected by mental illness in India, which has a close association with the rate of suicides, cardiovascular disorders, and loss of a significant number of productive days. It is estimated that around 50 percent of people with severe mental disease and around 90 percent of those with less severe symptoms, remain untreated in the country.

Depression, reportedly, the most prevalent form of mental illness that affects almost 3 to 5 percent of urban population living in cities, such as, Mumbai or Delhi. Around 30 percent of them are severely neurotic.

Alzheimer’s disease was reported to be the most common of severe disorders (54 percent) followed by vascular dementia (39 percent).

Another Government statistics indicate that 20 percent of Indians reportedly need counselling at some point of their lives. One per cent of the population suffers from serious mental health disorders, while 5-10 percent of Indians suffer from moderate disorders.

Another recent study:

Another recent report published in ‘The Lancet Psychiatry’ on 12 August 2016, captured the following details for India, in this area:

Very few population-representative data were found for mental disorders, with an average coverage of just 1 percent of the country’s population.

Major depressive disorder, anxiety disorder, and alcohol dependence were the most common mental, neurological, and substance abuse disorders, for men.

For women, anxiety disorder, major depressive disorder, and dysthymia were most common.

Human and financial resources for mental health are grossly inadequate with less than 1 percent of the national health care budget allocated to mental health in India.

Improvement of coverage will need to address both supply-side barriers and demand-side barriers related to stigma and varying explanatory models of mental disorders.

An associate professor of psychiatry at New Delhi’s All India Institute of Medical Sciences (AIIMS), reportedly said, there is just one psychiatrist for every 400,000 Indians. Apparently, he also said that there are only about 4,000 psychiatrists, 1,000 psychologists and 3,000 social workers in the entire country of over 1.2 billion people. Only 1,022 college seats for mental health professionals are set aside in India.

Or, in other words, a huge dearth of trained mental health professionals, coupled with low public investments, and fueled by high associated stigma, continue to compel many Indian populations lose many years of their lives to the illness.

Role of traditional medicines:

The study also suggests that traditional medicine practitioners, who are so common in India, “may be trained to recognize and refer patients who are at risk to themselves and others, or to advise patients against stopping their medication. Nevertheless, the authors do call for more research in this area to understand the effectiveness and potential risks of traditional medicines in the treatment and management of mental health.

Associated stigma:

It’s worth repeating, unlike many developed countries of the world, there is still a stigma associated with mental health problems in India. There are several instances of its adverse impact, not just on the social level, but also on the employment opportunities. These issues compound the treatment problem, making their public interaction too very weird at times, further increasing social polarization and inequalities.

Not a personal failure:

As the World Health Organization (W.H.O) articulates: “Mental illness is not a personal failure. It doesn’t happen only to other people. We all remember a time not too long ago when we couldn’t openly speak about cancer. That was a family secret. Today, many of us still do not want to talk about AIDS. These barriers are gradually being broken down.”

The Mental Health Care Bill:

The long-awaited ‘Mental Health Care Bill’, which after an extensive consultation process, is now awaiting the lawmakers’ formal approval for its enactment as law. The Bill, was passed by the Rajya Sabha on August 8, 2016, and is expected to be discussed in the Lok Sabha, probably in this budget session. It was first introduced on August 19, 2013, the Rajya Sabha Standing Committee report was submitted on November 20, 2013.

The bill reportedly redefines mental illness to better understand various conditions that are persistent among the population. It states that mental illness is a ‘substantial disorder of thinking, mood, perception, orientation or memory that grossly impairs judgement, behavior, capacity to recognize reality or ability to meet the ordinary demands of life’. Mental conditions related to alcohol or drug abuse are also included in the definition.

The Bill basically aims at protecting the rights of persons with mental illness and promote their access to mental health care.

One of the major highlights of the bill is decriminalization of attempt to suicide, as it states that the person attempting suicide will be presumed to be ‘under severe stress’ unless otherwise proven, and is not punishable. This move is commendable, ‘as it takes away the burden of implicating a mentally ill person in a crime that he or she had no sane control over.’ The W.H.O report on suicides (2000-2012) puts India right on top of the list in Southeast Asia. It says, the average suicide rate in India is 10.9 for every 100,00 people.

Conclusion:

Mental health has now been included in the United Nation’s ‘Sustainable Development Goals (SDG)’ at its General Assembly in September 2015. It is very likely that SDGs addressing mental health issues will become a part of country development plans and of bilateral and multilateral development assistance. This could well mean that millions of people will finally receive much needed help in this area.

Zeroing-in to India, mental health problems have since been a low priority area in the public health narrative of the country. The health information system of the country does not prioritize mental health, either.

To address this growing concern, besides forthcoming enactment of ‘Mental Health Care Bill’, the much-awaited healthcare reform of the nation, should include a transparent policy framework for mental health. A substantial number of community health workers, including traditional medicine practitioners need to be trained to deliver basic mental health hygiene and care. More serious cases, in that process, should be referred to the qualified professionals.

Mental health problems are growing at a rapid pace in India, being a cause of great concern in the healthcare space in India. It deserves to be treated like any other serious physical illness or disease, in a systematic way, backed by adequate budgetary support for affordable treatment and counselling measures, wherever required.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Declining MR Access to Doctors Prompts Increased Digital Engagement

Posted on October 3, 2016 by Tapan Ray

The trigger point for a disruptive change in the pharma marketing playbook now seems to be not just on the horizon, but could soon move to a countdown stage, in India.

On Friday, September 16, 2016, at a seminar on the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) organized at Bengaluru, Sudhanshu Pant, Joint Secretary (Policy), Department of Pharmaceuticals (DoP), India, reportedly said that the mandatory UCPMP is now in its last leg of clearance with the Union Government, after incorporating the inputs received from the pharma industry and other stakeholders.

He clearly articulated in his address, once a level playing field is created with mandatory UCPMP, both the pharma industry and the medical professionals will be restricted to offer and receive freebies, respectively, which is the in-thing today to generate prescriptions from the doctors.

“Our intent is that the new code should be followed in letter and spirit. It is not a draconian law, but penalties are stringent. We are enforcing fines. The violation of this code could also lead to suspension of product marketing,” the joint secretary further clarified.

Signals a forthcoming change:

Effective implementation of the mandatory UCPMP across India, could catalyze significant changes in the allegedly dubious pharmaceutical marketing process in India, revolving round ‘give and take’ of enticing ‘freebies’ to the prescribers. According to several reports, some of these practices are followed in the guise of ‘brand-reminders’, and several others fall under ‘events associated with Continuing Medical Education (CME), mostly arranged in various exotic places around the world, with associated hospitalities and equivalents. Besides, there exists a host of different kinds of ‘carrots for prescriptions’ of numerous types, forms and costs, as highlighted frequently by the national and international media.

Nevertheless, it is widely believed by many that Medical Representatives (MR) in India are having virtually no access barrier to meet the doctors, as a large number of both the receivers and the givers of the freebies have allegedly financial interest ingrained on meeting each other.

This scenario, I reckon, will change in India with the strict enforcement of mandatory UCPMP by the Government, curbing any possible misadventure by any stakeholder in the space of ethical pharma marketing practices that would impact the health interest of patients, directly.

Drawing a similar example:

One relevant example for India could be drawn from what happened in the United States (US) in this area, relatively recently. To contain wide-spread unethical pharma marketing practices in the US, President Obama administration enacted the Physician Payment Sunshine Act, effective August 1, 2013. This new law, that requires detailed disclosures from both the physicians and the pharma players on giving and accepting the freebies, limited the financial interest of the prescribers to meet with the MRs several times in a year, for face to face product detailing. Consequently, MR access to prescribers for the same started becoming increasingly more challenging.

A number of studies indicate, a large number of doctors have now started considering the delivery of a frequent barrage sales message an avoidable noise, when alternative highly user-friendly platforms are available to keep them up-to-date on various brands.

In the same way, as the new mandatory UCPMP will come into effect in India, it is quite likely that pharma companies operating in the country would start facing similar challenges with MRs visits, especially, to the important busy doctors and for similar reasons.

Digital channels are gaining strength:

With MRs access to physicians gradually declining, many pharmaceutical companies are trying to make the best use of a gamut of customized, innovative marketing approaches pivoted on various digital platforms. These initiatives are primarily to supplement effective engagement with the doctors to generate increasing prescription demand, and in a more user-friendly manner.

The latest study on trend:

There are many studies in this area, but I shall quote the latest one. According to a 2016 study of the global sales and marketing firm ZS Associates: “The number of digital and non-personal contacts that the pharmaceutical industry now has with physicians exceeded its number of sales rep visits to doctor offices.”

Analyzing the data from 681,000 health care providers who actually engage with pharmaceutical and biotech manufacturers across promotional channels, and more than 40,000 pharmaceutical sales representatives (MRs), the study reported, among others, the following:

44 percent of physicians are “accessible” (that is, they met with more than 70 percent of sales reps who try to meet with them). This is a decline from 46 percent in 2015 and nearly 80 percent in 2008.

38 percent of physicians restricted access (that is, they met with 31 to 70 percent of reps who try to meet with them).

18 percent of physicians “severely” restricted access (that is, they meet with 30 percent or fewer reps who try to meet with them).

More than half (53 percent) of marketing outreach to physicians now takes place through “non-personal” promotion, such as email and mobile alerts, as well as direct mail and speaker programs.

The remainder of marketing to physicians (47 percent) still takes place through in-person interactions with sales reps (MRs).

Today’s physician estimates that he or she already spends 84 hours per year – about two full work weeks – interacting with pharma companies via digital and other non-personal marketing channels.

Around 74 percent of the physicians use their smartphones for professional purposes.

Another interesting point also emerges from the report. Despite the fact that non-personal communications, including digital, comprise 53 percent of marketing outreach most drug companies still allocate around 88 percent of their total sales and marketing budget to the sales force.

Increasing ‘online professional networks’ for doctors:

Keeping pace with this change several online professional networks for doctors are coming up. One such example is Doctors.net.uk. This is claimed to be the largest and most active online professional network for all UK doctors. Each day over 50,000 doctors make use of Doctors.net.uk to network with colleagues and view information.

This particular online facility provides the doctors with a range of free secure services including an email service, clinical forums, accredited education and medical news, which help them to keep up to date, and to easily maintain their Continuing Professional Development (CPD).

Some digital initiatives of pharma companies:

Here, I would quote just a couple of interesting examples out of several others:

For continuous online engagement with doctors:

In January 2013, the top global pharma major Pfizer launched an online digital platform for the doctors named ‘Pfizerline’. It provides access to the latest information on Pfizer products ‘when, where and how’ the doctors want it. As claimed by the company, ‘Pfizerline’ is regularly updated and forms part of the company’s ongoing commitment to keep the doctors informed about their products and services.

Some say that with ‘Pfizerline’, ‘Pfizer has begun using digital drug representatives to market medicines, leaving the decision as to whether they want to see them in doctors’ hands.’

For new product launch:

According to the Press Release published by PMLive, the first in the pharmaceutical industry ‘digital marketing only’ campaign was launched by Abbott for its Low Dose HRT brand, in November 2013.

The campaign reportedly reached to 9,000 doctors, 45 percent of the NHS population of obstetricians and gynecologists, and nearly 23 percent of GPs who engaged with Abbott’s Low Dose HRT brand via professional network Doctors.net.uk.

According to Abbott, as quoted in this report, the digital campaign, which included interactive case studies, clinical paper summaries and an ask the expert section, helped increase the brand’s market share, with a continuous month-on-month growth in sales in 2013.

I am quoting these two examples, just to illustrate the point that serious experimentations with digital marketing for serious business initiatives, such as, doctor engagement and product launch, have already commenced.

Conclusion:

For better physician engagement, while preparing for a likely future scenario in India, any effective brand marketing strategy on digital platforms would call for in-depth understanding of the target audience preferences on the specific information needs and marketing channels. This customized approach needs to be harnessed to deliver the right message, to the right customer, through right platforms, and at a time of preferred by each prescriber.

The ball game of pharma marketing is gradually but surely changing. Clear signals are now coming from various Governments to the pharma companies to jettison the widely perceived unethical practices of alluring the drug prescribers with ‘freebies’ of different kinds and values, against patients’ health interest.

Unless various third parties come-up just to camouflage continuation of the same unethical marketing practices of many companies, at a cost, getting unfettered MR access to busy prescribers is likely to be increasingly more challenging. Otherwise, effective enforcement of mandatory UCPMP is likely to usher-in this change in India, sooner, just as what the ‘Physician Payment Sunshine Act’ did in the US. The countdown for the new paradigm in the country is expected to commence soon, as reportedly articulated by the Joint Secretary (Policy) of the Department of Pharmaceuticals, recently.

However, there are a couple of points to ponder. It is also widely believed, even today, and also in the US that, while various digital platforms offer never before opportunity to effectively engage with ‘difficult to meet’ prescribers, their use should be prudent and well thought of. Any mass-scale and imprudent general switch to digital communications, is unlikely to fetch the best outcome, to meet with this evolving challenge of change, at least, in the foreseeable future.

At the same time, if pharma companies continue increasing investment in less expensive digital communications sans diligent homework for scaling up, the prescribers may feel so overwhelmed that they will start ignoring them, just as what’s happening with frequent MRs’ visits. Hence, for sustainable business excellence while confronting with forthcoming disruptive changes, the notes of the pharma marketing playbook need to be recomposed, afresh.

By: Tapan J. Ray

Déjà Vu In Pharma Industry

Posted on September 12, 2016 by Tapan Ray

It’s happening in the West, and is equally widespread in the Eastern part of the globe too, though in different ways and forms, as both the national and international media have been reporting, consistently. The phenomenon is all pervasive, and directed towards stalling almost all possible future laws and policies that a large section of the pharma industry sees as a potential apocalypse for their business models.

It has a wide reach and covers, for example, the policy-decision makers or possible policy-decision makers in the near future, other policy influencers, many hospitals, and the final interface with the patients – the prescription decision makers.

Although, it affects health care as a whole, in this article I shall focus just on the pharma industry.

Looking West:

While looking at the West, I would cite a recent example from the United States. It’s yet another déjà vu for the western pharma industry.

On August 26, 2016, ‘The Los Angeles Times’ in an article titled, “Drug companies spend millions to keep charging high prices” stated, “Of roughly US$ 250 million raised for and against 17 ballot measures coming before California voters in November, more than a quarter of that amount – about US$ 70 million – has been contributed by deep-pocketed drug companies to defeat the state’s Drug Price Relief Act.”

The Drug Price Relief Act of California, is aimed at making prescription drugs more affordable for people in Medi-Cal and other state programs by requiring that California pays no more than what’s paid for the same drugs by the Department of Veterans Affairs of the United States. It would, in other words, protect state taxpayers from being ripped off.

The report also quoted Michael Weinstein, President of the AIDS Healthcare Foundation saying that industry donations to crush the Drug Price Relief Act “will top US$ 100 million by the election, I’m quite certain of it.” He further added, “They see this as the apocalypse for their business model.”

Looking East:

While citing a related example from the eastern part of the globe, I shall draw one from nearer home – India, as China has already been much discussed on this matter. This particular media report on a wide-spread pharma industry practice, though took place in a different form, as compared to the United States, belongs to the same genre, and captures yet another déjà vu involving the pharma players operating in the eastern world, similar to what’s happening in the west.

India:

On August 30, 2016 a report published in ‘The Economic Times’ titled, “Pharma cos offer freebies to doctors, violate code: MP” quoted a serious allegation of a Rajya Sabha Member of the Parliament on this issue. The MP claims, he has evidence of four drug companies’ recently bribing doctors across India to push their products. These four companies include both large Indian and multinational pharma players, and two out of these four features, among the top five companies of the Indian Pharma Market (IPM).

The lawmaker further said, “I am waiting for the minister’s response on this issue. Nothing has come so far. We also have the names of the doctors who have taken bribes, which we will release eventually,”

Another September 06, 2016 report, published by the same business daily in India, categorically mentioned that TOI has documents to establish that one of these companies took hundreds of doctors from across India to places like Vancouver, Amsterdam, Oslo, Venice, New York, Boston, Brussels and Moscow. The documents reportedly include email exchanges between the company executives, city-wise lists of doctors with ‘legacy codes’, names of spouses, passport copies and visa copies, and show how the company has spent several millions of rupees in taking doctors and sometimes even their spouses, ostensibly to attend medical conferences.

Other NGOs have also reportedly submitted proof of the same to the Government for remedial measures in India, against such gross ongoing unethical practices in pharma marketing.

It is worth mentioning here that all these expenses are part of the marketing budget of a company and the sum total of which is built into the ‘retail price to the patients’ of the respective drugs, even in India.

Two broad processes for the same goal:

Thus it emerges, very broadly, there are two key processes followed by many in the pharma industry to achieve the same goal of increasing profit. These are as follows:

Marketing malpractices in various forms to influence prescription decision
Arbitrary increase of drug prices, for both branded and generic medicines

The justification:

Many global pharma majors still keep justifying, though the number of its believers is fast dwindling, that the high new drug prices have a linear relationship with the cost of new drug innovation. Even for argument’s sake one nods in favor, the critical question that needs to be answered is, if this is the basic or primary axle on which the wheel of innovation moves, won’t affordability and access to drugs for a significant number of the population be seriously compromised?

If not, why is this furor, across the world, is fast assuming a snowballing effect? Why are even the generic drug prices going up steeply even in the United States, where some of the largest Indian drug manufacturers are being questioned for the same by the competent authorities of the country?

I deliberated on a similar subject in my article titled, “The Next Frontier: Frugal Innovation For High-Tech Drugs”, published in this Blog on May 20, 2016.

Marketing malpractices:

Laws are fast catching up to book the offenders resorting to pharma marketing malpractices in most of the countries of the world, including China. This is vindicated by the fact that global pharma players are now paying billions of dollars a fine, in various countries, especially in the West.

Just as no criminal law can totally eliminate any crime, anywhere in the world, despite a heavy dent in pharma’s reputation related to this area, many companies still continue to indulge in such malpractices, blatantly, and even with some brazenness.

India:

Unfortunately, in India, the inertia to catch the bull by the horn and lack of governance in this regard continues, making patients pay a heavy price. As the above media report indicates, both MNCs and the local players indulge into this deplorable activity almost without any inhibition. As many industry watchers believe, some companies have started hiring these services through professional third parties just to create a facade for taking the high moral ground, as and when required, both with the government and also other stakeholders.

Initiating a step in this direction, on December 12, 2014, the DoP announced details of the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’, which became effective across the country from January 1, 2015. The communique also said that the code would be voluntarily adopted and complied with by the pharma industry in India for a period of six months from the effective date, and its compliance would be reviewed thereafter on the basis of the inputs received.

UCPMP, though not a panacea, was aimed at containing pharma marketing malpractices in India. However, as happened with any other voluntary pharma marketing code, be it of a global drug major or their trade associations, similar non-compliances were detected even by the DoP with voluntary UCPMP. This gross disregard to the code, apparently prompted the DoP contemplating to make the UCPMP mandatory, with legal implications for non-compliance, which could possibly lead to revocation of marketing licenses.

In this context, it is worth recapitulating that the Union Minister of Chemicals and Fertilizer – Mr. Ananth Kumar, in his reply in the Indian Parliament, to a ‘Lok Sabha Starred Question No: 238’ on the UCPMP based on the inputs received, also had admitted:

“The Government had announced Uniform Code for Pharmaceutical Practices (UCPMP) which was to be adopted voluntarily w.e.f. 1st January, 2015 for a period of six months and has last been extended up to 30.06.2016. After reviewing the same it was found that the voluntary code was not working as expected. The Government consulted the stakeholders, including NGO’s / Civil Society members and after examining their suggestions it is now looking into the viability of making the Code Statutory.”

This seems to be yet another assurance, and expression of a good intent by the Union Minister. The fact today is, after extending the UCPMP in its original form up to June 30, 2016 with four extensions and despite the Government’s public admission that it is not working, by a circular dated August 30, 2016, the Government has informed all concerned, yet again, that voluntary UCPMP has now been extended ‘till further orders’.

This not only creates public apprehension on the DoP’s true intent on the subject, but also gives enough room for speculation regarding behind the scene power play by the vested interests to keep a mandatory UCPMP, having sufficient legal teeth, away, as long as possible. Are these forces then also visualizing its enforcement as an apocalypse for their business models in India too?

Thus, the possibility of containing pharma marketing malpractices in India is still charting in the realm of the decision makers’ assurances and no further.

Arbitrary drug price increases:

Arbitrary price increases of important drugs are drawing increasing public ire in the West, the latest being a 400 percent price increase of generic EpiPen of Mylan. This is now being considered yet another business malpractice in the pharma industry, as whole.

No robust regulatory or legal measure is now being followed in the West to contain the drug over pricing public health menace. Thus, it is increasingly assuming a critical political significance today to win over the voters, especially in the forthcoming Presidential election of the United States.

Thus, as reported by Reuters, on September 02, 2016, Hillary Clinton announced that, if elected, she would create an oversight panel to protect the consumers of the United States from large price hikes on longer-available, life-saving drugs and to import alternative treatments if necessary, adding to her pledges to rein in overall drug prices.

She would give the ‘Oversight Panel’ an aggressive new set of enforcement tools, including the ability to levy fines and impose penalties on manufacturers when there has been an unjustified, outlier price increase on a long-available or generic drug.

On September 08, 2016, reacting to these proposed measures articulated by Hilary Clinton, the global CEO of the world’s largest pharma player reportedly commented, as expected, that it “will be very negative for innovation.”

Nonetheless, the bottom-line is, even in the United Sates, a transparent mechanism to deal with arbitrary price increases of the existing important medicines, still charts in the realm of several assurances of the probable decision makers, just as it is India to effectively deal with pharma marketing malpractices.

A global CEO’s lone voice stands out:

In this context, I would start with yet another example of astronomical price increase of a widely used anti-diabetic product, besides EpiPen of Mylan. According to Dr. Mayer Davidson, Professor of Medicine at the Charles R. Drew University of Medicine and Science in Los Angeles, who has carefully tracked the rapid and repeated increases, from 2011 to 2013 the wholesale price of insulin went up by as much as 62 percent in the United States. Whereas, from 2013 to 2015 the price jumped again, from a low of 33 percent to as much as 107 percent.

In the midst of this scary situation, a solitary and apparently a saner voice from the global pharma industry stands out. According to an article published in the Forbes Magazine on September 06, 2016, Brent Saunders, CEO of Allergan, ‘explicitly renounced egregious price increases.’ Saunders also said that the industry needs to ‘end its addiction to price hikes far in excess of inflation, often taken several times in a single year.’ While outlining his company’s “social contract with patients,” Saunders vowed that Allergan would:

Limit price increases to single-digit percentages, “slightly above the current annual rate of inflation,” net of rebates and discounts.
Limit price increases to once per year.
Forego price increases in the run-up to patent expiration, except in the case of corresponding cost increases.

Though this seems to be a lone voice in the pharma industry, it makes the CEO stand much taller than his peers.

India:

On this score, India has already put in place the ‘National Pharmaceutical Pricing Authority’ to regulate the drug prices of primarily those falling under the ‘National List of Essential Medicines (NLEM)’. However, it is a different matter that as per its own public admission, NPPA is still unable to strictly enforce these price controls, with significant incidences of non-compliance. Therefore, the net benefits to the patients in India for having this mechanism, is indeed arguable.

The core issue:

All that we witness in this area are mostly assurances, promises and good intent on the part of various Governments of different political dispensation, over the last several decades. The same indifference to public health care, in general, continues. Nothing seems to be working effectively in the public health care space of the country, even today. A large section of patients, bearing the tough burden of the highest out of pocket health expenditure in India, are under significant consequential stress of all kinds.

An important part of this scenario is well-captured in the statement of the erstwhile Secretary of the Department of Pharmaceuticals (DoP) – V K Subburaj at an event in New-Delhi on April 19, 2016, when he said, “In the entire world, I think our drug control system probably is the weakest today. It needs to be strengthened.”

Is it a legacy? Possibly yes. But, who will fix it, and what steps are we taking now for its satisfactory resolution?

The core issue in the pharmaceutical arena is, therefore, about striking an optimal balance between drug profitability and patient affordability, to avoid any adverse impact on access to drugs for a large majority of population in the world.

Conclusion:

Thus, it appears to me, if those who now decide for the people’s health interest, also refuse to wake up from deep slumber and remain as indifferent as before, soon we may hear or read or experience yet another or more of similar deplorable developments, having serious adverse repercussions on the patients.

Interestingly, despite such incidents, pharma stocks remain generally unaffected and buoyant. Its overall trend continues heading north, factoring-in that no implementable Government action is forthcoming, for obvious reasons. Consequently, pharma business remains as robust as ever, but the patients continue to suffer increasingly more.

Pharma industry in general, has been seriously attempting to wash its hands off for this scary emerging situation, since long. It blames the governments for trying to throttle the money spinning business with ‘unnecessary’ regulations, as discussed above, for something that is only the state responsibility, as they perceive. The governments, in turn, blame the industry and try to regulate it more strictly. Invariably, the patients in need of right and affordable medical care get caught in this cross-fire – some succeed to overcome the health crisis, but mostly exposing themselves to huge financial uncertainty in the future, many others can’t.

When the business continues to flourish with current business ‘practices’, why would the pharma players bother about rapidly tarnishing industry reputation, and public outcry? Does it really matter at all on the ground, for running a money spinning business machine, especially when there exists a fair chance of stalling the new laws and policies, with deep pockets, as alleged by many?

In this scenario, what else a common man would do while falling seriously ill, except praying to the almighty for divine care and blessings for a speedy recovery, along with possibly lamenting, it’s déjà vu in the pharma industry?

By: Tapan J. Ray

Patented Drugs: A Dangerous Pricing Trend Impacting Patient Access

Posted on July 11, 2016 by Tapan Ray

The upcoming trend of jaw dropping high prices for new patented drugs sends a ‘storm signal’ to many stakeholders, especially for its adverse impact on patient access. Even more intriguing, such high and insane prices are being fixed rather arbitrarily, without any valid reason whatsoever.

It has now been well established, very clearly, that this trend has no linkages with the necessity of keeping the wheel of cost-intensive new drug development initiatives moving, uninterruptedly.

Many believe that this dangerous inclination of the global pharma players picked up, in a major way, with the launch of sofosbuvir (Sovaldi), costing around US$ 1,000 per pill in the United States. This new drug has no relationship with Gilead’s own R&D initiatives, just as many other high priced patented drugs belonging to this genre.

Additionally, the current brand pricing strategy of even those pharma companies who are developing new drugs in-house, is equally intriguing, as those drug prices too have no direct or indirect relationship with R&D expenditures incurred by the respective players. As I discussed that issue in my Blog on August 18, 2014 in an article titled, “Patented Drug Pricing: Relevance To R&D Investments”, I am not arguing on those points here again.

Nevertheless, these unholy practices did not go unnoticed. Anguish against irresponsible pricing, adversely impacting patient access, started gaining momentum, all over. A raging debate has also kick-started on this issue within a wide spectrum of stakeholders, including various Governments and other payers.

They all are questioning, should the Governments, health insurance companies and other payers support such windfall profits of the so called ‘research based’ pharma companies’?

In this article, I shall deliberate on this issue, just when the voices of disgust against this unholy trend have started multiplying.

A palpable disgust expressed in a recent article:

Against this arbitrary drug pricing trend, a good number of doctors have started raising their voices, with a discernible disgust.

“We’re all paying a high price for drug company profiteering”, thundered Dr. Daniel J. Stone, an internal medicine and geriatric medicine specialist, in an Op-Ed published in ‘The Los Angeles Times’ on July 6, 2016.

Dr. Stone further reiterated, “The drug companies are ripping us off, pill by pill, shot by shot. Instead of working to earn reasonable returns by relieving our suffering and saving lives, they now focus on profits above all. Their main targets are insurance companies. But when insurance companies take a hit, they bump up premiums to employers or the government. So we all pay - in taxes, reduced take-home pay, copayments and deductibles.”

Windfall profits:

The article focuses on this new trend in the global pharma industry, adversely affecting access to, especially, the new drugs to a vast majority of the patients. The author unambiguously highlighted that this dangerous pricing strategy got a major thrust from Gilead Sciences Inc. with its acquisition of sofosbuvir’s (Sovaldi) developer – ‘Pharmasset’ in 2011, for US$ 11 billion.

According to Dr. Stone, ‘Pharmasset’s chief executive made an estimated US$ 255 million on the deal, and its 82 employees each averaged around US$ 3.3 million, before Sovaldi came to the market. Thereafter, it’s a history. Gilead took a double markup on the drug, charging enough not just to more than cover the high cost of acquisition of ‘Pharmasset’, but also for making windfall profits.

The reason behind irresponsible pricing:

The question, therefore, arises, how do the global pharma players dare to go for such irresponsible pricing in many countries of the world?

It is possible for them because the payers, especially the health insurance companies, usually find it difficult to out rightly ignore any unique and new life saving patented medicine for various reasons. As a result, the concerned companies, allegedly effectively use these payers, and also a large section of doctors who can prescribe these brands, facilitating them to make huge profits at the cost of patients.

The justification:

To justify such pricing, these pharma companies and their trade associations are apparently using fear as the key. Through various types of communications, they keep trying to convey that any attempt to restrict their so called ‘reasonable’ prices of these medicines would seriously jeopardize the innovative drug development process, jeopardizing the long term needs of the patients.

More recently, serious attempts were made to also establish Sovaldi’s so called ‘reasonable’ pricing, and its cost effectiveness, in an interesting way.

The company highlighted that Sovaldi is cost effective, not just in comparison to paying for other health care services that the drug might prevent, it also helps avoid cost intensive liver transplant, in many cases. With those costs not being incurred with Sovaldi, the patients, on the contrary, make some savings on the possible alternative treatment cost to fight this deadly disease.

Is it not an atrocious argument?

However, according to Dr. Stone, “This argument is a lot like a plumber billing a customer US$ 20,000 to fix a leaky pipe under the sink. Considering the costs of a possible flood, it might seem defensible. In the real world, any plumber charging based on ‘what you saved’ by preventing a potential catastrophe would lose business to competitors.”

A warning sign:

The above article also highlights, Sovaldi like drug price tag is an unmistakable warning sign, and the emerging trend of patented drug pricing system is a danger to the health of any nation. According to the author:

Reforming the financing of drug development will require more creativity.

The government should consider subsidizing research and development to reduce the industry’s risk, in return for oversight on pricing that would allow reasonable returns on investment.

Not possible without many doctors’ active support:

Though it is encouraging to see that some doctors, such as, Daniel J. Stone are raising their voices and arguing against this practice, a large number of other doctors are being actively influenced by the pharma companies to prescribe such products.

This is vindicated by the latest release from the Open Payments database of the Government of the United States. It shows that the drug and device makers of the country incurred a mind boggling expenditure of US$ 2.6 billion towards payment to doctors related to speakers’ fees, meals, royalties and other payments, in 2015. Under the Physician Payments Sunshine Act of America, this is the second full year of the disclosure.

The total payment made by the drug and device makers to doctors and medical institutions for the year was shown as US$ 7.52 billion.

The point to ponder:

That said, the question that surfaces, if Gilead had to sell its drugs to individuals incurring ‘out of pocket’ health expenditure, how many Sovaldi like drugs would it sell with equivalent to around US$ 80,000 treatments cost?

It won’t be too difficult to ferret out its answer, if we look at the countries, like India, with very high ‘out of pocket’ expenditure on health care, in general, and medicines in particular.

A possible solution:

According to an article published by the World Health Organization (WHO) on February 8, 2007, Voluntary Licensing (VL)’ practices in the pharmaceutical sector could possibly be a solution to improving access to affordable medicines.

The Section 3 (d) of the Indian Patents 2005, which is generally applicable to ‘me too’ type of new products, could place India at an advantage. In the absence of a grant of evergreen type of product patents, many global companies would ultimately prefer to offer VL to Indian generic manufacturers, under specific terms and conditions, mainly to salvage the situation.

However, such a VL is unlikely to have any potential value, if the IPO refuses to grant patents to those products falling under the above section. In that case, generic competition would possibly further bring down the prices.

Has it started working in India?

Just to recapitulate, starting with a flash back to the year 2006, one can see that Gilead followed the VL strategy for India, probably for the first time, for its patented product tenofovir, used in the treatment of HIV/AIDS.

At that time Gilead announced that it is offering non-exclusive, voluntary licenses to generic manufacturers in India for the local Indian market, along with provision for those manufacturers to export tenofovir formulations to 97 other developing countries, as identified by Gilead. The company had signed a voluntary licensing agreement with Ranbaxy for tenofovir in 2006.

Interestingly, by that time Cipla had started selling one of the two versions of tenofovir, not licensed by Gilead. Cipla’s generic version was named Tenvir, available at a price of US$ 700 per person per year in India, against Gilead’s tenofovir (Viread) price of US$ 5,718 per patient per year in the developed Markets. Gilead’s target price for tenofovir in India was US$ 200 per month, as stated above.

Following this strategy, again in 2014, Gilead announced, “In line with the company’s past approach to its HIV medicines, the company will also offer to license production of this new drug to a number of rival low-cost Indian generic drug companies. They will be offered manufacturing know how and allowed to source and competitively price the product at whatever level they choose.”

Accordingly, on September 15, 2014, international media reported that Cipla, Ranbaxy, Strides Arcolab, Mylan, Cadila Healthcare, Hetero labs and Sequent Scientific are likely to sign in-licensing agreements with Gilead to sell low cost versions of Sovaldi in India.

It was also announced, just as tenofovir, that these Indian generic manufacturers would be free to decide their own prices for sofosbuvir, ‘without any mandated floor price’.

Once again, in July 2016, it was reported that a drug called Epclusa – the latest breakthrough treatment for Hepatitis C virus could soon be available in India following Gilead Sciences’ getting its marketing approval from the US FDA.

Press Trust of India (PTI) reported, as part of its effort to offer affordable treatment, Gilead Sciences, together with its 11 partners in India, are pioneering a VL model that transfers technology and Intellectual Property for the latest treatments and cures for viral Hepatitis and HIV.

Some other pharma majors of the world also seem to be attempting to overcome the safeguards provided in the Indian Patents Act, which serves as the legal gatekeeper for the patients’ interest. Their strategy may not include VL, but also not so transparent ‘Patient Access Programs’, and the so called ‘flexible pricing’. All these mostly happen when the concerned companies sense that the product patents could fail to pass the scrutiny of the Indian Patents Act.

That said, I have not witnessed the global pharmaceutical companies’ issuing a flurry of VLs in India, as yet.

Another possible solution for India:

Another possible solution for India, although was scripted in Para 4. XV of the National Pharmaceutical Pricing Policy 2012 (NPPP 2012) and notified on December 07, 2012, unfortunately has not taken shape even after four years.

On ‘Pricing of Patented Drugs’, NPPA 2012 categorically states as follows:

“There is a separate committee constituted by the Government Order dated February 01, 2007 for finalizing the pricing of Patented Drugs, and decisions on pricing of patented Drugs would be based on the recommendation of this committee.”

To utter disappointment of many, a strong will to make it happen, even by the new Government is still eluding, by far.

Conclusion:

Without having adequate access to new life-saving drugs, the struggle for life in the fierce battle against dangerous ailments, has indeed assumed an alarming dimension. This is being fuelled by the absence of Universal Health Coverage, and ‘out of pocket expenditure’ on medicines in India being one of the highest in the world.

It would continue to remain so, up until the global pharma majors consider entering into a VL agreement with the Indian pharma majors, just as Gilead. Otherwise, the Government in power should demonstrate its strong will to act, putting in place a transparent model of ‘patented drugs pricing’, without succumbing to any power play or pressures of any kind from vested interests.

Sans these strong initiatives, the dangerous trend of patented drug pricing will continue to deny access of many new medicines to a vast majority of the population to save precious lives.

By: Tapan J. Ray

‘Indian Drug Control World’s Weakest: Pharma Trade Bodies Working At Cross Purposes’

Posted on April 25, 2016 by Tapan Ray

“In the entire world, I think our drug control system probably is the weakest today. It needs to be strengthened,” said the Secretary of the Department of Pharmaceuticals (DoP) – V K Subburaj at an event in New-Delhi on April 19, 2016.

In his speech, the Secretary also singled out the pharma industry associations for working in opposite directions, adding that “if we take one decision, it is appreciated by one but the other one criticizes us”.

This is indeed an irony. Such scathing comments from an important and a top Government official indeed stand out. This is primarily because, in the midst of the prevailing scenario, where a large section of the Government is saying ‘we are the best’ or ‘best among the worst’ or, at least, ‘fast improving’, a seemingly helpless key decision maker for the pharma industry was constrained to publicly say, what he had said, as above.

Nonetheless, public expressions, such as these, coming from a top Government official well-captures the sad and pathetic scenario of the systemic failure of pharma industry regulators to bring order in the midst of continuing chaos. Virtually free-for-all business practices, blatantly ignoring the patients’ health and safety interest in the country, continue to thrive in a self-created divisive environment.

Unsparing remarks in two critical areas:

As reported by the ‘Press Trust of India (PTI)’, the DoP Secretary, with his unsparing remarks, publicly expressed his anguish for the delay in taking remedial measures, at least in the two critical areas of the pharma industry in India, as follows:

Questionable quality of drugs
Questionable pharma marketing practices

He also highlighted, how just not some Government Departments, but the pharma trade associations, which are formed and fully funded by the pharma players, both global and local, are working at cross-purposes to perpetuate the inordinate delay in setting a number of things right, to satisfy the healthcare needs of most patients.

I briefly dwelled on this critical conflict in my article in this blog of March 28, 2016 titled, “Ease of Doing Pharma Business in India: A Kaleidoscopic View”

A. Questionable quality of drugs:

There wasn’t enough debate in the country on the questionable drug quality in India. It began when the US-FDA started banning imports of a number of medicines in the United States from several drug manufacturing facilities in India. These pharma plants are of all sizes and scales of operations – large, medium, small and micro.

Almost on a regular basis, we now get to know, both from the national and international media, one or the other pharma manufacturing facility in the country, has received the ‘warning letter’ from the US-FDA on its ‘import ban’.

Dual drug manufacturing quality standards?

The spate of ‘Warning Letters’ from the US-FDA have brought to the fore the existence of two different quality standards of drug manufacturing in India:

High quality plants dedicated to exports in the well-regulated markets of the world, such as, the United States, following the US-FDA regulations.

Other plants, with not so stringent quality standards of the Drug Controller General of India (DCGI), cater to the needs of the Indian population and other developing non-regulated markets.

In this situation, when many Indian manufacturers are repeatedly faltering to meet the USFDA quality standards, the following two critical questions come up:

Are the US-FDA manufacturing requirements so stringent that requires a different compliance mindset, high-technology support, greater domain expertise and more financial resources to comply with, basically for protection of health and safety of the American patients?

If so, do the Indian and other patients from not so regulated markets of the world, also deserve to consume drugs conforming to the same quality standards and for the same reason?

Answers to these questions are absolutely vital for all of us.

Pharma associations working at cross-purposes?

Considering this from the patients’ perspective, there lies a huge scope for the pharma associations, though with different kind of primary business priorities, to help the Government unitedly in resolving this issue.

It appears from the deliberation of the DoP Secretary that the health ministry is already seized of the matter. The concerned departments are also apparently batting for quality, and trying to strengthen some specific capacity building areas, such as, increasing the number of inspectors and other drug control staff.

Reports also keep coming on the poor quality clinical trial data in India, including data fudging, as was recently detected by the foreign drug regulators. Intriguingly, nothing seems to be changing on the ground. In these areas too, the industry can unitedly try to protect the innocent patients from the wrongdoers, demonstrating enough credible and publicly visible real action.

From the anguish of the DoP Secretary on the critical quality related issue, it appears, there is a huge task cut out for the Indian drug regulators to ensure uniform and high drug quality standards for health and safety of all Indian patients’, just as their counterparts in America.

It is unfortunate to note from his observation that pharma industry associations are not visibly working in unison on many such issues in India.

B. The UCPMP:

The Edmund J. Safra Center for Ethics of Harvard University, while deliberating on “The Pharmaceutical Industry, Institutional Corruption, and Public Health” dwelled on the legal, financial, and organizational arrangements within which the pharmaceutical industry operates. It said, this situation sometimes creates incentives for drug firms and their employees, that conflict with the development of knowledge, drug safety, the promotion of public health, and innovation. More importantly, they also make the public depend inappropriately on pharmaceutical firms to perform certain activities and this leads to institutional corruption.

Illustrating from Professor Marc Rodwin’s project, the article said pharma players provide substantial discretionary funding for important medical activities, such as, continuing medical education, medical research, medical journals, and professional medical societies, which can encourage unwanted and undesirable compromise and bias in favor of their interests.

The same sentiment was also well-captured in an editorial of the well-reputed international medical journal BMJ of June 25, 2014. It unambiguously articulated, “Patients everywhere are harmed when money is diverted to the doctors’ pockets and away from priority services. Yet this complex challenge is one that medical professionals have failed to deal with, either by choosing to enrich themselves, turning a blind eye, or considering it too difficult.”

The editorial underscored the point that success in tackling corruption in healthcare is possible, even if it is initially limited, as anti-corruption bodies in the United Kingdom and US have shown to a great extent. With this, BMJ planned to launch a campaign against ‘Corruption in Medicine’, with a focus on India.

The DoP initiative:

Not a panacea:

It is worth noting, since the last three and a half decades, ‘Code of Pharmaceutical Marketing Practices’, prepared by various global pharma trade associations and most of the large global pharma companies individually, have come into existence purported for strictest voluntary adherence. These are being relentlessly propagated by them and their trade associations, as panacea for all marketing malpractices in the drug industry. Squeaky clean ‘pharma marketing codes’ for voluntary practices can be seen well placed in the websites of almost all large global pharma players and their trade associations.

The concept of a pharma marketing code and its intent are both commendable. However, the key question that follows: are all those working in practice? If the answer is yes, why then mind boggling sums in billions of dollars are being paid as settlement fees by a large number of global pharma companies for alleged colossal marketing malpractices in different countries of the world?

Mandatory UCPMP:

As happens with any other voluntary pharma marketing code of a global drug company or their trade associations, however mighty they are, similar non-compliance was detected by the DoP with voluntary UCPMP. This gross disregard on the code, apparently prompted the DoP making the UCPMP mandatory, with legal implications for non-compliance, which could possibly lead to revocation of marketing licenses.

A move in this direction, obviously necessitated meaningful discussion of the DoP with all stakeholders, especially the pharma trade associations. According to the Secretary, the discussions got unduly protracted, crippling his decision making process to put the mandatory UCPMP in place, soon.

Divergent views of pharma associations?

Thus, it is now quite clear that one of the reasons for the delay in making the UCPMP mandatory is the divergent views of various pharma trade associations.

In the Secretary’s own words, “To take an example of uniform marketing code, we thought we could arrive at a common solution. But even after 7-8 meetings, we failed to come to a conclusion. It’s only now that we have arrived at a code.”

However, the bottom-line is, as on date, we don’t know when would the mandatory UCPMP come into force in India.

Conclusion:

The reverberation of virtual helplessness in the recent utterances of the Secretary of the DoP, has naturally become a cause of great concern, especially for the patients. There is still no sign of early resolution of the critical issue of dubious quality, both in the drug manufacturing and clinical trials in India.

The concerned ministries would require to demonstrate unwavering will and unflagging zeal for good governance with accountability, to set things right, without any further delay. When US-FDA can, why can’t the DCGI succeed in doing so? The Government is expected to ensure that justice prevails in this area, for the patients’ sake, soon enough.

Similarly, wrong doings in pharma marketing practices also need to be addressed by the DoP, initially making the UCPMP mandatory having strong legal teeth, to start with, notwithstanding the fact that the trade associations mostly work at cross-purposes, in this area too.

As I hear from the grapevine, especially the MNC trade associations, both inside and outside the country, are trying hard to take, especially, the owners of the large Indian pharma companies on board, in several ways, basically to further their crusade on various self serving issues, such as dilution of Indian Patents Act.

That said, taking serious note of the observation of the DoP Secretary that the Indian drug control is the “weakest in the world”, together with the challenges that he is facing in containing pharma marketing malpractices, I hope, the honorable Prime Minister’s Office (PMO) may wish to intervene soon, in order to promptly contain these snowballing public health menace.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Ease of Doing Pharma Business in India: A Kaleidoscopic View

Posted on March 28, 2016 by Tapan Ray

Ensuring ease of doing any ethical business activity in India, is a new focus area of the Government and is very rightly so. Creating ease of doing ethical pharma business too, falls under this overall national objective.

In this article, restricting myself to the drug sector, I shall deliberate on various aspects, which are now being considered by the pharma industry, related to the ‘ease of doing pharma business in India’. My discussion would cover all subsets of pharma players, irrespective of whether they fall under Multinational (MNC) or purely homegrown Indian companies, with different scales of operations – large, medium, small, or micro.

To help the Government facilitating the ‘‘ease of doing pharma business in India’, it is just not enough to make the business models for all subsets of the Indian pharma sector looking ethical, conforming to all relevant laws, policies, rules and norms. Each pharma player need also to maintain an ongoing strict internal vigil, religiously, to ensure that the requirements of high quality clinical development, manufacturing and selling practices for effective, safe and rational medicines, are properly understood and strictly followed by all the employees within the organization.

A Kaleidoscopic View:

The above situation is something that ought to happen, as the Government keeps striving to improve the ‘ease of doing pharma business’ in India. However, while looking through a Kaleidoscope, as it were, the colors of industry expectations in this area keep changing rapidly, as the new contentious issues keep emerging. Consequently, the ground reality of assessing the same, by a large section of the pharma players in India, seems to veer only around different types of just self-serving demands, expecting those to act as a powerful tailwind pushing their business interests rapidly forward.

Such expectations keep surfacing, rather frequently, from all the subsets of the pharma industry, be they MNCs and their trade associations or the Companies of purely Indian origin and their trade bodies. The accusation to the Government pertaining to all these issues, is a common one: ‘Where is the ease of doing pharma business in India?’

Citing even some recent incidents, they are voicing with equal gusto, that the root causes of all these problems lie miles outside the pharma industry. The causative factor, they indicate, is rooted at the very doorsteps of the Government, as its ministries initiate tough action to root out corruption in the pharma industry as concurrent measures, disturbing their business comfort zones, and upsetting the apple carts.

The Government has its task cut out:

I hasten to add that I have no intention to paint it as a confrontation between the Government and the pharma industry, in any way. The Government is also facing the brunt from the various stakeholders, relentlessly, for its utter negligence of public health care, and public expenditure over it.

The impact of this Government indifference, though also comes on the patients, the industry does not seem to have much to crib over it as a direct impediment to the ‘ease of doing pharma business’ in India.

Probably as a diversionary tactic, the industry keeps using this critical Government inaction in the hope of diverting the public, or media attention from its own alleged business malpractices, even at a time when these are being covered both by the national and international media, regularly. Nevertheless, the industry credibility on these issues, seems to have started waning fast, as the genie is out of the bottle.

A common punching bag of all industry dissatisfaction on the Government:

It is worth noting that despite some key differences between the MNC and Indian pharma companies, which I shall discuss later, the common punching bag of the industry dissatisfaction on various Government decisions, always has been the lack of ‘ease of doing pharma business’ in the country.

This discontentment may be well justified. I have no qualms about it. However, when this dissatisfaction gets tagged with some recent Government action, taken to protect public health interests and does not have much to do with the ‘ease of doing ethical pharma business’, many eyebrows are obviously raised.

Against some of these critical patient-centric actions, the industry continues to express its annoyance in unison, while for some other Government decisions, it speaks in different voices – some are happy ones, and the others are not so. However, the common thread of expression of all such dissatisfactions is always linked with the lack of ‘ease of doing business’ in India.

A. Where the pharma Industry in India speaks in unison:

I shall now give two major examples of the key Government decisions, that have irked the entire pharma industry immensely, and makes it voicing that those Government actions grossly violate the fundamental requirements of its smooth running of business. Is that fair? Let me analyze that below with these two examples:

1. Drug price control:

The industry, by and large, opines that individual drug company should be allowed to decide the way it would price any drug, as the market forces, especially for generic drugs, would determine its price.

Indian Parliament, the Supreme Court of India, the Government in power at different times, most of the independent experts and the NGOs, on the contrary, consider drug price control is necessary in India, especially for essential drugs. It makes high quality essential medicines affordable and accessible to the general population.

National Pharmaceutical Pricing Authority (NPPA) has also announced and explained that the competition does not work on controlling prices for pharma products, where the consumers are not the decision makers. The key prescribing decision makers for the patients are the doctors, who are mostly and unethically influenced by the drug companies having vested interest in making such decisions. This unholy nexus has been widely alleged globally, and also established through umpteen number of studies of high credibility.

Nevertheless, the doctors, from across the globe, including in India, have long disputed that any payments, if and when they receive from pharmaceutical companies, have no relationship to how they prescribe drugs.

A March 17, 2016 study of ProPublica has conclusively established that: “The more money doctors receive from drug and medical device companies, the more brand-name drugs they tend to prescribe. Even a meal can make a difference.” This study may be in the context of the Unites States, but India in this in this regard is no exception, as captured even in the parliamentary Committee reports.

Thus, conceding to high voltage pharma advocacy, made on the pretext of ‘encouraging innovation’ and ‘ease of doing business in India’, if any Government contemplates the abolition of drug price control in India is, it would make not just essential drugs inaccessible to a large section of society, but encourage blatant corrupt practices. This caution has come, besides many others, also from a Parliamentary Committee report, unambiguously. Incidentally, the present Government too strongly speaks against corruption, in any form.

Thus, I reckon, if the industry believes that the price control of essential drugs, which are for public health interest, goes against ease of doing pharma business in India, so be it.

2. Manufacturing and selling of irrational FDCs:

A Fixed Dose Combination (FDC) drug may appear irrational to drug regulators and well-qualified experts, after necessary scientific scrutiny, for various reasons. This may happen, primarily because of the following reasons:

When the medical rationale of the FDC along with the ingredient details, submitted to the regulatory authority for marketing approval, are considered scientifically inappropriate.

When the evolving medical science establishes the irrationality of the FDC after a period of time.

When the analysis of ‘Adverse Drug Event’ reports from the ongoing Pharmacovigilance studies signals a red alert.

Widespread uncontrolled misuse or abuse of FDCs, where the consumers’ health risks far outweigh the drug benefits, as provided in the drugs Act, for public health interest.

Some regulatory loopholes were misused by the drug manufacturers in the past to get the irrational FDCs approved by the State Drug Authorities, violating the new FDC regulatory approval Policy.

Any irrational FDC so identified by the drug regulators and experts, by putting a system of scrutiny in place, must be banned forthwith, in public health interest. There should not be any scope of negotiation with drug manufacturer to make the bans effective.

Incidentally, realizing the gravity of public health risks posed by irrational FDCs, even the NPPA has reportedly decided to review afresh all new applications for price fixations of FDC and examine their safety and efficacy profile.

Moving towards this direction, the NPPA Chairman, has reportedly sent back more than 200 applications for price fixation of FDCs, instructing the concerned manufacturing and marketing companies to apply again with a declaration that their formulations are not “irrational.” It was also reported that the price regulator has also brought under the lens third-party drug makers and pharma companies that outsource to them, to check illegal sales of irrational FDCs and spurious drugs.

Two key questions being raised now:

Despite all these, the industry keeps repeating, especially, the following two questions, which are worth looking at, one by one:

1. Why is the ban now?

I discussed the issue of FDC ban in my previous article in this Blog on March 21, 2016 titled, “The Recent Ban On Irrational FDCs: History Repeats Itself”.

In the above article, I also argued that large section of the industry and its associations are protesting against the Government ban of 344 irrational FDCs, and questioning vigorously, even outside the Delhi High Court – ‘why is the ban now?’

The point ‘why now’ is absolutely irrelevant, as not taking any action ever, against a wrong doing ignored over a long period time for whatever reasons, does not confer any regulatory legitimacy to an irrational FDC formulation to be considered as a rational one for all time to come, and thereby, exposing patients to serious health risks, knowingly.

2. Why is this ban so sudden, and in some cases after decades?

Sudden banning of drugs, which are in the market for a long time, is not a recent Indian phenomenon in India. In 2011, according to a report, in the world’s largest pharma market – the United States, the FDA banned 500 prescription drugs that had been on the market and working for decades. USFDA ban also happened suddenly, and that includes cough syrups too. Thus, it is intriguing, why is this fuss created by the Industry in India now?

In the midst of it, one odd, knee-jerk, apparently ‘spoon-fed’ and ill-informed editorial in some Indian business daily, raises more questions about its real intent, rather than help finding answers to the poorly sketched problems.

I would hope, the Government would stay firm and be able to convince the Delhi High Court today, i.e. on March 28, 2016, with its robust data-based arguments, accordingly.

Be that as it may, in my perspective, if the industry still believes that bans of irrational FDCs to protect public health interest, as decided by the independent experts after long and structured deliberations, would go against ‘ease of doing pharma business’ in India, so be it.

B. Where the pharma industry in India speaks in different voices:

As stated above, there are several other key areas, where the MNC and Indian Pharma players have sharp differences in their perspectives. Despite these differences, the aggrieved section does not even blink a bit to attribute those Government actions to the lack of ‘ease of doing pharma business’ in the country.

In this area, I shall give just the following three examples:

1. The Patents Act:

MNCs say that section 3 (d) of the Indian Patents Act 2005, which is aimed at curbing patent ever-greening or frivolous inventions, is against the ease of doing business in India. However, the Indian Pharma players, do not think so, at all. Similar disagreement also exists in other critical areas too, such as, ‘Data Exclusivity (DE)’ and ‘Compulsory Licensing (CL)’.

Thus, in my opinion, if some ‘public health interest’ related provisions of the robust Indian Intellectual Property (IP) Act, such as, section 3 (d), DE and CL, are considered as going against the ‘ease of doing pharma business in India’ by the MNCs, so be it.

2. Mandatory Uniform Code of Pharma Marketing Practices (UCPMP):

Need to have a mandatory UCPMP, though, is reportedly supported by the MNCs, Indian pharma players do not seem to be quite in sync with this idea. I am not sure, whether the delay in the announcement of mandatory UCPMP, almost in every 3 months, has any coincidence with it or not. However, the reality is, no one still knows clearly, when would it definitely come, if at all.

Media reports on pharma MNC support to mandatory UCPMP, and repeated reiteration that its members in India rigidly follow the IFPMA Code of Marketing Practices, though commendable, seem to grossly lack in credibility.

Interestingly, despite the existence of this code and high-decibel vouch for its rigid conformance, maximum number of MNCs have been fined billions of dollars, by the Government in various countries, for alleged gross marketing and other business malpractices. It has been happening over a long period of time, and is being reported by the international media, frequently.

What is really happening, especially, on the so called total support of ethical marketing practices by the MNCs? Are they trying to create just good optics by craftily framing and supporting such showpiece codes, and blatantly defying these to achieve self-serving goals? The voice gets shriller, even when they are being levied hefty fines, after getting caught red handed, as reported by the global media? I guess, the future would ultimately unfold the reality. But would it, at all?

The Indian Scenario:

Even in India, such alleged marketing malpractices involving even a top pharma MNC have often been reported by the media. Just to illustrate, “Prescribe a drug maker’s medicine and get a free vacation”, reported a news article. There are several other similar reports too. Hence, the credibility of pharma MNC statements regarding strict conformance to ethical marketing codes, ably formulated by the well-known pharma trade associations, such as, IFPMA, appears to be very low, if exists at all.

The well-reputed medical Journal BMJ in one of its articles titled, “Corruption ruins the doctor-patient relationship in India”, published on May 8, 2014, expressed serious concern on this issue.

It concluded that corruption, kickbacks and the nexus between doctors and pharmaceutical firms are rampant India. This eventually prompted the BMJ, in June 2014, to launch a campaign reportedly called ‘Corruption in Medicine’.

On this issue, way back in May 08, 2012, even the Indian Parliamentary Standing Committee on Health and Family Welfare in its 58th Report, placed before the Parliament on May 08, 2012, expressed its serious concern.

Indian lawmakers, recommended in the report that the Department of Pharmaceuticals (DoP) should take decisive action, without further delay, in making the UCPMP mandatory, so that effective checks could be ensured on ‘huge promotional costs’ and the resultant add-on impact on medicine prices. Unfortunately, despite a change in the Government in 2014, UCPMP has still not been mandatory.

It is anybody’s guess, despite all these reports, what type of external pressure, if at all, the DoP is still facing to put in place a robust mandatory UCPMP with strong deterrent measures.

Under this backdrop, in my view, if mandatory UCPMP having enough teeth, to curb ongoing blatant marketing malpractices to protect patients’ health interest in India, is considered by any as going against the ‘ease of doing pharma business in India’, so be it.

3. Drug manufacturing quality:

Enough discussions have already been made on import ban of USFDA from over 45 drug manufacturing facilities of Indian Companies, of all sizes and scale of operations, on the ground of drug quality standards. USFDA considered drugs manufactured in those banned facilities are unsafe for the consumption of American patients. Some other foreign drug regulators, from the developed countries, have also taken similar action.

Taking advantage of this development, it was reported that attempts are indirectly being made to establish that MNC marketed generic drugs are superior to similar ones, manufactured even by the large Indian drug producers.

The fact, apparently, is quite different. MNCs operating in India has not come under the USFDA scanner in this regard as much, probably not because of their far superior drug manufacturing quality standards in India, as compared to even the best of their Indian counterparts. I reckon, it is mainly because, very few MNC drug manufacturing facilities in India export India manufactured drugs for consumption in the United States.

It may not, therefore, make any real sense to conclude that MNC marketed generic drugs in India, either manufactured my themselves or under loan & license or under a third party, are generally better in quality than the similar ones manufactured even by the large Indian manufacturers.

In any case, I feel that there is a huge scope for Indian drug regulators to ensure uniformly high drug quality standards. This is necessary for Indian patients’ health and safety. There also should be stringent regular quality audits in all drug manufacturing facilities in India, where non-conformance with prescribed standards would attract serious punitive measures. The Union Ministry of Health, together with the State Governments would require increasing the number of auditors accordingly.

However, the reality is, many Indian drug manufacturers have expressed that maintaining stricter drug manufacturing standards (cGMP) would involve huge expenditure, which they will not be able to afford. Consequently, this would go against the ‘ease of doing pharma business’ in India.

Again, in my view, if the stringent regulatory requirements for maintaining high drug manufacturing standards in India to protect public health interest, is considered as going against the ‘ease of doing pharma business’ in India, so be it.

Conclusion:

Improving ‘ease of doing pharma business’ in India is an absolute necessity, just as all other businesses. Pharma sector deserves it very badly too, as it has been experiencing excruciating delay in multiple regulatory clearances. Single window clearances of all applications, with a much greater sense of urgency, without bureaucratic red tapes and avoiding other unnecessary delays, is certainly the way forward for India. It would require urgent policy reforms, maintaining a right balance between, public, consumers and business interests.

Pharma sector is not all villain, either, by any yardstick. It is instrumental in saving and improving the quality of lives of so many people across the globe, since a very long time, with its both innovative and generic medicines. All must acknowledge it, and the Government does it too, openly, several times.

That said, the space of focus of the pharma industry appears to be getting increasingly narrowed down to more of its self-serving acts, and in their hard selling, through hugely expensive advocacy campaigns, even at the huge cost of attracting frequent self-defeating scathing criticisms, across the world.

At the same time, the Governments in different times hugely disappointed its citizens, in charting a clear road map for quality and affordable health care for all in India, along with appropriate budgetary allocations and policy reforms, and thereafter, in its implantation with military precision.

However, that doesn’t mean, in any way, while facilitating ‘ease of doing pharma business’ in India, the Government would turn a blind eye on the rapidly breeding corruption in the pharma business practices, and give in to unjustified industry muscle-flexing, sacrificing the health interest of its citizens in the country.

While looking through this Kaleidoscope, it appears to me, if the pharma sector considers the appropriate Government actions to protect public health interest, against the unacceptable industry practices, would also go against the ‘ease of doing pharma business’ in India… Well, so be it.

By: Tapan J. Ray

Indian Patents Act To Prevail Undiluted…Finally

Posted on July 27, 2015 by Tapan Ray

Curiously enough, what a little birdie told me just a couple of weeks ago, very similar to that I read in various media reports even less than a week later.

It was related to a somewhat trepidatious national policy in the making on Intellectual Property Rights (IPR) in India.

One major apprehension, besides a few others on this IPR Policy, was flying all over and nettling many. It was regarding the possibility of tweaking or dilution of the Indian Patents Act by the Government, coming under strong external pressure and also to get support on India’s food security in the World Trade Organization (WTO).

Probably to douse this simmering fire of trepidation, well calibrated, unambiguous and reassuring narratives on the subject were unfolded recently by the Government, that too in a quick succession, which were somewhat as under.

On July 20, 2015, at an event organized by the Federation of Indian Chambers of Commerce and Industry (FICCI), the Commerce and Industry Minister Nirmala Sitharaman reiterated that:

India’s IPR laws are quite in compliant with the TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement.

There is no need for apprehension in any corner of the world as to what India’s patent regime is like.

The Minister also indicated at the same event that following a transparent process of drafting…and redrafting; the final blue print of the IPR policy has now been circulated to all concerned ministries for inter-ministerial consultations. After completion of that process soon, her Ministry would submit the final version to the Cabinet for approval.

It is now anticipated that by the end of this year the first ‘IPR Policy’ of India would be operational.

The creeping angst for a possible twitching in the country’s otherwise robust Patents Act, was mostly originated from a pointed recent utterance of Prime Minister Modi on this issue that we shall quickly explore in this article.

Another stronger assertion:

Immediately thereafter, while commenting on a related article published in an Indian business daily dated July 24, 2015, Minister Nirmala Sitharaman reasserted the following points even more emphatically and virtually in so many words:

India’s IPR laws are fully compliant with international obligations under the TRIPS agreement. This includes the Patents Act, 2005, whose provisions have time and again stood the test of judicial scrutiny.

There is no question of permitting ‘evergreening’ of patents, or of realigning our IPR laws to comply with US laws.

There is no question of sacrificing our IPR laws to get support from a particular country even on food security.

A brief background:

In October 2014, almost immediately after Prime Minister Modi’s return to India from the United States, the the Department of Industrial Policy and Promotion (DIPP) formed a six-member ‘Think Tank’, chaired by Justice (Retd.) Prabha Sridevan, to draft the ‘National IPR Policy’ and suggest ways and legal means to handle undue pressure exerted by other countries in IPR related areas.

The notification mandated the ‘Think Tank’ to examine the current issues raised in such reports and give suggestions to the ministry of Commerce & Industry as appropriate.

However, the domestic pharma industry, many international and national experts together with the local stakeholders, continue to strongly argue against any fundamental changes in the prevailing robust patent regime of India.

Taking quick strides, on December 19, 2014, the Think Tank’ released its first draft of 29 pages seeking stakeholders’ comments. According to Minister Nirmala Sitharaman, “Different people, countries, including the United States and other organizations have already given their inputs on the draft policy.”

The new policy would focus on stronger enforcement of IPR by increasing the manpower in IP offices and reducing pendency of IPR filings. It aims at bringing clarity to the existing laws and making changes wherever required to safeguard the interests of Indian industry and patent holders worldwide.

I reviewed this subject in my blog post of January 19, 2015 titled, New “National IPR Policy” of India – A Pharma Perspective.

Most recent apprehension:

The most recent spark for the speculation of a possible dilution in the Indian Patents Act 2005, came from the April 24, 20015 media report that quoted Prime Minister Modi expressing his intent on the issue, seemingly going overboard, as follows:

“India’s patent laws should be brought on par with global standards to make Asia’s third largest economy a hub for outsourced creative services.”

The basic purpose of making such an apparently ambiguous statement may be construed as an attempt to attract more Foreign Direct Investments (FDI) for the country.

Whatever it may be, this announcement of the Prime Minister sent a strong signal to many as an impending major shift in his Government’s thinking to move away from an otherwise robust and a decade old IPR regime in India, undoubtedly under intense external pressure.

The above pronouncement from an otherwise tough minded Prime Minister came as a bolt from the blue, as it were, to many stakeholders. This is mainly because; India has so far been maintaining in all forum that its IPR regime is fully TRIPS compliant and garnered enough international support from the experts in this area, including Nobel Laureates.

The Prime Minister made his intent even stronger, when he further elaborated his argument as under:

“If we don’t work towards bringing our intellectual property rights at par with global parameters, then the world will not keep relations with us. If we give confidence to the world on IPR, then we can become a destination globally for their creative work.”

Some American Government agencies reportedly lapped up Prime Minister Modi’s statement as they openly commented as follows:

“The United States also welcomes April 2015 statements made by Prime Minister Modi recommending that India align its patent laws with international standards and encourages India expeditiously undertake this initiative”

Intriguing comment:

Prime Minister Modi’s comment in this regard that “India needs to bring its patent laws on par with global standards,” comes of rather intriguing to many domain experts, as TRIPS agreement is the only universally accepted ‘Global Standard’ for IPR. Even the new Government has reiterated that Indian patent regime is fully TRIPS compliant.

India welcomes and encourages innovation:

With the enactment of Patents Act 2005, India has demonstrated that Intellectual Property Rights (IPR) and pharma patents in particular, help fostering innovation and is critical in meeting unmet needs of the patients.

However, the moot question still remains, what type pharmaceutical invention, should deserve market exclusivity or monopoly with overall freedom in pricing, keeping larger public health interest in mind.

There are still some loose knots in the process of speedy resolution of all IP related disputes and creation of a desirable ecosystem for innovation in the country, that the new IPR Policy is expected to effectively address, soon.

Two fundamental changes that the US is looking for:

Leaving aside the peripheral ones, the following two are the center pieces where the United States would want India to dilute its Patents Act 2005 considerably:

Patentability for all types of innovation, including ‘me-too’ ones and evergreening of patents, which would delay entry of affordable generic drugs.

“Compulsory Licensing (CL)” provisions, other than during natural calamities.

The status today:

Though the Prime Minister has not further spoken on this subject publicly, from the recent statements of the Union Minster of Commerce and Industry it seems rather clear that for greater public health interest, India has decided to keep its Patents Act undiluted, at least, for now.

The Union Government has distinctly explained its stand in the following two areas:

I. No…No, to ‘Evergreening’ of patents in India:

In line with this thinking, for quite sometime a raging global debate has brought to the fore that there are quite a large number of patents on drug variants that offer not very significant value to the patients over the mother molecules, yet are as expensive, if not more than the original ones.

In common parlance these types of inventions are considered as ‘trivial incremental innovations’ and described as attempts to ‘evergreening’ the patents.

A paper titled, “Pharmaceutical Innovation, Incremental Patenting and Compulsory Licensing” by Carlos M. Correa argued as follows:

“Despite decline in the discovery of New Chemical Entities (NCEs) for pharmaceutical use, there has been significant proliferation of patents on products and processes that cover minor, incremental innovations.”

The study conducted in five developing countries – Argentina, Brazil, Colombia, India and South Africa has:

Evidenced a significant proliferation of ‘evergreening’ pharmaceutical patents that can block generic competition and thereby limit patients’ access to medicines.

Found that both the nature of pharmaceutical learning and innovation and the interest of public health are best served in a framework where rigorous standards of inventive steps are used to grant patents.

Suggested that with the application of well-defined patentability standards, governments could avoid spending the political capital necessary to grant and sustain compulsory licenses/government use.

Commented, if patent applications were correctly scrutinized, there would be no need to have recourse to CL measures.

Indian Patents Act under its section 3(d), discourages the above practices for public health interest. This particular provision, though absolutely TRIPS compliant is not followed in the developed markets, predominantly for commercial reasons. Hence the mounting pressure is on India for its major dilution.

II. Compulsory License (CL) provisions would stay to prevent misuse and abuse:

This is another major safeguard provision for the patients against abuse and misuse of patents, including obscene price tags of patented drugs, non-working of patents as a commercial strategy, limited availability, besides extreme urgency and some other situations. Though TRIPS very clearly allows all such provisions, India has so far granted just one CL.

With these India has amply demonstrated that CL provisions are important safeguards for the country and not for abuse or misuse by any one, including the Government. Moreover, it has to pass the acid test of rigorous judicial scrutiny that includes the Supreme Court of India.

Despite all these, more scares are being created around CL provisions in India than what is the reality in the country.

Various safeguards and deterrents against misuse and abuse of patents are absolutely essential for public health interest. Hence there is naturally no question of going back from such provisions in the statute.

It is worth noting, if Indian Patent regime is not TRIPS compliant, why hasn’t any country complained against India to the World Trade Organization (WTO) for having all these provisions in the Indian Patents Act, as yet?

India shows the new IPR way:

According to available reports, the following countries are coming closer to the Indian pharma patent regime:

Argentina has issued guidelines to reject ‘frivolous’ patents
Peru, Columbia and some other South American countries have placed curbs
Philippines has similar provisions
South Africa is contemplating to incorporate such steps
Australia is deliberating on making the law tougher

Positive reverberations in the domestic pharma sector:

Home grown pharma players seem to be visibly happy too, as the overall stand of the Government in this regards is getting clearer.

This in many ways gets vindicated, when a promoter, chairperson and managing director of a mid-size Indian Pharma and Biotech company, with high media visibility, reportedly comments on the finalization of Indian IPR Policy as follows:

“There is a need to protect interest and disallow monopolies like big pharma or big companies/corporates that want to invest and take advantage of the Indian market.”

Concerns of some ‘Who’s Who’:

The following is just an example of such concern:

On February 10, 2015, the Nobel Laureate in Economics – Joseph E. Stiglitz, made the following comment in an article published in ‘The World Opinion Page’ of ‘Project Syndicate’:

“If the Obama administration succeeds in forcing India to strengthen its patent laws, the change would harm not only India and other developing countries; it would also enshrine a grossly corrupt and inefficient patent system in the US, in which companies increase their profits by driving out the competition – both at home and abroad. After all, generic drugs from India often provide the lowest-cost option in the US market once patent terms have expired.”

As things stand today, it would not be unreasonable to conclude that the Nobel Laureate Joseph E. Stiglitz’s worst apprehension on the Indian Patent regime, in all probability would not come true.

Conclusion:

For quite some time, Indian Government has been under intense nagging from the United States, other developed countries, many drug MNCs and the pharma lobby groups lavishly funded by them; to effect major changes in the Patents Act of the country that currently denies unreasonable commercial exploitations, in many ways. Section 3(d) of the statute is just one of the key examples.

The browbeaters of such ilk keep pontificating the importance of ‘innovation’ and that too with a condescending undertone, as if the Indian Government is blissfully ignorant about it.

They allegedly want the Government to dilute the robust safeguard provisions of Indian Patents Act, trying to unfairly tilt the balance of justice in their favor. Consequently, it would go against the patients’ health interest by considerably delaying entry of cheaper generic equivalents, of ‘me-too’ type of inventions, in the country.

Despite initial apprehensions based on the possible misconstrued observation of the Prime Minister Modi on this issue, clear and unambiguous recent assertions of the Government on the patent regime of India, especially in the ‘count-down’ days of the new IPR Policy announcements, is reassuring. It goes without saying, this cannot happen without the benediction of India’s all-powerful Prime minister.

As stated in the draft document, let us hope that the new IPR Policy would help establishing a dynamic, vibrant and balanced intellectual property system in India, to foster innovation and creativity in a knowledge economy and accelerate economic growth, employment and entrepreneurship.

Under this backdrop, it now emerges almost indubitably that Indian Patents Act 2005 would continue to prevail undiluted much to the dismay of its fiercest critics…Finally?

By: Tapan J. Ray

Utility Model: Would It Work In India For Pharma?

Posted on June 8, 2015 by Tapan Ray

The revised draft of India’s IPR Policy penned by the Government constituted ‘Think-Tank’ in 2014, suggests enactment of new laws, such as for ‘Utility Models’ and Trade Secrets, to fill some gaps in the country’s IPR ecosystem .

However, media reports of May 21, 2015 indicate, the Department of Industrial Policy and Promotion (DIPP) is not in favor of changing the country’s ‘Patents Law’ framework to allow grant of utility patents, as suggested by the ‘Think-Tank’.

Though comments from the other Ministries and Departments on the revised draft IPR Policy is still awaited, DIPP reportedly feels, ‘Utility Models’ being less-stringent form of intellectual Property (IP) protection, could ultimately lead to ‘ever-greening’ of patents.

A volte-face?

This development is indeed interesting because on May 13, 2011 the same DIPP uploaded in its website a Discussion Paper on “Utility Models”. Many believed at that time, it as a precursor of a new policy initiative of DIPP on Intellectual Property Rights (IPR) to encourage innovation in the country, without diluting the prevailing strict criteria for patentability. The above Discussion Paper highlighted, among others:

“…minor technical inventions which frugally use local resources in a sustainable manner need to be encouraged by providing a legal framework for their protection and commercial exploitation. Such useful, low cost and relatively simple innovations which create new mechanical devices or contribute to the optimal functioning of existing ones may have commercial value only for a limited time period, before they are replaced by other products or rendered redundant by change of technology.”

In that paper DIPP also highlighted that many countries of the world, for example; Australia, China, Japan, Germany, France, Korea and Netherlands still find the ‘Utility Model’ as an extensively used tool to foster innovation within the local industries.

We shall also touch upon this point below.

The Discussion Paper did trigger a healthy national debate on this subject at that time, though Government did not make known to the public the outcome of this public discourse.

The definition:

The World Intellectual Property Organization (WIPO) defines ‘Utility Model’ as follows:

“Utility Model is an exclusive right granted for an invention, which allows the right holder to prevent others from commercially using the protected invention, without his authorization, for a limited period of time. In its basic definition, which may vary from one country (where such protection is available) to another, a utility model is similar to a patent. In fact, utility models are sometimes referred to as petty patents or innovation patents.”

Or in other words “A utility model is similar to a patent in that it provides a monopoly right for an invention.”

However, utility models are much cheaper to obtain, the requirements for grant of a ‘Utility Model’ are usually less stringent and the term is shorter – mostly between 7 and 10 years, as against up to 20 years term of protection for a patent.

Major differences between Utility Models and Patents:

According to WIPO, the main differences between ‘Utility Models’ and patents can be summarized as follows:

The requirements for acquiring a ‘Utility Model’ are less stringent than for patents. While the requirement of “novelty” is always to be met, that of “inventive step” or “non-obviousness” may be much lower or absent altogether. In practice, protection for ‘Utility Models’ is often sought for innovations of rather incremental in character, which may not meet the patentability criteria.

The term of protection for ‘Utility Models’ is shorter than for patents and varies from country to country (usually between 7 and 10 years without the possibility of extension or renewal).

In most countries where ‘Utility Model’ protection is available, patent offices do not examine applications as to substance prior to registration. This means that the registration process is often significantly simpler and faster, taking on an average about six months.

‘Utility Models’ are much cheaper to obtain and to maintain.

In some countries, ‘Utility Model’ protection can only be obtained for certain fields of technology and only for products but not for processes.

Countries providing ‘Utility Model’ protection:

Many countries do not grant ‘Utility Models’. However, the major countries granting ‘Utility Models’, as stated above, include: Australia, China, Japan, Germany, France, Spain and Italy.

According to WIPO, currently the countries and regions that provide ‘Utility Models’ are as follows:

Albania, Angola, Argentina, ARIPO, Armenia, Aruba, Australia, Austria, Azerbaijan, Belarus, Belize, Brazil, Bolivia, Bulgaria, Chile, China (including Hong Kong and Macau), Colombia, Costa Rica, Czech Republic, Denmark, Ecuador, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Guatemala, Honduras, Hungary, Indonesia, Ireland, Italy, Japan, Kazakhstan, Kuwait, Kyrgyzstan, Laos, Malaysia, Mexico, OAPI, Peru, Philippines, Poland, Portugal, Republic of Korea, Republic of Moldova, Russian Federation, Slovakia, Spain, Taiwan, Tajikistan, Trinidad & Tobago, Turkey, Ukraine, Uruguay and Uzbekistan.

Interestingly, ‘Utility Models are not available in the United Kingdom or the United States.

A recent allegation of ‘Utility Model’ infringement against a global pharma:

Quite recently, in November 2014, Copenhagen headquartered Forward Pharma A/S reportedly filed a lawsuit against Biogen Idec GmbH, Biogen Idec Internaional GmbH and Biogen Idec Ltd. in the Regional Court in Dusseldorf, alleging infringement of its German ‘Utility Model’ DE 20 2005 022 112 due to Biogen Idec’s marketing of Tecfidera® in Germany.

Tecfidera® – a product containing dimethyl fumarate (DMF) as the active ingredient, is used for the treatment of Myasthenia Gravis (MS).

Forward Pharma asserted that its above ‘Utility Model’ precludes anyone from selling in Germany, without the Company’s consent, drugs with DMF as the sole active pharmaceutical ingredient for the treatment of MS at a daily dose of 480 mg.

With this lawsuit Forward Pharma did not seek to stop sales of Tecfidera® to MS patients, but rather sought damages for what the Company believes are Biogen Idec’s unlawful sales of Tecfidera® in Germany.

Although ‘Utility Models’ are registered without substantive examination, the Company reiterated its belief in the validity and enforceability of the said ‘Utility Model.’

Subsequently, on April 14, 2015 Forward Pharma A/S announced that an interference was declared by the Patent Trial and Appeal Board (PTAB) on April 13, 2015 between the Company’s patent application 11/576,871 (the “’871 patent application”) and Biogen’s issued patent 8,399,514 (the “’514 patent”).

The PTAB reportedly designated Forward Pharma A/S as the “Senior Party” in the interference based on the Company’s earlier patent application filing date.

Would ‘Utility Model’ be useful in pharma?

Utility Models (UM) are considered particularly suited for SMEs that make “minor” improvements to, and adaptations of, existing products. It is worth noting that UMs are primarily used for mechanical innovations.

However, in India, the ‘Utility Model’ concept in pharma would be directly conflicting with the intent and spirit of the section 3(d) of the Patents Act 2005 of the country, which clearly stipulates that mere discovery of a new form of a known substance which does not result in the enhancement of the known ‘clinical’ efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant, is not patentable.

Therefore, section 3(d) of the Indian Patents Act 2005, is considered as one of the most important safeguards against “evergreening” of patents, usually done through alleged “molecular manipulation or tweaking”, that delays entry of affordable generic equivalents, adversely impacting the public health interest.

In that sense, enactment of a new law granting protection to pharma ‘Utility Models’ in India could seriously jeopardize both short and long term health interests of the patients, in general.

This is primarily because, being denied of a 20 year product patent under section 3(d), the same company would then be eligible to apply and may also probably get a monopoly status for that molecule, though for a shorter term with ‘Utility Models’.It would obviously happen at the cost of quicker entry of equivalent affordable generics.

Conclusion:

Considering all these, and having witnessed a serious allegation of a ‘Utility Model’ (which goes through no more than a liberal regulatory scrutiny) infringement, against a major patented pharma product that passed through the acid test of stringent and cost intensive regulatory requirements, it appears that ‘Utility Models’ need to be excluded, especially for pharmaceuticals in India.

This is purely for the sake of patients’ interest, at least on the following two counts:

All new/novel drugs, without any compromise whatsoever, should pass through the stringent acid test of the drug regulatory requirements for requisite efficacy, safety and quality standards.

‘Evergreening’ of patents, under any garb, delaying entry of affordable equivalent cheaper generics, should not be encouraged in the country.

Thus, in my view, Indian Government should continue to remain firm with its bold stance on the relevance of section 3(d) of the Indian Patents Act. Any possibility of its dilution by a grant of market monopoly, though for a much shorter period, covering incremental innovations that do not conform to the country’s IP laws, must be openly discouraged with robust reasons.

In that sense, the flag raised by the DIPP on the intriguing recommendation of the IPR Policy ‘Think Tank’ for enacting new laws in India for ‘Utility Model’, appears to be pragmatic and far sighted, specifically in the context of pharmaceuticals.

By: Tapan J. Ray

PILMAN

A Tapan Ray Website

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