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Access to Medicine: Losing Track in Cacophony

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Indian Healthcare space is by and large an arena, where perceptions prevail over the changing reality in many important areas. Consequently, fierce discourse in those areas mostly gives rise to a cacophony of ‘Your Perceptions Against Mine’.

It is intriguing, why even in some well-hyped research studies of recent times, multiple interpretations are made not based on specific analytics-based numbers, but around critical data gaps and then the vital ‘conclusion’ is craftily packaged in a particular way to reinforce a set of perceptions and view points.

Serious discourse on ‘Access to Medicine’ in India often falls in these data crevasses, resulting nothing more than abject cynicism and expert sermons sans accountability from all quarters. Suggestions for precise quantification of magnitude of the problem, so far as ‘Access to Medicine’ is concerned, and then measuring the same periodically for sustainable corrective measures, obviously fade away in the din of multiple shrill voices, heavily loaded with self-perceptions attempting to score favorable brownie points.

A quantifiable number on overall ‘access to medicines’ remains illusive:

A quantifiable recent number on overall ‘Access to Modern Medicines’ in India, which could well form the base to measure progress of the country in this critical area subsequently, still remains illusive.

It is an irony, no one seems to know today what is the current ‘Access to Modern Medicines’ in India, in real term.

A recent study too goes around it, but NOT into it:

A 2012 industry sponsored study carried out by IMS Consulting, instead of giving just one number for overall ‘Access to Modern Medicines’ in India, went around it by reiterating the obvious that ‘access’ has 4 dimensions such as, Physical Reach, Availability/Capacity, Quality/Functionality and Affordability.

That is fine. No issue. However, the much sought after number of overall ‘Access to Modern Medicines’ still remained illusory in this study too. Interestingly, there are no numbers available to public for each of the above 4 important dimensions either. Thus the cacophony got shriller.

Clutching on to ‘Dinosaurian data’ in modern times:

Against the above backdrop, like many others, both local and global, even the honorable President of India on January 16, 2013, while addressing the ASSOCHAM 10th Knowledge Millennium Summit, quoted the ‘World Medicines Situation of 2004 report’, the base year of which is reportedly 1999. This study indicated, ‘only 35% of the population of India, against 53% in Africa and 85% in China has access to modern medicines’.

Thus in the absence of any recently updated number, the ‘Dinosaurian data’ of 1999 (published in 2004) is being considered relevant by many even in 2013, including the esteemed industry body that probably provided those irrelevant data to the president of India’s office for his speech, at the beginning of this year.

Importance of capturing today’s ‘Access’ data to provide ‘Healthcare to all’:

There should not be even an iota of doubt that the above reported scenario has changed quite significantly, at least, during the last decade in India, making the 1999 (published in 2004) ‘Access to Medicines’ numbers irrelevant, having no sense whatsoever in 2013.

To drive home this point, I shall now focus on just three sets of parameters, besides many others, to vindicate my comment on ‘dinosaurian data’. These parameters are as follows:

  1. Compounded Annual Growth Rate (CAGR) in per-capita expenditure on healthcare from 2006-11
  2. Compounded Annual Growth Rate (CAGR) of the domestic pharmaceutical industry in this period
  3. Quantum of increase in use of public healthcare facilities

1. Per capita Healthcare expenditure from 2006-11:

Year US $
1999 18.2
2004 28.7
2006 33.0
2007 39.9
2008 42.7
2009 43.6
2010 51.4
2011 59.1

(Source WHO Data)

The above table vey clearly highlights that in 1999, the base year of the above study, per capita healthcare expenditure in India was just US$ 18.2. The figure rose to US$ 28.7 in year 2004, when that study was published. The number reached to US $ 59.1 in 2011. This reflects a double digit Compounded Annual Growth Rate (CAGR) in per capita healthcare expenditure of the country from the 2004 study to 2011.

No doubt, this number is still much less than many other countries. Nevertheless, in 2013, per capita healthcare expenditure in India will be even more, indicating significant increase in ‘Access’ as compared to 2004.

2. Growth of domestic pharmaceutical market: 

According to the PwC – CII report titled “India Pharma Inc.: Gearing up for the next level of growth”, the domestic drug market has been clocking a CAGR of more than 15 percent over the last five years. Thus, high growth of the Indian Pharmaceutical Market (IPM) since the last decade, both from the urban and the rural areas, would certainly signal towards significant increase in the domestic consumption of medicines. Moreover, fast growing rural and semi-urban markets would also clearly support the argument in favor of increasing ‘Access to Modern Medicines’ in India.

A back of the envelope calculation:

Improvement in access as compared to what ‘World Medicines Situation of 2004 report’ had highlighted, may not have a linear relationship to the volume growth of the industry during this period. However, a large part of this growth could indeed be attributed to increase in overall consumption of drugs, leading to improvement in access to medicines in India.

For example, out of the reported 15 percent CAGR of the IPM, if one attributes just 8 percent volume growth/year to increased access to drugs, a back of the envelope calculation would indicate that during last nine years over the base year of 2004, the access to medicines has improved at least to 70 percent of the population, if not more, and has NOT remained just at 35 percent, as many tend to establish a point or two by quoting the above dated report.

Unfortunately, even the Government of India does not seem to be aware of this gradually improving trend, as evidenced in the honorable President of India’s speech in 2013, as quoted above. Official communications of the government also keep quoting the outdated statistics stating that 65 percent of the population of India does not have ‘Access to Modern Medicines’ even today.

Be that as it may, around 30 percent of Indian population would still perhaps not have ‘Access to Medicines’ in India. This issue needs immediate attention of the policy makers and can possibly be achieved through effective implementation of a holistic public health policy model like, ‘Universal Health Care (UHC)’.

3. Increase in use of public healthcare facilities:

According to a study done by the IMS Consulting Group in 2012, in rural India, which constitutes around 70 percent of the total 1.2 billion populations of India, usage of Government facilities for Out Patient (OP) care has increased from 22 percent in 2004 to 29 percent in 2012, mainly due to the impact of National Rural Health Mission (NRHM). This increase will have significant impact in reducing ‘Out of pocket (OoP)’ healthcare expenses of the rural poor.

Overall impact on some key health indicators: 

The same 2012 study of IMS Consulting highlights that an objective and comprehensive assessment of healthcare access in India was last undertaken in 2004, through a survey performed by the National Survey Sample Organization (NSSO). 
The survey reported on multiple parameters related to healthcare, including morbidity in broad age groups, immunization status, episodes of outpatient/ inpatient treatment across geography/ income segments together with expenditure on treatment. These measures, the study indicates, were taken collectively to indicate the status of healthcare access.

According to this report, the Government of India had undertaken multiple programs to improve healthcare access. These programs have addressed numerous issues, in varying proportion, that are linked to healthcare access, including lack of infrastructure, high cost of treatment, and the quality and availability of treatment. Some of these programs have been enormously successful: for example, India is a polio-free country today, the study reinforces.

The study also highlights significant progress in some basic healthcare indicators. The examples cited are as follows:

  • Maternal mortality rate has decreased by ~50 percent, and was reported at 200 deaths per 100,000 live births in the year 2010 as compared to 390 a decade ago. A few states such as Tamil Nadu, Maharashtra, and Kerala have already achieved the Millennium Development Goal (MDG) of a maternal mortality ratio less than 109 maternal death per 100,000 live births, with multiple other states close to achieving this target.
  • Infant mortality rate has decreased by greater than 25 percent over the period 2000–2009, and was reported at 50 deaths per 1,000 live births. Correspondingly, the under-5 child mortality rate (U5MR) has decreased by similar percentage levels, and was reported at 64 deaths per 1,000 live births. While U5MR for urban India has achieved the MDG target of 42 the same for rural of 71 is significantly lagging the target level.
  • Immunization coverage has increased significantly, for example diphtheria-tetanus-pertussis immunization among 1 year olds has increased from 60% to 70%, and the Hepatitis B coverage has increased from 68% in 2005 to 91% in 2010.
  • National programs have successfully improved detection and cure rates for tuberculosis and leprosy.

No direct relationship established between healthcare spend and outcomes:

Though India’s per-capita healthcare spend has been lowest among the usually compared BRIC countries, the following quick example would clearly establish that the healthcare outcomes do not have a linear relationship with the per-capita healthcare spend either:

Per capita Healthcare expenditure in 2011: Country Comparison

Country US $ World Rank Physician/1000 people Hospital/1000 people Life expectancy at birth (years)
Brazil 1120.56   41 1.76 2.3 73.4
Russia 806.7   55 4.31 9.6 69.0
India 59.1 152 0.65 0.9 67.08
China 278.02   99 1.82 3.8 73.5 

(Source: WHO data)

Thus, taking a cue from these numbers, India should decide at what percapita spend the country would possibly be able to ensure quality ‘access’ to healthcare for 100 percent of its population. Mere, comparison of percapita spend of each country, I reckon, may thus not mean much.

Conclusion:

The moot point, I reckon, is that, to measure progress in any sphere of activity, one will need to have a robust well-derived base point. Thereafter, progress needs to be monitored and quantified periodically from one point to the next.

So far as the access to healthcare in general and medicines in particular are concerned, it becomes difficult to fathom why is this basic approach still not being considered to measure progress in ‘Access’ and its rate in India.

As a result, discussions among the stakeholders do not take place around those updated numbers, either. Instead, what we hear is a high decibel cacophony of perceptions, at times groping around various dimensions of ‘Access’ and that too without quantification of each, as stated above.  This makes the task all the more complicated in pursuit of providing ‘Healthcare to All’ in India.

That said, the question to ponder now:

Does any one know what is the current ‘Access to Modern Medicines’ number in India and at what rate the progress is being made in that direction to achieve ‘Health for All’ objective of the country?

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.

‘Big Pharma’ Prowls Falter: Triggers Off Yet Another Critical Debate

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The ‘Big Pharma’ prowls faltered yet again exposing the ‘fault line’ to all, when the GSK global head honcho, a pharma icon in his own right, Sir Andrew Witty supported the pharmaceutical policy of India, while in the country earlier this month. This support is quite in contrary to arrogant displeasure being expressed by his MNC counterparts against the pharma regime in India up until now.

Sir Andrew reportedly spoke against the usual pharma MNC practices of charging very high prices for patented medicines during an interview and said that multinationals need to look at things from India’s perspective. 

The above comment, when analyzed especially in context of one of the recent actions of Big Pharma MNCs complaining in writing to President Obama against India’s prevailing pharmaceutical regime, the fault line gets clearly visible.

In this context, a recent report captured the anger and desperation of Big Pharma. This hostility vindicates the general apprehensions in India that MNCs are once again pushing for a stringent patent regime in the country, against the general health interest of Indian patients for access to affordable newer medicines.

Quoting US Chamber of Commerce’s Global Intellectual Property Center another report reconfirmed the impatient prowl of the mighty lobby group in the corridors of power. This piece states, “Recent policy and judicial decisions (Glivec judgment and Nexavar) that invalidate intellectual property rights, which have been increasing in India, cast a daunting shadow over its otherwise promising business climate.” 

The ‘fault line’, thus surfaced, triggers off yet another critical debate, especially related to the slugfest on a stringent pharmaceutical product patent regime in India, as follows:

“Does Stricter IPR Regime Spur Pharma Innovation?”

Global innovator companies strongly argue that stringent Intellectual Property Rights (IPR) and stricter enforcement of IP laws have strong link with fostering innovation leading to a robust economic growth for any nation.

However, another group of thought leaders opine just the opposite. They argue that strong IPR and IP laws have little, if any, to do with fostering innovation and economic growth, as there are no robust research findings to drive home the above point.

It has been noticed that the MNC lobby groups quite often very cleverly use their magic word ‘innovation’ on a slightest pretext with an underlying desire of having a ‘very strict patent regime’ in India. Thus they seem to be trying to mislead the common man, as if India is against innovation.

Comment of the Chairman of National Innovation Council of India:

On September 15, 2012, while delivering his keynote address in a pharmaceutical industry function, Dr. Sam Pitroda, the Chicago based Indian, creator of the telecom revolution in India, Chairman of the National innovation Council and the Advisor to the Prime Minister on Public Information, Infrastructure & Innovations, made a profound comment for all concerned to ponder, as follows:

“Everyone wants to copy the American model of development.  I feel that this model is not scalable, sustainable, desirable and workable.  We have to find an Indian Model of development which focuses on affordability, scalability and sustainability.”

Recent Indian stand:

On March 5, 2013, the Government of India made a profound statement on the subject of ‘Innovation and Small and Medium Enterprises (SMEs)’ at the TRIPS Council meeting covering the following points:

  • There is no direct correlation between IP and Innovation even for the Small and Medium Industries.
  • The technological progress even in the developed world had been achieved not through IP protection but through focused governmental interventions.
  • The proponents of this Agenda Item have reached the present stage of technological development by focusing solely on the development of their own domestic industry without caring for the IPRs of the foreigners or the right holders.
  • After achieving a high level of development, they are now attempting to perpetuate their hold on their technologies by making a push towards a ‘TRIPS plus’ regime.
  • Their agenda is not to create an environment where developing countries progress technologically, but to block their progress through stringent IP regime.
  • It is essential that the flexibilities provided by the TRIPS Agreement need to be secured at any cost, if the people in the developing countries are to enjoy the benefits of innovations.

A Wharton Professor’s view:

As the Wharton professor of Healthcare Management Mark V. Pauly has been quoted saying that the link between patent protection and innovation has never been definitely proven.

However, Pauly reportedly is aware that the innovator global pharma companies do say, ‘If you don’t allow us to reap the benefits of our R&D expenditure, we won’t put as much into it, and we won’t invent as many great things’.

However, the Wharton Professor counters it by saying, “The problem is that nobody really knows how much less innovation there would be if there were less patent protection. We just don’t know what the numbers are.”

The above report says, according to Pauly, the onus to prove that patent protection matters should be on the drug industry itself.

He argues, “Rather than always just insisting you should never limit intellectual property protection, they really ought to develop some evidence to show that without that protection, there would be an impact on the rate of adoption of new products. Everybody has an opinion, but nobody knows the facts.“

A French Professor’s view:

In another WIPO seminar held on June 18, 2013, Margaret Kyle, a Professor at the Toulouse School of Economics and the Université de Toulouse I in France, reportedly presented preliminary findings of a study.

This paper explored in detail the impact of World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) in various areas related to the speed of launch, price, and volume of sales of drugs across countries and across different drug products.

In this study, as the above report states, Kyle analyzed the trade-off between the dynamic and static effects of Intellectual Property Rights (IPRs).

The dynamic effect of IPRs was considered as an incentive for innovation based on the general belief that patent protection, through granting market exclusivity, incentivizes companies to invest in the research and development (R&D) to develop new drugs.

On the other hand, the static effect of IPRs in the short term is that granting market exclusivity often leads to innovator companies pricing their products at levels, which will be unaffordable by a large number of patients, especially in lower-income countries.

Kyle explained that the results implied as follows:

  • IPRs are neither necessary nor sufficient to launch new pharmaceutical products.
  • The existence of a product patent does not always inhibit generic imitation, nor does the lack of such a patent necessarily deter an originator from making a product available in a given market.

Other eminent voices:

While highlighting that TRIPS-Plus intellectual property protection is passed by some developing countries in order to implement FTA obligations, another recent paper presents the following examples in support of the argument that there no correlation between strong IP laws and fostering innovation:

  • UK Commission on Intellectual Property Rights. Integrating Intellectual Property Rights and Development Policy. 2002. (Link)

“…Strong IP rights alone provide neither the necessary nor sufficient incentives for firms to invest in particular countries… The evidence that foreign investment is positively associated with IP protection in most developing countries is lacking.”

  • Robert L. Ostergard., Jr. “Policy Beyond Assumptions: Intellectual Property Rights and Economic Growth.” Chapter 2 of The Development Dilemma: The Political Economy of Intellectual Property Rights in the International System.  LFB Scholarly Publishing, New York. 2003

“…No consistent evidence emerged to show that IPR contributed significantly to economic growth cross-nationally.  Furthermore, when the nations are split into developed and developing countries, results to suggest otherwise did not emerge.”

  • Carsten Fink and Keith Maskus. “Why We Study Intellectual Property and What We Have Learned.” Chapter one of Intellectual Property and Development: Lessons from Economic Research. 2005. (Link)

“Existing research suggests that countries that strengthen their IPR are unlikely to experience a sudden boost in inflows of FDI.  At the same time, the empirical evidence does point to a positive role for IPRs in stimulating formal technology transfer.”

“Developing countries should carefully assess whether the economic benefits of such rules outweigh their costs. They also need to take into account the costs of administering and enforcing a reformed IPR system”

“We still know relatively little about the way technology diffuses internationally.”

  • Keith Mascus. “Incorporating a Globalized Intellectual Property Rights Regime Into an Economic Development Strategy.”  Ch. 15 of Intellectual Property, Growth and Trade. (ed. Mascus). Elsevier.  2008.

“Middle income countries must strike a complicated balance between promoting domestic learning and diffusion, through limited IP protection, and gaining greater access to international technologies through a strong regime… it makes little sense for these nations to adopt the strongly protectionist IP standards that exist in the U.S., the EU and other developed economies.  Rather, they should take advantage of the remaining policy space provided by the TRIPS Agreement.”

“It is questionable whether the poorest countries should devote significant development resources to legal reforms and enforcement of IPR.”

  • Kamal Saggi. “Intellectual Property Rights and International Technology Transfer via Trade and Foreign Direct Investment. Ch. 13 of Intellectual Property, Growth and Trade. (ed. Mascus). Elsevier.  2008.

“Overall, it is fair to say that the existing empirical evidence regarding the overall technology-transfer impacts of increased IPR protection in developing countries is inconclusive at this stage.  What is not yet clear is whether sufficient information flows will be induced to procure significant dynamic gains in those countries through more learning and local innovation.”

  • Alexander Koff, Laura Baughman, Joseph Francois and Christine McDaniel. “Study on the Economic Impact of ‘TRIPS-Plus’ Free Trade Agreements.”  International Intellectual Property Institute and the U.S. Patent and Trademark Office. August 2011.

“TRIPS-Plus IPRs viewed as ‘important, but not essential’ for attracting investment. Many other factors matter like, taxes, human capital, clustering, etc.”

Patients versus Patents:

Another recent  article on this subject states as follows:

“Compulsory licensing and stricter patentability standards allow domestic manufacturers to produce lower-cost versions of patented NCD medications and break into lucrative therapeutic areas, such as oncology, in which multinational drug firms are heavily invested.”

The paper clearly highlights, “If patients are pitted against patents, international support for IP protection—upon which drug firms and many other developed country industries now heavily rely—will again diminish.”

Yet another article published in The New England Journal of Medicine, July 17, 2013 states:

“Patents are government-granted monopolies. As monopolies, they can drive the prices of drugs up dramatically. For example, in 2000, when only patented antiretroviral drugs for Human Immunodeficiency Virus (HIV) infection were widely available, they cost approximately $10,000 per person per year, even in very poor countries. Today, these same medicines cost $150 or less if they are purchased from Indian generics companies…. patents cause especially acute problems for access to medicines in developing countries – not only because of low incomes but also because insurance and price-control systems are often absent or inadequate.” 

A WHO Report:

To chart the way forward at the backdrop of ongoing global debate elated to the relationship between intellectual property rights, innovation and public health, the World Health Assembly decided in May 2003 to give an independent Commission the task of analyzing this key issue. Accordingly, the Director-General of WHO established the Commission in February 2004. This report titled, “Public health, innovation and intellectual property rights” was published in 2006 and articulated that neither innovation nor access depend on just intellectual property rights and highlighted, among others, the following:

  • Intellectual property rights have an important role to play in stimulating innovation in health-care products in countries where financial and technological capacities exist, and in relation to products for which profitable markets exist.
  • In developing countries, the fact that a patent can be obtained may contribute nothing or little to innovation if the market is too small or scientific and technological capability inadequate.
  • In the absence of effective differential and discounted prices, patents may contribute to increasing the price of medicines needed by poor people in those countries.
  • Although the balance of costs and benefits of patents will vary between countries, according to their level of development and scientific and technological infrastructure, the flexibility built into the TRIPS agreement allows countries to find a balance more appropriate to the circumstances of each country.

India – now the most attractive global investment destination:

Trashing the anger and displeasure of pharma MNCs, as per the latest international survey, India reportedly has emerged as the most attractive global investment destination followed by Brazil and China. It is worth noting that even recently, during April- June period of 2013, with a capital inflow of around US$ 1 billion, the pharma sector became the brightest star in the FDI landscape of India.

Conclusion:

In the Indian context, a 2013 paper titled, “Intellectual Property Protection and Health Innovation: Concerns for India” published by Center for WTO Studies highlights that the regime change in the patent system has not been very supportive for improving access to medicines in India. It reiterates, it has not been established yet that a stricter patent regime in the developing countries like India, has helped health innovation and access to medicines at economically viable prices.

The paper recommends, although India is trying to incorporate all the flexibilities under TRIPS in its Patents Act, the ‘Indian Policy Makers’ should not give in to the pressure of western powers to make IPR more stringent in the country.

In the backdrop of arrogance exhibited by Big Pharma MNCs, in general, against Indian policies and judicial verdicts on this subject, the comments made by Sir Andrew on the issue, as deliberated above, are indeed profound and far reaching. However, it clearly exposes the fault line in the collective mindset of pharma MNCs, without any ambiguity.

I shall not be surprised either, if clever attempts are made now by the MNC lobby groups to negate or trivialize the profoundness of this visionary statement not just in India, but beyond its shores, as well.

Further, as stated above recent emergence of India as the most attractive global investment destination with pharma leading the deck is a point worth noting, more in the context of policy and statutes that India has decided to follow.

Be that as it may, it is beyond the scope of any doubt that innovation or for that matter encouraging innovation still remains the wheel of progress of any nation.

However, have we garnered enough evidence yet, to establish that stringent IPR regime with absolute pricing freedom would lead to fostering more innovation leading to well-being of people of the developing countries, like India?

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.

 

 

 

Balancing IPR with Public Health Interest: Brickbats, Power Play and Bouquets

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It is now a widely accepted dictum that Intellectual Property Rights (IPR), especially pharma patents, 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.

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 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.

The terminology ‘evergreening‘ usually ‘refers to a strategy employed by many pharmaceutical companies to extend their market monopoly by slightly changing the existing molecules and obtaining new patents to continue to enjoy market exclusivity and pricing freedom, which otherwise would not have been possible.

Path breaking or jaw-drooping ‘W-O-W’ types of innovations are not so many. Thus most of the patented drugs launched globally over the last several decades are indeed some sort of ‘me-too drugs’ and generally considered as ‘low hanging fruits’ of R&D, not being able to offer significantly greater value to patients than already exiting ones. Many of these drugs have also achieved blockbuster status for the concerned companies, backed by high voltage marketing over a reasonably long period of time. It is understandable, therefore, that from pure business perspective why serious global efforts are being made to push the same contentious system in India too.

Example of some of these molecules (not necessarily in the written order), are as follows:

  • Cemetidine – Ranitidine – Famotidine – Nizatidine – Roxatidine (to treat Acid-peptic disease)
  • Simvastatin – Pravastatin – Lovastatin – Pitavastatin – Atorvastatin – Fluvastatin – Rosuvastatin (to treat blood lipid disorder)
  • Captopril – Enalepril – Lisinopril – Fosinopril – Benzapril – Perindopril – Ramipiril – Quinalapril – Zofenopril (Anti-hypertensives)

However, pharmaceutical companies do argue that such ‘incremental innovations’ are the bedrock for growth of the pharmaceutical industry and are essential to continue to fund pharmaceutical research and development.

An interesting paper:

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.
  • A study conducted in five developing countries – Argentina, Brazil, Colombia, India and South Africa has:
  1. Evidenced a significant proliferation of ‘ever-greening’ pharmaceutical patents that    can block generic competition and thereby limit patients’ access to medicines.
  2. 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 step are used to grant patents.
  3. 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.
  4. Commented, if patent applications were correctly scrutinized, there would be no need to have recourse to CL measures.

A remarkable similarity with the Indian Patents Act:

The findings of the above study have a striking similarity with the Indian Patents Act. As per this Act, to be eligible for grant of patents in India, the pharmaceutical products must pass the ‘two-step’ acid test of:

  • Following the inventive step: Defined under Section 2(ja) of the Patents Act as follows:

“Inventive step” means a feature of an invention that involves technical advance as compared to the existing knowledge or having economic significance or both and that makes the invention not obvious to a person skilled in the art.

  • Passing scrutiny of Section 3(d) of the law: It categorically states, inventions that are a mere “discovery” of a “new form” of a “known substance” and do not result in increased efficacy of that substance are not patentable.

Supreme Court of India clarifies it:

The Honorable Supreme Court of India in page 90 of its its landmark Glivec judgement has clearly pronounced that all ‘incremental innovations’ may not be trivial or frivolous in nature. However, only those ‘incremental innovations’, which will satisfy the requirements of both the above Sections of the Act, wherever applicable, will be eligible for grant of patents in India. 

An opposite view:

Another paper presents a different view altogether. It states that incremental improvements on existing drugs have great relevance to overall increases in the quality of healthcare.

With the progress of the pharmaceutical industry, such drugs have helped the physicians to treat diverse group of patients. They also represent advances in safety, efficacy along with newer dosing options significantly increasing patient compliance.

The paper claims that ‘even from an economic standpoint, expanding drug classes represent the possibility of lower drug prices as competition between manufacturers is increased’.  It states that any policy aimed at curbing incremental innovation will ultimately lead to a reduction in the overall quality of existing drug classes and may ultimately curb the creation of novel drugs.

Pricing:

Experts, on the other hand, argue, if patents are granted to such ‘incremental innovations’ at all, their prices need to be determined by quantifying ‘Incremental Value’ that patients will derive out of these inventions as compared to the generic versions of respective original molecules.

Use of such drugs may lead to wasteful expenditure:

A large majority of stakeholders also highlight, though many of such drugs will have cheaper or generic alternatives, physicians are persuaded by the pharma players to prescribe higher cost patented medicines with the help of expensive avoidable marketing tools, leading to wasteful expenditure for all. The issue of affordability for these drugs is also being raised, especially, in the Indian context.

  • The ‘2012 Express Scripts Canada Drug Trend Report’ unfolded that the use of higher-cost medications without offering additional patient benefits resulted in waste of $3.9 billion annually in Canada.
  • Another recent Geneva-based study concluded as follows:

“Evergreening strategies for follow-on drugs contribute to overall healthcare costs. It also implies that policies that encourage prescription of generic drugs could induce saving on healthcare expenditure. Healthcare providers and policymakers should be aware of the impact of evergreening strategies on overall healthcare costs.”

  • Some other studies reportedly revealed, “Medicines sold in France are 30 times more expensive than what it costs pharmaceutical companies pay to manufacture them.” Industry observers opine, if that is happening in France what about India? Quoting experts the same report comments, “If pharmaceutical companies are forced to follow moral and human values, it could save the tax payer at least 10 billion euros, an amount which could fill up the deficit of the national health care system.”
  • Yet another article questioned, “What if a physician is paid speaking or consulting fees by a drug maker and then prescribes its medicine, even if there is no added benefit compared with cheaper alternatives?”

More debate:

According to a paper titled, ‘Patented Drug Extension Strategies on Healthcare Spending: A Cost-Evaluation Analysis’ published by PLOS Medicine, European public health experts estimate that pharmaceutical companies have developed “evergreening” strategies to compete with generic medication after patent termination. These are usually slightly modified versions of the existing drugs.

Following are some brands, which were taken as examples for evergreening:

S.No.

Evergreen

Medical Condition

Original Brand

1.

 Levocetirizine (Vozet) Allergies Cetirizine (Zyrtec)

2.

 Escitalopram (Lexapro) Depression Citalopram (Celexa)

3.

 Esomeprazole (Nexium) Acid reflux Omeprazole (Prilosec)

4.

 Desloratadine (Clarinex) Allergies Loratadine (Claritan)

5.

 Zolpidem Extended Release (Ambien CR) Insomnia Zolpidem (Ambien)

6.

 Pregabalin (Lyrica) Seizures Gabapentin (Neurotonin)

Source: Medical Daily, June 4, 2013

In this study, the researchers calculated that evergreening – where pharmaceutical companies slightly modify a drug molecule to extend its patent, had cost an extra 30 million euros to the healthcare system in Geneva between 2000 and 2008. The authors argue that ‘evergreening’ strategies, “more euphemistically called as ‘life cycle management’ are sometimes questionable benefit to society.”

As the paper highlights, in this scenario the companies concerned rely on brand equity of the original molecule with newer and more innovative marketing campaigns to generate more prescriptions and incurring in that process expenses nearly twice as much on marketing than on research and development.

Brickbats:

In this context, recently a lawmaker rom America reportedly almost lambasted India as follows:

“I’m very concerned with the deterioration in the environment for protection of US intellectual property rights and innovation in India. The government of India continues to take actions that make it very difficult for US innovative pharmaceutical companies to secure and enforce their patents in India.“ 

On this, the Indian experts comment, if the situation is so bad in India, why doesn’t  America get this dispute sorted out by lodging a formal complaint against India in the WTO, just as what India contemplated to do, when consignments of generic drugs of Indian manufacturers were confiscated at the European ports, alleging those are counterfeit medicines.

Yet another recent news item highlighted a “concerted effort, which involves letters from US corporations and business groups to the president, testimony by Obama administration officials before Congress, and lawmakers’ own critiques, came ahead of US secretary of state John Kerry’s trip to India later this month (has already taken place by now) for the annual strategic dialogue, which will precede Prime Minister Manmohan Singh’s visit to Washington DC in September.”

The report stated, the above letter complained that over the last year, “courts and policymakers in India have engaged in a persistent pattern of discrimination designed to benefit India’s business community at the expense of American jobs … Administrative and court rulings have repeatedly ignored internationally recognized rights — imposing arbitrary marketing restrictions on medical devices and denying, breaking, or revoking patents for nearly a dozen lifesaving medications.” 


At a recent Congressional hearing of the United States, a Congressman reportedly expressed his anger and called for taking actions against India by saying,

“Like all of you, my blood boils, when I hear that India is revoking and denying patents and granting compulsory licenses for cancer treatments or adopting local content requirements.”

Indian experts respond to these allegations by saying, patent disputes, patent challenges, revocation of patents, compulsory licensing etc. are all following a well-articulated judicial process of the country, where Indian government has hardly any role to play or intervene. American government and lawmakers are also expected to respect the rule of law in all such cases instead of trying to denigrate the Indian system.

The Power Play:

This short video clipping captures the Power Play in America on this matter.

The Government of India responds:

Ministry of Commerce and Industries of India reportedly countered the allegations of the United States over patents to the US Trade Representive arguing that the Indian IPR regime is fully TRIPS-compliant and Indian Patents Act “encourages genuine innovation by discouraging trivial, frivolous innovation, which leads to evergreening”.

Countries adopting the Indian model:

The above report also highlighted as follows:

  • Argentina has issued guidelines to reject ‘frivolous’ patents.
  • Peru, Columbia, other South American countries have placed curbs.
  • Philippines has similar provisions.
  • Australia is contemplating making the law tougher.

Revised report of Dr. R. A. Mashelkar Committee:

Even the revised (March 2009) ‘Report of the Technical Expert Group (TEG) on Patent Law Issues’, the TEG, chaired by the well-known scientist Dr. R.A. Mashelkar, in point number 5.30 of their report recommended as follows:

“Every effort must be made to prevent the practice of ‘evergreening’ often used by some of the pharma companies to unreasonably extend the life of the patent by making claims based sometimes on ‘trivial’ changes to the original patented product.  The Indian patent office has the full authority under law and practice to determine what is patentable and what would constitute only a trivial change with no significant additional improvements or inventive steps involving benefits.  Such authority should be used to prevent ‘evergreening’, rather than to introduce an arguable concept of ‘statutory exclusion’ of incremental innovations from the scope of patentability.”

Bouquets:

As stated above, many experts across the world believe, the criticism that Section 3 (d) is not TRIPS Agreement compliant is unfounded, as no such complaint has been lodged with the World Trade Organization (WTO) in this matter, thus far. The safeguards provided in the patent law of India will help the country to avoid similar issues now being faced by many countries. Importantly, neither does the section 3(d) stop all ‘incremental innovations’ in India.

Quoting a special adviser for health and development at South Centre, a think tank based in Geneva, Switzerland, a recent report indicated, “Many developing countries will follow India’s example to protect the rights of their populations to have access to essential medicines”.

Yet another report quoting an expert articulates, “India’s top court’s decision affirms India’s position and policy on defining how it defines inventions from a patenting point of view for its development needs. It challenges the patenting standards and practices of the developed countries which are the ones really in much need of reform.”

The Honorable Supreme Court in its Glivec judgment has also confirmed that such safeguard provisions in the statute are expected to withstand the test of time to protect public health interest in India and do not introduce any form of unreasonable restrictions on patentability of drug inventions.

Conclusion:

Not withstanding the report of the US-India Business Council (USIBC) titled ‘The Value of Incremental Innovation: Benefits for Indian Patients and Indian Business’, arguing for abolition of section 3(d) of the Indian Patents Act to pave the way for patentability for all types of incremental innovations in pharmaceuticals, realistically it appears extremely challenging.

As the paper quoted first in this article suggests, denial of patents for inventions of dubious value extending effective patent period through additional patents, is a significant safeguard to protect public health interest. This statutory provision will also pave the way for quick introduction of generics on expiry of the original patent.

Taking all these developments into active consideration, keen industry watchers do believe, for every effort towards balancing IPR with Public Health Interest, both brickbats and bouquets will continue to be showered in varying proportion together with the mounting pressure of power play, especially from the developed world and still for some more time.

However, in India this critical balancing factor seems to have taken its root not just deep and strong, but in all probabilities - both politically and realistically, the law is now virtually irreversible, come what may.

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.

 

 

The Ghost Keeps Haunting: NCD Dogs Cancer in ‘Compulsory License’ Debate of India

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In November 2012, as a part of the ‘Campaign for Affordable Trastuzumab’ for the treatment of breast cancer, a citizens’ collective, reportedly sent an ‘Open Letter’ signed by around 200 cancer survivors, women’s groups, human rights and health rights campaigns and treatment activists from across the world to the Indian Prime Minister, urging him to ensure that the breast-cancer drug Trastuzumab is made affordable for treating cancer patients in the country.

Trastuzumab was named because of the following reasons:

  • Breast-cancer affects around 28-35 per cent of all cancers among women in major cities of India.
  • No other drug against HER+2 cancer can reduce patients’ mortality as Trastuzumab and reduce the spread of malignancy to other parts of the body.
  • Majority of women with HER+2 breast cancer do not have access to a complete course of the drug, which reportedly costs anywhere between Rs 6 to 8 lakhs (US$ 11,000 to US$ 14,500).

Reaping reach harvest: 

According to a media report, three homegrown Indian companies are currently developing biosimilar drugs to this protein molecule to reap a reach harvest arising out of the emerging opportunities.

However, this is expected to be an arduous, expensive and challenging endeavor, as the concerned companies will require pursuing a complicated biotechnological route to create follow-on biologics for Trastuzumab.

The ‘Trigger Factor’: 

It is widely believed that the above ‘Open Letter’ to the Prime Minister had prompted the Ministry of Health to form an ‘Experts Committee’ to evaluate the situation and make recommendations accordingly.

Thereafter, within a short period of time, in January, 2013, in a move that is intended to benefit thousands of cancer patients, Ministry of Health forwarded the report of the above ‘Experts Committee’ to the Department of Industrial Policy and Promotion (DIPP) for its consideration to issue Compulsory Licenses (CL) for three commonly used anti-cancer drugs namely, Trastuzumab (used for breast cancer), Ixabepilone (used for chemotherapy) and Dasatinib (used to treat leukemia). Public Health Foundation of India (PHFI), among other experts, also reportedly had participated as a member of this ‘Experts Committee’,

For a month’s treatment drugs like Ixabepilone and Dasatinib reportedly cost on an average of US$ 3,000 – 4,500 or Rs 1.64 – 2.45 lakh for each patient in India.

 A ‘Technology Transfer’ discouraged: 

Such a rapid development in the CL landscape of India is indeed intriguing, especially after a voluntary announcement by Roche in 2012 that it will produce Trastuzumab and Rituximab in India through transfer of technology to an Indian contract manufacturer.

Consequently for a month’s treatment, the price of Trastuzumab will come down from around US$ 2,000 to US$ 1, 366, i.e. by 31 percent and Rituximab from around US$ 1,456 to US$ 682 i.e. by 53 percent. This was reportedly announced by none other than the Minister of State of Chemicals and Fertilizers of India Mr. Srikant Jena.

Despite this voluntary decision of technology transfer and price reduction of two life saving drugs in India by Roche, reported Government consideration for grant of CL for Trastuzumab, without getting engaged in any form of a win-win dialogue with the Company, could ultimately prove to be counter productive and may discourage further technology transfer of expensive patented drugs to India.

Increasing incidence of cancer in India: 

Cancer is just not a dreaded disease, but also making a devastating impact, financial and otherwise, on the lives and families of thousands of sufferers in India.

According to ‘The Lancet’, published on 28 March 2012, in India 556 400 people died of cancer only in 2010.

The paper also comments that only half of the estimated 9.8 million total deaths per year is captured by the CRS in India, fewer than 4 percent are medically certified, while more than 75 percent of deaths occur at home.

The Lancet study clearly highlights that most cancer patients in India die without medical attention and drugs. Cancer is, therefore, increasingly becoming a public sensitive disease area with high socioeconomic impact in the country. High treatment cost of this near terminal disease is beyond reach of majority of population in the country.

In a written reply to a question in the ‘Upper House’ of the Indian Parliament, the Minister of State for Health and Family Welfare on March 4, 2012 said that according to “Three Year Report on Population Based Cancer Registries 2006 – 08″ of the Indian Council of Medical Research (ICMR), the estimated numbers of cancer patients for 2015 and 2020 are 1.16 million and 1.27 million respectively. There is a gradual rise in the prevalence of cancer in India, though the government has initiated several measures in this area.

High incidence of breast cancer: 

As per a recent report, an estimated 1, 00,000 – 1, 25,000 new patients suffer from breast cancer every year in India and this number is expected to double by 2025.

Government is mulling CL for NCD: 

Currently the DIPP appears to be planning to extend the provision of Compulsory License  (CL) beyond cancer drugs to other Non-Communicable Diseases (NCD) in the country, like diabetes. 

Domestic Pharma Association supports the move: 

A major domestic pharmaceutical industry association, as per media reports, supports this move by clearly articulating, “Over the years, more deaths are taking place on account of Non-Communicable Diseases (NCDs) than communicable ones. It is, therefore, natural that this provision (CL) will be used for NCDs as well.”

UN declaration on NCD provides flexibilities in TRIPS Agreement: 

Experts believe that this new move on CL for drugs related to NCDs is a consequence of India’s signing the United Nation (UN) declaration on the prevention of NCDs in the country by, among others, using flexibilities in the TRIPS Agreement to increase availability of affordable drugs for such diseases.

The Government has already launched a “National Program for Prevention & Control of Cancer, Diabetes, Cardio Vascular Diseases and Stroke (NPCDCS)” as a pilot project covering 150 million people in 100 inaccessible and most backward districts during the financial year 2011-2012 at a cost of US$ 275 million.

Socio-economic impact of NCDs in India: 

Indian Journal of Community Medicine (IJCM) in an article titled, “Social and Economic Implications of Non-Communicable Diseases (NCDs) in India” has highlighted, among others as follows:

  • NCDs account for 62 percent of the total disease burden in India with a significant ascending trend both in terms of overall mortality and morbidity.
  • This burden is likely to increase in the years to come.
  • Due to chronic nature of the disease and technological advancements in care, costs of treatment are high leading to access barriers, or ‘catastrophic expenditures’ for those who undergo treatment.
  • There are evidences of greater financial implications for the poorer households suffering from NCDs.
  • Most estimates suggest that the NCDs in India account for a significant economic burden ranging from 5 to 10 percent of GDP.
  • An urgent multi-sectoral Government action is strongly warranted both on grounds of economic arguments and social justice.
  • Action needs focus on addressing the social determinants of NCDs for prevention and strengthening of health systems to meet the challenge.
  • A framework for monitoring, reporting, and accountability is essential to ensure that the returns on investments in NCDs meet the targets and expectations set in the national plans.

Innovator companies contemplating legal recourse: 

Reacting to all these developments, the global pharmaceutical companies have, once again, expressed strong commitment to protect and continue to defend their Intellectual Property Rights (IPR) within the legal framework of India.

They have also reiterated their belief that a robust IPR regime will encourage innovation in the country making available more and more innovative drugs for the patients in India.

An interesting WHO report on a ‘robust IPR regime’: 

In this regard a World Health Organization (WHO) research report titled “Patents, Price Controls and Access to New Drugs: How Policy Affects Global Market Entry” makes some interesting observations on a ‘robust IPR regime’.

The report highlights the following four important points:

1. Increasing the strength of a patent system to include long-term protection on pharmaceutical products appears to spur market entry mostly in the high-income countries.

For the low- and middle-income countries that are currently being encouraged to move to stronger protection through trade policies, the evidence that extending protection enhances access to new pharmaceuticals is mixed.

2. There is some evidence that high level of protection might encourage more frequent entry of innovative products in the short term. However, in the longer term the same domestic capacity could well be an alternative source of entry of such drugs.

3. Intellectual Property (IP) holders frequently assert that the poor quality of enforcement in developing countries undermines the value of their patent rights. However, it is quite evident now that patent laws in these countries are at least broadly meaningful commensurate to their respective domestic requirements.

4. The standard argument on price regulation that it will dissuade market entry for innovative drugs appears to have more relevance among the high-income countries and not so for the poorer countries.

The authors further indicate:

“There we find that while price regulation makes it less likely that new drugs will be available quickly, it does not appear to prevent new products from being launched eventually.”

Conclusion: 

Following all these recent developments and weighing pros and cons, one could well imagine that pressure on the Government from various stakeholders for CL on drugs for Cancer and NCDs will keep mounting, unless an alternative measure like, ‘Price Negotiation for Patented Drugs’ is put in place by the Department of Pharmaceuticals, sooner than later, in 2013.

The recent judgment of the ‘Intellectual Property Appellate Board (IPAB)’ on CL to Natco may further add fuel to this raging debate.

It is now quite clear from the Finance Minister’s speech on the ‘Union Budget Proposal’ for 2013-14 that eagerly awaited ‘Universal Health Coverage’ or ‘Free Distribution of Essential Medicines to all’ schemes will not be implemented, at least for now.

Thus in all probability, the ghost of CL will keep haunting the innovators in India unabated, unless an effective, scalable and sustainable model for improving access to patented drugs for majority of population in the country is put in place. This will call for demonstrative, innovative and constructive Public-Private-Partnership (PPP) initiatives, sooner. In this effort  all concerned should at first be aligned with the cause, in principle, and try to be a constructive partner to get it translated into reality together, rather than just playing the role of vociferous critics in perpetuity .

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.

Indian Patent office (IPO) asks for details of ‘working of patents’ in India – does it herald the beginning of a new chapter in the IPR regime of the country or it could trigger another raging debate

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A Public Notice dated 24/12/2009 issued by the Controller General of Patents, Design & Trade Marks, directing all Patentees and Licensees to furnish information in Form No.27 on ‘Working of Patents’ as prescribed under Section 146 of the Patents Act (as amended) read with Rule 131 of the Patents Rule 2003 ( as amended). The notice also draws attention to penalty provisions in the Patent Act, in case of non-submission of the aforesaid information.The Last date for filing the information is March 31, 2010. Only history will tell us about the possible future impact of this notification.Why is this information needed by the IPO?

Indian Patent Law specifies a provision for submission of information in Form 27 regarding the details of ‘working of a patent’ granted in India, which is a statutory requirement.

The information sought by the IPO in Form 27 can be summarized as follows:

A. For not ‘working of patent’: the reasons for not working and steps being taken for ‘working of the invention’ to be provided by the patentee.

B. In case of establishing ‘working of a patent’, the following yearly information needs to be provided:

1. The quantity and value of the invention worked; which includes both local manufacturing and importation.
2. The details to be provided if any licenses and/or sub-licenses have been granted for the products during the year.
3. A statement as to whether the public requirements have been met partly/adequately to the fullest extent at a reasonable price.

NB:

• A fine of up to (USD $25,000 may be levied for not submitting or refusing to submit the required information by the IPO.
• Providing false information is a punishable offence attracting imprisonment of up to 6 months and/or a fine.

What would amount to ‘Local Working of Patent’ in India?

Obviously, the question will arise what then would constitute ‘working of patent’ in the country. It is generally believed that ‘commercial exploitation’ of patented products in India will mean local ‘working of patent’ in the country.

This is still a controversial issue as some experts claim that ‘local working of patent’ can be established only through local manufacturing and thus importation of such products will not be considered as ‘local working of patent’ in India.

However, other groups of experts opine, as a signatory of article 21 (1) of TRIPS, India is under clear obligation to accept importation of a locally patented product as ‘local working of patent’.

How affordable is affordable?

Besides, ‘local working of patent’ issue, section 84.1 of the patent Act 2005 under ‘Compulsory licenses’ says:

“At any time after the expiration of three years from the date of the (grant) of a patent, any person interested may make an application to the controller for grant of compulsory license on patent on any of the following grounds, namely:

a. that the reasonable requirements of the public with respect to the patented invention have not been satisfied, or
b. that the patented invention is not available to the public at a reasonably affordable price, or
c. that the patented invention is not worked in the territory of India.”

The question, therefore, will arise, who will determine whether a patented product is available to the public at a reasonably affordable price or not? Moreover, what will be the measure, formula or yard to stick to decide reasonably affordable price? The next question could be – reasonably affordable price for whom … for the rich minority… or for around 300 million middle class population of the country… or for another 713 million lower middle class or poorer section of the society?

How ‘affordable’ then will be considered as ‘affordable’ in such cases?

Conclusion:

Whatever may be the case, it would be interesting to know, how the Indian patent Office (IPO) would deal with these details. In any case, such information will not remain a secret. ‘The Right to Information Act’ will help ferret all these details out in the open.

Thus, when the ‘moment of truth’ comes, one will be quite curious to note how the proponents of ‘compulsory licensing (CL)’ would try to push their envelope hard enough on this score to establish their view points… And on the other hand how would the innovator companies establish that the price is indeed a function of the value that the product would offer… and in that process would gear themselves up with relevant and credible, possibly ‘Health Technology Assessment (HTA)’ details to establish the price premium of patented products in India to meet the ‘unmet needs of the ailing patients.’

Striking a right balance in this matter by the IPO between rewarding fruits of expensive, risky and time consuming innovation, on the one hand, and help improving access to affordable modern medicines to a vast majority of the population of the country, on the other, will indeed be a daunting task.

By Tapan 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.

The relevance of the Indian version of the Bayh-Dole Act – the country needs all stakeholders’ open debate on the proposed bill.

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The Bayh-Dole Act is an American legislation, which was originally sponsored by two US senators named Birch Bayh and Bob Dole. This Act deals with Intellectual Property (IP) arising out of US government funding. Bayh-Dole Act is also known as University and Small Business Patent Procedure Act. In December 12, 1980 this was enacted into a law by the US Congress.
What it does:
Under this Act, IP rights over government funded inventions for further development, license to other parties or direct commercialization are transferred to the universities and small businesses operating with government contracts. The government though retains its right to license the invention to any third party without any consent from the IP right owner or the licensee, if it feels that on a reasonable basis the public is being denied of the benefits of the invention.

The Indian version of the Bayh-Dole Act:

The Utilization of the Public Funded Intellectual Property Bill 2008, which has been formulated in line with the US Bayh-Dole Act, has already been approved by the Union Cabinet of India. This bill ensures both utilization and protection of the IP arising out of government funded research initiatives. Currently government funded academic institutions and research institutes cannot commercialize the inventions.

The proposed bill will not only allow them to patent such inventions but will also reward the inventors and the institutes with a share of its commercialization proceeds as per specific guidelines.
The bill has attracted a mixed response from the stake holders.

The relevance of Bayh-Dole Act in India:

Relevance of Indian version of the Bayh-Doll Bill in the post product patent regime in India is
significant. The core concept of the bill encourages innovation and ensures protection of patents and other forms of IP rights of the government funded R&D outcomes, where the owner of the intellectual property will be the government grant receipients or the government.

This bill is expected to offer to various research institutions, universities, small businesses and non-profit organizations, the IP rights on their inventions, resulted from the government funding. Overall environment towards innovation within the country is expected to get a boost in that process.

Is the ownership and protection of R&D a real remedy to make government academic institutions and universities self sustainable?

This is certainly not the only remedy, but an important one. This process will have significant potential to effectively facilitate technology transfer from government funded research laboratories or universities to the user industry to make these establishments self-sustainable.

What are the main implications of the bill if enacted in its current form?

Although the fine prints of the bill are not yet clearly known, the bill in its current form raises more questions than answers. Some of the concerns with the bill in its current form are as follows:

- This law could effectively transfer the decision making process about
publications of the research papers from the researchers and academia to
the bureaucrats in the government establishments, making the R&D
environment quite stifling for the researchers and the initiative
counterproductive.

- Academia at times will be compelled to incur significant expenditures
towards different types of IPR related litigation, which could have been
otherwise productively spent by these institutions towards research
initiatives.

- The learning and research may get transformed into another kind of
businesses activity, as such a law could change the research focus on to
the issues, which will be of greater commercial interest to various
industries and will offer immediate financial benefits to the
institutions. As a result vital non-commercial research, which could be of
critical interest to the nation as such, may take a back seat.

Conclusion:

The country will therefore need an extensive public debate on this bill, which has not taken place, as yet. The loose knots of the bill need to be tightened and the concerns of the stakeholders need to be adequately addressed before its enactment into a law.

By Tapan 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.

The stormy debate on wrongful grant of pharma product patents – a countdown of the news events, for a quick perspective.

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To give a quick perspective to this debate, I reckon, a countdown of five reported news events on the subject will be helpful. I start from February, 2009 and gradually go one year back, to February, 2008, to capture the key elements of this stormy debate. Finally, I move to ‘ground zero’ to explore the basic remedial measures to effectively address the issue.Event 5‘The Economic times’ (ET) dated February 24, 2009 reported an interesting news item titled, “Dichotomy between patent law and practice”. The timing of this article, with its various quotes, highlighting the following points, evokes interest:

1.“Indian patent authorities are virtually not following the spirit of the Sections 3(d) and 3(e)”.

2.“A large number of patents granted in India since 2005 pertain to products first patented in 1970s, 1980s, and 1990s, most of which were launched in Indian markets long before 2005, the year of introduction of product patenting in the country”.

3.“The patent applicants are not making adequate disclosures, making it difficult for potential challengers to file post-grant objections which the law provides for. Since the International Non-proprietary Name (INN) is not of the drug is often not given along with the Title of the Patent, it is cumbersome for anyone to trace the patent to the original PCT (Patent Cooperation Treaty) application and have an idea about how new it is”.

4.“Many law firms refuse to take briefs from Indian companies, because their multinational clients do not permit them to do so! The result— post-grant objection facility is not effectively used by Indian companies.”

Why are these observations interesting?

These observations are interesting because for point number 1 to 3, as stated above, following three recourses are available to all:

1. After publication of the patent applied for, in the patent journal, one can file a pre-grant opposition.

2. Assuming that someone has missed this opportunity, the provision for filing post grant opposition will still be there.

3. Assuming that both the opportunities have been missed due to some reasons and one could not understand the details of the patent applied for, during the patent granting process, the opportunity of going to a Court of law with a request to make such patents (which have violated section 3.d) invalid, will still exist.

It is indeed very difficult to understand why such measures are not being taken by the aggrieved parties, as specified in the law.

Point number four is even more difficult to understand. When lawyers are available to the domestic companies to defend alleged patent infringement, why then lawyers will not be available to them to take such objections to a court of law?

Event 4

Mint dated October 7, 2008 in its article titled; “Cozy deals and conflicting interest mark patent granting process” reported the following:

“There are even local and multinational corporates who ‘seek’ help of examiners and controllers to get their applications drafted, thereby ensuring a grant for a price”.

Event 3

‘The Economic Times’ dated July 1, 2008 reported in its article titled, “Cipla gets patent for Nexium, Fosamax modified versions” that Mumbai Patent office granted these two patents to Cipla in April, 2008 for new forms of two well known blockbuster drugs, Esomeprazole (Nexium of Astra Zeneca) and Alendronate (Fosamax of Merck). This news came as a big surprise because Cipla is well known for its continuous accusation to innovator companies for trying to extend ‘monopoly’ period by ever-greening patent through similar means. The report, therefore, raised a very valid question, whether Cipla has ‘walked the talk’ in India? It will be interesting to know on what basis Cipla managed to overcome the ‘efficacy’ barriers under section 3(d).

On this ET report, well known IPR expert Shamnad Basheer wrote the following in his blog dated July 6, 2008:

“Reading the ET piece, Nathan Evans of Finnegan Henderson, who’s a very astute commentator on the Indian patent scene and has written a couple of articles in this regard posed this question to me:

“This makes me wonder if the patent office in India will apply the laws less strictly to Indian pharmas than MNCs (kind of like they apply the patent laws more strictly for essential medicines)”

Shamnad Basheer concluded his comment on this subject with the following observations:

“How ought section 3(d) to be interpreted when our very own generic manufacturers are applying for supposedly “incremental” inventions?”

Event 2

According to Federation of Indian Chambers of Commerce (FICCI) report dated March 7, 2008, FICCI and the Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce and Industry have joined hands to set up a working group to improve Intellectual Property regime in India.
It will be interesting to know the view of this joint working group between the Government and the Industries, in this matter. I have not read anywhere any comments of this important working group on such matter, so far.

Event 1

‘Thomson and Reuters patent focus report’ dated February, 2009 observed absence of clear guidelines (Manual of Patent Practice and Procedure) about some of the complex provisions of patent law, particularly section 3(d). The report indicated that there should be clarity on what would qualify as “enhanced efficacy” under section 3(d) so that it can help the patent examiners to clearly make out which patent applications would fall under section 3(d).

Ground Zero:

Let us now try to ponder, realize and fathom the core issue of this problem, which lies at the ‘Ground Zero’. Thus far we have been reading constant allegations about the functioning of Indian Patent Offices and even on their integrity and honesty.

In absence of a well drafted, long overdue, Patent Manual, all concerned, including patent examiners will have their own ways of looking into “enhanced efficacy”. In such a situation, I shall not be surprised if the Patent Examiners suffer from the dilemma as to what exactly will constitute “enhanced efficacy”.

Protracted debate with the stakeholders on the ‘draft patent manual’ appears to be over now. The last stakeholders’ meeting on this subject was concluded in Kolkata following Delhi, Mumbai and Bangalore, several months ago. However, the final Patent Manual is still not in place, which has been kept for public inspection since 2005.

To address this stormy debate, in my view, we need to:

1. Push for expeditious release and implementation of the Patent Manual (Manual of Patent Practice
and Procedure).

2. Let FICCI – DIPP working group work more effectively and cohesively for better functioning of the
new IPR (Intellectual Property Rights) regime.

3. Let ‘capacity building’ exercise at the Indian Patent office (IPO) continue with greater speed.

Mere accusation and constant bashing of the IPOs, as we now see around, may not yield much result. After having taken the above measures, if similar dissatisfaction in any quarter still remains, let law take its own course. Despite great apprehensions by some, as quoted above under point 1, never mind, enough lawyers will be available to fight such cases.

By Tapan 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.

The heated debate on WHO IMPACT definition of Counterfeit Drugs is now on a ‘pause’ – A time to evaluate the reasons for supporting and opposing it.

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The World Health Organisation (WHO), in December 2008, proposed the following new definition, as prepared by the International Medical Products Anti-Counterfeiting Taskforce (IMPACT):“A medical product is counterfeit when there is a false representation in relation to its identity and/or source. This applies to the product, its container or other packaging or labeling information. Counterfeiting can apply to both branded and generic products. Counterfeits may include products with correct ingredients/components, with wrong ingredients/components, without active ingredients, with incorrect amounts of active ingredients, or with fake packaging.”This definition, indeed, created a furor in India. The Ministry of Health of the Government of India initiated discussions, on this issue, with the stakeholders and by mid-January, 2009 a consensus was arrived at between the Drug Controller General of India (DCGI) and the generic industry on much debated definition of counterfeit drugs. It was reported that the Government had decided to place this definition before the World Health Organisation (WHO) in its next meeting on the subject. The consensus definition, after the above meeting, was reported as follows:

“A medical product (medicine, vaccine, diagnostics and medical implants/devices) is counterfeit when it is deliberately and fraudulently mislabelled with respect to its identity and/or source. Counterfeit can apply to components with wrong ingredients/components without active ingredients, with incorrect amounts of active ingredients, or with fake package”

In end-January 2009, although it was reported that under pressure from the developing countries like, India, WHO has dropped this new definition, it is very likely that the initiative is now just on a ‘pause’ mode.

Let us now try to explore the ‘Eye’ of this stormy debate and its relevance to India. The ‘eye’ of the storm lies mainly within the following 3 key concerns of the opponents of the definition:

1. False representation of identity and source applies not only to labeling but also to the ‘product,
its container or other packaging’
2. The new definition could include Intellectual Property Right (IPR) issues and as a cosequence of
which, Indian generics could run into the risk of being branded as counterfeit
3. Removal of the words ‘fraudulent and deliberate’ from the original definition and replacing them
with ‘false representation’ will shift the burden of proof

In India, the share of voice of those opposing this definition was undoubtedly much more than those who were supporting it. However, the rationale for supporting the definition, in Indian context, appears to be much stronger than opposing it.

While arguing on this point, I am of the view that most of the apprehensions expressed above have been abundantly clarified in the definitions of Misbranded drugs (section 17), and Spurious drugs (Section 17 B) of the Indian Drugs and Cosmetics Act, 1940.

Let us now have a quick look at the Section 17 and Section 17 B of the Drugs and Cosmetics Act to find out whether the WHO IMPACT definition is way off the definitions for Misbranded and Spurious drugs as indicated in the above Act.

“Section 17. Misbranded drugs – For the purposes of this Chapter, a drug shall be deemed to be misbranded –

(a) If it is so coloured, coated, powdered or polished that damage is concealed or if it is made to appear of better or greater therapeutic value than it really is; or

(b) If it is not labelled in the prescribed manner ; or

(c) If its label or container or anything accompanying the drug bears any statement, design or device which makes any false claim for the drug or which is false or misleading in any particular.”

Does Section 17 of the Drugs and Cosmetics Act, 1940 answer the ‘concern 1’ above?

“Section 17B. Spurious drugs – For the purposes of this Chapter, a drug shall be deemed to be spurious

(a) If it is manufactured under a name which belongs to another drug; or

(b) If it is an imitation of, or is a substitute for, another drug or resembles another drug in a manner likely to deceive or bears upon it or upon its label or container the name of another drug unless it is plainly and conspicuously marked so as to reveal its true character and its lack of identity with such other drug; or

(c) If the label or container bears the name of an individual or company purporting to be the manufacturer of the drug, which individual or company is fictitious or does not exist; or

(d) If it has been substituted wholly or in part by another drug or substance; or

(e) If it purports to be the product of a manufacturer of whom it is not truly a product.”

Does Section 17B of the Drugs and Cosmetics, 1940 Act answer the ‘concern 2′ above?

The ‘concern 3’ above deals with shifting the ‘burden of proof’ with replacement of the words ‘fraudulent and deliberate’ by ‘false representation’. Many legal experts opine that this change will only mean that “criminal intent (fraudulent and deliberate) shall be considered during the legal procedures for the purpose of sanctions.”

What could then possibly be the reasons for opposing the revised WHO IMPACT definition of Counterfeit Drugs in India, especially when we have similar definition in place in our own Drugs and cosmetics Act, 1940? Does it make sense for the Government to reinvent the wheel? Who knows?

By Tapan 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.