Tag Archives: IPR

Making New Cancer Drugs Cost-effective

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The prices of new cancer drugs are increasingly becoming unsustainable across the world, and more so in India. A sizable number of poor and even middle-income patients, who spend their entire life’s savings for the treatment of this dreaded disease, is pushed towards extreme economic hardship. Their plight in India would continue to remain so, till Universal Health Care (UHC) comes into force, as enunciated in the National Health Policy 2017.

Thus, the delivery of affordable and equitable cancer care poses one of India’s greatest public health challenges. Public expenditure on cancer in India remains below US$ 10 per person, as compared with more than US$ 100 per person in high-income countries. The May 2014 paper, published in ‘The Lancet Oncology’, analyzed this concern in detail.

In this article, after giving a brief backdrop, I shall explore a possible alternative to make cancer treatment with new drugs affordable to many by scaling up this strategic option.

Cancer – the second leading cause of death:

According to the World Health Organization (W.H.O), cancer is the second leading cause of death globally and accounted for 8.8 million deaths in 2015. This works out to nearly 1 in 6 of all global deaths, with US$ 1.16 trillion being the estimated total annual economic cost of cancer in 2010. Lung, prostate, colorectal, stomach and liver cancer are the most common types of cancer in men, while breast, colorectal, lung, cervix and stomach cancer are the most common among women. To reduce significant disability, suffering and deaths caused by cancer worldwide, effective and affordable programs in early diagnosis, screening, treatment, and palliative care are needed. Treatment options may include surgery, medicines and/or radiotherapy – the report reiterates. In many instances, anti-cancer drugs are the mainstay treatment.

For the country, Indian Council of Medical Research (ICMR) reported over 736, 000 people succumbing to the disease in 2016. This figure is expected to shoot up to 880,000 by 2020. ICMR estimated the total number of new cancer cases at around 1.45 million in 2016, and the same is likely to reach 1.73 million by 2020. The situation in this area, therefore, rather grim across the world, including India.

Cancer treatment cost in India is one of the highest in the world:

Anticancer drugs are generally expensive. As stated in a related article, published in the Nature Reviews Clinical Oncology on March 14, 2017, in the United States, a novel anticancer drug routinely costs more than US$ 100,000 per year of treatment. When adjusted for per capita spending power, these lifesaving medicines become most unaffordable in economically developing nations, such as India and China. Not only are their launch prices high and fast rising, but these also often escalate during the respective patent exclusivity period.

That in terms of the ability to pay for drugs, cancer drugs are most affordable in Australia and least affordable in India and China, was established in one of the largest research study presented at the 2016 Annual Meeting of the American Society of Clinical Oncology. Moreover, even in those cases where cancer could be detected early, about half the patients in India are compelled to skip the treatment for high drug cost, highlights another article.

Interestingly, the concerned drug manufacturers seldom, if at all, justify such astronomical drug prices and subsequent price increases well supported by some rational factors, such as, the extent of benefit patients are likely to derive, the novelty of the agents, or detailed spending on research and development, the above paper states.

The increasing trend of price escalation of cancer drugs harms many patients, often directly, through increased out-of-pocket expenses, which reduce levels of patient compliance, or drive thousands of cancer patients skipping the drug treatment, altogether. Consequently, it also harms the society by imposing cumulative price burdens on many patients that are unsustainable.

Despite high cost, annual global spending on anticancer drugs has already exceeded US$100 billion, and is predicted to reach US$150 billion by 2020. In India too, oncology is a leading therapeutic segment, which reached a turnover of Rs. 2,000 Crore (around US$ 320 million) in 2013 and is expected to grow to Rs. 3,831 crore (around US$ 615 million) by the end of 2017, according to a report of Frost and Sullivan.

The reason for high drug price:

The real reason for the high cost of cancer drugs, just as many other life-saving medicines, is quite challenging to fathom. Many attribute its reason to unsustainable R&D models of the global pharma companies, in general.

For example, “the spiraling cost of new drugs mandates a fundamentally different approach to keep lifesaving therapies affordable for cancer patients” – argued an article titled, “How Much Longer Will We Put Up With US$ 100,000 Cancer Drugs?”, published by Elsevier Inc. In the same context, another article titled “Making Cancer Treatment More Affordable”, published in the ‘Rare Disease Report’ on Feb 09, 2017, reiterated that the current R&D model needs to change, as the cost of many such treatments is higher than the cost of an average person’s house in the United States.

Nonetheless, the drug manufacturers answer this difficult question with ease and promptness, citing that the cost of innovation to bring these drugs through a complex research and development (R&D) process to the market, isn’t just very high, but is also increasing at a rapid pace.

Pharma R&D cost:

An analysis by the Tufts Center for the Study of Drug Development, published in the Journal of Health Economics in March, 2016 pegged the average cost to develop and gain marketing approval for a new drug at US$ 2.558 billion. It also said that the total cost of innovation of a new drug and bringing it to market, has increased more than double from US$ 1.22 billion in 2003 to US$ 2.6 billion in 2014. Although these numbers are being vehemently challenged in several credible journals and by the international media, many global pharma majors justify the high new drug prices

by highlighting that developing a new molecule takes an enormous amount of time of 12 to 14 years, lots of financial resources and huge efforts.

On the other hand, an article titled, “Does it really cost US$ 2.6 billion to develop a new drug?”, published in The Washington Post on November 18, 2014 observed that: ‘The never-ending debate about what drugs should cost is in part driven by the fact that no one seems to know what it actually costs to develop one.”

But, why is the decline in the R&D productivity trend?

According to a 2014 review article titled, “Recent Advances in Drug Repositioning for the Discovery of New Anticancer Drugs”, published in the International Journal of Biological Sciences, while the total R&D expenditure for drug discovery worldwide increased 10 times since 1975 (US$ 4 billion) to 2009 (US$ 40 billion), the number of NMEs approved has remained largely flat (26 new drugs approved in 1976 and 27 new drugs approved in 2013). The average time required for drug discovery to market launch has also increased over time in the US and in the EU countries from 9.7 years during 1990s, to 13.9 years from 2000 onwards.

Be that as it may, the bottom-line is regardless of tremendous advancement in biological science, technology and analytics, especially in the new millennium, coupled with increasing investments in pharma R&D, the total number of NMEs that has reached the market hasn’t shown commensurate increase.

One of my articles published in this blog titled, “How Expensive Is Drug Innovation?” found an echo of the same in a globally reputed journal. This study, published by the BMJ on May 2016, titled “Propaganda or the cost of innovation? Challenging the high price of new drugs”, expressed deep concern on the rising prices of new medicines. It reiterated that this trend is set to overwhelm health systems around the world.

Need for an alternative R&D strategy:

The hurdles in discovering and developing new drugs call for alternative approaches, particularly for life threatening diseases, such as cancer. I reckon, it’s about time to scale-up a viable alternative strategy to bring down the R&D cost of new drugs, improve the success rate of clinical development, reduce a decade long ‘mind to market’ timeframe for an innovative drug or a treatment, and of course, the mind blogging cost of the entire process, as asserted in the above report from the Tufts Center.

One such alternative strategy could well be: ‘Drug Repurposing’

Drug Repurposing:

As defined by the National Center for Advancing Translational Sciences, ‘drug repurposing’ “generally refers to studying drugs that are already approved to treat one disease or condition to see if they are safe and effective for treating other diseases”.

As many molecules, with well-documented records on their pharmacology and toxicity profile, have been already formulated and undergone large clinical trials on humans, repurposing those drugs building upon the available documents and experiences for fresh clinical trials in different disease conditions, would hasten the regulatory review process for marketing approval, and at a much lesser cost.

I shall quote here just two such examples of ‘drug repurposing’ from well-known molecules, as follows:

  • Sildenafil (Viagra): The blockbuster drug that was launched by Pfizer in 1998 for the treatment of erectile dysfunctions was originally developed for the treatment of coronary artery disease by the same company in 1980s.
  • Thalidomide: Originally designed and developed by a German pharmaceutical company called Grünenthal in Stolberg as a treatment for morning sickness in 1957, but was withdrawn in 1961 from the market because it caused birth defects. The same molecule was reintroduced in 1998 as a ‘repurposed drug’ to effectively treat patients with erythema nodosum leprosum (ENL) – a complication of leprosy, and multiple myeloma – a type of cancer.

I had given many more examples of ‘drug repurposing’ in one of my earlier articles published in this blog.

Repurposing drugs for cancer:

The above-mentioned review article of International Journal of Biological Sciences 2014 clearly noted: “Drug repositioning has attracted particular attention from the communities engaged in anticancer drug discovery due to the combination of great demand for new anticancer drugs and the availability of a wide variety of cell and target-based screening assays. With the successful clinical introduction of a number of non-cancer drugs for cancer treatment, ‘drug repurposing’ now became a powerful alternative strategy to discover and develop novel anticancer drug candidates from the existing drug space.”

The following are some recent successful examples of ‘drug repurposing’ for anticancer drug discovery from non-cancer drugs, which are mostly under Phase I to II clinical trials:

Drug Original treatment Clinical status for cancer treatment
Itraconazole Fungal infections Phase I and II
Nelfinavir HIV infections Phase I and II
Digoxin Cardiac diseases Phase I and II
Nitroxoline Urinary Tract Infections Preclinical
Riluzole Amyotropic lateral sclerosis Phase I and II
Disulfram Chronic alcoholism Phase I and II

‘Drug repurposing’ market:

A January 2016 report by BCC Research estimates that the global market for drug repurposing will grow from nearly US$ 24.4 billion in 2015 to nearly US$ 31.3 billion by 2020, with a compound annual growth rate (CAGR) of 5.1 percent for the period of 2015-2020.

Expressing concern just not enough:

There are enough examples available across the world regarding stakeholders’ expression of great concern on this issue, with the buzz of such protests getting progressively shriller.

However, in India, high prices of cancer drugs do not seem to be a great issue with the medical profession, just yet, notwithstanding some sporadic steps taken by the National Pharmaceutical Pricing Authority (NPPA) to allay the economic burden of cancer patients to some extent. Encouragingly, the top cancer specialists of the American Society of Clinical Oncology are reportedly working out a framework for rating and selecting cancer drugs not only for their benefits and side effects, but prices as well.

In a 2015 paper, a group of cancer specialists from Mayo Clinic also articulated, that the oft-repeated arguments of price controls stifle innovation are not good enough to justify unusually high prices of cancer drugs. Their solution for this problem includes value-based pricing and NICE like body of the United Kingdom. An interesting video clip from Mayo Clinic justifies the argument.

All this can at best be epitomized as so far so good, and may help increase the public awareness level on this subject. However, the moot point remains: Has anything significantly changed on the ground, on a permanent basis, by mere expression of such concerns?

Conclusion:

This discussion may provoke many to go back to the square number one, making the ongoing raging debate on Innovation, Intellectual Property Rights (IPR) and Public Health Interest to gather more steam, but the core concern continues to remain unresolved.

I hasten to add that all such concerns, including strong protests, may no doubt create some temporary pressure on drug manufacturers, but they are experienced enough to navigate through such issues, as they have been doing, so far. However, for making new cancer drugs cost-effective for a vast population of patients, coming out of the current strategic mold of pharma research and development would be necessary. Grant of Compulsory License (CL), or the expectation of the local drug manufacturers for a Voluntary License (VL) of new cancer drugs, can’t be a routine process either, as it appears unrealistic to me, for various reasons.

I have discussed in this article just one alternative R&D strategy in this area, and that is Drug Repurposing (DR). There could be several others. DR is reportedly gaining increasing focus, as it represents a smart way to exploit new molecular targets of a known non-oncological drug for a new therapeutic applications in oncology. Be that as it may, pharma companies and the academia must agree to sail on the same boat together having a common goal to make new cancer drugs cost-effective for majority of cancer patients struggling hard, for life.

I would conclude this article quoting the President and Chief Science Officer of Illinois-based Cures Within Reach who said: “What I like about drug repurposing is that it can solve two issues: improved health-care impact and reduced health-care cost – That’s a big driver for us.”

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.

At The Indian IPR Front: ‘Ground Control, There’s No Major Storm’

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The incessant pressure of the developing countries on India, from 2005 to date, to include various restrictive conditions in the Indian Patents Act 2005, still continue. This demand spans across the inclusion of even those provisions, which many experts term as TRIPS-Plus, as these are not required by the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement. More interestingly, the pressure group also insists on the simultaneous deletion or dilution of some existing important provisions in the statute that guarantee public health interest of the nation.

This pressure is expected to mount in the G20 summit of September 4-5, which is now being held in China.

Refreshingly, on 30 August 2016, just ahead of this summit, the eminent economist Dr. Arvind Panagariya, who is also the incumbent Vice Chairman of Niti Aayog of India, and India’s Sherpa at the G20 summit reiterated, as follows, in an interview to a leading National English Business Daily:

“India has strongly opposed the language of the draft on Intellectual Property Protection (IPR) to be taken up at the upcoming G20 meeting in Beijing.”

In the interview, having re-emphasized the critical point that “there is a certain flexibility that we have under the TRIPS agreement and anything that dilutes that flexibility is not acceptable to India,” Dr. Panagariya clearly reaffirmed, yet again that ‘Indian IPR laws and policies are absolutely TRIPS compliant’.

This statement indeed sends a very positive signal to all on the ground, regarding the robust position maintained by the Government, to ward off any move by the overseas vested business interest to derail the flexibility that Indian well-balanced patent regime offers today, not just for public health, but also to foster innovation ecosystem in the country.

At the same time, India’s Sherpa at G20 summit also reportedly clarified that the IPR framework being proposed at the G20, in its strictest sense, cannot be construed as TRIPS-Plus. Nevertheless, some language used in the proposed G20 draft could be subject to interpretation, and India feels that it should not leave any room for ambiguity that has the potential to stretch this demand further, as we move on.

According to Dr. Panagariya: “Right now, these documents have some language where people in the Department of Industrial Policy & Promotion (DIPP) feel that it impinges a bit. We have to fight it out at the summit.”

The basis of apprehension:

There are many reasons for the recent apprehension that India may buckle under the US pressure to dilute its IP laws and policies. One of the reasons could well be a possibility that India has come to an understanding with USTR in this area.

An interesting article published in the ‘spicyip’ on March 14, 2016 also captured this scenario pretty well. I am reproducing below in verbatim a paragraph of this paper, just as an example:

“Last month, the Indian government privately assured the US-India Business Council (“USIBC’’) that it would not invoke compulsory licensing for commercial purposes, as reported in their submissions (available here) to the United States Trade Representative (“USTR”) for the 2016 Special 301 Review. The USIBIC stated that it would be “further encouraged” if the government of India were to make a public commitment, or a written declaration to only issue compulsory licenses in the event of public health emergencies, and not for commercial purposes. This, in their eyes, would “greatly enhance legal certainty for innovative industries”. While such a private assurance doesn’t give rise to any legal commitments, it may well be indicative of a policy shift.”

Prior to this, among many others, a March 3, 2016 ‘The Wire’ report captioned “India Assures the US it Will Not Issue Compulsory Licenses on Medicines”, also raised the same red flag.

The pressure continues even post engagement:

Be that as it may, America has been, repeatedly, raising its concerns over India’s patent regime, driven by its powerful pharma lobby groups.

To keep the kettle boiling, the Office of the United States Trade Representative (USTR) in its 2016 Special 301 Report released this year on April 12, continued to keep India, along with 11 countries, on the Priority Watch List (PWL) for the current year.

USTR reportedly expressed serious concern about Indian IP policies stating that the regime apparently ‘favor’ indigenous manufacturing or Indian innovators. It also alleged that such direction ‘damages’ the patent infrastructure not just in India, but across the world.

It is believed by many that the Special 301 Report is, in fact, a formal posturing of the country on their unilateral IP related business hurdles for the year, exhibiting the power to implement unilateral trade sanctions when the US demands are not met.

In that context, the 2016 Special 301 Report caught many by surprise, as the Indian ‘IPR Think Tank’ (a body of the Union Government-selected experts) was also working closely with the United States to identify and address their issues of concern, such as, patent system, copyright infringement, trademark and counterfeiting, among others.

At that time, this discussion was possibly in its final stage as, just a month after, on May 12, 2016, the Union Cabinet approved the National Intellectual Property Rights Policy (IPR) of India, as proposed by the ‘Think Tank’, in consultation with, among others, especially the United States, which reportedly expressed its overall satisfaction with the final IPR policy.

Key concerns:

From the pharma industry perspective, the key IP concerns are centered, primarily, in the following three areas, besides a few others:

  • Patentability
  • Compulsory Licensing (CL)
  • Data Exclusivity

I would, therefore, concentrate briefly on these three areas to argue how reasonable is the Indian Patents Act 2005 to create a win-win situation both for the patients and the industry while fostering pharma innovation in the country.

Patentability:

One of their key concerns on patentability, revolves round an important provision in the statute – Section 3 (d).

Pharma Multinational Corporations (MNCs), and their trade associations have been going overboard, since long, to lobby hard to make all concerned believe that section 3 (d) is a stumbling block for pharma innovation, as it does not allow patent protection on known chemical substances lacking any significant improvement in clinical efficacy.

This provision of the statute prevents ever-greening of patents with frivolous incremental innovation. Consequently, it blocks the possibility of pricing such ‘me too’ new molecules, exorbitantly, and persuading the prescribers of the existing molecule switching over to the new brand, backed by contentious marketing campaigns, adversely impacting affordability and access to the majority of the patients in India.

Notwithstanding the shrill voices of vested interests, Section 3 (d) has been upheld by the Supreme Court of India in the famous Glivec case of Novartis against Cipla.

The Submission of the Federation of Indian Chambers of Commerce and Industry (FICCI) to USTR for the Review of ‘2016 Special 301 Report’, categorically also states that the Indian Patent Act prescribes a higher threshold on inventive step for medicines, which is in keeping with the TRIPS Agreement, Paris Convention and the Doha Declaration. Hence, Section 3 (d) is sound in terms of the TRIPS, Public policy and Health policy.

Compulsory License (CL):

Besides the hard fact that India has, so far, granted just one CL in a span of more than the last ten years, the Doha Declaration on the TRIPS Agreement related public health clearly provides the flexibility to all its member states to decide on the necessary grounds for granting CL. It is noteworthy that for public health interest, TRIPS flexibilities for CL has been used even by the developed countries, such as, Canada, United States and Germany, in the not too distant past.

Data exclusivity:

The terminologies ‘Data Exclusivity’ and ‘Data Protection’ are quite often used interchangeably by many, creating a great deal of confusion on the subject. However, in a true sense these are quite different issues having a critical impact on the public health interest of a nation.

In an article published in ‘ipHandbook’, titled “Data Protection and Data Exclusivity in Pharmaceuticals and Agrochemicals”, the author Charles Clift, a former Secretary, Commission on Intellectual Property Rights, Innovation and Public Health, World Health Organization; differentiated these two terminologies as follows:

Data Protection (DP): Protection of commercially valuable data held by the drug regulator against disclosure and unfair commercial use.

Data Exclusivity (DE): A time bound form of Intellectual Property (IP) protection that seeks to allow companies recouping the cost of investment in producing data required by the regulatory authority.

According to Charles Clift, Article 39.3 only articulates widely accepted trade secret and unfair competition law, and is not an invitation to create new IP rights, per se, for test data. Nor does it prevent outside parties from relying on the test data submitted by an originator, except in case of unfair commercial practices.

Some developed countries, such as the United States and the European Union have argued that Article 39.3 of TRIPS requires countries to create a regime of DE, which is a new form of time-limited IP protection. However, it is worth noting that in both these countries DE regime was adopted prior to the TRIPS Agreement. Hence, many experts construe such approaches and pressure, thus created for DE, as ‘TRIPS-Plus’.

In its new IPR Policy, India has successfully resisted the demands of TRIPs-Plus provisions, such as, data exclusivity, patent linkage and patent-term extension.

Even the draft IPR policy had reiterated that India accepts: “Protection of undisclosed information not extending to data exclusivity.”

Any near-term possibility of a change in the statute?

While the new IPR Policy of India focuses on consolidating institutional mechanisms to create a robust IPR ecosystem in the country, besides resolving some pressing issues, such as, expediting approval processes involving patents or trademarks, it does not indicate any possible change in the important provisions in the Patents Act 2005, including the much talked about Section 3 (d) and compulsory licensing, despite concerns expressed by the US and pharma companies.

Moreover, a May 13, 2016 Press Trust of India (PTI) report on the Union Cabinet approval of Indian IPR Policy quoted a Government official, as follows, negating the apprehensions that the government may yield to the pressure of developed countries with regard to its IR regime:

“India will never go beyond its current commitments in the TRIPS. Section 3 (d), patent linkage, data exclusivity and compulsory licensing are red lines.”

On the same day and in the same context, Union Finance Minister Arun Jaitley also reportedly stressed that India’s IPR policies are TRIPS-compliant and encourage invention of life-saving drugs, while at the same time, “we must also be conscious of the need to make it available at a reasonable cost so that drug cost does not become prohibitive as has become in some parts of the world”, he articulated, unambiguously.

Conclusion:

Despite all these developments, reiterations and interpretations, a lurking fear on India’s diluting the current patent regime of the nation was refusing to die down in the country.

Many experts were also quite apprehensive about what would be India’s stand on IP in the G 20 summit on September 4-5, currently being held in China.

Is it, then, just a storm in a tea cup on the ground?

This is not a very easy question to answer, though, as many industry watchers sense. Nonetheless, yet another emphatic statement on the subject coming from a top Government echelon and none other than Dr. Arvind Panagariya, the Vice Chairman of Niti Aayog and India’s Sherpa at G20 summit, possibly sends a clear message, at least for now, to all those holding ground in the Indian IPR front:

‘Ground Control, There’s No Major Storm’.

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 Patents Act To Prevail Undiluted…Finally

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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

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.

Utility Model: Would It Work In India For Pharma?

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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

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.

TPP: Discord Within A Strange Mélange And Impact On Access To Medicines

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On May 19, 2015, Bloomberg reported that a sizable number of President Barack Obama’s own party colleagues, besides teachers, seniors, Internet freedom groups and nuns, have joined the push to defeat the proposed Trans-Pacific Partnership (TPP) treaty.

Before I delve into the TPP, solely from the Indian pharmaceutical industry perspective, it is worth acknowledging upfront India’s firm assertion, repeatedly, to continue with its well-thought out and robust Patents Act 2005.

Even the final draft of the National IPR policy, which is now being circulated for inter-ministerial consultations and will soon be taken up by the Cabinet, reasserted that the country’s IPR policy is fully compliant with the Trade Related aspects of IPR (TRIPS) agreement of the World Trade Organization (WTO).

In this process, global demonstration of India’s firm resolve against dilution of the country’s Intellectual Property (IP) regime, coming under any form of intense external pressure, seems to have become a model to follow for the emerging economies of the world, in general.

This trend now gets reflected from some constituents even within the United States, besides several members of the 12-nation TPP, which is a proposed regional regulatory and investment treaty, aimed at strengthening relationship on economic policies and regulatory issues between the member nations.

Publicly articulated key objectives of the pact are to significantly reduce tariffs between the member nations and open up trade, boosting investment flows between its signatories, to accelerate economic growth.

The member countries of TPP have also agreed to work together on issues such as customs procedures, labor practices, intellectual property and competition policies.

Through its comprehensive coverage of issues and binding regulations, TPP is expected to set new benchmark for international trade. It is expected to eventually mature into a regional trade agreement covering the entire Asia-Pacific region.

Uneasy secrecy:

However, the uneasy secrecy surrounding the negotiations of the agreement makes its critics seriously apprehensive about its impact on the developing nations of the world. This is because; the concerned delegates of the negotiating team always remain tight lipped about the progress made in coming to an agreement on the scope of the pact. This information is critical for assessment of direct and indirect global impact of TPP on the trade, economy and society, in general.

According to reports, TPP members, such as, Brunei, Malaysia, Singapore and Vietnam are negotiating hard to get incorporated somewhat similar to Indian IP rules in the TPP agreement.

Besides the above countries, other members of TPP are United States, Australia, Japan, New Zealand, Canada, Chile, Mexico and Peru.

Large Asian economies are not a part:

Interestingly, large Asian economies, especially, four important members of the G20, namely, China, India, South Korea and Indonesia, are not a part of the TPP, just yet.

It is worth noting, TPP is being led by the world’s largest economy and the biggest trading nation – the United States, the country that sees Asia-Pacific as key to its future growth.

Noting all these, many experts in this field, across the world, have already raised a flag saying that the US may be trying to use TPP as a means to undermine China’s growing economic might in the region.

Many gaps still to bridge:

The real negotiations for this treaty started only in 2010 and are still continuing. However, the details of negotiations is so much shrouded under water tight secrecy, even to the lawmakers of the United States, it is indeed challenging for anyone to predict the timeframe of its coming to fruition.

Reuters reported on May 21, 2015, “Chief negotiators from the 12 TPP countries are trying to bridge gaps for a deal at a meeting in Guam that will run through to May 28, 2015. But ministers would need to meet to clinch an accord,”

In this article, I shall only focus on the possible impact of this pact on the access to medicines, especially in the developing world.

Leaked drafts of TPP negotiations:

As the progress of negotiations of this pact continue to remain under uneasy secrecy, on November 13, 2013, WikiLeaks released the secretly negotiated draft text for the entire IPR Chapter of the TPP.

30,000-word IP chapter of the leaked documents, besides others, reportedly contains proposals to increase the term of drug patents beyond 20 years, and lower global standards for patentability.

TPP and patents:

When it comes to the issue of access to affordable medicines for a vast majority of the global population, the overall patent ecosystem of a nation and how evergreening of patents with monopolistic high pricing are addressed, automatically enter into the broader framework of intense public and stakeholders’ discourse.

Article 8.1 of the draft agreement sets-forth the availability of patents, and provides that “patents shall be available for any new forms, uses, or methods of using a known product; and these may satisfy the criteria for patentability, even if such invention does not result in the enhancement of the known efficacy of the product.”

Interestingly, TRIPS agreement, on the other hand, specifies that patents are available “provided that the invention is new, involves an inventive step and is capable of industrial application.”

In that sense, the above provision in the Article. 8.1 is quite inconsistent with the patent laws of many TPP member countries, and especially India.

Consequently, experts have raised serious concerns about the impact of TPP on the IP laws of a country, in general, as it may extend the scope of drug patents, preventing free distribution of cheaper generic drugs to the needy patients.

Impact on access to medicines:

As stated earlier, there have been serious apprehensions that TPP would adversely impact the access to medicines.

According to widely reported leaked drafts of TPP negotiations, the US is demanding aggressive IP provisions in the agreement. It is believed, if accepted, these would directly undermine public health safeguards available in international law, making it harder for TPP member countries to gain access to cheaper generic drugs.

Many experts in this field reportedly construe, these stringent IP provisions that the US is demanding may be categorized as ‘TRIPS-plus’ and have the following serious impact adversely impacting access to medicines :

  • Make it impossible to challenge the validity of a patent before it is granted
  • Lower the requirements for patentability, so that minor alterations of existing medicines can be 
given additional protected monopoly status, even if the alteration offers no therapeutic benefit
  • Require the patenting of diagnostic, therapeutic and surgical methods
  • Lengthen patent monopolies for pharmaceutical firms so that they keep generics out and inflate drug prices for longer periods of time
  • Make it harder for generic manufacturers to obtain regulatory approval for their drugs
  • Create additional monopolies based on clinical data
  • Impose new forms of IP enforcement that give customs officials excessive powers to impound legitimate generic medicines
  • Impose higher prices on national pharmaceutical reimbursement programs
  • Allow pharmaceutical companies to sue governments and limit governments’ abilities to effectively set prices for medicines and legislate in the interest of public health.

Discord within key TPP member countries:

Though Australia is one of the key signatories of TPP, in February 2015, the Medical Journal of Australia also commented that the leaked draft of the agreement includes patenting standards that would delay cheaper drugs.

Quoting the Medical Journal of Australia, ‘The Guardian’ too reiterated: “The most recently leaked draft of the international trade deal includes provisions proposed by the US that would further protect the monopoly pharmaceutical companies hold over drugs, and delay cheaper versions from entering the market. The draft agreement sets in stone low patenting standards, which allow drug companies to practice ‘evergreening’ – when a pharmaceutical company tries to maintain its market monopoly on a drug for longer by applying for extra patents. This prevents other companies entering the market with cheaper versions of the same medicine and imposes large and unnecessary costs on the health system and consumers.”

Similarly, across Canada, people are speaking out about the TPP. They are rallying against the secrecy of the 12-country negotiations and the corporate agenda behind the deal.

On February 12, 2015 legislators in seven of the 12 TPP countries issued the following joint statement about the negotiations:

“We, the undersigned legislators from countries involved in the negotiation of the Trans-Pacific Partnership Agreement, call on the Parties to the negotiation to publish the draft text of the Agreement before any final agreement is signed with sufficient time to enable effective legislative scrutiny and public debate.”

In Canada, the federal NDP and the Green Party of Canada endorsed the above statement. It is the simplest of demands for democracy on a “trade” deal that threatens to undermine the very notion of the public good, by giving corporations more power to undermine public policy.

As stated above, Brunei, Malaysia, Singapore and Vietnam are also negotiating hard to get incorporated somewhat similar to Indian IP rules in the TPP agreement.

Though not in the areas of access to medicines, Japan too expressed its concerns on TPP impacting its agriculture sector. Protests are forthcoming in the copyrights area, as well.

Apprehensions catching-up in the US too:

May 19, 2015 Bloomberg report also indicates, specifically from the pharmaceutical industry perspective, some key stakeholders are worried about the effects of more open markets on drug pricing that could increase their costs and “Foreign corporations or subsidiaries will be able to challenge a number of public health programs.”

In a letter of May 12, 2015 to the House and Senate, the Alliance for Retired Americans has reportedly underscored the possibility of this grave danger to them, if TPP comes into effect.

On May 21, 2015, Reuters reported, just 13 out of 44 Democrats (of President Obama’s own Party) backed the legislation in the Senate’s second procedural vote on last Thursday.

Earlier, a group of over 30 legal academics reportedly sent a letter to the US Trade Representative, expressing “profound concern and disappointment at the lack of public participation, transparency and open government processes in the negotiation of the intellectual property chapter of the TPP”.

Other important areas of criticism: 

Other key areas of criticism of TPP are as follows:

  • Excessive emphasis on trade issues that have remained unresolved or unaddressed at the WTO due to differences between developed and emerging markets.
  • Adopting a negotiating style reflecting the US regulatory approach to international trade
  • Allowing companies to sue foreign governments, which would allow them to dodge health and environmental standards.
  • Giving shape to a geo-political road map of the US that supports its strategic rebalancing towards Asia.

A strange mélange:

An article published in the April 9, 2015 edition of Forbes, titled “TPP Is A Mistake”, very appropriately describes TPP as a strange mélange of 12 members countries that includes five from the Americas (Canada, Chile, Mexico, Peru and the US), five from Asia (Brunei, Japan, Malaysia, Singapore and Vietnam), along with Australia and New Zealand.

In terms of populations, the total American contingent which stands at 535 million, more than half the total population of the Americas (947 million), is significantly larger than the Asian population figures which amount to no more than 256.6 million (285 if one adds Australia and New Zealand), compared to Asia’s total population of 4.3 billion: almost half of the Asian contingent is accounted for by one member – Japan, the articles states.

In this article, former Malaysian Prime Minister Tun Dr Mahathir Mohamad, the architect of Malaysia’s impressive economic growth and development during his tenure from 1981 to 2003, was quoted saying:

“The strongest campaigner of TPP is America … which seeks … to contain China and to safeguard its own economic interests by exploiting all resources from small but growing independent nations such as Malaysia”.

He further adds, “TPP is not a fair or free trade partnership, but an agreement to tie down nations with rules and regulations that would only benefit American conglomerates”.

Is TPP more than just a trade agreement?

Many experts feel, that TPP is basically a geopolitical tool to contain China with ‘trade’ as its façade.

The votaries of TPP argue that it aims to achieve a very high standard trade agreement and thus the reason of keeping China out of it is not geopolitical. Other Asian nations, including China, can apply and qualify for membership once they commit to meeting these high standards, they reiterate.

The above argument does not seem to be a robust one, as that would mean, a sizable proportion of its smaller current members, such as, Vietnam, already conform to so called ‘high standards’, as required for the TPP agreement.

Besides geopolitical issue, many are also questioning whether TPP is what the developing countries need, especially, at this stage of their development.

Conclusion:

One may quite pertinently ask, in what way TPP is relevant to India?

TPP is relevant to India in the sense that it is expected to eventually mature into a regional trade agreement covering the entire Asia-Pacific region.

Be that as it may, if I restrict myself only to the drug patent related area of the proposed pact, it appears, unless the damaging provisions in the concerned chapters are removed through negotiations before the agreement is finalized, the TPP would possibly turn out to be the most harmful trade pact ever, especially from the perspective of access to medicines in the developing countries of the worlds.

May 2015 issue of ‘amfAR’ – The Foundation for AIDS Research based in Washington DC of the United States captured the essence of possible healthcare related issues with TPP – the pact of a strange mélange of 12 member countries, with the following words:

“By providing avenues for pharmaceutical companies to extend IP protection beyond what is required by current international standards, the TPP could greatly delay the entrance of generic competition for much-needed medicines and keep prices high. Doing so would continue an unacceptable and dangerous trend of irrevocable expansion of IP protections at the expense of access to medicines and would serve as a justification for even more aggressive measures in future FTAs.”

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 Curious Imbroglio: Innovation, IPR, India and ‘Uncle Sam’

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Last week, the Office of the United States Trade Representative (USTR) released the “2015 Special 301 Report”, which is its annual review of the global state of Intellectual Property Rights (IPR) protection and enforcement.

While looking through the Kaleidoscope of business interests of the United States, variegated changing patterns of a wide variety of country-specific observations can be noted in this report.

It is widely believed that the report ‘pontificates’ about the adequacy and effectiveness of IPR protection and enforcement of its trading partners against USTR’s own yardstick, hinting unhesitantly at the possible consequences, if found lacking.

USTR reviewed seventy-two (72) trading partners for this year’s Special 301 Report, and placed thirty-seven (37) of them on the ‘Priority Watch List’ or ‘Watch List’. Thirteen (13) countries – Algeria, Argentina, Chile, China, Ecuador, India, Indonesia, Kuwait, Pakistan, Russia, Thailand, Ukraine, and Venezuela, are on the ‘Priority Watch List’.  These countries will be the subjects of particularly intense bilateral engagement during the coming year.

India specific significant elements of the 2015 Special 301 Report include the following:

  • Increased bilateral engagement in 2015 between the United States and India on IPR concerns, following the 2014 Out-of-Cycle Review (OCR) of India on this issue.
  • India will remain on the ‘Priority Watch List’ in 2015, but with the full expectation of US about substantive and measurable improvements in India’s IPR regime for the benefit of a broad range of innovative and creative industries.
  • The US offered to work with India to achieve these goals.
  • No OCR at this time for India, but US will monitor progress in India over the coming months, and is prepared to take further action, if necessary.

The 2015 report also highlights:

“While it is impossible to determine an exact figure, studies have suggested that up to 20% of drugs sold in the Indian market are counterfeit and could represent a serious threat to patient health and safety.”

According to media report, a senior Commerce & Industry Ministry official has commented, “India is disappointed at being featured yet again in the US ‘Priority Watch List’ of weak IPR countries. But it is not worried.”

Recent Action by India:

In October 2014, almost immediately after Prime Minister Modi’s return to India from the US, the Government formed a six-member ‘Think Tank’ to draft ‘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.

In the same month, the Department of Industrial Policy and Promotion (DIPP) constituted a six-member ‘Think Tank’ chaired by Justice (Retd.) Prabha Sridevan to draft the ‘National IPR Policy’ of India. Taking quick strides, on December 19, 2014, the Think Tank’ released its first draft of 29 pages seeking stakeholders’ comments and suggestions on or before January 30, 2015. A meeting with the stakeholders was also scheduled on February 5, 2015 to take it forward.

Possible reasons of US concern on the draft ‘National IPR Policy’:

As I discussed in my blog post of January 19, 2015 titled, “New “National IPR Policy” of India – A Pharma Perspective”, I reckon, there are three possible key areas of concern of American pharma industry against Indian patent regime. However, in the draft National IPR Policy India seems to have stood its ground in all those areas.

The draft IPR policy responded to those concerns as follows:

Concern 1: “India’s patentability requirements are in violations of ‘Trade Related Aspects of Intellectual Property Rights (TRIPS)’ Agreement.” (Though it has not yet been challenged at the WTO forum)

Draft IPR Policy states: “India recognizes that effective protection of IP rights is essential for making optimal use of the innovative and creative capabilities of its people. India has a long history of IP laws, which have evolved taking into consideration national needs and international commitments. The existing laws were either enacted or revised after the TRIPS Agreement and are fully compliant with it. These laws along with various judicial pronouncements provide a stable and effective legal framework for protection and promotion of IP.”

A recent vindication: On January 15, 2015, Indian Patent Office’s (IPO’s) rejection of a key patent claim on Hepatitis C drug Sovaldi (sofosbuvir) of Gilead Sciences further reinforces that India’s patent regime is robust and on course.

Gilead’s patent application was opposed by Hyderabad based Natco Pharma. According to the ruling of the IPO, a new “molecule with minor changes, in addition to the novelty, must show significantly enhanced therapeutic efficacy” when compared with a prior compound. This is essential to be in conformity with the Indian Patents Act 2005. Gilead’s patent application failed to comply with this legal requirement.

Although Sovaldi ((sofosbuvir) carries an international price tag of US$84,000 for just one treatment course, Gilead, probably evaluating the robustness of Sovaldi patent against Indian Patents Act, had already planned to sell this drug in India at a rice of US$ 900 for the same 12 weeks of therapy.

It is envisaged that this new development at the IPO would prompt entry of a good number of generic equivalents of Sovaldi. As a result, the price of sofosbuvir (Sovaldi) formulations would further come down.

However, reacting to this development Gilead has said, “The main patent applications covering sofosbuvir are still pending before the Indian Patent Office…This rejection relates to the patent application covering the metabolites of sofosbuvir. We (Gilead) are pleased that the Patent Office found in favor of the novelty and inventiveness of our claims, but believe their Section 3(d) decision to be improper. Gilead strongly defends its intellectual property. The company will be appealing the decision as well as exploring additional procedural options.”

For more on this subject, please read my blog post of September 22, 2014 titled, “Gilead: Caught Between A Rock And A Hard Place In India”

Concern 2: “Future negotiations in international forums and with other countries.”

Draft IPR Policy states: “In future negotiations in international forums and with other countries, India shall continue to give precedence to its national development priorities whilst adhering to its international commitments and avoiding TRIPS plus provisions.”

Concern 3: “Data Exclusivity or Regulatory Data Protection.”

Draft IPR Policy states: “Protection of undisclosed information not extending to data exclusivity.”

I discussed a similar subject in my blog post of October 20, 2014 titled, “Unilateral American Action on Agreed Bilateral Issues: Would India Remain Unfazed?”

Confusion with the Prime Minister’s recent statement:

It is worth noting that in end April 2015, Prime Minister Narendra Modi reportedly remarked to align India’s patent laws with “international standards”.

What the Prime Minister really meant by patent laws with “international standards” could be of anybody’s guess. This is because, even the World Trade Organization (WTO) considers Indian Patents Act compliant to TRIPS Agreement, which has been globally accepted as the ‘Gold Standard’ in the realm of IPR…unless, of course, Prime Minister Modi intends to accept ‘TRIPS Plus’ provisions for India, under US pressure and at the cost of health interest of majority of Indian patients.

It is noteworthy though, his own Ministry of Commerce & Industry has categorically emphasized and re-emphasized several times in the past that India’s patent regime is fully TRIPS compliant.

To add greater credence to this argument, the noted free market economist and Professor of Economics at Columbia University – Arvind Panagariya, who has recently been appointed to run Prime Minister Narendra Modi’s new NITI Aayog, has also endorsed it in his published articles, unambiguously.

As usual, leaving nothing to chance, immediately after the above remark of the Indian PM to align India’s patent laws with “international standards”, the USTR urged India to ‘expeditiously undertake’ initiatives stated by PM Modi, flashing across a long list of changes that the US wants to get incorporated in the Indian IP Acts and policies.

Pressure for amendment of Indian Patent Law:

From the intensity of pressure that the US Pharma industry is generating on the US Government, it is clear that American pharma industry will not be satisfied till Modi Government brings in changes in the Indian Patents Act 2005, as dictated by its constituents.

At the top of much publicized US wish list on IPR, features abolition of Section 3(d) of the Indian patent law. This provision of the Act denies patents to frivolous and incremental innovations without offering any significant value to the patients in terms of improved clinical efficacy of the drug. Many would term such innovation as attempts towards evergreening of patents through minor molecular manipulation or similar other means. This kind of innovation gives already a very high priced blockbuster drug another full term of patent monopoly, often with even higher price, at the cost of patients.

Pressure for a relook at the National IPR Policy:

In fact, the USTR 2015 report, also asks India to have yet another round of consultations with stakeholders before finalizing its IPR policy. This is widely construed as an attempt on the part of the US Government and industry to conclude their unfinished IPR agenda for India.

Whether Modi Government would be bullied by the American Pharma industry to succumb to its pressure at the cost of the Indian patients and going against the national and international experts’ opinion, only time would tell.

Benefits of Innovation and India:

India has amply demonstrated time and again that it does understand the value and benefits of innovation in different facets of life and business. The country endeavors to protect it too, according to the law of the land. However, there are still some procedural loose knots existing in the IPR environment of the country.

As stated above, for effective remedial measures in those areas, a ‘Think Tank’ has already been constituted by Modi Government to formulate a robust and comprehensive National IPR Policy.

In this context, a media report quoted a senior official from the Union Ministry of Commerce & Industry saying, “We hope this year we can convince the US that our laws are drafted in a way so as to protect both our consumer and industry’s interest. The new IPR policy that we are coming out with will take care of any anomalies or vagueness in our existing regime and make it tight and also fast-track clearances of patent applications.”

Would there be a ‘Ghost Writer’ for Indian IPR Policy?

The first draft of the policy has already been circulated in January 2015 and discussed in the following month with the stakeholders. However, American Pharma industry does not seem to be satisfied with its overall content, leave aside the nitty-gritty.

Going by this development some apprehends that a powerful lobby group probably wants to be the ‘Ghost Writer’ for the IPR Policy of India. Coincidentally enough, we also see the USTR blowing hot and cold on this critical issue…blowing hot through its ‘Special 301 Report’ and cold by praising Prime Minister Modi’s remark to align India’s patent laws with “international standards”.

India should play a catalytic role in changing the drug innovation model:

A paradigm shift in the drug innovation model can materialize only when there will be a desire to step into the uncharted frontier…coming out of the comfort zone of much familiar independent money spinning silos of all kinds of drug innovations…from break-through drugs to me-too varieties. Dove tailing scientific and business excellence with patients’ health interest, dispassionately, would then be the name of the game.

Though arduous, playing a catalytic role to bring out this transformation sooner, is extremely important for India. This is because, drug innovation with significant value addition would continue to remain as critical as access to important medicines for all, in perpetuity. India understands that just as clearly as USTR …for its ‘make in India’ campaign or otherwise. No well-orchestrated and spoon-fed pontification required in this area…uncalled for.

Conclusion:  

The bottom line is, the US Pharma industry continues to flex its muscle relentlessly under the very often used, misused and even abused façade that India does not understand the value of innovation.

On the other hand, the general sentiment in this area, both national and international, favors India.

As the new Vice Chairman of NITI Aayog of India, Dr. Arvind Panagariya wrote, “India must call the US’ bluff on patents,” it’s indeed time to demonstrate the same, once and for all.

However, in the context of upholding patients’ health interest in India, a lurking fear does creep in, after PM Modi’s well publicized recent remark to align India’s patent laws with “international standards”, especially when Indian Patents Act 2005 is already TRIPS compliant, according to WTO requirements.

That said, in the midst of a raging debate involving innovation, IPR, India and ‘Uncle Sam’, the moot question that floats at the top of mind is:

Has seemingly tough-minded Prime Minister Modi already yielded to ‘Uncle Sam’s’ bullying tactics to effect changes in an otherwise robust Indian patent regime, and that too at the cost of health interest of needy patients 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.

‘Data Protection’: Needs A Clear Direction…But Is It An IPR Issue?

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The terminologies ‘Data Exclusivity’ and ‘Data Protection’ are quite often used interchangeably by many, creating a great deal of confusion on the subject. However, in a true sense these are quite different issues having critical impact on public health interest of a nation.

In several media reports as well, one can notice the interchangeable use of these two terms. It is especially happening when the reports are speculating whether or not the Government of India is considering putting in place ‘Data Exclusivity’/ ‘Data Protection’ along with ‘Patent Linkage’ through administrative measures, without making any amendments in the Patents Act 2005 of the country.

Tracking this development, the last week, I wrote about ‘Patent Linkage’. In this article, I shall dwell on the same area, but from ‘Data Exclusivity’/ ‘Data Protection’ perspective.

A brief overview:

Close to a decade ago, Government of India constituted ‘Satwant Reddy Committee’ to recommend a direction that India should follow on ‘Data Protection’ in the country involving pharmaceutical and agricultural products.

In 2007 the Committee submitted its report recommending ‘Data Protection’ in the country to be introduced for pharma products in a calibrated manner. However, the report did not specify a timeline for its implementation.

Interestingly, even this committee did not differentiate between the terminologies ‘Data Protection’ and ‘Data Exclusivity, as we now see in the first draft of the ‘National IPR Policy.’

According to available reports, after due deliberation, the erstwhile Government decided not to take any action on the committee’s recommendations for ‘Data Protection’ in India.

Difference between ‘Data Protection’ and ‘Data Exclusivity’:

In an article published in ipHandbook, titled “Data Protection and Data Exclusivity in Pharmaceuticals and Agrochemicals”, the author Charles Clift with a great deal of experience in the U.K. Department of International Development (DFID) and a former Secretary, Commission on Intellectual Property Rights, Innovation and Public Health, World Health Organization; differentiated these two terminologies as follows:

Data Protection (DP): Protection of commercially valuable data held by the drug regulator against disclosure and unfair commercial use.

Data Exclusivity (DE): A time bound form of Intellectual Property (IP) protection that seeks to allow companies recouping the cost of investment in producing data required by the regulatory authority.

Arguments in favor of ‘Data Exclusivity’:

International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), Geneva, in its website argues in favor of ‘Data Exclusivity’ as follows:

- Health authorities require, as part of a submission for a marketing authorization, that proprietary information be disclosed in order to ensure public health and patient safety.

- The innovator assumes the entire risk for the generation of the data, what requires expensive and lengthy clinical trials.

- ‘Data Exclusivity’ is necessary to provide a measure of certainty to the innovator that they will be provided with a period of protection for their efforts of testing a drug.

- Patents and ‘Data Exclusivity’ are different concepts, protect different subject matter, arise from different efforts, and have different legal effects over different time periods

Arguments suspecting the intent of ‘Data Exclusivity’:

The above paper of Charles Clift highlights the following on DE:

- The effect of DE is to prevent entry of generic competitors, independent of the patent status of the product in question.

- DE law, wherever applicable, prevents generic manufacturers from using innovators’ test data, though it would allow the drug regulator to analyze this data prior to market approval.

- Even if the patent period has expired or there is no patent on a product, DE will act independently to delay the generic entry until the period of DE is over.

- In that way DE compensates innovators for delayed market entry and concomitant loss of potential profits.

- DE is a much stronger right than a patent, mainly because, unlike patent law, there is no exceptions or flexibilities that allow the governments to provide the equivalent of Compulsory License (CL).

- DE acts as a barrier to CL of a patent on the same product by preventing marketing approval for a CL.

TRIPS Agreement talks about DP, but not DE:

Article 39 of TRIPS Agreement on “Protection of Undisclosed Information” contains a general clause on the obligations of the members of the WTO, where Article 39.3 specifies three obligations for its member countries as follows:

- To protect data on New Chemical Entities (NCE), the collection of which involves considerable effort, against unfair commercial use.

- To protect these data against disclosure, except where necessary to protect the public

- To protect such data against disclosure, unless steps are taken to ensure that the data are protected against unfair commercial use

According to Charles Clift, Article 39.3 only articulates widely accepted trade secret and unfair competition law, and is not an invitation to create new IP rights per se for test data. Nor does it prevent outside parties from relying on the test data submitted by an originator, except in case of unfair commercial practices.

Some developed countries, such as the United States and the European Union have argued that Article 39.3 of TRIPS requires countries to create a regime of DE, which is a new form of time-limited IP protection. However, it is worth noting that in both these countries DE regime was adopted prior to TRIPS Agreement. Hence, many experts construe such approaches and pressure, thus created for DE, as ‘TRIPS Plus’.

What is ‘TRIPS Plus’?

The ‘TRIPS-Plus’ concept would usually encompass all those activities, which are aimed at increasing the level of IP protection for the right holders, much beyond what is required for conformance of TRIPS Agreement by the World Trade Organization (WTO).

Some section of the civil society nurtures a view that ‘TRIPS Plus’ provisions could significantly jeopardize the ability, especially, of developing countries to protect the public health interest adequately.

Some common examples of ‘TRIPS Plus’ provisions:

Common examples of ‘TRIPS Plus’ provisions could include:

- Extension of the patent term beyond usual twenty-year period

- Introduction of provisions, which could restrict the use of CL

- Delaying the entry of generics

Is ‘Data Protection’ an IPR issue?

In my view, the issue of ‘Data Protection’ is more a drug regulatory than an IPR related subject and should be treated as such. This is because ‘Data Protection’ is more related to the ‘Drugs and Cosmetics Act’ of India rather than the ‘Patents Act 2005′.

Thus, it is quite intriguing to make out why ‘Data Protection’, which will be governed by ‘Drugs and Cosmetics Act’, is featuring in the IPR Policy of the country.

I wrote on the draft National IPR Policy in my blog post of January 19, 2015, titled “New “National IPR Policy” of India – A Pharma Perspective”.

Conclusion:

After jettisoning the ‘Satwant Committee Report’ on ‘Data Protection’, the Government was in no mood, until recently, to discuss anything about DP and DE, despite intense pressure from the pharma MNC lobby in India. However, the issue first resurfaced during EU-FTA negotiation, when India rejected these provisions outright and unambiguously.

However, the ghost started haunting India, yet again, when the US Government started flexing its muscle on this issue, at the behest of the American pharma companies.

Although DP is a drug regulatory issue, curiously, it features in the draft National IPR Policy. Even there, the subject has taken an interesting turn, when in the first draft of ‘National IPR Policy’ of India, the six-member ‘Think Tank’ chaired by Justice (Retd.) Prabha Sridevan clearly recommended “Protection of undisclosed information not extending to data exclusivity.”

In my opinion this is indeed a very pragmatic recommendation. It deserves support from all concerned so that the profound intent continues to feature in the final IPR Policy of India, to protect public health interest of the nation.

Just like ‘Patent Linkage’, as I discussed in my last week’s article, finding a middle ground to put ‘Data Protection’ in place through administrative measures, without making any amendments either in the Drugs & Cosmetics Act or in the Patents Act of the country, seems to be desirable and very much possible, as well.

However, the very thought of considering ‘Data Exclusivity’ in India, in my view, should prompt a clear ‘No…No’ response from the present Government of India.

This is mainly because, besides all other reasons as mentioned above, even if the patent period for a molecule has expired or there is no patent on a product, DE will act independently to delay the generic entry until the period of ‘Data Exclusivity’ gets over.

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.

 

‘Patent Linkage’: Can The Core Issue Be Resolved?

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On February 10, 2015, a leading business daily of India, quoted the Commerce Secretary of India – Rajeev Kher, saying, “India needs to relook at its Intellectual Property Rights (IPR) Policy with a view to bring in a differentiated regime for sectors that have a greater manufacturing potential.”

In the present Government regime, it appears virtually impossible to make such important comments out of turn by a senior bureaucrat without the blessings of the Prime Minister’s Office (PMO). I hold this view, despite the fact that the Commerce Secretary reportedly added that his suggestion is “a highly controversial subject and if I discussed this in the government, I think I will be shot down in the very first instance”.

Be that as it may, as I indicated in my just previous article, several recent media reports also speculated, around the same time, that the Government of India is probably considering putting in place ‘Patent Linkages’ and ‘Data Exclusivity’ through administrative measures, without making any amendments in the Patents Act 2005 of the country.

As I had indicated in my blog post of January 19, 2015 titled, “New ”National IPR Policy” of India – A Pharma Perspective”, these speculations originated mainly from the following events:

  • During Prime Minister Narendra Modi’s visit to the United States in September 2014, a high-level Indo-US working group on IP was constituted as a part of the Trade Policy Forum (TPF), which is the principal trade dialogue body between the two countries.
  • Almost immediately after the Prime Minister’s return to India, in October 2014, the Government formed a six-member ‘Think Tank’ 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 by the industry associations, including those that have appeared in the media and give suggestions to the ministry of Commerce and Industry as appropriate.

Speculations arising out of these two events were almost simultaneously fuelled by the following developments:

A. US Trade Representative Mike Froman’s reported affirmation of the following to the US lawmakers during a Congressional hearing held on January 27, 2015:

- “We have been concerned about the deterioration of the innovation environment in India, and we have engaged with the new government since they came into office in May of last year about our concerns.”

- “We held the first Trade Policy Forum in four years in November. I just returned from India yesterday as a matter of fact … and in all of these areas, we have laid out a work program with the government of India to address these and other outstanding issues.”

- “We are in the process of providing comments on that draft policy proposal on IPR, and we are committed to continuing to engage with them to underscore areas of work that needs to be done in copyright, in trade secrets as well as in the area of patents.”

- “We’ve got a good dialogue going now with the new government on this issue, and we’re committed to working to achieve concrete progress in this area.”

B. Union Minister of Commerce and Industry of India specifically seeking American Government’s inputs in the finalization process of the new National IPR policy of the country.

Keeping these in perspective, let me try to explore whether or not it would be fair for India deciding to put in place ‘Patent Linkages’ and ‘Data Exclusivity’ through administrative measures, without making any amendments in the Patents Act of the country.

In this article, I shall deliberate on my personal take on ‘Patent Linkage’ and in the next week’s article on ‘Data Exclusivity’.

Definition:

Patent linkage is broadly defined as the practice of linking market approval for generic medicines to the patent status of the originator reference product.

A brief background in India:

The ‘Patent Linkage’ saga has an interesting background in India. I would now try to capture the essence of it, as stated below.

About 7 years ago, probably prompted by intense lobbying by the Pharma MNCs, the then Drug Controller General of India (DCGI) reportedly informed the media, on April 28, 2008, the following:

“We (DCGI) are going to seek the list of the drugs from innovator companies that have received patent in India. Once we have the database of the drugs which have been granted patent, we will not give any marketing approval to their generic versions…The DCGI has issued internal guidelines to this effect and it will also co-ordinate with the health ministry to give a formal shape to the initiative. The government expects to finalize a proper system within the next 2-3 months.”

It was also reported in the same article that Patent attorney Pratibha Singh, who along with Arun Jaitley was representing Cipla in the Tarceva case against Roche said:

“The DCGI does not have the authority to reject marketing application of a generic drug on the grounds that an innovator company has received the patent for the same drug in the country.”

Immediately following the above reported announcement of the DCGI on ‘Patent Linkage’, another media report flashed that the domestic drug companies are strongly objecting to the DCGI’s plans to link marketing approval for a drug with its patent status in the country, citing requirement of additional resources for the same and concern that it could block access to affordable medicines by suppressing competitive forces.

Despite this objection of the domestic Indian pharma companies, a senior official in DCGI office reportedly reaffirmed the DCGI’s intent of establishing the linkage so that no slips happen in the future. The same media report quoted that Government official as saying:

“We will have to amend the rules in the Act. We have to put it before the Drugs Consultative Committee first and this could be around the end of this year.”

Current ‘administrative’ status in India:

Currently in India, there is no provision for ‘Patent Linkage’, either in the Statute or through any administrative measure.

After those potboiler reports, it is quite challenging to fathom, what exactly had happened for the reverse swing thereafter at the DCGI’s office. The bottom line is, the above initiative of the then DCGI for ‘Patent Linkage’ in India ultimately got killed in the corridors of power. Hence, there does not exist any direct or indirect measure for ‘Patent Linkage’ in India, as I write this article.

Current legal status:

In 2008 Bayer Corporation had filed a Writ Petition before the Delhi High Court against Union of India, the DCGI and Cipla seeking an order that the DCGI should consider the patent status of its drug, Sorefenib tosylate, and refuse marketing approval to any generic versions of this drug.

It is worth mentioning, Sorefenib tosylate is used to treat renal cancer and was being reportedly sold in India by Bayer at Rs. 2,85,000 for 120 tablets for a monthly course of treatment.

The appeal in the Delhi High Court was filed against a judgment delivered by Justice Ravindra Bhat on 18 August 2009, rejecting Bayer’s attempt to introduce the patent linkage system in India through a court direction. But, in a landmark judgment on February 9 2010, a division bench of the Delhi High Court dismissed the appeal of Bayer Corporation in this regard. Thereafter, Bayer Corporation moved Supreme Court against this Delhi High Court order.

However, in December 01, 2010, a Division Bench of the Supreme Court rejected the appeal filed by Bayer Corporation against the February 2010 decision of the Delhi High Court. The Apex Court of India ordered, since the Drugs Act does not confer power upon the DCGI to make rules regarding the ‘Patent Linkage’, any such attempt would constitute substantive ultra vires of the delegated power.

RTI helps to get the marketing approval status of drugs:

Currently relevant information on marketing approval application status of generic drugs are not available at the CDSCO website. Hence, some innovator companies have resorted to using Right To Information (RTI) Act to ferret out such details from the DCGI office and initiate appropriate legal measures for patent infringement, well before the generic version of the original drug comes to the market.

A middle ground:

In view of the above order of the Supreme Court, the government of India may try to seek a middle ground without amending any provision of the Patents Act, in any way.

Even avoiding the word ‘Patent Linkage’, the Ministry of Health can possibly help the pharma MNCs achieving similar goal, through administrative measures. It can instruct the DCGI to upload the ‘Marketing Approval’ applications status for various generic products in the Central Drugs Standard Control Organization (CDSCO) website. If for any patented drugs, applications for marketing approval of generic equivalents are made, the available information would enable the patent holder taking appropriate legal recourse for patent infringement, much before the drug is marketed at a heavily discounted price.

It is quite possible that the interested constituents had put requests for such administrative measures even before the earlier Government. As no tangible action has been taken even thereafter, the erstwhile Government probably felt, if introduced, such a system would adversely impact quick and early availability of the generic drugs in the market place.

Conclusion: 

I wrote an article on similar issue in my blog post of August 24, 2009 titled, “Recent Bayer Case Judgment: Patent Linkage: Encouraging Innovation in India.”

Taking all these into consideration, in my view, it is quite possible for the present Indian Government to resolve the core issue related to ‘Patent Linkage’ through administrative measure, without amending any Acts or breaching any case laws of the land.

In the present IPR imbroglio, the above administrative measure could well be a win-win solution for all.

It would help facilitating early judicial intervention by the patent holder in case of prima facie patent infringements, enabling the Government to send a clear reiteration that the patents granted to pharmaceutical products will be appropriately enforced and protected in 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.