India’s Pharmaceutical Industry: A Call for Stronger IP Protections
May 31, 2013
On April 1, 2013, the Indian Supreme Court rejected a case on a pharmaceutical company’s, Novartis, patent on Gleevec (or Glivec – a drug used to inhibit cancer cells, most notably in leukemia patients) because it felt that the company was ever-greening the product. This ruling has caused concern that ‘big pharma’ may pull out of India’s pharmaceutical industry altogether. This ruling along with other incidences of weak IP protections will most likely hinder the burgeoning industry.
Historically, India has neglected, and even made a farce of, pharmaceutical patents. In fact, it was not until 2005 that India offered patent protections for pharmaceutical companies at all. This has led to abuses of the compulsory licensing agreement with the WTO, and has led to major criticisms of other global pharmaceutical companies like Pfizer, Roche, and Bayer.
According to these companies, India’s generic drug manufacturing industry is destroying R&D funding and future innovation. This is because the companies which invented the brand name drugs are not receiving royalties; and therefore, losing out on profit, a lot of which would have been put back into R&D. While the WTO under the TRIPS agreement (Doha Declaration) has provided for the use of compulsory licenses (temporary patent rights for life-saving pharmaceuticals), recently India has been more lenient in its use of this stipulation. In fact, the first use was in 2012 for Nexavar. Since then India has used the compulsory licensing provision at least five times.
As Indian pharmaceutical companies start truly investing in R&D and developing their own molecules available for patenting, it is undeniable that they will want to protect their innovation through patents. Therefore, the Indian government ought to be promoting and protecting patents of multinational companies too.
Patent protections and other forms of Intellectual Property (IP) rights are important for industry and R&D. Without strong protections companies, especially pharmaceutical companies, do not have incentives for R&D or developing new, innovative drugs. Therefore, the Property Rights Alliance urges the Indian government to follow through with its WTO agreements when it comes to following IP rights and protections.