Pharmaceutical Industries and the case of India IP protection system!
Jun 22, 2013
Recently the Indian pharmaceutical company, Ranbaxy, has been informed that it is required to pay a $500 million fine for implementing inappropriate manufacturing processes. This is problematic for the verdant Indian industry that wants to develop into being the largest global producer of pharmaceuticals. However, the country as a whole has larger problems than poorly regulated manufacturing processes.
India has relatively weak IP laws especially when it comes to a foreign company requesting to re-patent an already existing, but slightly modified drug. The Indian Supreme Court felt that by only altering a drug marginally, pharmaceutical companies were trying to ever-green– allow patents to exist indefinitely – their products.
The American based company, Pfizer, vehemently disagrees with this sentiment. According to Roy F. Waldron, the chief IP counsel, companies are usually justified in their re-patenting requests. These modifications are generally in the form of improving bioavailability. Bioavailability is the ability of a drug to make it to the target area; it is how efficacious a drug is at being absorbed by the body. Conducting these experiments and developing a more potent, effective version of a drug is both expensive and time-consuming. Consequently, pharmaceutical companies ought to be rewarded for their efforts, by way of extending patents.
While India still has a lot of work to do when it comes to their IP laws, they are at least willing to concede occasionally. The Indian Supreme Court reversed their decision to revoke Pfizer’s Sutent (a cancer drug used to treat kidney and other intestinal cancers) patent. Apparently, new evidence has surfaced and the Controller and Board must re-analyze and decide on whether or not Sutent’s patent ought to remain intact.
If the Board agrees to allow Pfizer to keep the patent then that is a much needed win for the global, especially American, pharmaceutical companies. It would indicate that India is serious about intellectual property protection, even in the pharmaceutical industry. Furthermore, it would signal to foreign pharmaceutical companies that India may indeed be friendly to their patent requests.
However, if the Board rejects, again, Sutent’s patent claim then it is one more example of how India does not take their intellectual property laws seriously. Furthermore, it may even be a cause of concern for multinational corporations currently holding pharmaceutical patents in India, that their products may not be protected for long.
On the other hand, India continues to support their IP laws and enforcement mechanisms. There is growing concern in the United States Congress about India’s assessment of their IP protections, and consequently, discussion of their laws will be on the forefront of Secretary of State, John Kerry’s, visit next week.
If India does not start doing a better job of protecting companies’ patent rights, it would not be unrealistic or incredulous if foreign companies began pulling out of India. In fact, India’s cut of pharmaceutical companies’ foreign R&D funding is only $0.8 billion compared to $36 billion in Europe. Without stronger protections for companies’ products that $0.8 billion will disappear altogether.