India is a country with a large poor population many of whom cannot afford the cost of patented drugs which are sold there by Western companies. It also has a thriving generics industry and is known as the ‘pharmacy of the developing world’. It provides strong patent protection and is an important emerging market, and therefore has been the recipient of a lot of foreign investment. Since last year India has started taking steps to circumvent patent protection on important drugs in order to allow generics companies to make them available at a fraction of the cost.
In principle the WTO has accepted the concept of circumventing patent rights on the grounds of public health. In 2001 the ‘Doha Declaration on the TRIPS Agreement and Public Health’ was adopted by the WTO Ministerial Conference. It concerned the right of members of TRIPS to grant compulsory licences on patents on certain grounds, including public health. However in practice compulsory licensing rarely happens in the developing world.
In 2012 India issued its first compulsory licence for a medicine. This was issued to Natco for Bayer’s Nexavar, and Bayer failed to reverse the decision at the Intellectual Property Appellate Board earlier this year. BDR Pharmaceuticals has now also requested a compulsory licence for Bristol Meyers Squibb’s Dastinib.
India has also been revoking patents held by Western drug companies, such as Allergan’s patents for Ganfort and Combigen recently. This is a policy which China also seems to be following, recently declaring Gilead’s patent on the AIDS drug Viread invalid. Indian patent law requires derivatives of drugs to have significantly improved properties to be patentable, making it difficult to pursue ever-greening strategies to extend patent life. This policy has been cited as an example which other developing countries should follow (see here) and has also been criticised (see here).
It seems that India is also considering changes to its foreign investment rules that would prevent Western drugs companies taking control of local drugmakers (see here).
So it seems that for now India continues to pursue a brave and aggressive policy to make Western drugs more affordable to its population. Whilst many in the West have voiced their criticism, no action has yet been taken at the level of the WTO. It will be interesting to see how the developed world chooses to respond.