Drugs Log

A drugs firm asked Indian officials for permission Thursday to make cheaper generic copies of cancer drugs for export to poor countries in a case watched closely by global pharmaceutical giants.

Indian firm Natco Pharmaceuticals made the plea for the country’s first so-called “compulsory licence” to the patent office as it bids to make generic copies of Pfizer’s Sutent and Roche’s Tarceva cancer drugs.

“This is the first case in India. A compulsory licence will allow companies like ours to manufacture and export drugs to least developing countries,” said M. Adinarayana, the secretary of Natco Pharmaceuticals, as the hearings began.

The global drugs patent system allows countries to make cheaper generic copies of patented drugs in certain situations, such as public health emergencies, under compulsory licences.

Experts said Natco’s request for permission to make and export copies of Sutent and Tarceva to Nepal tested those regulations, amid a wider debate about whether poor countries have enough access to key but often pricey medicines.

Tarceva was granted a patent in India in 2007 following a new patent law passed in 2005, which brought the world’s largest maker of generic drugs in line with World Trade Organisation guidelines on intellectual property.

The laxer rules before 2005 had encouraged generic drugs manufacture in India, which campaigners had welcomed as good for the poor.

Compulsory licences have been granted since 2005, but so far none have been issued in India, making Hyderabad-based Natco’s plea a potentially landmark case.

Canada allowed a generic copy of a patented AIDS drugs to be exported to Rwanda in October. Thailand also issued domestic compulsory licences last year, but was criticised over claims it was not responding to a public health emergency.

An Indian Patent Office official, who declined to be named, said the hearing had started over the Roche case and that the Pfizer case would be held Friday. He expected representatives from Roche and Pfizer to attend.

Roche or Pfizer did not immediately respond to emailed requests for comment.

Many Indian activists have complained that the cost of patented drugs is too high and that provision should be made to allow generic drugs to be supplied to the country’s legion of poor.

“If compulsory licensing is not resorted to, 98 percent of India’s population will not be able to afford any of the patented drugs,” said Y.K. Sapru, the president of the non-profit Cancer Patients Aid Association.

But pharmaceutical giants often argue protecting patents are crucial to stimulating the research and development of new drugs.

Industry groups object that if Natco is granted a compulsory licence for Nepal, then it could lead other Indian firms to push for more sales of generic drugs domestically.

Natco has reportedly offered Roche a five percent royalty on generic versions of Tarceva exported to Nepal, one of the world’s poorest nations. The Indian firm stopped sales of an earlier generic copy of Tarceva after Roche won its 2007 patent.

But Indian firm Cipla, based in the financial capital Mumbai, started making a generic version of Tarceva a few months ago. Roche has filed a court case to halt further domestic sales by the firm.

One tablet of Tarceva, which fights lung cancer, costs about 4,800 rupees (120 dollars) in India, where tens of thousands of people need the medicine. Cipla’s generic copy sells for nearly one-third that price.

The cost difference is crucial for poor people, a Medecins Sans Frontieres official said.

“India is the only source for generic drugs for developing countries. It has the capacity to manufacture and has many generic producers,” said Leena Menghaney, a campaigner for the group in India.

India Restricts Generic Drugs

On spring 2005, India’s parliament voted to restrict production of low-cost generic medicines. Because India is the primary supplier of inexpensive drugs to the developing world, particularly antibiotics, cancer therapy, and AIDS drugs, the bill may choke off a vital supply of medicines to the global poor.

Under India’s 1970 Patent Act, Indian companies have been allowed to produce cheaper versions of a drug as long as they used a different manufacturing process. Competition from Indian generics has slashed the price of some drugs by almost 98 percent. In Africa, Indian generics have reduced the cost of AIDS drugs from $15,000 to $200 per patient per year. Indian companies also combined a cocktail of medicines into one simple pill. Aidsmap, a UK based information resource for AIDS patients and caregivers, estimates that half of all AIDS patients in the Third World rely on Indian generics.

The bill will change Indian patent law to be more like laws in the West. Patents will be granted to products instead of processes, and companies will maintain exclusive rights to any new drug for 20 years. The change has been anticipated since 1995, when India joined the WTO on the condition that it agree to eliminate process patents by January 1, 2005.

The new bill still must be signed by the president to go into effect. The president was the original sponsor of the bill, so Indian and international officials expect the bill to become law soon.

The legislation allows Indian generic drugs currently on the market to be sold, but manufacturers must pay a royalty to the patent holder—usually a Western multinational corporation. The bill says this fee must be “reasonable,” but it does not specify what “reasonable” means. International standards for royalties hover around 3 to 4 percent,
but Doctors Without Borders reports that GlaxoSmithKline charged a 40 percent royalty in South Africa until activists and courts intervened.

Like patent laws in the West, the new bill contains “compulsory licensing” clauses, which allow the government power to break patents in a health emergency. Although 5.1 million Indians are HIV-infected, the Indian government has not designated HIV/AIDS a national health emergency.

Theo Smart from Aidsmap writes that, by making it more pro?table for Indian manufacturers to lend their capacities to large Western pharmaceutical companies than to produce their own drugs, the law may encourage further outsourcing from the West. According to the New Delhi-based newspaper Financial Express, more than 30 agreements between Indian and multinational drug companies have already been signed, including deals with Cipla and Ranbaxy, the two largest AIDS drug manufacturers in India.

Keywords for this article:

• cheaper generic drugs
• cancer drugs
• Natco Pharmaceuticals
• Pfizer Sutent
• Roche Tarceva