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Indian Generics Case Worries Humanitarian Agencies

By January 5, 2013

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Pharmaceutical company Novartis is making final arguments to India's Supreme Court in the final stages of its six-year legal battle to overturn the Indian patent office's rejection of its drug Gleevec  used for treating leukemia. The case has much broader consequences since much of the developing world depends on cheaper copies of expensive patented medicines that are manufactured in India. About $10 billion in Indian generics are exported annually. For example, Gleevec (or Glivec, as it is branded outside the US) can cost as much as $70,000 a year in the United States while the Indian generic versions cost about $2,500 a year.

The problem stems from the fact that India did not allow drug patents from 1970 to 2005 so Novartis could not get a patent in that country for the original formulation of the drug in Gleevec. Although India was required to reinstate drug patents in 2005 to be admitted into the WTO, it maintains a strict requirement that newer forms of known drugs can only be patented if they significantly improve effectiveness of the medicine. This requirement is designed to prevent evergreening--patenting and releasing a new formulation of an old drug to extend the time period a pharmaceutical company can maintain exclusive rights to a drug.

The sticking point with regard to this case, and a few others, is the idea of the drug's improved effectiveness, or more precisely, efficacy, which is the term used in the law. Does increasing a drug's efficacy mean the new version of the drug has to be shown to make more sick patients better, as the Indian patent office narrowly interprets it? Isn't efficacy also increased if the new drug formulation reduces side effects, makes it easier to use, or, as Novartis is arguing in this case, is more quickly absorbed by the body? After all, 40 other countries have granted patents on Gleevec.

Humanitarian aid groups are watching the decision closely as the implications are broader than just the Novartis case. While Indian companies would still be able to manufacture older versions of generic compound in Gleevec, they would not be able to provide the new formulation Glaxo is current selling. Gilead Sciences and Roche also have similar cases resulting from rejected patents for new versions of drugs against HIV and cancer. Leena Menghaney, India manager of the Access Campaign for Doctors without Borders stated to the Associated Press, "The implications of this case reach far beyond India, and far beyond this particular cancer drug....Across the world, there is a heavy dependence on India to supply affordable versions of expensive patented medicines."

As the third largest drug producer in the world, India has often adopted policies favoring broader access to drugs. The 35 year elimination of drug patents is just one example. Just this past summer, the Indian government implemented a $5.4M policy to provide free generic drugs to all patients in its public healthcare system. Also, the government is planning to extend price controls to patented drugs. Possibly more surprising, in March, India used the compulsory licensing authority of the its drug patent regulation to force Bayer to license manufacture of its anti-cancer drug Nexavar, which was priced at over $5,000 a month, to the Indian manufacturer Natco Pharma who had been selling it for the equivalent of $176 per month. Bayer received 6% royalty on Natco's sales as compensation.

Until the Court renders its decision later in the year, the generic Gleevec will continue to be available.

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