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Patents and IP Reforms in India’s Pharmaceutical Sector
Why data exclusivity in pharma could be risky
Context: India’s pharmaceutical sector is a global leader in affordable generics, but its intellectual property (IP) regime—particularly regarding patents and data exclusivity—has long been a battleground between public health priorities and commercial interests.
Why have patents been the bone of contention in the pharma sector in India?
- High Drug Prices due to Patents: Patent monopolies enable originator companies to charge exorbitant prices, limiting accessibility of life-saving drugs. For example, patented cancer drugs cost lakhs before compulsory licensing reduced their price by ~97%.
- Evergreening Practices: Pharma MNCs often try to secure multiple patents for the same molecule (minor modifications) to extend exclusivity beyond the 20-year limit. This delays generic entry and affordable alternatives.
- Public Health vs. TRIPS Obligations: India’s Patents Act (1970) excluded pharma product patents, allowing robust generics manufacturing. But post-TRIPS (2005 amendment), product patents became mandatory, raising concerns over access to affordable medicines.
- Safeguards under Threat: Sections like 3(d) restrict evergreening by permitting patents only on proven enhanced efficacy. Compulsory licensing provisions exist, but political and trade pressures discourage their use, even during Covid-19.
How can Intellectual property reforms affect the pharma sector in India?
- Data Exclusivity Risks: Allowing data exclusivity would prevent regulators from using originator trial data to approve generics. This delays generic entry even after patent expiry, raising costs for patients.
- Tilt Toward MNCs: IP reforms driven by FTA negotiations with the US/EU may prioritise ease of doing business and R&D investments, but compromise public health safeguards.
- Facilitation of Evergreening: Weakening of Section 3(d) or broader patentability definitions could increase evergreening, creating longer monopolies.
- Reduced Role of Compulsory Licensing: FTAs with EFTA/UK already put India under pressure to prioritise voluntary licensing. This limits India’s flexibility to issue compulsory licenses for affordable access.
- Risk to Health Security: Excessive strengthening of IP rights could restrict India’s role as the “pharmacy of the global South” by constraining production of affordable generics for domestic and export needs.
What measures can be taken to address the concerns?
- Preserve Safeguards in Patents Act: Uphold Section 3(d) and ensure strict scrutiny of applications to prevent evergreening.
- Balanced IP Reforms: Design reforms that attract R&D while safeguarding affordability, e.g., encouraging public-private partnerships in pharma innovation rather than granting blanket exclusivity.
- Strengthen Compulsory Licensing: Use CL more actively for high-cost essential medicines; streamline government-use licenses for emergencies like pandemics.
- Resist Trade Pressures in FTAs: Avoid commitments that dilute safeguards (e.g., confidentiality clauses on patent working, restrictions on CL). Ensure health security remains non-negotiable in negotiations.
- Promote Alternative Incentives for R&D: Government-backed innovation funds, tax credits, or public sector trials can support innovation without compromising access.
- Enhance Regulatory Capacity: Ensure the CDSCO remains empowered to rely on existing data for generic approvals, maintaining timely entry of affordable medicines.
