International Conference GLOBAL HEALTH LAW TRIPS AGREEMENT ON PATENT LAWS
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International Conference
GLOBAL HEALTH LAW TRIPS AGREEMENT ON PATENT LAWS - extracted text
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International onference
or
GLOBAL HE
(Inaugurated by the President of India
organised by
THE INDIAN LAW INSTITUTE
in collaboration with
THE WORLD HEALTH ORGANISATION
VIGYAN BHAWAN, NEW DELHI
December 5-7, 1997
TRIPS AGREEMENT ON PATENT LAWS;
IMPACT ON PHARMACEUTICALS AND
HEALTH FOR ALL
(Presented at the Plenary Session chaired by
Justice S .C. Bharucha, Judge, Supreme Court of India)
by
B.K. Keayla
Convenor, National Working Group on Patent Laws, and
Co-ordinator, Forum of Parliamentarians on Intellectual Property
and W.T.O. Issues, New Dellii.
L
—tf-rw:
TRIPS AGREEMENT ON PATENT LAWS:
IMPACT ON PHARMACEUTICALS AND
HEALTH FOR ALL
B.K. Keayla*
Introduction
The public health laws, national drug policy and the patent system are intensely inter- related. Tins
was explained by none other than our great Prime Minister, the Late Mrs. Indira Gandhi while
speaking at the historic session of the World Health Assembly m Geneva on May 6, 1981. In her
words:
"Affluent societies are spending vast sums of money understandably on the
search for new products and processes to alleviate suffering and to prolong
life. In the process, drug manufacturer has become a powerful industiy."
Adding further, she commented thus, on the patent system:
"My idea of a better ordered world is one in which medical discoveries would
be free of patents and there would be no profiteering from life or death."
In this historic session, the participating countries unanimously adopted a resolution for "Global
Strategy on Health for All". Since then, there have been laudable contributions by science and
technology to successfully tackle many health problem areas. While there is substantial unfinished
agenda on the health front, new formidable challenges have been thrown up by an unequal treaty on
all prevasive economic and social aspects by the Final Act embodying the results of the Uruguay
Round Negotiations, hi particular, the Agreement on Trade Related Aspects of Intellectual Property
Rights(TRIPs) is the most contentious part of the Final Act. The aim of this Agreement is to
enforce globally tough standards in respect of several forms of intellectual property which include
patents, trade marks, protection of undisclosed information, etc., totally forgetting the laudable goals
expressed by Mrs. Gandhi in regard to freeing of medical discoveries from the patent system. As
opposite to this, the standards of protection provided in the TRIPs Agreement are more or less on the
lines of those which are being practiced by the technologically advanced countries like the USA,
Germany, Japan, UK, etc. The important issue here is that while the WTO ~ as the successor to
GATT ~ w'as set up to ensure freer trade, the TRIPs Agreement, never earlier a part of international
trade regulations framework, makes for the perpetuation of monopobes and crippling of dynamic
competition. The developmental objectives and the other critical concerns of the developing
countries like population growth, environmental degradation, poverty, sanitation and health related
issues were totally ignored in formulating the TRIPs Agreement. The claim that all countries are
supposed to benefit from the new framework is patently hollow, bi the areas of transfer and
dissemination of new technologies, the Agreement has not brought any freedom or respite from
monopolies. In fact, it strengthens monopolies. This is objectionable particularly in the area of
human health care, thereby increasing the sufferings of the poor due to pushing up of prices of
pharmaceutical products in the strong patent regime. As for the domestic enterprises in the
developing countries are concerned, they wall have to encounter unequal competition with the giant
transitional corporations. The general public interest in almost all countries will suffer from the
abusive use of strong patent system.
This paper extensively deals with the comparative analysis of the existing and the new patent system
and the safeguards which have to be provided in public interest to accomplish the goals of "health for
all".
*Mr. B.K. Keayla. former Commissioner of Payments. Government of India, is Convenor. National
Working Group on Patent Laws, and Co-ordinator. Forum of Parliamentarians on Intellectual Property
and WTO Issues, New Delhi.
I
PART I
PATENT SYSTEM AND BASIC ELEMENTS
(a) Patents : Definition & Subject Matter
Patents rights were introduced in the legal system in the 19th century, with a view to:
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promoting innovation;
to enable disclosure of inventions for furthering research; and
for dissemination of fruits of new research for the benefit of the general public.
The broad idea behind the system is to ensure the availability of new knowledge for the
prosperity of mankind. These rights are formally granted by Governments under their
national laws through an act of Parliament to both nationals and foreigners at par, and are
enforceable for a specified period. The rights provide for excluding other enterprises from
making, using, offering for sale any of the patented products or products manufactured
through the patented processes. In the pharmaceutical fields, thus these laws govern the
relations between the patent holder and the public about the health care. The objectives of
the patent system and its scope are sought to be enlarged in the TRIPs Agreement.
In order to be patentable, an invention needs to meet the requirement of:
novelty (previously unknown to the public),
non-obviousness (containing sufficient innovativeness to merit protection); and
industrial applicability for usefulness).
Patents may be granted for all kinds of products and processes including those related to the
primary sector. Patent protection is only an acquired right under the national laws and as
such it is not a natural right and cannot be treated as private right as envisaged in the
preamble of the TRIPs Agreement.
(b) Patent System : Types
The patent system provides for two types of patents, viz. product patent and process patent.
Product patent provides for absolute protection in respect of patented products, whereas
process patent provides for protection only to the technologies and methods of
manufacture. Process patent system promotes competitive environment and a strong check
on prices, as against monopoly created through product patent system wherein resource
power is used for snuffing out competition and fleecing of consumers by charging high
prices. In the field of pharmaceuticals, there are certain countries like USA who grant
patents even for usage form, dosage form and combinations (formulations) which help the
patent holders to enjoy patent rights for much longer period.
(c) Varying Patent Systems
Worldwide, national governments used their prerogative to evolve their own patent system
It is generally related to other stage of development. IPR laws in developing countries.
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therefore, are compatible with their developmental objectives. The right to develop in the
developing countries prevailed over the intellectual property right in the developed
countries. As such, patent systems of countries differed widely from each other. National
laws have been gradually upgraded by the developed countries to provide for greater
protection to their scientific and technological achievements. They have succeeded only
now through TRIPs to ensure global protection to their inventions which have been
monopolised by MNCs in these countries for commercial exploitation. For example, Italy,
Germany and Japan changed over to product patent from process patent system in
pharmaceutical field only in the recent past.
(d) Basic Elements in Patent Systems : Evolved through long practice
Over a long period of operation of the patent system, certain laudable basic elements have
found place in almost all national laws, including the laws of the developing countries. The
national laws provide for the balancing of rights and obligations for the patent holders. The
scope of patentability has been applied in most countries, as stated above, to the stage of
development in those countries. Patent monopolies have not been allowed to be
established in sectors of vital importance.
The patent system legally ensures the working of the patent in the country which grants the
patent rights. Imports beyond a specified period is being regarded as abuse of patent rights
(even the Paris Convention also called it abuse of rights) and for this reason the imports are
being used as one of the reasons for the grant of sub-licensing to others. A system of
compulsory licensing has thus been provided in the national laws. Compulsory licences are
granted by the national governments for upholding the public interest.
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due to non-working of the patent or
inadequate working of the patent or
due to the charging of monopolistic prices for the patented product or
due to continued imports beyond 3/4 years from the date of patent grant.
In India, automatic licensing of rights has also been provided for certain products in public
interest for ensuring working of patents in a competitive environment. This right is mainly
available for chemical based products like pharmaceuticals. As regards the term of the
patent, the same varies from country to country. India has been having term of only 5/7
years for process patents for pharmaceuticals and other chemical based products and 14
years for other products whereas USA held a uniform term of 17 years for all patents and
now it has changed to 20 years because of TRIPs.
The TRIPs patent system now seeks a uniform patent laws for all member countries of the
WTO.
It would be relevant to mention that according to the U.S. Supreme Court "It is undeniably
true that the limited and temporary monopoly granted to inventors was never designed for
their exclusive profit or advantage, the benefit to the public or community at large was
another and doubtless the primary object in granting and securing that monopoly".
(Quoted in Vaughan 1956,32). But now this objective is being totally ignored in providing
a global strong patent system in TRIPs.
3
PART II
HISTORY OF THE PATENT SYSTEM
Speaking at the Third World Patent Conference held on 15-16th March, 1990, Mr. K.R.
Narayanan (now Hon'ble President of India) said: "The story of the interchange of
knowledge, scientific knowledge and technology is a very old one. Today the developed
countries of the world have more or less domination in the field of science and technology.
But they did not get it from the void; it was a part of continuous process of interchange of
knowledge which took place in the world during many centuries. Scientific knowledge was
passed on to the industrialised western countries of today from Asia, China and India. In
fact, even today in the form of brain drain from the countries like India very significant
scientific - technological - knowledge is going from East to West. Some years ago,
probably it was in 1953, the then US .Ambassador Mr. George Allen said: 'For countless
centuries your country (India) was the source of world drugs and spices. It is high time the
West began to repay its debt to you by helping you to regain your rightful place in this field.'
Those spacious days are no longer there and today the way the West is repaying it is
through Special 301 and Super 301. It is neither historically true nor morally valid for the
developed countries of the world to take up the position that by transferring technology to
the developing countries they are doing a great favour. They had imbibed a lot from India
in the past and even currently too". The history of the patent system has to be understood
in the background of what Hon'ble Mr. K.R.. Narayanan said. The patent system, has a long
history. It has its origin in the practice of granting monopolies by the Crown in England.
In the reign of Edward-III, some form of patent protection appears to have been given for
arts and sciences which were for the public good. In the middle ages in the UK cases are
reported of patents being granted to foreign workers to entice them to leave their own
country and come to work and teach their skills to native craftsmen. In the beginning UK
did not resort to compulsory licensing system. In fact, they even opposed compulsory
licensing at the International Conference on Industrial Property at Paris in 1878. However,
UK soon changed its mind and made provision for compulsory licensing at the International
Conference on Design Act, 1883. Further strengthening of the provision for grant of
compulsory license were incorporated in the UK Patents Act in 1919 and 1949. Insofar as
the process patent system is concerned, UK had practiced this system between 1918 and
1949. They introduced product patent system only after substantial achievement in
technological self reliance.
In France, a Venetian, Thesco Mutio, received a grant of patent in 1551 for a ten year
monopoly for the manufacture of a type of Venetian glassware. The earliest law
concerning patents for inventions appears to have been that passed in Venice in 1474. In
1594, Gallileo was granted under this law a patent for a device for raising water for
irrigating the land. Provision for compulsory working of patented invention was
incorporated in the French Law in 1741. Other countries in Europe also provided similar
provisions in their laws.
In America, patents were granted as early as in 1641 although the system proper started in
1790. The Patents Act was amended in 1793 and later became closer in its terms to the
UK Act. In USA also in the recent past, there has been considerable debate about the
choice between competition and innovation in the pharmaceutical field which has continued
since investigation of the patent system by Kefauver Committee in 1959. This committee
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found that "pharmaceutical patents led to high profits" and proposed that patents be limited
to three years only; beyond that time, the patent holder should be required to grant licences
to other firms at a maximum royalty7 rate of 8 per cent. This recommendation, though not
implemented, had substantial indirect effect on the stronger authority accorded to the Food
and Drug Administration (FDA) whose more comprehensive regulatory approval of new
drugs replaced in part the role of weaker patent monopoly. Further, again in USA the
hearing led by Rep. Henry Waxman of the House Energy and Commerce Committee during
1988 on the prices of pharmaceutical industry7 found that "since July 1985 drug prices had
risen 4.5 times more than consumer price index" and that "between 1982 and 1986 revenue
gains of 24 leading companies were three times higher than the R&D increases".
According to Rep. Waxman "an attractive alternative to the problem would be to adopt the
Canadian compulsory licensing system which had proved its efficacy in terms of hundreds of
millions of savings to the drug consumers". Thus even in USA, the pragmatic approach at
highly responsible levels other than pharmaceutical industry7 had been for the application of
the compulsory licensing system in some form or the other to contain the prices of
pharmaceuticals and to reduce the cost of health care to its people.
The German Patents Law of 1877 was enacted with only process patents for chemical
products (including pharmaceutical products) to encourage development of innovative and
cost effective processes for the same. In fact, Germany provided an interesting example
about the evolution of process patent system. In 1876 when German industry was in its
infancy and the patent law was yet to be evolved, Bismarck appointed a committee to study
the likely impact of the patent system on the industry. Among the members of the
committee were the founders of Siemens and Hoechst. Their observations made an
interesting reading:
"Today industry is developing rapidly
monopolization of
inventions and abuse ofpatent rights will inevitably expose large
segments of industry to serious injury. The Government must
protect industry against these dangers ............... These patents
will not be taken out in order to protect industrial plants established
or to be established in Germany; they will be taken out to monopolise
production abroad. These articles will be imported into this country.
Such a danger must be met. ”
The history of the patent system would be incomplete without the mention of the Paris
Convention administered by the World Intellectual Property Organisation (WIPO). The
Paris Convention for the protection of industrial property was established in 1883 and has
been revised six times. The amending Conventions are:
Brussels Convention,
Washington Convention,
Hague Convention,
London Convention,
Lisbon Convention,
Stockholm Convention,
1900
1911
1925
1934
1958
1967
All amending conventions have provided for stiffer provisions granting more protection to
pantentees. The developing countries are concerned about social obligations for the
patentee
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whereas the Paris Convention does not provide for any such obligations. It provides for
maximization of individual rights (Article 5). Paris Convention does provide for system of
compulsory license which can be applied on the ground of failure to work or insufficient
working after three years of patent grant [Article 5(2)]. However, there is also provision
that compulsory license "shall be refused if patentee justifies inaction by legitimate reasons".
The Paris Convention also provides for members to ensure effective protection against
"unfair competition". The only reason given for this is "far contrary to honest practices".
There are over 100 countries who are now members of the Paris Convention. Presently,
WIPO is engaged in evolving a so called harmonization of patent system which is known as
"Treaty Supplementing Paris Convention". Some critics have observed that the provisions
of this Treaty under consideration are more onerous than even the patent system provided
in the TRIPs Agreement. As it is all the substantive provisions of the Paris Convention
(Articles 1 through 12 and Article 19) shall have to be complied with by all members as
provided in Article 2 of TRIPs Agreement of WTO. Later the new "Treaty
Supplementing Paris Convention" would also become applicable to all Members of WTO
because of Article 2 and Article 71 of TRIPs.
Insofar as the developing countries are concerned, the first Patents Act relating to the grant
of patent rights was passed in India in 1856. The straits settlements (Singapore, Wellesely
Penang and Malacca) were made colonies independent of India in April 1867. In
November 1871, it received the patent law which substantially followed the Indian laws.
The basic features of laws in the developing countries like India, Malaysia, Thailand,
Argentina, Brazil, Mexico, China, Egypt and Canada did follow the principle of
encouraging the role of the domestic industry in the field of drugs and pharmaceuticals. In
order to achieve this, they had either excluded drugs and pharmaceuticals from the patent
system or had provided for only the process patent or the method of manufacturing these
substances. They had also provided for compulsory licensing/licensing of right system to
ensure that monopolistic regimes are not established by the patent holders under the patent
system and the domestic industry is able to play its role in providing pharmaceutical
products. Thus the devolution of the patent system, both in industrialised and developing
countries, would clearly establish the fact that there has been a close co-relation between
the level of economic, industrial and technological development of a country on the one
hand and the nature and extent of patent protection granted by it on the other. In the
crucial phase of their industrial development, many of the industrialised countries of today
had either "on-patent" or weak patent standards in vital sectors in order to strengthen their
industrial and technological capabilities. It was only after they attained sufficient
technological strength in certain areas that they considered making changes in their patent
system. The patent system, in fact, has been an instrument of national economic policy for
the industrialisation and technological advancement of a country. In the case of developed
countries, it is of foremost importance that the patent system does not block or hinder the
building up of their own industrial and technological capabilities. Now these developing
countries, under pressure either changed or are changing their patent laws to provide for
product and process patents for pharmaceutical products. In any case, all the member
countries of WTO have to change the patent system as provided in the TRIPs Agreement.
A simmering debate has already been started by the public interest groups in most countries,
about the impact of the TRIPs patent regime on the health care system.
6
PART III
PHARMACEUTICAL MARKET- GLOBAL SCENARIO
A. Production/Sale of Pharmaceuticals
The global pharmaceutical market has increased dramatically from the past two decades. In
1976 world consumption of drugs amounted to US S43 billion and in 1985 it reached US $94.1
billion; thus registering an overall annual increase of 9.1% in the decade between 1976 and
1985. The world market consumption increased to US $260 billion in 1995 and increased to
US $290 billion in 1996. The forecast for the future is that it will grow at a compound annual
growth rate of 6.2% in the next 5 years to reach US $378 billion in 2001 according to the
recent IMS Report. Both production and sales are heavily concentrated in the developed
countries; the US, Europe and Japan account for about 80% of both production and sales.
Paradoxically, the population in the developing countries in 1976 was 73% of the world
population whereas the pharmaceutical consumption was only 24% of global production
During 1989 the developing countries registered population at 75% whereas the
pharmaceutical consumption decreased to 21%. The increasing balance was due to the fact
that the drug consumption accrued at an average of 9.6% per year in the developed countries
and at only 7.2% in the developing countries. In other words, in 1985 1.2 billion people living
in the developed countries consumed nearly US $75 billion worth of drugs while the remaining
4 billion living in developing countries consumed only US $20 billion worth.
The regionwise world consumption of pharmaceuticals has been as follows: (Figures in US $
billion, ex-manufacturer price)
Table 1
1976
1985
North America
Western Europe
Eastern Europe
Japan
Oceania
Latin America
Africa
Asia (excluding China and Japan)
China
8.761
13.111
6.197
4.020
0.480
3.689
1.268
2.920
2.600
28.141
22.000
Total
43.046
94.079
9.600
14.038
0.700
5.600
2.700
6.600
4.700
The above Table indicates substantial increase in consumption of pharmaceuticals in the
developing counties, whereas the consumption in developing countries is not growing much
even when the actual needs keeping the health care scenario in view are much higher.
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Two largest drug markets in the developing countries, viz. China and India had the following
sales :
Table 2
1985
.1976________
Country
Sales
% of w orld
(USS billion)
market
Sales
%of world
(USS billion)
market
China
India
2.600
0.508
4.700
1.775
6.0
1.1
5.0
1.9
Source: Global Study of Pharmaceuticals Industry
During the last one decade both these markets have registered substantial increase and are
likely to provide largest jump in the market share during the next 5 years according to the latest
Global Pharma Forecast 1997-2001.
B. Per Capita Drug Consumption
Another important element to be taken into account while assessing the world drug
consumption is per capital drug consumption. As a whole, this indicator does not reflect the
consumption of drugs throughout the community, as the average value is likely to be far from
the extremes. However, it does help to give an idea of the discrepancies that exist between the
developed countries and the developing countries.
Table 3
Value of per capita drug consumption
1976
1985
Annual growth rate (%)
Developed countries 29.0
Western Europe
34.0
North America
36.3
17.0
Eastern Europe
Japan
35.6
Developing countries 3.4
Asia
2.4
Africa
3.0
Latin America
11.2
62.1
54.5
106.3
24.5
4.2
4.9
13.8
8.8
5.4
12.7
4.1
14.0
5.0
6.3
5.7
2.3
World
19.4
7.2
US $
116.3
5.4
10.3
Source: Global study of the pharmaceutical industiy, unpublished UNIDO document:
IMS Market letter. 11 August 1986; estimates of WHO secretariat.
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The \ alue of drug consumption per capita in individual countries has been as follows:
Table 4
J 976
1985
1990
0.8
2.7
2.3
3.0
4.4
7.0
16.0
97.0
191.0
412.0
US s
India
China
Brazil
UK
USA
Japan
10.9
18.3
36.2
10.3
41.4
110.5
116.2
35.6
Sources: Global study of the pharmaceutical industiy. Unpublished UNIDO document:
and Chemical W'eckly 1996.
4 he gap in per capita ding consumption between the developed and developing countries which
was already very considerable in 1976 continued to grow in the subsequent 10 years. While in
terms of value each inhabitant of a developed country consumed on an average in 1976 8.5
times as many drugs as an inhabitant of a developing country; in 1985 he consumed dings
costing 11.5 times as much. This worsening of the situation is due to both the slower growth
of drug consumption in developing countries and the faster growth of population. Whereas
the growth rate of the population in developing countries reached 2.1% per year in the period
1976-85, in developed countries it was less than 0.8%. The above consumption figures do not
necessarily reflect the true consumption of drugs in these countries as the factors relating to the
exchange rate and inflation have not been taken into account. If these factors are accounted
for, probably the per capita consumption thus obtained would show that in terms of volume the
evolution had been different in different countries. In any case the poverty-health nexus in the
developing countries is quite strong. Poor health care conditions retain the poor in these
countries in poverty and poverty retains them in poor health. For example, there is 70%
population in India which cannot afford modern medicines and this is one of the strong reasons
for poor health conditions for its people where there are still 40% population below poverty
level.
C. Research and Development in Pharmaceutical Industry
The pharmaceutical industry is characterised by high research and development which has
remained the principal mechanism whereby the society is supplied with new drugs to prevent,
control and cure diseases. R&D is also extremely important for pharmaceutical firms in
maintaining growth and competitive advantage; investment in research and development has
to generate products that can be sold in large markets at reasonable profit. Accordingly,
economic and social concerns are often in conflict. The leading global companies in the world
market spend an average of about 15% of their sales on R&D. These leading companies have
their base in France, the Federal Republic of Germany, Japan, Switzerland, the United Kingdom
and the United States of America. In 1982, these companies accounted for 75% of the
pharmaceutical industry expenditure on the research of new medicines. In 1984, their
expenditure on R&D was estimated to be US $6.5 billion. The global R&D expenditure of the
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pharmaceutical industry in 1995 was about US $25 billion. The US industry accounted for the
largest R&D expenditure. It spent $13.4 billion and 14.5 billion during 1994 and 1995
respectively. The earlier expenditure of US pharmaceutical firms during 1970 was US $0.62
billion; in 1990, it rose to US S8.2 billion, The R&.D spending of major pharmaceutical firms
during 1995 has been as follows :
Table 5
Firm
R&D Expenditure
1995
$M
1,884
1,695
1,331
Glaxo Wellcome
Novartis
Merck & Co.
Pfizer
Hoechst Marion Roussel
American Home Products
Pharmacia Upjohn
Bristol-Myers Squibb
Eli-Lilly
Bayer
1,295
1,250
1,220
1,128
1,007
990
903
D. Expenditure on Drug Development
The cost of research and the time required to transfer a drug from the laboratory to the market
has increased substantially. In 1963 in the United Kingdom, according to the industry analysis,
it took about 3 years and spent 2-3 million pounds to develop and market a new drug. In late
80s, the estimated cost increased to 50 million pounds and the time period also increased to 710 years. During the same period, in the Federal Republic of Germany the average duration of
R&D on new substances increased from 2-3 for research and 5 years for development in 1964
to 9-13 years in 1981 with a cost in 1981 of about DM 150 and 300 million (US $57 and US
$114 million) respectively. In the United States, development time increased from 2 to 7-10
years and cost from US $54 million in 1976 to US $ 75-100 million in 1985. A study
conducted by the US Pharmaceutical Manufacturers' Association stated that in 1986 the cost of
developing a new chemical entity had risen to US $125 million (US $65 million out of
pocket expenditure and US $60 million as opportunity cost). These figures are stated to be
averages and cover the failures as well as successes. Some industry analysis consider that
much of the cost must relate to R&D products that do not succeed. The actual cost of
developing chemical entity must now therefore be far less. According to Burke (1996), the
development of drugs has become extremely costly and uncertain. The average cost of
developing new drugs was $120 million and $359 million in 1987 and 1992 respectively.
According to the latest estimate, the cost has increased to $600 million by 1995. The cost of
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drug development has increased for the two main reasons:
The new generation drugs are very complex and their discovery
and development require costly technology; and
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The regulatory control has become very strict. The drug has to
pass through more stringent safety and other tests than in the past.
The introduction of new drugs has been on the decline. According to a study, the number of
new drugs declined from 564 in 1953 to 166 in 1962. According to Whittakar and Bower
(1994), the number of drugs introduced in the US market, for example, declined from early
average of 100 in 1960s to less than 40 in 1980s. However, the discovery rate has improved in
the recent years. There has been an explosive growth in the biomedical knowledge. Though
the discovery rate has increased, the number of drugs has continued to decline in the 90s
because of the stricter regulatory requirement. Only 28 new drugs were approved in the USA
in 1995 and only 40 new drugs were introduced worldwide during the same year.
PART IV
PHARMACEUTICAL INDUSTRY IN INDIA : A CASE STUDY
India's first Patents Act of 1858 was replaced by a more comprehensive Patents and Designs
Act m 1911. This Act was designed to serve foreign interests. The raw materials from India
were exported and value added finished goods at monopolistic prices were sold in Indian
markets. The industry was dominated by MNCs. They were reaping enormous profits from
the Indian markets. An American Senate Committee, headed by Senator Kefauver, stated in
1959 in their report that the prices of drugs in India were "amongst the highest in the world".
Following independence in 1947, one of the first major decisions taken by the Indian National
Government was to change the colonial Patents Act of 1911. The new Patents Act was
eventually enacted in 1970 after in-depth study by two high-powered Committees, headed by
Justice Bakshi Tek Chand and Justice N. Rajagopal lyenger, and extensive debate in
Parliamentary Committees and both the Houses of Parliament. In amending its Patents Act,
India took a considered decision to stay outside the Paris Convention. The lyenger Committee
advised the Government against India's joining the Convention on the ground that country
would lose freedom to exclude certain areas of development from patentability by foreign and
domestic interests and revoke patents when they are not worked in the country. In the recent
past, several eminent jurists of the country and former Chief Justices of the Supreme Court of
India, viz. Justice M. Hidayatullah, Justice Y.V. Chandrachud and Justice J.C. Shah also
advised against India joining the Paris Convention. According to Justice Chandrachud "the
creed of the Convention is the protection of private rights, not the securing of public interest".
The jurists had doubted the constitutionality of the Paris Convention and its provisions being
forced on India.
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The Indian Patents Act, 1970 was hailed by many developing countries and UNCTAD as one
of the most progressive statute suitable as a model for the developing countries. It safeguards
the interest of both the inventor and the consumer in a balanced manner. The interests of the
public have been given priority over the private interests of the patent holders. This Act is
product of deep consideration and long deliberation to synchronize with the Directive
Principles of State Policy contained in the Constitution which provides in Article 39 that:
"39. The State shall, in particular, direct its policy towards securing
(a) ..............................
(b) that the ownership and control of the material resources of the community are so
distributed as best to subserve the common good; and
(c) that the operation of the economic system does not result in the concentration of wealth
and means ofproduction to the common detriment. "
The Indian Patents Act, 1970 is a landmark in the history of industrial development and forms
the basis for transfer of technology. The Act devotes equal attention towards the industry, the
scientists, the consumers and the nation as a whole. It has preserved the continuing interest of
the inventor in his creation, his social interest in encouraging research, the consumer interest in
enjoying the fruits of inventions at reasonable cost and creation of conditions for the
acceleration and promotion of economic development of the country.
The important features of the Indian Patents Act, 1970 can be judged from the obligations
which have been laid down for the patent holder for working the patent to satisfy the
reasonable requirement of the public. One sees competitive environment in the country.
Another important feature of the Indian Patents Act, 1970 relates to the exclusion from
patentability of technologies relating to atomic energy and inventions relating to agriculture and
horticulture products or methods. As regards the chemical based products, the Act provides
that ’’only methods or processes of manufacture claimed for substances intended for use or
capable of being used as food or as medicine by chemical processes including alloys,
optical glass, semi-conductor and inter-metallic compounds, would be patentable and that as
such no patent shall be granted in respect of claims for the substances themselves”. It is
because of this provision that it has been possible for the scientists and entrepreneurs in India to
develop alternative process technologies which have helped the pharmaceutical industry to
produce new drugs in the country in a relatively shorter period. The salient features of the
Patents Act, 1970 thus deal with :
Exclusion of certain fields basic to our economy and well being of Indian
people from patentability;
~
No product patents in some other important areas like drugs and
pharmaceuticals, agro-chemicals, etc.;
~
Shorter period of patent protection;
~
Importation not treated as working of patent;
Compulsory licensing and license of right to ensure working and
disssemination of technologies;
Ceiling on royalties on sub-licensing of patents. Thus balancing of rights
and obligations and ensuring that patent monopolies are not established.
12
Because of these features, the Indian industry during the post 1970 period after the new patent
system was introduced progressed quite satisfactorily. The pharmaceutical industry especially
made excellent progress within the framework of the new patent laws as is evident from the
following facts :
(a) Process Research
Table 6 indicates the basic drugs manufactured by the domestic sector companies in India
based on indigenously developed process technologies.
Table 6
Basic Drugs Manufactured by Domestic Sector Companies Based on Indigenously Developed
Process Technologies Effect of the Process Patent System
1. Acetazotamide
2. Allopurinol
3. Amitryptiline
4. Amidaqine
5. Amoxycillin
6. Ampicillin
7. Analgin
8. Aspirin
9. Atenolol
10. Betamethasone
11. Caffeine
12. Ca. Sennosides
13. Carbamezapine
14. Cephaclor
15. Cephazoline
16. Cephalexin
17. Chloraphenicol
18. Chiordiazepoxide
19. Chlarpropamide
20. Chloroquine
21. Cimetidine
22. Ciprofloxacin
23. Cisplatin
24. Clonidine
25. Cloiibrate
26. Cioxacillin
27. Cyproheptadine
28. Danazol
29. Dapsone
30. Dexamethasone
31. Dextropropoxyphene
32. Diazepam
33. Diloxanide Furoate
34. Diphenylhydantoin
35. Diphenhydramine
36. Doxycycline
37. Emetine
38. Ephedrine
39. Erythromycin
40. Etiiambutol
41. Ethinyl Estradiol
42. F!orafur
43. Folic Acid
44. Frusemide
45. Furazolidine
46. Gentamycin
47. Glipimide
48. Glibenclamide
49 Guaphenesin
50. Griseofulvin
51. Heparin
52. Hydrochlorothiazide
53. Hydoxiprogesterone
54. Hydroxyzine
55. Ibuprofen
56. Indomethacin
57. Isopropylantipyrine
58. Kanamycin
59. Keterolac
60. Lorazepam
61. Mebendazole
62. Metoprolol
63. Metoclopramide
64. Metocarbamol
65. Methyldopa
66. Metranidazole
67. Nalidixic Acid
68. Naproxen
69. Niacinamide
70. Nicotinamide
71. Nifedipine
72. Nitrazepam
73.
74.
75.
76.
77.
78.
79.
80.
81.
82.
83.
84.
85.
86.
87.
88.
89.
90.
91.
92.
93.
94.
95.
96.
97.
98.
99.
100.
101.
102.
103.
104.
105.
106.
107.
13
Nitrofurantoin
Norethisterone
Norfloxacin
Ofloxacin
Paracetamol
Pethidine
Pentazocine
Phenarimine
Piperazine
Piracetam
Progesterone
Propanolol
PVT-Iodine
Povidine Iodine
Pyrental Palmoate
Pyrazinamide
Quinidine
Quinine
Ranitidine
Roxitidine
Salbutamol
Silver Sulphadiazine
Sulphacetamide
Sulphamethoxazole
Sulphamoxole
Terbutaline
Theophylline
Thiacetazone
Timolol Maleate
Tinidazole
Trimethoprim
Triazolin
Vinblastine
Vincristine
Vitamin Bl2/
other Vitamins
Table 7 indicates the time lag between the introduction of a new drug in the world market and
its introduction in India after the domestic enterprises developed their own technologies to
manufacture the products.
Table 7
Time lag between introduction of a new Drug
in the World Market and its introduction in India
Drug
Salbutamol
Mebendazole
Rifampicin
Naproxen
Bromhexin
Ranitidine
Captopril
Norfloxacin
___________ Introduced (Year) In_______
World Market by the
Indian Market by
Inventor
Domestic Cos.
1973
1974
1974
1978
1976
1981
1981
1984
1977
1978
1980
1982
1982
1985
1985
1988
: Time Lag: Introduc: duction in India (Yrs.)
4
4
6
4
6
4
4
4
In view of indigenously developed process technologies, the pharmaceutical industry has been
able to produce basic drugs covering various therapeutic groups and achieve near selfsufficiency in the production of bulk drugs in the country. The industry has also developed
capabilities of producing enough surplus of basic drugs and formulations for exports
worldwide.
(b) Production
After the Patents Act, 1970 was enacted, the number of pharmaceutical producers (small,
medium and large scales) increased from 5,000 to 24,000. The production of pharmaceutical
products has also grown more than 38- fold from Rs.250 crores in 1971 to over Rs.9,500
crores in 1995-96. Similarly in recent years, there has been a sharp rise of twenty times in
exports by the industry: from Rs. 140 crores in 1985-86 to over Rs.2800 crores in 1995-96.
The domestic industry has thus greatly helped in providing not only drug security in the country
but has also succeeded in getting access to foreign markets both in the developed and
developing countries. Of the 465 bulk drugs used in the country, 425 are produced
indigenously. The Indian industry has emerged as world leader in the production of bulk drugs
like Ciprofloxacin, Dextrapropoxyphene, Ethambutol, Ibuprofen, Norfloxacin, Sulpha
methoxazole, Trimethoprim, etc. Ranbaxy, Cipla, Cadila, Alembic, Lupin, Themis and
Torrent enterprises have emerged as major Indian companies meeting requirements of all kinds
of drugs in the country and having strong foreign presence by exporting drugs and medicines
matching the worldwide quality standards. Ranbaxy alone exported drugs worth Rs.630
crores out of its production of Rs. 1153 crores during 1996-97 and during 6 months of 1997-98
they have already exported drugs worth Rs. 304 crores.
14
There is competitive environment in India in production of almost all essential drugs and it can
be judged from the number of total producers in the country and the number of producers of
major essential bulk drugs as shown in the following Table 8.
Table 8
Drug
Number of Manufacturers
Ampicillin
Amoxycillin
Cephalexin
Chloramphenicol..
Diazepam
Diclofenac sodium
Enlhromycine
Ibuprofen
Mebendazole
Paracetamol
Rifampicin
Tinidazole
Trimethoprim
32
22
25
68
20
29
22
52
35
63
27
40
88
The above competitive environment and self-reliance with the implementation of monopolistic
TRIPs Patent System would be totally crippled. The dependence upon imports would make
things worst from the consumer angle. They will have to pay high prices in the new situation
for their health care needs.
PARTY
BASIC FRAMEWORK OF TRIPS AND MAIN FEATURES
Basic Framework
It can be emphatically stated that TRIPs Agreement as such is not based on proper nego
tiations in the Uruguay Round between the members of the developed and developing countries
of the WTO. The basic framework for the TRIPs patent system was conceived and shaped in
a Joint Statement (Paper) presented to the GATT Secretariat in June 1988 by :
~
the Intellectual Property Committee (IPC) of USA;
~
Keidanran of Japan; and
UNICE of Europe.
IPC is a coalition of thirteen major US Corporations dedicated to the finalisation of TRIPs in
GATT in their favour. The member of the IPC then were Bristol Myers, Dupont, General
Electric Motors, Hewlett Packered, IBM, lohnson and Johnson, Merck, Monsanto, Pfizer,
Rockwell and Warner. Similarly, the other two organisations of Japan and Europe also then
represented powerful business and industry interests.
When one compares the framework provided in the Joint Statement and the framework of the
TRIPs Agreement, one does not find any basic difference between the two. The three
15
powerful organisations jointly submitted the Statement only to further the worldwide
interests of the TNCs. They have thus been able to ensure their monopolistic rights fully.
In the ords of James Enyart of Monsanto. "We went to Geneva where we presented (our) document to the
staff of the GATT Secretariat. What I have described to you is absolutely unprecedented in GATT.
Industry has identified a major problem in international trade. It crafted a solution, reduced it to a concrete
proposal and sold it to our own and other governments
The industries and traders of w orld
commerce have played simultaneously the role of patient, the diagnostician and the prescribing physician."
(Les Nouvelles June 1990 - pp 54-56).
The TRIPs patent system provides for virtually no obligations for the patent holder in the
country which gives the patent rights. The system is, in fact, a charter of rights for the
patent holders. There is no provision in the proposed patent system for transfer and
dissemination of technology, even though the objectives and the principles laid down in
Articles 7 & 8 of the TRIPs Agreement provide for the same. The new patent system will
, thus help the TNCs to achieve their objective of monopolising worldwide markets including
the markets of the developing countries.
Patent Regime under TRIPs Agreement ~ Main Features
(a) Preamble
The TRIPs Agreement lays down minimum standards for protection of intellectual property.
The Agreement envisages that member countries will not grant protection less than the
levels laid down therein and the same has to be implemented through the domestic laws of
each country. The preamble of the TRIPs Agreement "recognises the need for multilateral
framework of the principles, rules and disciplines dealing with international trade in
counterfeit goods". [According to US interpretation, the goods produced in India even by
legally taking process patents, are counterfeit goods.] The preamble also explicitly
"recognises the underlying public policy objectives of national system for the protection of
intellectual property, including developmental and technological objectives". In spite of
these provisions, the substantive provisions in "Section 5 : Patents" of TRIPs Agreement
do not provide for the objectives and principles laid down in Articles 7 & 8 of the TRIPs
Agreement and its preamble.
Even though many countries including India are not yet members of the Paris Convention,
according to Article 2 of the TRIPs Agreement "the members shall comply with Articles 1
through 12 and Article 19 of the Paris Convention (1967)." This provision automatically
brings all the member countries within the framework of the Paris Convention.
These provisions clearly amplify the designs of the MNCs who conceived and shaped the
global and monopolistic patents system in the TRIPs Agreement.
(b) Objectives and Principles
Article 7 of the TRIPs Agreement provides that Mthe protection and enforcement of
intellectual property rights should contribute to the promotion of technological innovation
and to the transfer and dissemination of technology, to the mutual advantage of producers
and users of technological knowledge and in a manner conducive to social and economic
welfare, and to a balance of rights and obligations”. Similarly, Article 8 of the Agreement
provides that "Members may, in formulating or amending their laws and regulations, adopt
measures necessary to protect public health and nutrition, and to promote the public interest
in sectors of vital importance to their socio-economic and technological development.
16
Thp«P Cd
measures are consistent with the provisions of this (TRIPs) Agreement"
"Section iPa en^X* ™"dAPrinCiP'eS
lh' ^tantive provisions in
proXns of rS X 7 Zl
A.gree”“"'
^eloping countries should interpret the
XXe*; ' hT"""1 PrOd“,S "
field a^nler Xrs”?
<,eVe,0P"“
their naEXX
(c) Scope ofpatentability
When the Uruguay Round started, there were many countries which did not confer
Protecuon on pharmaceutical products and as such it was the essential aim of the USA and
other technologically advanced industrial countries to extend the scope of patentability to
the pharmaceutical products globally. The scope of patentability in 'TRIPs A^reemenThas
thus been greatly enhanced. According to Article 27,
Agreement has
"patents shall be available :
► for any invention whether products or processes in all fields of
technologies ~ provided that they are new, involve an inventive
step and are capable of industrial application." [Art.27(1)]
The above provision is one of the major concessions capitulated by
the developing countries for a global scope.
protection will also be extended to [as per Art.27(3)(b)J
• Micro-organism;
non-biological and micro-biological processes; and
plant varieties either by patents or by an effective
sui generis system or by any combination thereof
sectors’16 NoPfleex£entabiIitr
t0 the entire industrial and agriculture
from the scope of patentabihtyinthe XmS^
^viewing the above provision of sub-paragraph 27(3)(b) in four years after 1 1 ’1995 when
agreed position and hence they provided for review after four years.
It is reported that the European Council of Ministers on November 27 1997 approved the
EU Commissioner's proposed Directive on the Legal Protection of BiotechnolXl
Invention, otherwise known as the "Life Patent Directive". Despite coming as I major
fGRAINl0? °Ve7 WOrld’ aS reported by the Genetic Resources Action International
(CELMN), have vowed to continue to fight the legislation which will allow life to become a
private commodity, owned by the TNCs in the name of profit.
to become a
The concept of non-biological and micro-biological processes and effective sui generis
system are likely to raise serious problems in legislation and in practice.
8
17
(d) Non-patentability
Article 27(2), however, specifically provides for the following exclusions from patentability:
commercial exploitation of invention prevented by the members within their territory
to protect ordrepublic or morality, including to protect human,
animal or plant life or health, or
to avoid serious prejudice to the environment;
provided that such exclusion is not made merely because the exploitation is
prohibited by the law.
The existence of a legal provision prohibiting exclusion, if based on other grounds
will not be regarded as sufficient ground for non-patentability.
Article 27(3) also excludes the following from patentability:
► diagnostic, therapeutic and surgical methods for the treatment
of humans or animals;
(According to Dr. Carles Correa, an authority on IPR, the exclusion mentioned above would not
apply to any apparatus used for diagnostic or therapeutic purposes for its ’’diagnostic kits” one
of the main biotechnology based products on the market at present.)
►
plants and animals (other than micro-organisms); and
(The scope of this exclusion is limited to traditional methods of breeding and
improvement ~ thus covering the protection for inventions based on genetic
engineering or gene manipulation.)
►
essentially biological processes for the production of plants or
animals (other than non-biological and microbiological processes).
The conditions for exclusion under Article 27 (2) to protect ordre public and serious
prejudice to environment are quite complicated ones and in legislating on these aspects
special care will have to be taken by the member countries to make them real effective.
Further, the special issue No.24 of year 12 of the Revista de Mundo Indusrial, Buenos
Aires, mentions about the possible patentability of products which "copy” substances
already existing in nature has given rise to animated discussion and different solutions
among the industrialised countries.
(e) Working of Patents: A Non-Issue
An important aspect of the working of the patent in the new patent regime has been totally
changed. Imports are generally not regarded as working of the patent in the national laws.
All along the patent holders had the obligation to work the patent in the country which
grants the patent as an important element of the system. Even the Paris Convention
recognises working of the patent in the country granting the patent. In fact non-working is
considered as an abuse of patent rights under the Paris Convention (Art. 5A). The TRIPs
Agreement, according to Article 27, however provides that: ’’patents shall be available and
patent rights enjoyable without discrimination as to the place of invention, the field of
technology and whether products are imported or locally produced”.
18
The provision for providing patent protection for imported products at par with locally
produced products is a major deviation in the patent system as followed hitherto. Even
while granting exclusive rights under Article 28 of TRIPs for products and processes,
exclusive rights have been extended to making, using, offering for sale or selling and ’
imports subject to the provision of Article 6. The implication of this provision is that the
patent holders will have no obligation as such towards the national government conferring
the patent rights under the new patent system to produce the patented product in that
country There will be thus free flow of imports of patented products. The right to import
the patented products or product produced by patented process will also vest as an
exclusive right with the patent holder. This will again be a serious matter particularly when
this right is applied with another provision of "reversal of burden of proof under Article 34.
Also it will not be possible to regulate the prices of such products as price control system
cannot be extended to imported products. It will be extremely dificult to determine their
cost price. Thus patented products would be sold at relatively much higher prices. The
dependence upon imports would also increase substantially. The weakening of the
obligation to work the patent has thus strengthened the internationalisation of production
and marketing by multinational companies as stated by Chesnais (1994). Having chosen to
locate production in a place, their (MNCs) strategy is to supply global markets under
monopolies conferred by patents, exporting finished or semi-finished products rather than
transferring technology or making direct foreign investment (Correct 1989).
The footnote under Article 28 refers to Article 6 which permits member countries to
provide for exhaustion of intellectual property rights subject to national and most favoured
national treatment. According to Dr. Carlos Correa (Health Economics 1997), exhaustion
may only apply to acts occurring within a country ("national exhaustion") in a group of
countries or a region ("regional exhaustion") or in the global market as a whole
( international exhaustion). He has further clarified that recent legislative reforms in a
number of countries has established the principle of international exhaustion with the aim of
introducing a certain degree of competition into the market. He gave an example that if a
patented product is sold in country A at a price of $100 and in country B the same
(legitimate) product is sold at $80, this principle allows any interested party in country A to
import the product from country B without the consent of the patent's owner.
(f) Authorisation for use of Patented Product
Article 31 of TRIPs deals with "other use without authorization of the right holder", The
provisions under this article are in no way comparable to the usual provisions of
"compulsory licensing" or "licences of right" for non-working. However, this Article does
not restrict the rights of the member government to grant compulsory license "where the
law of a Member allows for other use". It could be extended to "measures necessary to
protect public health and nutrition and to promote the public interest in sectors of vital
importance to their socio-economic and technological development, provided that such
measures are consistent with the provisions of this (TRIPs) Agreement" ~ the criteria which
have to be consistent could be interpreted to relate to Articles 27.1 and 31. Further,
compulsory license can also be granted when the patent holder has not responded within a
reasonable period to efforts by any enterprise to obtain authorisation from the right holder
on reasonable commercial terms and conditions.
19
Further Article 31 provides for licensing 'without authorisation of the right holder', The
scope of this provision, as stated above, is limited and is available only :
in cases of national emergency,
in cases of extreme urgency;
in cases of public non-commercial use,
in cases to remedy a practice determined after judicial or
administrative process to be anti-competitive;
in cases where second patents are permitted; and
in cases of Government use.
The scope and duration of such cases are supposed to be limited to the specific purpose for
which authorisation may be granted.
Article 31 also deals with the conditions that have to be respected by the member
governments for grant of authorisation or compulsory license to third parties. These
conditions are as follows:
(i)
Compulsory license or 'authorisation of such use’ shall be considered
on its individual merits. This means that the concerned government has to
specifically consider the individual application on merits and not apply any
general consideration. [Article 31 (a)]
(ii)
The individual enterprise desirous of commercial exploitation of
patent has to make direct efforts for authorisation with the right holder on
reason- able commercial terms and conditions and that such efforts have not
been successful within a reasonable period of time. [Article 31 (b)J
(iii) The scope and duration of such use shall be limited to the purpose
for which it is authorised [Article 31(c)], Thus for commercial purposes the
duration of authorisation for local production will have to be till the patent
rights are enjoyed by the patent holder.
(iv) Articles 31 (d) & (e) provide for the authorisation/compulsory
license, to be non-exclusive and non-assignable. This would imply that
there is scope of giving compulsory license to more than one party.
(v) Article 31(f) restricts the compulsory license to predominantly for
the supply of the domestic market. This restriction may mean limiting of
capacity to an unviable size.
(vi) According to Article 31(h), the patent holder has to be paid adequate
royalty taking into account the economic value of authorisation
The member countries have to ensure while implementing the TRLPs Agreement that their
national interests are fully safeguarded keeping the spirit of Articles 7 & 8 in view.
Dr. Colette Kinnon, a health economist and a member of WHO's Task Force on Health
Economics, while speaking at Health Action International seminar on GATT/WTO,
Pharmaceutical Policies and Essential Drugs, organised in Bielefeld, Germany, in October
20
1996, on minimising adverse effects said:
"Government could also consider making use of certain provisions of the agreement
for the purpose of avoiding monopolistic practices and encouraging competition
among products that are essential for public health, for example, the agreement
specifies certain grounds on which a country’ may employ compulsory licensing,
such as protection of public health and nutrition; or for public non-commercial use.
for instance when a government is directly interested in using the patented
invention. A third one, w hich is an example of the way the agreement can work in
favour of the consumer, is the granting of such licences to deter anti-competitive
practices or to penalise abuse of a dominant market position. Furthennore, the
agreement does not limit the grounds on which a country may grant compulsory
licences. Domestic law can define the grounds for granting them, even if they are
not mentioned in the agreement."
Adrian Otten, Director of the Intellectual Property and Investment Division of the WTO
Secretariat in Geneva, while speaking at Health Action International seminar on
GATT/WTO, Pharmaceutical Policies and Essential Drugs, organised in Bielefeld,
Germany, in October 1996, on compulsory licensing said.
"Under the TRIPs agreement, this option is posssible. The outcome of the debate on
compulsory licensing was a set of rules applying to both forms of use without the
authorisation of the right owner - that is to say, compulsory licensing and government
use and does not limit the grounds on which compulsory licenses can be granted.
There are a number of conditions, including:
~
Compulsory licensing must not discriminate according to the field of
technology. A number of countries have special systems operating in the area of
pharmaceuticals. These will have to be eliminated.
~
Patent rights must be enjoyable without discrimination as to whether products are
imported or locally produced. Failure to meet the reasonable needs of the market
can remain grounds for the grant of a compulsory licence.
The government should authorise the use of the patent after adequate
repayment has been agreed upon."
Dr. Carlos M. Correa, Centre of Advanced Studies, University of Buenos Aires, Argentina,
in his article on ’’Patenting Pharmaceuticals: A New Global Order” in Essential Drugs
Monitor, a journal published by World Health Organisation, states as follows about
"compulsory licences":
"The Agreement grants members the right to compulsory licences on certain grounds. These
include:
Public health and nutrition or other reasons of public interest
Article 8 (’Principles') of the Agreement specifically recognises the right of
members to 'adopt measures necessary to protect public health and nutrition, and to
promote the public interest in sectors of vital importance to their socio-economic
and technological development...’ Many countries, including some developed
countries, provide for such compulsory licences in their legislation.
21
- 17-0
05603
National emergency and extreme urgency
This is specifically mentioned in Article 31(b). It could also be considered to be
covered by other general formulations such as 'public interest'. In such cases, prior
negotiations with the right holder can be avoided.
Public non commercial use
In this case, a government is directly interested in using the patented invention for
non commercial purposes.
Anti competitive practices
Compulsory’ licences can be granted to prevent abuse of a dominant market position.
Refusal of a voluntary licence
The TRIPs Agreement also authorises the granting of a compulsory licence when a
patent holder refuses a reasonable commercial offer, which he has been given a
reasonable amount of time to consider.
Other grounds
The Agreement does not limit the grounds for granting compulsory licences:
domestic law can define the grounds for granting such licences, including those that
are not meantioned in the TRIPs Agreement, which is only indicative in this
respect."
James Love, an economist working at the Center for Study of Responsive Law in
W ashington, DC, has commented as follows on compulsory licensing in his article "As They
Relate to Rules Regarding Intellectual Property":
"The United States is pushing hard in several forums to ban or severely limit
compulsory licensing of pharmaceuticals patents or related property rights. The
Trade Related Aspects of Intellectual Property (TRIPS) addresses this in some
detail. Compulsory licensing of patents are severely constrained by the TRIPS, but
not flatly ruled out. In Article 31, the TRIPS sets out a long check list of
procedures a nation must follow. These are sufficiently ambiguous that future
jurisprudence before the World Trade Organization (WTO) will be important in
defining the limited rights retained by national governments. We have suggested
in several forums that nations be permitted to use non-exclusive compulsory’ licenses
based upon a fixed royalty as an alternative to national price controls, possibly
where the patent holder could choose between the alternatives. Ultimately, this or
other approaches will be resolved through the WTO dispute resolution
mechanisms."
Ladas & Parry, Intellectual Property Attorney, having their major operations in New York,
Chicago, Los Angeles, London and Munich, have expressed the following views in regard
to intellectual property provisions of GATT (particularly compulsory licences):
"Compulsory’ licenses or other 'official licenses' are only to be permitted after
consideration of the individual situation in which such a license is requested and,
except in cases of national emergency, the grant of a compulsory license is subject to
a number of conditions, including the following:
a)
The party requesting the license must have used its best efforts to obtain a voluntary license on
reasonable conunercial tenns;
b)
The compulsory’ license must be tenninated if the circumstances leading to its grant have ceased
and are unlikely to recur;
22
c)
The holder of the compulsory license must pay adequate compensation for the right to use the
imention;
d)
The determination of the amount of adequate compensation must be subject to independent review;
e)
Where such a license is granted in order to enable use of a subsequent patented invention, a license
shall only be granted if the later invention is an 'important technical advance of considerate
economic significance relative to the dominant patent and the owner of the dominant patent is
entitled to a cross license under the secured patent."
In their Report of July 1996 on the implications of TRIPs for developing countries.
UNCTAD has also commented on the creation and dissemination of IPR as follows:
"In designing an efficient, rules-based system of intellectual property rights, the
following objectives should be pursued:
a. To the extent possible, the system should be based on market-oriented incentives
for innovation and creation;
b. The system should attempt to minimize the costs of innovative acth ity;
c. The system should provide for timely disclosure of innovation or creation and also for
reasonable fair use with economic and social goals in mind;
d. The scope and length of protection should be limited in order to strike an appropriate
balance between creation and dissemination;
e. There should be coherent interaction with other regulatory or eonomic systems, including
antitrust policy to avoid competitive abuses of IPRs, trade and EDI policies affecting the values
of IPRs, and general technology’ development strategies."
The Report also commented about compulsory licensing as follows:
’’Compulsory licenses remain available, but on strict terms and conditions that are
more favourable to patentees than under prior law (Article 31).”
The above conclusions are important in taking a view about the importance of compulsory
licensing system particularly for the developing countries. The issues are quite complex
and framing of provisions relating to compulsory licensing have to be carefully provided so
that there is no lacuna from the legal interpretation point of view. The foreign patent
holder would use the best legal advice available the world over to contest related issues to
protect their monopoly which will become available to them on implementation of the
TRIPs Agreement.
(g) Term of the Patent
Article 33 deals with the term, i.e. period of protection which 'shall not end before the
expiration of a period of twenty years counted from the filing date'. Under the TRIPs
Agreement, this term of 20 years would be globally applicable. There will be no varying
the period of patent term as at present in the national laws of developing and developed
countries. Since patentability extends to products and processes, the term would be
applied for twenty years for product patent and then twenty years for process patent
particularly in the chemical field, including drugs and pharmaceuticals. In the case of
medicines, patents are available in USA for usage form, dosage form and combinations and
23
the same would be extended to other countries on implementation of TRIPs provisions.
The following Table gives an idea of new combinations for which patents have been taken
in USA even when the product patent on the basic drug expired long back.
Table 9
Illustrative List of Combinations under Patent in USA
Generic Name and
Patent Expiry Year
Aspirin (1973)
Brand and
Company Names
SOMACOMPOUND.W.
CODEINE
Wallace Labs
Diazepam (1980)
VALIUM
Hoffman La Roche
VALRELEASE
Dosage/Formulations
Patent Expiry
_________ Date
a) Aspirin 325 mg + Carisoprodon
200 mg + Codcin Phosphate 16 mg
b) Aspirin 325mg + Carisoprodol 200 mg
13/8/2002
a) lOmg tab
b) 2 mg tab
c) 5 mg tab
d) 2 mg/ml inj
e) 15 mh Cap
23/2/1999
23/2/1999
23/2/1999
23/2/1999
23/2/1999
a) 120 mg Caps
b) 180 mg Caps
c) 60 mg Caps
d) 90 mg Caps
26/10/2005
26/10/2005
26/10/2005
26/10/2005
Diltiazem Hcl (1988)
CARDIZEM SR
Marion Labs.
Hydro-chlorothiaz ide
(1979)
PRINZIDE - 12.5
a) 12.5 mg + Linosporil 20 mg tabs
Merch Sharpe & Dhome
Methyldopa (1976)
ALDOMET
Merck Sharpe & Dhome 250 mg/ml suspension
13/8/2002
30/12/2001
13/09/2000
Norfloxacin (1996)
NOROXIN
400 mg tabs
Merck Sharpe & Dhome
27/01/2004
Oxazepam (1984)
SERAX
Wyeth Labs
04/11/2003
Ranitidine Hcl (1995)
ZANTAC 150
ZANTAC 300
Glaxo
a) 10 mg Caps
b) 15 mg Caps
c) 30 mg Caps
04/11/2003
a) Eq. 150 mg base tab
b) Eq. 15 mg base/ml syrup
c) Eq. 25 mg base/ml inj
d) Eq. 300 mg base tab.
e) Eq. 50 mg base/100ml inj.
05/12/1995
29/04/2003
29/04/2003
04/06/2002
29/04/2003
Source : FOI Services Inc., USA
The patent protection under the TRIPs patent system would thus be used for extending
monopoly by taking process patents and patents for usage form, dosage form and
combination form. The monopoly protection would be extended through minor changes
to the existing medicines where the product patents have expired long back.
24
i
New processes would be patented and new dosage form, etc. would also be patented. This
kind of protection would have a far reaching implication for the developing countries
including India and in a period of 10-15 years the patent protection in some form or the
other would cover almost 70-80 per cent, if not more, of turnover of pharmaceutical
products. It would become impossible for the domestic industry to subsist without new
products and their business in the existing products would also be affected since protection
in one form or the other would be available for such products also. Their survival and role
to provide medicines at competitive prices would become a serious question.
(h) Reversal of burden ofproof
Article 34 provides for reversal of burden of proof during the process patent regime for civil
proceedings in respect of infringement of the rights of the patent owner. The onus of
proving on the legal complaint that process used by another enterprise is totally different
than the patented process would lie with the defendant and he will have to prove that he is
not guilty of infringement. This provision would also be misused by powerful MNCs to
curb competition from others, particularly the small companies, even when their process
may be different. Serious legal objections might also be raised about the imported products
covered by process patent. Keeping this aspect in view, the legal system to check
infringement has to be carefully evolved so that the same is not misused.
(i) Protection of test data
Article 39 provides for protection of undisclosed information that test data provided by a
company in order to obtain marketing approval from competent authority for
pharmaceutical and agricultural chemical products has also to be protected against unfair
commercial use; they must also be protected against disclosure, except where necessary to
protect the public or unless steps are taken to ensure that the data are protected against
unfair commercial use. Protection of such a data would be very difficult task for the
authorities concerned. However, there appears to be flexibility available for the national
government to frame provisions for implementation of this Article.
(]) Control of anti-competitive practices in contractual licences
Article 40 provides that the TRIPs Agreement recognises that the countries may specify in
their domestic legislation the commercial licensing practices that constitute an abuse of
intellectual property protection, and take steps to address these through appropriate
measures.
(k) Enforcement: General Obligations
Article 41 of the TRIPs Agreement provides that members must provide effective means of
action for any right holder, foreign or domestic, to secure the enforcement of rights while
at the same time preventing abuse of the procedures. Similarly, Articles 43-50 of the
Agreement specifies procedures for civil and judicial action, including means to produce
relevant evidence. Civil remedies that must be available should include injunctions,
damages and destruction of infringing goods or disposal of these outside the channels of
commerce. Provisional measures also have to be available to prevent infringing activity
and to preserve relevant evidence.
25
(I) Dispute Settlement
Article 64 of the Agreement provides that the new WTO dispute settlement procedures will
apply to the TRIPs Agreement. However during the first 5 years from 1.1.1995, the
dispute settlement procedures under Article XXIII of GATT 1994 shall not apply. During
this period, the Council for TRIPs shall examine the scope and modalities for complaints of
the type provided for under Article XXIII of GATT 1994. The Council shall submit its
recommendations to the Ministerial Conference for approval. The decision of the
Ministerial Conference shall be made only by consensus.
(m) Transitional arrangement
(i) Article 65 allows a general grace period of one year from 1.1 1995 to all
countries for applying the provisions of TRIPs Agreement. The developing
countries have been allowed further four years to implement the Agreement.
However, the developing countries who do not extend product patent
protection to areas of technology not so protectable in its territory on 1.1.1995
will have further period of five years to give effect to the provisions of product
patent. Thus country like India would have a period of ten years to apply
product patent for chemical based products including pharmaceuticals.
(ii)According to Article 70(3), the member countries will not be required to
give protection to subject matters which have already fallen into the public
domain.
(iii)
Article 70.8 provides for an obligation to receive applications from
1 1 • 1995 for product patents for pharmaceuticals and agrochemicals if product
patent as such is not available in the domestic laws of a country as on 1.1.1995.
Article 70.9 provides for another obligation for grant of exclusive marketing
rights to the applicants of product patents for pharmaceuticals and
agrochemicals.
Both the above obligations are subject matter of severe criticism in
developing countries including India in particular.
PART VI
TRIPS : AN EXTREME COMPROMISE
OF PUBLIC INTEREST
The TRIPs Agreement consolidates new forms of protectionism, which are not exercised
through tariffs but through the appropriation of the knowledge applied to produce goods.
The new highest expression of protectionism is, in the view of developed countries, a
necessary condition to promote innovation and to stimulate technology and the capital flows
to developing countries. Their assumption is that people from developed and developing
countries will benefit alike from this kind of intellectual property rights.
26
This assumption is questionable. In the first place, the rationale of conferring monopoly
rights over knowledge which can be used by anyone at once and, therefore, many may
benefit from its use concurrently. It makes sense for society, as noted by Prof. Hettinger
(1992) to grant exclusive rights to tangible objects because by its very nature the use by one
person requires excluding others. But this is not the case of a "public good" like knowledge.
Secondly, it is not true that a reinforced and expanded protection on intellectual property
rights worldwide, shall increase the flow of technology and capital to developing countries.
On the contrary, studies undertaken by the United Nations (1993) suggest that "innovatory
companies in the North shall growingly opt, in the new post-Uruguay scenario, to directly
sell the products or services that incorporate the innovations, rather than transferring the
technology' through foreign direct investments and licensing agreements". It is in this
concept that the usual compulsory licence system in the TRIPs Agreement has been
dropped. The likely result: more exports by developed countries, and less opportunities for
industrial and technological development for developing countries.
Thirdly, strong patent system establishes monopoly of worst kind. This has been the logic of
monopoly to charge as high a price as possible with the purpose of maximizing profits.^
These prices have no consideration with buying capacity of the consumers. The following
table of price comparison of medicines between India, Pakistan, Indonesia, UK and USA
will bear this out:
Table 10
Price comparison of medicines
(Prices converted into Indian Rupees)
Drugs/B rands
Company
India
Pakistan
Indonesia
Ranitidine
(Zantac)
-300 mg x 10s
Times costlier
Glaxo
17.39
241.44
658.36
-502.70 1080.72
17« oC
(13.38)
(37.86)
^•8/ fol' 7
(28.91) (62.15)
Diclofanic
Sodium (Voveran)
50 mg x 10s
Times costlier
Ciba
Geigy
55.62
177.18
100.10
Piroxicam
(Dolonex/Feldene)
20 mg x 10s
Times costlier
Pfizer
One US $
Rs. 36 Z.3
UK
USA_
/ zi.
6A9
362.12
Jo 5 Ci
28.33
(8.57)
(27.30)
(15.42) (55.86)
72.50
218.45
117.70 958.32
(2.56)
(7.71)
(4.15) (33.83)
Prices compiled in July 1997
The above scenario is directly related to the ’patent system’ practised in these countries. It
is the same enterprise which is charging highly differential prices in different countries as it
is possible to exploit the markets on the consideration of extent of patent monopoly
available.
27
According to Ralph Nader (1995), with the establishing of the global patent system, ’’they
(MNCs) are now moving towards uniform prices in order to avoid the downward ratchet
effect of cross-country comparisons. This trend is raising prices for new drugs in the
poorest countries”. Finally, increased profit neither necessarily means more private R&D,
nor a lower contribution by the public to technological development. Prof. Love (1994) has
demonstrated that 12 out of 17 significant drugs developed in the United States between
1987 and 1991 were obtained with significant support from government, and that these
drugs were much more expensive than those developed without such funding.
Who worries about the societal helplessness? The social implications and cost charges to
society due to the intellectual property legislations in the developing countries, was never
considered a relevant issue by the governments of developed countries and the powerful
industrial lobies of MNCs which managed those changes at the Uruguay Round. Such
costs, however, are likely to be substantial as illustrated in the above table and by several
other studies in the case of medicines :
•
After the introduction of pharmaceutical product patents in Italy in 1979. the prices of medicines
increased on average more than 200%, i.e. consumer suffered a net welfare loss (Pablo Challu, 1991).
•
In accordance with a World Bank's economist, the minimum w elfare loss to a sample of developing
countries (Argentina. Brazil, India. Mexico, Korea, and Taiwan) would amount to a minimum of US
$3.5 billion and a maximum of US $10.8 billion (Nogues, 1990).
•
A "national health disaster” has been anticipated by’ the Indian Drug Manufacturers' Association as a
result of the implementation of the TRIPs Agreement in India where only 30% of the population can
afford modem medicines in spite of the fact that drug prices in India are one of the low est in the world.
•
Similarly, the economist A. Subramanian (1992) noted that drug prices in Malaysia, where patent
protection existed, were from 20% to 76% higher than India, which reflected a profit-maximizing
behaviour based on "what the market can bear".
•
A study conducted in Argentina (Pablo Challu, 1991) estimated that the introduction of pharmaceutical
product patents in the country would imply an annual additional expenditure of US $194 million with a
reduction of 45.5% in the consumption of medicines, as a result of a price increase of around 270%.
•
Ralph Nader and James Love (1995) while rejecting TRIPs approach contend that "there would be no
generic drugs ~ every' drug would have monopoly patent protection for ever. The poorest consumers
including large portions of citizens in the poorest countries would suffer from even greater barriers to
access to medical care. Middle class consumers in the US also would be forced to pay’ much higher
costs for drugs than they do today”. They have also pleaded "to convene a meeting of US and
international consumer and health organizations to discuss new framework for trade agreements that
address intellectual property rights and health care."
•
The Network’s Newsletter of Pakistan of September 1996 indicates:
’’Pakistani consumers could have saved over rupees one billion on only nine medicines in 1995 if
the companies would have offered the same price as they do in India. Pakistani consumers paid
Rs. 1,702,883,000 for buying these 9 medicines (14% of the retail market). These drugs are
marketed by the same companies in India as well but at much lower prices. If patients in Pakistan
were offered by these companies the same prices, their medicine bills would have come down to
one-third (a 66% saving) or they would have saved a staggering amount of Rs. 1,049,493,000.”
28
Substantial consumer welfare losses and the exclusion of a larger proportion of the population
(between 75-80%) from the market of modem medicines, are some of the costs to be borne by most
developing countries which are under pressure to adopt TRIPs new patent protection foi
pharmaceuticals. Economic gains by large MNCs will be privileged over the health and life
expectancy of millions of suffering people. No mechanism to mitigate these societal implications
have been discussed during Uruguay Round negotiations. The issues are quite complex and serious
from public interest angle. Any compromise in a haste and without indepth study of IPR issues are
fraught with lasting consequences. Thus TRIPs in the present form is a great compromise for the
developing countries including India. The availability of patented medicines at high pnees will be of
no avail as the general public will not be able to afford them and their sufferings will not be
mitigated. The MNCs have to understand this moral/human right and about the consequences of
strong patent system.
THE ABOVE SCENARIO WILL HAVE DIRECT IMPACT ON HEALTHCARE
POLICIES IN DEVELOPING COUNTRIES AND GOAL OF ’’HEALTH FOR ALL
BY 2000 AD”.
PART VII
IMPACT ON AVAILABILITY OF PHARMA PRODUCTS
(a) Impact on availability
Apart from the impact on prices of pharmaceutical products, as discussed above, the
general availability of new drugs from indigenous sources of the domestic companies
would be totally out of question. Dependence upon imports would go up as it has started
happening in some Latin American countries, Canada and even Italy, who have changed
their patent laws in the recent past. Other countries would also face similar phenomena in
the coming future.
The following report from SCRIP of May 24, 1994, substantiates this point:
"ALIFAR DENOUNCES US PATENT MOVES
Plant closures in Chile and increased levels of drug import to Mexico have followed the introduction of
'monopolistic' patent laws in these countries. Although both laws were drawn up in line with US
requirements, there is renewed pressure from the US to increase patent protection periods from 15 to 20
years in Chile and from 20 to 23 years in Mexico according to speakers at the 15th meeting of the
confederation of Latin American Industry associations (Alifar).
The trade benefits and investments which were promised in exchange for the implementation of a ’US-style’
patent laws have never materialized, the Chilean representatives maintained. The Argentinean government
'should look at its neighbours, see what is happening to us, and reality that the promises were false, Muriam
Orellana, executive director of the Chilean national industry association, (Asilfa), declared. (The
Argentinean draft patent law currently being considered by Senate).
Asilfa president Jose Plubins commented that five multinationals - Pfizer, Parke-Davis, Squib, Bayer and
Schering AG had closed manufacturing plants, and started importing to Chile, as allowed by the patent law.
The closures have resulted in many job losses, he said. While there have not been any plant closures in
Mexico, drug imports by multinationals have been increasing, according to Rafael Gual, executive director
of the Mexican association, Anafam.
29
There was much criticism at the meeting of US government pressure on countries throughout the region to
implement new patent laws, and calls for the US to respect the GATT Uruguay Round agreement, which
gives developing countries a 10 year, transitional period to do so. LatinAmerican governments should
defend national interests by drawing up patent laws which take into account the needs of national
companies and consumers, and respect GATT recommendations. ALIFAR says.
There were also speakers from the US at the meeting who denounced the conduct of US pharmaceutical
companies. For. example, Professor Stephen Schondelmeyer, director of the pharmacy faculty at the
University of Minnesota., criticized us drug price levels noting that the oral contraceptive Ortho Novum
costs $20 in the U S, $3 in Argentina. $1.60 in Mexico and $1.20 in France. Peter Amo from the .Albert
Einstein school New York said that eight million Americans over the age of 55 have to choose between
bming food and drugs . Paula Begala an adviser to President Bill Clinton, criticized the 'alannist
campaign' mounted by US companies against the health sy stem reform plans.
The meeting was held in Argentina and attended by national industry associations from Brazil. Colombia.
Argent^a^1VadOr’ Guatemala’ Mexic0’ Paraguay> Peru, the Deminical Republic, Uruguay. Venezuela and
(h) Impact on Medium and Small Scale Sector
The existing industry, particularly in the medium and small scale sectors, where there are
thousands of registered units in the developing countries, will over a period of a decade or
so after the introduction of the new patent regime, face serious degrowth as they will have
no possibility of taking up new products. Even for the existing products/processes, new
patents will be taken creating difficulties for such companies to market their existing
products. This will result in liquidation of competitive environment, large scale
unemployment, making existing infrastructure redundant and closure of many small units.
(c) Impact on Research and Development
The impact on domestic research and development activity in the developing countries
would also be tremendous. Due to paucity of funds, particularly in drugs and
pharmaceuticals field, the research in the public and private sectors in developing countries
has been mainly concentrated on developing of process technologies. This kind of research
effort would be severely affected as there would be no immediate use of process
technologies for new drugs in the new patent regime as it would not be possible to
commercially exploit them. For basic research neither funds nor capabilities to exploit any
such invention worldwide are available with the domestic companies. They do not have
infrastructure to match the TNCs for registering patents worldwide and promoting and
marketing their products in various countries.
It would be relevant to mention here that US pharmaceutical industry spent $8.2 billion in
1990, $9.1 billion in 1991, $10.96 billion in 1992, $12.6 billion in 1993, $13.4 billion in
1994 and $14.5 billion in 1995 on R&D, and their worldwide sales during 1990 was $57.4
billion and must have doubled if not more than that by now. With enourmous resources
available with TNCs only they can afford to invest large outlays on R&D. For TNCs, the
entire world is market for them and that is why they spend large sums on R&D to
monopolise the markets world over with their innovative products. The TNCs are almost
controlling 80% of the global production/sales.
It will be observed from the following table that Inngelheim spent 19.2% of their total
sales on R&D. Compared to this, Ranbaxy, the largest Indian company, invests only
around 4-6% of its sales (Rs. 1,000 crores/US $280 million) on R&D. Enterprises in
30
developing countries are substantially low in profitability and volume of sales for
committing their resources for R&D. Sales of their large enterprises have to multiply
manifold before they could make any worthwhile investment in R&D. The total
pharmaceutical production in India is around $2800 million whereas almost all the 10 TNCs
shown in the table below individually are having sales more than what India is producing.
Further, India s total expenditure on R&D is about $50 million per annum for drugs and
pharmaceuticals. There is virtually thus no comparison of sales and R&D expenditure
between the developed and developing countries :
Table 11
Leading Companies by Nominal Pharma
R&D spending in pharmaceuticals
Script Review 1993-94
Company
Sales
(S mill.)
R&D
(S mill.)
R&D as %
of sales
1. BMS
2. Glaxo
3. Hoechst
4. SB
5. Bayer
6. Sandoz
7. J&J
8. B. Ingelheim
9. Rhone-Poulenc
10. MMD
4.439.2
4.679.5
4.410.6
3.668.8
4,237.8
3,464.1
2,652.0
1.914.4
2,184.6
2,211.0
657.0
654.2
613.3
552.5
487.2
484.1
419.0
357.0
350.9
329.0
14.8
13.9
13.9
15.1
11.5
14.0
15.8
19.2
12.6
14.9
The profitability of the Indian pharmaceutical industry for various reasons has been also
quite low. In the past, it had been around 4-5% of sale turnover and now it has slightly
improved to 6-7% of sale. As against this, the TNCs are enjoying substantially high
profits. For example, Zantac (Ranitidine) which is a top selling drug in the world,
produced and marketed by Glaxo (UK) has been enjoying quite a high profit. Glaxo holds
worldwide product patent where-ever such patents are available. Their sale turnover of
this drug during 1994 was $4,011 million and they earned profit in 1992 around 35% on
their pharma sales.
The above statistics are only indicative of the problems which the domestic companies in the
developing countries, including India, have been facing. It would be impossible for them
for many more years to embark upon any programme of basic research in a big way. In
fact, domestic companies in developing countries will never be able to match with TNCs
potential in R&D, sale turnover and worldwide infrastructure for patenting and promotion
of their products. Further, there are many other regulatory hurdles of safety and efficacy
during a long and difficult development period from discovery to registration which will
also have to be cleared before pharmaceutical patents lead to saleable products.
Additionally, financial risk is too high as there are more possibilities of failure than success.
Thus pharmaceutical patents by themselves would be in fact meaningless if the owner of the
patent is not able to organise all these basic requirements before launching his product.
In the background of these hurdles in developing countries, the need is to mainly continue
with the existing role in R&D for developing innovative processes for old and new drugs
and this can be achieved by having a strong system of compulsory liicensing/licensing of
right by paying adequate compensation to the patent holder. THIS MEASURE WILL
ALSO HELP IN ACHIEVING THE GOAL OF "HEALTH FOR ALL".
(on -1 x- O
U5603
is/
Veal?
PART VIII
Problems with TRIPs Patent System
There are three major problems with the TRIPs Agreement:
Transitional arrangement - it is virtually an empty shell;
Safeguarding of public interest - it is virtually absent; and
The 'scope of patentability’ - it has been widened, with no flexibility
available to any country to exclude certain critical technologies from
the domestic patent system ~ thus making the accessability of
essential products more difficult.
Transitional Arrangement: An Empty Shell
Article 65 of the TRIPs Agreement provides for transitional period of 5/10 years for the
developing countries for implementing the TRIPs Agreement. This transitional period has
been virtually invalidated in the provision contained in Article 70.8 of the TRIPs Agreement
which provides that Member countries which do not provide for product patents for
pharmaceuticals and agro-chemicals would provide for means for acceptance of product
patent applications for these products from 1.1.1995 on the establishment of WTO. The
application of the provisions of the product patent to these areas of technology under
Article 65 would be effective from 1.1.2005 . But according to Article 33, the term of the
protection, i.e. the patent rights, are to be available to the patent holder from the date of
filing of the patent application. The composite interpretation of these three Articles would
virtually exclude domestic enterprises from developing process technologies for any new
product and market them in the domestic or outside markets from 1.1.1995 onward. They
would be able to market only those products which have already fallen in the public domain.
Thus, there is a clear distortion in providing the 10-year transitional period for introduction
of product patent regime where no such protection is available on the one hand in Article
65, and invalidating the same through Article 70.8 which will establish patent rights from
1995 itself (and 1994 with right of priority where-ever is established).
There is yet a more serious distortion that patent-like protection to such applicants of
pharmaceuticals and agro-chemicals will have to be provided on their new products in the
form of 'exclusive marketing rights' (EMR) from 1.1.1995. Article 70.9 provides that such
a right can be obtained if the following conditions are met:
a patent application has been filed in a Member country after the
entry into force of the Agreement;
a patent application has been filed in another Member after the entry
into force of the Agreement and a patent has been granted;
Marketing approval has been obtained in the said other Member, and
marketing approval has been obtained in the concerned Member
country mentioned above.
The provision of granting marketing approval for establishing EMR, in view of above, will
prove mere a formality.
32
The combination of the above two provisions implies that any MNC, obtaining a patent and
marketing approval for a drug in any small country having no proper system can get
exclusive marketing rights for that product in a country, like India, if it amends its laws to
provide for EMR. This can happen even when the patent or marketing approval may not
have been taken in the country where the research might have actually taken place. Thus a
large Indian population may be vulnerable for experimental and clinical testing ~ a really
absurd proposition.
The changing of the patent system to accord with the TRIPs Agreement raises fundamental
issues having a bearing on the sovereign law-making power without evolving a national
consensus on the contentious requirement of legislation on exclusive marketing rights about
which the TRIPs Agreement is silent about the content and scope. To what extent the
existing laws about licensing of right or compulsory licensing could be applied? Can the
third party use the invention for tests, experiments, manufacture, market approval, etc.?
An indepth analysis of these issues on the implications of Article 70.9 would be required.
The abuse of a dominant position, public health needs etc. would be sufficient ground to
contain the exclusivity through strong compulsory licensing/licensing of right like measures.
The impact of EMR has thus a disastrous implication. If the existing laws provide for
public interest measures, the same could be preserved without any amendment. For
example, India does provide for such measures and as such there should be no need to
amend them. In this way, it would be possible to contain damage to the public interest in
health care areas.
The Patents (Amendment) Bill, 1995 amending the Patents Act, 1970 to provide for India's
obligation during the transitional period was passed by the Lok Sabha (Lower House) on
March 21, 1995, It could not be introduced in the Rajya Sabha (Upper House) as the ruling
party apprehended problems in getting the Bill passed in that House. As a compromise,
the Bill was referred to the Rajya Sabha Select Committee. Before the Select Committee
could complete their examination of the Bill and finalise their report, the Lok Sabha was
dissolved and as such the Bill lapsed as the same had originated from the Lok Sabha. Since
then it has not been possible for the government to reintroduce the Bill as the Forum of
Parliamentarians on Intellectual Property and WTO Issues has succeeded in pursuading the
government to evolve a national consensus on the TRIPs Agreement on the patent system
as a whole. Such a consensus has yet to emerge through an expert group. It would be
relevant to point out one of the major lacuna in the Bill relating to the examination of
applications for grant of exclusive marketing rights. The Bill restricted the examination of
EMR applications under section 3 and section 4 of the Patents Act, 1970 as against the
comprehensive procedure provided in the Patents Act, 1970 in Chapters IV & V. It is
reported that between January 1, 1995 and February 15, 1997 a total of 1,339 applications
for pharmaceutical and agro-chemical products have been received by the Patent Office. If
the scope of examination had been limited to only section 3 and section 4 of the Patents
Act, 1970, all the applications would have qualified for grant of exclusive marketing rights.
The patent applications/EMR applications were supposed to be filed keeping the provisions
of Article 27 of the TRIPs Agreement in view. Article 27 provides for patents to be
available for innovations which are new, involve an innovative step and are capable of
industrial use. (The terms "innovative step" and "capable of industrial use" are deemed to
be synonymous with the terms "non-obvious" and "useful" respectively. The research in
pharmaceuticals has slowed down in the recent past and has come down to an average of
around 50 new inventions per annum. Health Horizons (Spring 1997), a journal published
33
by the Intenational Federation of Pharmaceutical Manufacturers' Associations, also reports
about US inventions in 1996 as follows:
"In its last report, the American research-based pharmaceutical manu- facturers
associations PhRMA announced that in 1996 the US Food and Drug Administration
(FDA) approved a record 53 new drugs, and increased its approval of new biologies
from two products to nine.”
Even the President of Organisation of Pharmaceutical Producers of India (MMC's
Association) in his evidence before the Department-related Parliamentary Standing
Committee 1993-94 (Gujral Committee) stated that "May I point out that not more than
18-20 molecules are introduced each year internationally". In view of this, it is difficult to
comprehend as to how such a large number of applications have been filed for grant of
patent/EMR when the scenario of new products developed is so low. Surely, there is
something fishy in this and it needs to be examined. The Government of India could even
consider preliminary examination of these applications to find out whether they relate to
such products which have already fallen into public domain for which there is no obligation
under Article 70.3 to provide for protection.
Public Interest Element: Absent
The public interest criterion is totally absent in the TRIPs Agreement. As already stated,
this Agreement is a "charter of rights" for the patent holders and there are no specific
obligations towards the country which gives the patent rights specified for the patentees.
The interest of the consumers which is the primary obligation in the patent system has been
totally ignored. In the first place, there is a provision allowing the patent rights without
discriminating "imports" against domestic production. This is completely antithetical to the
provisions of the Patents Act, 1970 [Section 83(b)] which states clearly that Patents "are
not granted merely to enable patentees to enjoy a monopoly for the importation of the
patented article". The import right has been incorporated in the patent system for the first
time. This provision read with the exclusive rights even for imports provided in Article 28
would make the accessability of patented products more difficult for the users. The
dependence upon imports would go up substantially. Neither the price nor the quantum of
supplies can be regulated, giving a total monopoly to the patentee. Secondly, there is no
usual provision for compulsory licensing for 'commercial purposes' in Article 31. Unless
there is such a provision in the national patent system, the public interest would not be
served at all, and there would be no way to ensure the easy availability of the patented
product through commercial channels at competitive prices.
The model provision about the reasonable requirements of public interest deemed not
satisfied has been quite explicitly stated in the Indian Patents Act, 1970 as follows:
”90. When reasonable requirement of the public deemed not satisfied :
(a)
If, by reason of the default of the patentee to manufacture in India to an adequate extent and supply
on reasonable terms the patented article or a part of the patented article which is necessary for its
efficient working or if, by reason of the refusal of the patentee to grant a licence or licences on
reasonable tenns -
(i)
an existing trade or industry or the development thereof or the establishment of any new trade
or industry in India or the trade or industry or any person or classes of persons trading or
manufacturing in India is prejudiced; or
34
(ii) the demand for the patented article is not being met to an adequate
reasonable terms from manufacture in India; or
extent or an
(iii) a market for the export of the patented article manufactured in India is not being supplied or
developed; or
(n) the establishment or development of commercial acthities in India is prejudiced; or
(b)
if, by reason of conditions imposed by the patentee upon the grant of licences under the patent or
upon the purchase, hire or use of the patented article or process, the manufacture, use or sale of
materials not protected by the patent, or the establishment or development of any trade or industry
in India, is prejudiced; or
(c)
if, the patented invention is not being worked in India on a commercial scale to an adequate extent
or is not being so worked to the fullest extent that is reasonably practicable; or
(d)
if, the demand for the patented article in India is being met to a substantial extent by importation
from abroad by ~
(i)
(ii)
(iii)
(e)
the patentee or persons claiming under him; or
persons directly or indirectly purchasing from him: or
other persons against whom the patentee is not taking or has not taken
proceedings for infringement; or
if, the working of the patented invention in India on a commercial scale is being prevented or
hindered by the importation from abroad of the patented article by the patentee or the other persons
referred to in the preceding clause."
Article 31 allows authorisation for "other use" whose parameters are not specified as such,
under the TRIPs Agreement. However, the question of categorisation of "other use" is
very important, and therefore deserves special emphasis. Member Governments have not
been limited to the grounds on which for "other uses" they could grant licences without the
authorisation of the patent right holder. The opening sentence of Article 31 does allow
freedom to the member countries (governments) to determine the scope of "other use".
The wording in the TRIPs Agreement is: "where the law of a Member allows for other use
of the subject matter of patent without the authorisation of the right holder". The point to
be noted herein is that though the parameters of compulsory licensing without the
authorisation of the right holder are totally at variance with the usual compulsory licensing
system being practised in the national laws worldwide so far, it should be possible to
specifically provide for such parameters consciously for which national legislation has to be
very carefully (and incisively) drafted.
The framework of Article 31 is also not in consonance with the spirit of the provisions of
Articles 7 & 8 of the TRIPs Agreement. The objectives under Article 7 provide that ’’the
protection and enforcement of intellectual property rights should contribute to the
promotion of technological innovation and to the transfer and dissemination of technology,
to the mutual advantage of producers and users of technological knowledge and in a manner
conducive to social and economic welfare, and to a balance of rights and obligations".
There is obvious contradiction when we examine the substantive provisions of the TRIPs.
The Member countries, while drafting any amendment to their legislation, should focus on
the public interest, on social and economic welfare of the people and on the issue of transfer
and dissemination of technology. The framework of "other use" for compulsory licensing
under Article 31, as discussed above, has therefore to be deliberately specified to provide
for the objectives in Article 7 and also to accomplish clearly specified 'public policy'
objectives of the national system as recognised in the Preamble of the TRIPs Agreement.
Similarly, Article 8 which deals with the 'principles' of the TRIPs Agreement does allow that
35
'in formulating or amending their national laws and regulations (members may) adopt
measures necessary to protect public health and nutrition, and to promote the public interest
in sectors of vital importance to their socio-economic and technological development....’
The implementation of the TRJPs Agreement should, therefore, comply with the 'objectives
and principles of Articles 7 & 8 and public policy objectives' as may be provided in the
national Constitutions. All this can be accomplished through deliberate action to provide
for an active role of domestic industry through a strong compulsory licensing/licensing of
right system for patented products, while defining the category of "other use" in the national
laws.
The conditions for grant of compulsory licensing for commercial purposes could be that ’the
proposed user has made efforts to obtain authorisation from the right holder on reasonable
commercial terms and conditions and that such efforts have not been successful within a
reasonable period of time' (as provided in Article 31(b) of the TRJPs Agreement).
Additionally, it should be provided that this enterprise has to be competent enough to
exploit the patent. The Chinese system of compulsory licensing, as provided in their Patent
Act of 1992, also provides for similar conditions. The patent holder on such sub-licensing
would be entitled to adequate remuneration as provided in Article 31(h) of the TRIPs
Agreement. The relevant provisions of the Chinese Patents Act of 1992 on 'Compulsory
Licensing' are re- produced below :
COMPULSORY LICENCE FOR EXPLOITATION OF THE PATENT
Art. 51. Where any entity which is qualified to exploit the invention or utility model has made request, for
authorisation from the patentee of an invention or utility model to exploit its or his patent on reasonable
terms and such efforts have not been successful within a reasonable period of time, the patent office may,
upon the application of that entity, grant a compulsory’ licence to exploit the patent for invention or utility
model.
Art. 52. Where national emergency or any extraordinary state of affairs occurs or where the public interest
so requires, the patent office may grant a compulsory’ licence to exploit the patent for invention or utility
model.
Art.53. Where the invention or utility model for which patent right was granted is technically more
advanced than another invention or utility model for which patent right has been granted earlier and the
exploitation of the later invention or utility model depends on the exploitation of the earlier -invention or
utility model, the patent office may, upon the request of the later patentee, grant a compulsory licence to
exploit the earlier invention or utility model.
Where, according to the preceding paragraph, a compulsory licence is granted, the patent office may, upon
the request of the earlier patentee, also grant a compulsory licence to exploit the later invention or utility
model.
Art. 54. The entity or individual requesting, in accordance with the provisions of this Law’ a compulsory
licence for exploitation shall furnish proof that it or he has not been able to conclude with the patentee a
licence-contract for exploitation on reasonable terms.
Art. 55. The decision made by the patent office granting a compulsory’ licence for exploitation shall be
registered and announced.
Art.56. Any entity or individual that is granted a compulsory’ licence for exploitation shall not have an
exclusive right to exploit and shall not have the right to authorise exploitation by any others.
Art. 57 - Any entity or individual that is granted a compulsory' licence for exploitation shall pay to the
patentee a reasonable exploitation fee, the amount of which shall be fixed by both parties in consultations.
Where the parties fall to reach an agreement, the patent office shall adjudicate.
36
Art 58. Where the patentee is not satisfied with the decision of the patent office granting a compulsorylicence for exploitation or with the adjudication regarding the exploitation fee payable for exploitation, he or
it may. within three months from the receipt of the notification, institute legal proceedings in the people's
court."
Even recently enacted amendments to the Patent Laws of Brazil and Argentina state as
follows:
Brazil Patent Law of May 1996 provides as follows:
Art. 68. A patent shall be subject to compulsoiy licensing if the owner exercises his
rights therein in an abusive manner or if he uses it to abuse economic power under the
terms of an administrative or judicial decision.
(This provision has been further elaborated in the amending Act).
Argentina Patent Law of March 1996 provides as follows:
Art. 42. Where a prospective user has attempted to secure the grant of a license from
the owner of a patent on reasonable commercial terms and conditions under Article 43.
and the attempts have had no effect after 150 days have elapsed following the date on
which the license in question was requested, the National Institute of Industrial Property
may allow other uses of the said patent without authorization by the owner thereof.
(This provision has been further elaborated in the amending Act).
There is another strong aspect regarding 'dissemination of technology' as provided in the objectives
under Article 7 of TRIPs. This particular objective could be accomplished by adopting the system
of 'licensing of right’ as is available in Indian Patents Act, 1970. This right could be made
applicable after, say, 5 years (instead of 3 years from the date of sealmg of patents as in the Indian
Patents Act). This longer period should provide sufficient time to the patent holders to ensure
dissemination of technology on payment of adequate remuneration. The relevant provisions of
"licensing of right" as in the Indian Patents Act, 1972 are reproduced as follows :
”86.
(1) At any time after the expiration of three years from the date of the sealing of a patent, the
Central Government may make an application to the Controller for an order that the patent may be
endorsed with the words ’’Licences of right" on the ground that the reasonable requirements of the
public with respect to the patented invention have not been satisfied or that the patented invention
is not available to the public at a reasonable price.
(2) The Controller, if satisfied that the reasonable requirements of the public with respect to the
patented invention have not been satisfied or that the patented invention is not available to the
public at a reasonable price, may make an order that the patent be endorsed with the words
"Licences of right”.
(3) Where a patent of addition is in force, any application made under this section for an
endorsement either of the original patent or of the patent of addition shall be treated as an
application for the endorsement of both patents, and where a patent of addition is granted in
respect of a patent which is already endorsed under this section, the patent of addition shall also be
so endorsed.
(4) All endorsements of patents made under this section shall be entered in the register and
published in the Official Gazette and in such other manner as the Controller thinks desirable for
bringing the endorsement to the notice of manufacturers.
87.
(1) Notwithstanding anything contained in this Act (a) every' patent in force at the commencement of this Act in respect of
inventions relating to :
37
(i)
substances used or capable of being used as food or as medicine or drug;
(ii) the methods or processes for the manufacture dr production of any such substance as
is referred to in sub-clause (i);
(iii) the methods or processes for the manufacture or production of chemical substances
(including alloys, optical glass, semi-conductors and inter-metallic compounds).
shall be deemed to be endorsed with the words "Licences of right" from the commencement of this
Act or from the expiration of three years from the date of sealing of the patent under the Indian
Patents and Designs Act, 1911. whichever is later; and
(b) every patent granted after the commencement of this Act in respect of any such invention
as is referred to in section 5 shall be deemed to be endorsed with the words "Licences of
right" from the date of expiration of three years from the date of sealing of the patent.
(2)
In respect of every patent which is deemed to be endorsed with the words "Licences of right" under
this section, the provisions of section 88 shall apply."
The above models could be adopted by the member countries to ensure transfer and
dissemination of technologies of patented products/processes.
Why public interest is important?
It is extremely important for developing countries to care for public interest angles because
their health indicators are still far below than those in the developed countries. There
should be no compromise on certain basic and fundamental issues like the competitive
environment ensuring the role of domestic industry, dependence upon imports only for a
short period, continuance of R&D activity to the extent possible, etc. The following
comparative health indicators cannot be ignored to satisfy the vims and fancies of the
MNCs;
Table 12
Demographic indicators in India compared with selected countries
__ ____________ Japan
Population (millions)
Annual births (xlOOO)
Life expectancy (Yr)
Per capita income ($)
Infant mortality rate
Under 5 mortality
124.5
1390
76
26930
6
4
USA
UK
255.2
4078
76
22240
10
9
57.7
801
76
16550
7
9
Malvsia
India
18.8
545
71
2520
14
19
879.5
25900
60
330
83
124
There are many other alarming indicators about diseases pravelant in India which have to be
given top prioiity in deciding about the need to preserve public interest provisions in our
patent system. These relate to population of 396 millions in 1993 exposed to flaria, and
oyer 2.27 millions positive cases of malaria in 1993. Pulmonary tuberculosis is India’s
biggest public health problem. The number of cases of any one time has been estimated to
be at least 1.5 per cent of the population, i.e. 12.7 millions suffering from radiologically
active tuberculosis with about one fourth of the cases being sputum positive or infectious.
Infected and not diseased cases are reported at 36.6 per cent of population, i.e. 308.9
millions in number. The epidemic of HIV/AIDS continue to spread in India. By October
31, 1997 of a total of 3.20 million individuals practising risk behavious and suspected AIDS
cases who were screened for HIV infection, 67,311 were found to be seropositive and a
cumulative total of 5,002 cases of dreaded AIDS have been reported. Nearly 2.3 million
38
people scummed to the deadly AID all over the world in 1997 and a total of 5.8 million
people were infected with HIV that causes AID in 11 months according to "UNAIDS".
Health laws, drug policy and patent system in India have to be intensely inter-related to
tackle these problems. There may be compromise upto a point of granting product patents
in pharmaceutical field but not beyond that on public interest issues. Even the WTO has
also to address itself to this problem.
The Constitution of India provides the right to health as a fundamental right. In Vincent
Vs. Union of India (AIR 1987 SC 990), a bench of the Court held:
"As pointed out by us. maintenance and improvement of public health have to rank
high as these arc indispensable to the very physical existence of the community and on
the bettennent of these depends the building of the society which the Constitution
makers emisaged. Attending to public health, in our opinion, therefore, is of high
priority- ~ perhaps the one at the top."
Peoples' Commission on GATT in their Report (1996) also commented on the importance
of public interest as follows:
"Let us remember the sombre realities of Indian life and health. Holistic health
strategy- pertinent to the Third World traumata, where nutritional deficienncies,
medical privations and endemic ~ epidemic diseases are common, forbids
patentisation of foreign pharmaceuticals who may monopolize life-giving drugs and
essential medicines and keep prices untouchable and unapproachable for the Indian
masses. The sequitur is that lethal liberalization of patent law tuned to TRIPs
prescriptions is impermissible".
TRIPs Patent System : Scope Enlarged
The scope of patentability in TRIPs Agreement has been greatly enhanced. The parameters
of Article 27 about the extent of coverage of patentability and exclusion from patentability
has been explained earlier.
Patent rights have been extended to imports at par with the domestic production without
any discrimination. The exclusive rights conferred on the patent holder under Article 28
also enlarges the scope of such rights. He will enjoy exclusive rights on imports also for
the purpose of making, using, offering for sale and selling of such imported products.
Further, it would be possible to apply the patent rights on product patents for 20 years and
therafter another spell of 20 years for products covered by patented processes followed by a
further spell of protection for dosage form, usage form and combinations, thereby
perpetuating monopolies. All these provisions have serious implications not only for new
products, but also for existing products particularly for the health care products. The
national governments should consider excluding patentability of formulations.
The scope of exclusion from patentability as provided in Article 27 is quite limited.
However, it should be possible to totally exclude bio-technology products to protect ordre
public or morality. Thus, the patenting of all 'life forms' including seeds, germ plasms,
biological cells and cell forms, should be clearly and categorically excluded from the very
scope of patenting. Even the UNCTAD Report of July 1996 on the implications of TRIPs
39
for developing countries has commented on the subject of 'exclusion' as follows:
’In this connection, it is worth noting that the TRIPs Agreement contains no
definitionn of "im ention" and. therefore, leaves member countries relatively free to
draw the line between nonpatentable "discoveries" and actual "im entions" in the
biological field. Thus, domestic legislation may exclude the protection of
substances found in nature, including cells and subcellular components (such as
genes), and it may develop a policy approach that comprehensively address
problems of access to, and appropriation of. genetic resources."
Similarly, the importation right should not be perpetual right. At the most the same could
be permitted for a period not more than five/six years when it should be possible to set up
economically viable manufacturing capacity.
These considerations could contain the charter of rights in the TRIPs Agreement on the new
patent system and help in strengthening the health care laws and programmes from the point
of view of easy availability of medicines from domestic sources and at competitive prices.
PART IX
USA ATTITUDE AND THE MULTILATERAL
TRADING SYSTEM
Towards the closing years of World War II, a sense of global manifest destiny came to
dominate United States policies. It was envisaged that for lasting world peace the purpose
of global alliances from the openly military were to be switched to the plainly economic
issues. The Bretton Woods Conference (1944) marked the beginning of a new world
economic order. This coference envisaged three international institutions, viz.,
World Bank
International Monetary Fund
International Trade Organisation
The thrust of the new economic order which was conceived by USA and its allies was to
ensure conquest through trade using the blessings of liberalisation, privatisation and
globalisation. Calvin Coolidge said that ’’the business of America is business”. USA,
however, did not agree to the establishment of International Trade Organisation whose
details were worked in the Havana Charter. For the US Congress it was US sovereignty
angle due to which they did not ratify the setting up of International Trade Organisation.
Later on the basis of selected provisions of the Havana Charter, General Agreement on
Trade and Tariffs was established in 1948 as an interim arrangement and this arrangement
continued till 1994. GATT had recognised the fact that the world was divided into unequal
countries, viz. developed, developing and least developed. There is virtually no change in
this unequal situation during
4 1/2 decades since 1948 as the per capita income of a
major developing country, viz. India, is only $330 as compared to per capita income of
USA at $22,440 and Japan at $26,930. However, GATT Rules did recognise the
inequality of situation and provided for differential and preferential treatment for the
developing countries under Article XVIII. Because of this provision, the developing
countries for the reasons of balance of payment could create non-tariff barriers, tariff
barriers, import policy, import licensing, channelisation of imports and other economic
restrictions to safeguard their economic interests. The USA, however, felt that such
concessions were hurting their interest in the international trade.
40
Between 1980 and 1985 the US trade deficit grew from $36.3 to $148.5 billion ~ a 309%
increase. Similarly, the budgetary deficit and foreign loans/debts also mounted to alarming
figures. The growing trade deficit led to a totally new approach to trade policy by US
Administration. The advocates argued that the US was at a marked disadvantage due to
relatively open US market as opposed to relatively closed markets in a number of trade
partners. The US President Advisory Committee for Trade Negotiations' Task Force on
Intellectual Property Rights advocated in their Report of October 1985 underscoring US
interest in getting a multilateral intellectual property agreement. The protection of US
intellectual property became a major issue with the US industry to improve their share of
trade in the world market. Thus the intellectual property issue became one of the dominant
factors for the Uruguay Round of GATT Negotiations which started in 1986. It was
during this time that the Omnibus Trade and Competitiveness Act was amended by the USA
in 1988 to strengthen the provisions of Section 301 by incorporating new sections of Super
301 and Special 301. Since then, USA started pressurising the developing countries to
change their intellectual property laws in a manner which could provide monopolistic
exclusive rights to TNCs over the patented products in other countries. The TRIPs
Agreement became an offshoot for US to solve its trade problems. Since 1988, USA has
been annually reviewing the IPR laws of trading partners. In April 30, 1997 Report, USTR
Report on Special 301, named a large number of countries whose trade laws yet have
deficiencies compared to the provisions of the TRIPs Agreement. This report summarises
the deficiencies as follows :
1. Argentina
Argentina's patent regime denies adequate and effective protection to US right holder,
particularly in the pharmaceutical industry'. Its patent law contains onerous
compulsory licensing provisions and pharmaceutical patent protection will not
become available until November 2000. There is also no provision for pipeline
protection or protection from parallel imports.
2. Ecuador
Ecuador patent laws are not in accord with the TRIPs Agreement in regard to local
working requirements, compulsory licences, exclusion of certain products from
patentability7.
3. Egypt
There is lack of patent protection in Egypt. USA urges Egypt to enact promptly a
modem patent law that provides immediate patent protection for all types of products,
including pharmaceuticals, agricultural chemicals and foodstuffs.
4. India
India has not implemented its obligations under Articles 70.8 and 70.9 of the TRIPs
Agreement. These articles require developing countries not yet providing patent
protection for pharmaceutical and agricultural chemical products to provide a
"mailbox" in which to file patent applications and the possibility7 of up to five years of
exclusive marketing rights for these products until patent protection becomes
available.
5. Brazil
USA remains concerned that Brazil has not enacted modern intellectual property laws
to protect computer software, copyright and integrated circuits.
6. Chile
Chile's patent term is stated to be TRIPs-inconsistent and pipeline protection remains
unavailable.
7. Colombia
Colombia has not yet fully implemented the WTO TRIPs Agreement. Deficiencies
in its patent and trademark regime include insufficiently restrictive compulsory
licensing provisions, working requirements, inadequate protection of pharmaceutical
patents and lack of protection against parallel imports.
41
8. Costa Rica
Costa Rica's patent law is deficient in several key areas. The term of patent coverage
is a non-extendable 12 year term from the date of grant. In the case of products
deemed to be in the 'public interest', such as pharmaceuticals, chemicals and agro
chemicals. fertilizers and beverage/ food products, the term of protection is only one
year from the date of grant. The US looks to the Goy’ernment of Costa Rica, as it
implements its WTO obligations, to adopt a term of patent protection of 20 years
from filding as required by TRIPs.
9. Denmark
Denmark has not yet provided TRIPs-level protection for exclusive test data submitted
in the marketing approval process.
10. Dominican
Republic
There is lack of adequate and effecth e intellectual property protection.
11. Guatemala
Guatemala does not adequately protect pharmaceuticals and its copyright layv is
deficient.
12. Honduras
Honduras needs to improve patent and trademark laws and intellectual property
enforcement.
13. Jordan
The inadequacies of the patent law have led to a growing problem of patent
infringement for pharmaceuticals which are manufactured for both domestic and
export markets.
14. Kuwait
Pharmaceutical patents fail to meet international standards in numerous other
regards.
15 Peru
USA's concern is for imposition of a domestic working requirment in its patent
regime.
16. Thailand
Thailand is still in the process of amending its patent law to comply with the TRIPs
Agreement.
17. U.A.E.
UAE's patent law’ exempts medicines and pharmaceutical compounds from protection
and contains onerous compulsory- licensing provisions. Concerns remain about
reports of the unauthorised production of pharmaceutical products.
18. Venezuela
There are deficiencies in the patent and trademark regime which include overly
restrictiy e compulsory licensing provisions, yvorking requirements, inadequate
protection of pharmaceutical patents and lack of protection against parallel imports.
19. Cyprus
The current patent regime in Cyprus is inadequate as well as inconsistent with TRIPs.
The above would indicate that worldwide there are still many countries who have to change
their patent laws to accord with the TRIPs Agreement. In fact, there are many developed
countries who are still maintaining their earlier compulsory licensing system to protect their
public interest. This conclusion has been drawn from the monthly reports of 1995, 1996 &
1997 of the World Intellectual Property (WIPO) which reports on amendments on patent
laws by different countries.
The above indicates as to how under a multilateral free trade system, after the establishment
of WTO, USA is pressurising various countries under threat of naming countries under
Special 301 to achieve its own agenda of monopolising the world market. Not only this,
the US Act cited as the 'Uruguay Round Agreement Act' which was adopted on 8.12.94 to
approve and implement the trade agreements concluded in the Uruguay Round contains
42
certain specific provisions which are WTO miltilateral trade system inconsistent. The
relevant sections are reproduced as follows:
Section 102 (a)
"(a) RELATIONSHIP OF AGREEMENTS TO UNITED STATES LAW. (1) UNITED STATES LAW TO PREVAIL IN CONFLICT. - No pronsion of any of the
Uruguay Round Agreements, nor the application of any such provision to any person or
circumstance, that is inconsistent with any law of the United States shall have effect.
(2) CONSTRUCTION. - Nothing in this Act shall be construed (A) to amend or modify any law of the United States, including any law
relating to (i) the protection of human, animal, or plant life or health.
(ii) the protection of the emironment. or
(iii) worker safety, or
(B) to limit any authority conferred under any law of the United States,
including section 301 of the Trade Act of 1974.
unless specifically provided for in this Act."
Section 102 (b)(2)(A):
"(2) LEGAL CHANGE.-
(A) IN GENERAL.- No State law. or the application of such a State law, may be declared
invalid as to any person or circumstance on the ground that the provision or application is
inconsistent with any of the Uruguay Round Agreements, except in an action brought by the
United States for the prupose of declaring such law or application invalid."
By Section 313, the following provision is added in connection with enquiry and report by USTR.
Section 182 (4)
"(4) A foreign country may be determined to deny adequate and effective protection of
intellectual property rights, notwithstanding the fact that the foreign country7 may be in compliance
with the specific obligations of the Agreement of Trade-Related Aspects of intellectual PropertyRights referred to in section 101(d)(15) of the Uruguay Round Agreements Act."
The above would show that USA is behaving like a superior authority above the sovereign
rights of all countries and the WTO Agreement. If USA laws have to prevail even when
they are inconsistent with Uruguay Round Agreements, why not then the laws of other
countries should also prevail. Their sovereign rights are in no way inferior to the sovereign
rights of USA.
The Final Act of Uruguay Round of GATT Negotiations is a package of unequal treaty
comprising about 28 Agreements. This treaty is a self-fulfilling treaty which means that the
member countries have to implement the Agreements without any change. There is no
flexibility available to the members. There was no such a situation in the past seven
rounds. The members could choose any protocol for implementation as agreed upon
during the seven rounds. The Final Act now envisages adoption of global standards for all
economic issues by all developed, developing and least developed countries. The only
concession which is available to them is in the shape of transitional period ranging from 5 to
10 years due to large disparities between the member countries' economic status. There are
serious problems in implementing various agreements as have been finally provided in the
Final Act.
43
PART X
CONCLUSIONS
What should be the approach for Developing Countries?
In order to ensure public interest for achieving the laudable objectives of health for all and
to provide for pragmatic approach for health care programmes, it is necessary that the
domestic pharmaceutical industry in the developing countries, particularly in India, must be
facilitated to play a major role in the health care sector. For achieving this objective which
is totally in consonance with Articles 7&8 of TRIPs, joint efforts of developing countries
will have to be made for ensuring unrestricted role in the patented products. In the
meantime while amending the Patent Laws the developing countries could keep in mind the
following three principles:
(a)
Countries could express their readiness to amend their patent laws
by 2000 AD and set about redrafting their own amendments keeping
the long term challenges particularly relating to health care and the
international scenario in mind;
(b)
Developing countries should in the meanwhile reject the idea of any
transitional arrangements of providing EMR as a first choice. As a
second choice. Member countries could at the most consider bare
minimum changes to their national Patents Act without
compromising in any way the framework of national public policy
parameters :
(D
legal provisions for accepting product patent applications for
making
available patent protection and redefining
of the scope of patentability excluding certain inventions
as discussed above; and
(ii)
allowing grant of EMR/patent protection after the applicant
has obtained marketing approval in the concerned country
and also in the country in which the research originated.
This protection could be made available from the date of
application of the TRIPs Agreement as provided by Article
65(2) of TRIPs. There should be no other change to the
existing patent laws at this stage. All other public interest
provisions mutatis mutandis should be applicable on the grant
of exclusive marketing right on the product patent so that the
role of domestic industry is also fully ensured under the
relevant provisions; and
44
(C)
They should also clearly provide, in the amendments ~ with all necessary
prologues under the 'objectives’ of the amending legislation :
(i)
exclusion of all life forms/germplasms, biological cells and cell forms
and dosage form, usage form and combination formulations (in order
to protect the existing formulations from small changes for taking
patent protection in some form).
(ii)
provision of strong compulsory licensing and licensing of right on
the lines indicated earlier to ensure transfer and dissemination of
technology as stated in the ’’Article 7 ~ Objectives” and ’’Article 8
~ Principles" of TRIPs; and
(iii)
broad negation of the concept of ’import’ as equivalent to the
working of a patent and allowing imports only for a limited
period ~ not more than 5/6 years.
The developing countries should also collectively evolve their future "Agenda" for restoring
the balance of rights and obligations in TRIPs patent system so that there is smooth
implementation of TRIPs (Patents) Agreement.
Finally, the Governments in developing countries must strengthen the basic R&D activity in
their countries through direct funding or through strengthening the tax concessions so that
the industry is able to gear itself to meet the global challenges of uniform patent system of
TRIPs Agreement. Even the developing countries should also consider collaborative
research for such diseases as are prevalent in their countries.
45
I
I
ZT
INTERNATIONAL
.
s PRICES
n VIS-A-V1 S INDIAN PRICES
!
SOME SELECT PRODUCTS
Drug &
Dosage
Pack Brand/
Company
India
(Rs.)
Brand/
Pakistan
Company (Rs.)
Times
Brand/
Costlier Company
Price
US$
Price
(Rs.)
Times Brand/
Costlier Company
Price
Price
in UK (Rs.);
(pnds)
Times
Costlier
Antibacterials
Ofloxacin
200 mg
4’s
Tarivid/
Hoechst
100.00 Tarivid/
Hoechst
116.85
1.17 Floxin/
Ortho
12.71
457.56
4.58 Tarivid/
Hoechst
4.10
225.50
2.26
Cefadroxil
500 mg
4‘s
Cefadur/
Protec
42.29 Duricef/
BMS
81.27
1.92 Duricef/
BMS
13.76
495.36
11.71 Baxan/
BMS “
1.13
62.15
1.47
Ciprofloxacin
500 mg
10's QUINTOR/
TORRENT
59.75 Ciproxin/
Bayer
496.65
8.31 Cipro/
Miles
33.4
1202.40
23.33 Ci proxi n/
Bayer_
13.75
756.25
12.66
Norfloxacin
400 mg
10's Norspan/
Bluecross
20.55 Noroxin/
MSD
114 25
5.56 Noroxin/
Merck
25.82
929.52
45.23 Utinor/
MSD ~
4.80
264.00
12.85
Lomefloxacin
400 mg
4’s
Lomitas/
Intas
34.00
25.4
914.40
26.89
Pefloxacin
400 mg
4's
Proflox/
Protec
15.60 Abaktal/
Lek
84.00
5.38
Tobramycin
0.3%
5m I Tobacin/
Aristo
17.20 Tobralex/
(3 ml) Alcon
129.05
7.50 Tobrex/
Alcon
19.69
708.84
41.21 Tobralex/
Alcon
1.39
76.45
4.44
Maxaquin/
Searle
N.A.
N.A.
N.A.
N.A.
Anti Inflammatory
Diclofenac
50 mg
10's Voveran/
Ciba
6.49 Voltaren/
Ciba
55.62
8.57 Voltaren/
Ciba
10.07
362.52
55.86 Voltarol/
Ciba
1.82
100.10
15.42
Piroxicam
20 mg
10’s Dolonex/
Pfizer
28.33 Feldene/
Pfizer
72.50
2.56 Feldene/
Pfizer
26.62
958.32
33.83 Feldene/
Pfizer
2.14
117.70
4.15
Page 1
I
L
Drug &
Dosage
Pack Brand/
Company
India
(Rs.)
Brand/
Pakistan
Company (Rs.)
Times
Brand/__
Costlier Company
Price
US $
Price
(Rs.)
Times
Brand/
Costlier Company
Price
Price
in UK (Rs.)
(pndsj
Times
Costlier
Anti-Ulcerants
Ranitidine
300 mg
10’s Zinetac/
Glaxo
17.39 Zantac/
Glaxo
241.44
13.88 Zantac/
Glaxo
30.02
1080.72
62.15 Zantac/
Glaxo
9.14
502.70
28.91
Famotidine
40 mg
14’s Topcid/
Torrent
15.26 Pepcidine/
MSD
363.37
23.81 Pepcid/
Merck
41.69
1500.84
98.35 Pepcid/
Morson
13.30
731.50
47.94
Omeprazole
20 mg
10’s Cozep/
S G Pharm
28.00
Prilosec/
Astra
36.30
1306.80
46.67 Losec/
Astra
12.66
696.30
24.87
Lansoprazole
30 mg
7's
44.00 Zoton/
Lederle
350.00
7.95
Zoton/
Lederle
9.09
499.95
11.36
LAN-1 D/30
INTAS
N.A.
N.A.
Cardiovasculars
Atenolol
50 mg
14's Tenormin/
IC!
29.24 Tenormin/
ICI
118.25
4.04 Tenormin/
Zeneca
13.13
472.68
16.17 Tenormin/
Stuart
2.67
146.85
5.02
Diltiazem
60 mg
10’s Dilzem/
Torrent
36.90 Herbeser/
Tanabe
74.18
2.01 Cardizem/
MMD
6.96
250.56
6.79 Britiazem/
Thames
1.50
82.50
2.24
Lisinopril
5 mg
10's Cipril/
Cipla
37.50
Prinivi!/
Merck
7.86
282.96
7.55 Zestril/
Zeneca
3.42
188.10
5.02
Enalapril
Maleate 5mg
10’s Envas/
Cadila
16 20 Renitec/
MSD
39.67
2.45 Vasotec/
Merck
9.12
328.32
20.27 Innovace/
MSD
2.81
154.55
9.54
Prazosin
2 mg
10's Prazopress
Sun Pharm
37.50 Minipress/
Pfizer
12.65
0.34 Minipres/
Pfizer
6.89
248.04
6.61 Hypovase/
Invicts
0.83
45.65
1.22
Amiodarone
200 mg
10's Cordarone
-X /Torrent
87.50
N.A.
Cordarone/
Wyeth
30.46
1096.56
12.53 Cordarone
-X /Sanofi
2.93
161.15
1.84
Amlodipine
Besylate 5mg
10’s KLOP ID/
KOPRAN
7.00
N.A.
Norvasc/
Pfizer
11.79
424.44
60.63 Instin/
Pfizer
4.23
232.65
33.24
N.A.
Page 2
Drug &
Dosage
Pack Brand/
Company
India
(Rs.)
Brand/
Pakistan
Company (Rs.)
Tinies
Brand/
Costlier Company
Price
US$
Price
(Rs.)
Tinies
Brand/
Costlier Company
Price
Price
inJJK"
(pnds)
(R?-I
ITimes
Costlier
Anti-viral/ fungal
Ketoconazole
200 mg
10's Funazole/
Khandelwal
57.90 Nizoral/
Janssen
Zidovudine
100 mg
10's Zidovir/
Cipla
250.00
221.23
N.A.
3.82 Nizoral/
Janssen
28.15
1013.40
17.50 Nizoral/
Janssen
5.23
287.65
4.97
Retrovir/
Wellcome
15.48
557.28
2.23 Retrovir/
Wellcome
12.50
687.50
2.75
9.17 Hismanal/
Janssen
19.22
691.92
57.66 Hismanal
/Janssen
1.80
99.00
8.25
12.50
450.00
19.57 Triludan/
MMD- ‘
1.70
0.90
0.04
2.91
160.05
22.86
Anti-histamine
Astemizole
10 mg
10's Alestol/
Indoco
12.00 Mayasen/
Janssen
Terfenadine
60 mg
10's Terdane/
Intas
23.00
N.A.
Seldane/
MMD
Ceterizine
10 mg
10's C2-3
LUPIN
7.00
N.A.
N.A.
Loratadine
10 mg
10's Lorfast/
Cadila
39.50
N.A.
Claritin/
Schering
25.74
926.64
23.46 Clarity n/
Schenng
2.53
139.15
3.52
N.A.
Xanax/
Upjohn
7.73
278.28
22.70 Xanax/
0.88
48.40
3.95
110.00
Zirtek/
UCB ’
Anti-Anxiolytics
Alprazolam
0.5 mg
10's Alp rax/
Torrent
12.26
Trazodone
HCI 50 mg
10's T razalon/
Sun Pharm
30.00 Deprel/
Adamjee
40.00
1.33 Desyrel/__
Apothecon
13.00
468.00
15.60 Molipaxin
ZMMD
2.06
113.30
3.78
Buspirone
5 mg
10's Buspin/
Intas
9.50 Buspar/
BMS
88.17
9.28 Buspar/
BMS
5.96
214.56
22.59 Bus par/
BMS
3.12
171.60
18.06
Page 3
Drug &
Dosage
Pack Brand/
Company
India
(Rs.)
Mitoxantrone
2mg/ml
10ml Oncotron/
TDPL
395.00
N.A.
Novantrone
/Immunax
Carboplatin
150 mg
Vial Oncocarbin
/TDPL
850.00
N.A.
N.A.
Vincristine
1 mg
Vial On cocrist in
-AQ /TDPL
46.79 Oncovin/
Lilly
358.54
7.66 Oncovin/
Lilly
34.62
1246.32
Vinblastine
10 mg
Vial Cytoblastin
/Cipla
195.00 Velbe/
Lilly
370.41
1.90 Velban/
Lilly
38.92
Etoposide
100 mg
Vial Etosid/
Cipla
250.00
Vepesid/
BMS
Brand/
Pakistan Times
Brand/
Company (Rs.)
Costlier Company
Price
US$
Price
(R^)
679.28
24454.08
Times
Brand/
Costlier Company
Anti-Cancer
N.A.
Price
Price
in UK
(pnds)
WT
Times
Costlier
61.91 Novantrone
/Lederle
150.43 8273.65
20.95
Paraplatiri/
BMS
65.83 3620.65
4.26
26.64 Oncovin/
Lilly
14.18
779.90
16.67
1401.16
7.19 Velbe/
Lilly
14.15
778.25
3.99
136.49
4913.64
19.65 Vepesid/
BMS
9.96
547.80
2.19
33.29 Prozac/
Dista
22.46
808.56
67.66 Prozac/
Dista
6.92
380.60
31.85
Nimotop/
Miles
55.04
1981.44
33.53 Nimotop/
Bayer
3.89
213.95
3.62
3.29 EI_dep_ry|/_
Somerset
21.37
769.32
24.04 Eldepryl/
Britannia
4.68
257.40
8.04
Anti-Depressant
Fluoxetine
20 mg
10's Dswnex/
Micro
11.95 Prozac/
Lilly
397.86
________ L
Miscellaneous
Nimodipine
30 mg
10’s Vasotop/
Protec
59.09
Selegiline
HCI 5 mg
10’s Selerin/
Protec
32.00 Jumex/
Medimpex
N.A.
105.20
Page 4
Drug
Dosage
Pack Brand/
Company
India
(Rs.)
Brand/
Pakistan
Company |(Rs.)
Tinies
Brand/
Costlier Company
Price
FVice
usT
(Rs.)
Times
Brand/
Costlier Company
Miscellaneous (Contd.)
Ondansetron
MCI 4 mg
1O's Zofer/
Lovastatin
20 mg
10's RecolZ
NOTE
96.50
N.A.
Natco
Themis
1.
130.00
N.A.
Zofran/
Cerenex
112.23
Mevacor/
Merck
21.66
4040.28
41.87 Zofran/
Price
Price
in UK~~
LRsT
(pnds)
40.50 2227.50
Glaxo
779.76
6.00
N.A.
IRETAIL PRICES IN INDIA & WHOLESALE PRICES IN OTHER COUNTRIES CONSIDERED
-E—
E _ J... ZZ1
I
I ------ T---- 1------ T-----------------rzx
__ _
ZL_ZZZZZZZZZLZZZZZ
2. CONVERSION RATE OF EXCHANGE CONSIDERED : 1 USD = Rs.36.00, 1 GBP = Rs.55.00 AND 1 PAK. RS = Rs.1.00
r . .i
t
LZZZZIi__ nl
3. _SOURCEFOR PRICES : USA PRICES - RED BOOK 1996
[—
_
UK PRICES J- UK MIMS MAY 1997
________________PAKISTAN - QIMP ANNUAL 1995 - 96
INDIA
- IDR MAY - JUNE 97
JULY 97
Page 5
-----------
Times
Costlier
23.08
INTERNATIONAL PRICES VIS-A-VIS INDIAN PRICES
Drug &
Dosage
Pack Brand/
India
Company (Rs.)
Brand/
Pakistan
Company (Rs.)
Times
Brand/
Thailand-Baht Price
Costlier Company 1 Baht=Rs.1.38 (Rs.)
Pack [Price
Times Brand/
Indonesia (Rp)
Costlier Company 1 Rp=Rs.0.0151
Pack [Price
Price
(Rs.)
Times
Costlier
L ■
Anti-bacterials
Ofloxacin
200 mg
4's
Tarivid/
Hoechst
100.00 Tarivid/
Hoechst
116.85
1.17 Tarivid/
Daiichi
10s
Tarivid/
Daiichi
4s
14000
211.40
2.11
Cefadroxil
500 mg
4's
Cefadur/
Protec
42.29 Duricef/
BMS
81.27
1.92 Duricef/
BMS
100s
Duricef/
BMS
4s
12760
192.68
4.56
Ciprofloxacin
500 mg
10's QUINTOR
TORRENT
59.75 Ciproxin/
Bayer
496.65
8.31 Ciprobay/
Bayer
10s
900 1242.00
20.79 Ciproxin/
Bayer
10s
69300
1046.43
17.51
Norfloxacin
400 mg
10’s Norspan/
Bluecross
20.55 Noroxin/
MSD
114.25
5.56 Norflocin/
Polio Pha.
10s
200
276.00
13.43 Norbactin/ 10s
Sunti Sep.
20873
315.18
15.34
Lomefloxacin
400 mg
4's
LOMITAS
INTAS
34.00
Maxaquin/
Searle
4s
232
320.16
9.42
Pefloxacin
400 mg
4‘s
PROFLOX
PROTEC
15.60 Abaktal/
Lek
84.00
5.38 Abaktal/
Lek
100s
Abaktal/
Lek
22000
332.20
21.29
Tobramycin
0.3%
5ml Tobacin/
Aristo
17.20 Tobrex/
(3 ml) Alcon
129.05
7.50 Tobrex/
Alcon
5ml
Optosin/
Ken rose
5ml
111.24
17.14 Diclosian/
10s
3.19 Voltaren/
10s
11734
177.18
27.30
10s
14467
218.45
7.71
N.A.
N.A.
4‘s
Anti Inflammatory
■
Diclofenac
50 mg
10*s Voveran/
6.49 Voltaren/
Ciba
Ciba
Piroxicam
20 mg
10's Dolonex/
28.33 Feldene/
Pfizer
Pfizer
15
20.70
Asian Pha
72.50
2.56 Feldene/
Pfizer
Ciba
10s
164.3
226.73
8.00 Feldene/
Pfizer
2
Drug &
Dosage
Pack Brand/
AnthUlcerants
Ranitidine
10's Zinetac/
300 mg
Famotidine
40 mg
Omeprazole
20 mg
Lansoprazole
30 mg
14’s TOPCID
60 mg
Lisinopril
5 mg
Enalapril
Maleate 5mg
Prazosin
2 mg
Amiodarone
200 mg
Amlodipine
Besylate 5mg
Pakistan
Times
Company
(Rs.)
241.44
Thailand-Baht Price
Times
Costlier Company
Pack
Costlier Company
13.88 Zantac/
30s
Glaxo
15.26 Pepcidine/
TORRENT
10’s GOZEP
Brand/
17.39 Zantac/
Glaxo
363.37
10's LAN-15/30
Losec/
500.00
Lederle
118.25
36.90 Herbeser/
74.18
Tanabe
N.A.
CAD I LA
10's Prazopres
Sun Phar
10's Cordarone
Pfizer
87.50
N.A.
TORRENT
10’s KLOPID
KOPRAN
79.34
MSD
37.50 Minipress/
N.A.
Pack
(Rs.)
Costlier
Price
43600
658.36
37.86
14s
28700
433.37
28.40
10s
58150
878.07
31.36
14s
22580
340.96
11.66
10s
6677
100.82
2.73
10s
14291
215.79
5.75
10s
7800
117.78
7.27
10s
5300
80.03
2.13
2.16 Cordarone 10s
10000
151.00
1.73
14553
219.76
31.39
Kai be
7s
Losec/
Astra
10s
450.00
621.00
4.04 Tenolol/
10s
14.11
N.A.
Tenormin/
Zeneca
2.01 Herbeser/
Tenabe
10s
Lispril/
10s
90.00
124.20
4.90 Renitec/
Zestril/
Zeneca
10s
59.50
82.11
MSD
12.65
0.34 Minipres/
10s
44.00
60.72
1.62 Minipres/
Pfizer
Cordarone 10s
Pfizer
5.07 Inoprilat/
Pharos
Pfizer
Norvasc/
3.37 Herbeser/
Tenabe
136.67
188.60
Sanofi
7.00
Times
10s
Facid/
Siam Phar
16.20 Renitec/
Price
Glaxo
Siam Phar
CIPLA
10’s ENVAS
Prevacid/
Indonesia (Rp)
Takeda
29.24 Tenormin/
ICI
37.50
11.36
Brand/
Zantac/
MSD
N.A.
44.00 Zoton/
TORRENT
10‘s CIPRIL
(Rs.)
Astra
INTAS
10's DILZEM
Price
23.81 Pepcidine/ 30s
MSD
28.00
Brand/
Glaxo
S G PHAR
Cardiovasculars
Atenolol
14’s Tenormin/
50 mg
ICI
Diltiazem
India
Company (Rs.)
Sanofi
10s
187.33
258.52
36.93 Norvasc/
Pfizer
10s
3
Drug &
Dosage
Pack Brand/
India
Company (Rs.)
Brand/
Pakistan
Company (Rs.)
Times
Brand/
Thailand-Baht Price
Costlier Company Pack Price
(Rs.)
Times
Brand/
Indonesia (Rp)
Costlier Company Pack Price
Price
(Rs.)
Times
Costlier
Anti-viral/ fungal
Ketoconazole
200 mg
10's F unazole/
Khandelwal
57.90 Nizoral/
Janssen
Zidovudine
100 mg
10’s Zidovir/
Cipla
250.00
221.23
N.A.
3.82 Funginox/
Charoen
10s
Retrovir/
Wellcome
100s
60.00
82.80
1.43 Nizoral/
Jannsen
10s
17783
268.53
4.64
Retrovir/
Wellcome
10s
36110
545.26
2.18
2.30 Hismanal/
Jannsen
10s
10250
154.78
12.90
Anti-histamine
Astemizole
10 mg
10's ALESTOL
INDOCO
12.00 Mayasen/
Janssen
Terfenadine
60 mg
1C's TERDANE
INTAS
23.00
N.A.
Teldane/
MMD
100s
Hiblorex/
Otto
10s
3850
58.14
2.53
Ceterizine
10 mg
10’s C2-3
Lupin
7.00
N.A.
Zyrtec/
UCB
20s
Ryzen/
UCB
10s
11500
173.65
24.81
Loratadine
10 mg
10’s LORFAST
CADILA
39.50
N.A.
Clarityne/
Schering
10s
3.25 Clarityne/
Schering
10s
12000
181.20
4.59
12.26
N.A.
Xanax/
Upjohn
100s
Xanax/
Upjohn
10s
5165
77.98
6.36
110.00
9.17 Hisno/
Milano
500s
20.00
93.00
27.60
128.34
Anti-Anxiolytics
Alprazolam
0.5 mg
10’s ALPRAX
TORRENT
Trazodone
HCI 50 mg
30.00 Deprel/
10's T razalon
Sun Pharma
Adamjee
40.00
1.33 Desirel/
500s
Codal Syn
Trazone/
Kolbe
10s
8700
131.37
4.38
Buspirone
5 mg
10’s Buspin
INTAS
88.17
9.28 Barpril/
Biolab
10s
Buspar
10mg/BMS
14355
216.76
22.82
9.50 Buspar/
BMS
100s
4
Drug &
Dosage
Pack Brand/
India
Company (Rs.)
Brand/
Pakistan
Company (Rs.)
Times
Brand/
Thailand-Baht Price
Costlier Company Pack Price
(Rs.)
Times
Brand/
Costlier Company
Indonesia (Rp)
Pack Price
Price
(Rs.)
Times
Costlier
Anti- Cancer
Mitoxantrone
2mg/ml
10ml Oncotron/
TDPL
395.00
N.A.
Novantron/ 10ml
Lederle
Carboplatin
150 mg
Vial Oncocarbin 850.00
/TDPL
N.A.
Paraplatin/
Bristol
Vincristine
1 mg
Vial Oncocristin
TDPL
Vinblastine
10 mg
Vial Cytoblastin 195.00 Velbe/
/Cipla
Lilly
Etoposide
100 mg
Vial ETOSID
CIPLA
46.79 Oncovin/
Lilly
250.00
6740
9301.20
vial
23.55 Novantron/ 10ml
Lederle
49500
747.45
1.89
Paraplatin/
Bristol
vial
333300
5032.83
5.92
358.54
7.66 Oncovin/
Lilly
vial
Krebin/
CarloErba
vial
29000
437.90
9.36
370.41
1.90 Blastovin/
Teva
NA
Erbablas/
CarloErba
vial
75000
1132.50
5.81
Lastet/
vial
Nipon Kay
Vepesid/
BMS
vial
84700
1278.97
5.12
N.A.
Anti-Depressant
Fluoxetine
20 mg
10's Dawn ex/
Micro
11.95 Prozac/
Lilly
397.86
33.29 Prozac/
Eli Lilly
28s
Nimotop/
Bayer
30s
3.29 Jumex/
Chinom
50s
Prozac/
Eli Lilly
10s
28679
433.05
36.24
4.05 Nimotop/
Bayer
10s
16269
245.66
4.16
Miscellaneous
Nimodipine
30 mg
10's Vasotop/
Protec
59.09
Selegiline
HCI 5 mg
10's Selerin/
Protec
32.00 Jumex/
Medimpex
NOTE
1.
N.A.
105.20
173.33
239.20
N.A.
RETAIL PRICES IN INDIA & WHOLESALE PRICES IN OTHER COUNTRIES CONSIDERED.
2. CONVERSION RATE OF EXCHANGE CONSIDERED : 1 Pak. Rs. = Rs.1.00, 1 Thailand Baht=Rs.1.38, 1 Indonesian Rp=Rs.0.0151
3. SOURCE FOR PRICES :
I
JULY 1997
THAILAND PRICES = TIMS APRIL - JULY 1997
INDONESIAN PRI< NOV. - FEB 1997
PAKISTAN = QIMP ANNUAL 1995 -96
INDIA = I D R MAY-JUNE 1997
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