Denying recent reports, India government say it hasn't promised to restrict compulsory licensing
- In a terse statement, the Indian government denied recent reports that it had privately promised not to use compulsory licenses for commercial purposes,
- Earlier this month, documents filed by the U.S. Chamber of Commerce and the U.S.-India Business Council with the U.S. Trade Representative (USTR) indicated the Indian government had pledged to limit its use of compulsory licensing, a tool which can be used to allow a country's domestic drugmakers to manufacture a branded drug.
- While India has used this mechanism sparingly, the pharmaceutical industry has strongly opposed its use and pushed for strong patent protection in India. Each year, the USTR compiles a so-called Special 301 report, which includes a "Priority Watch" list of countries which don't provide sufficient IP protection. India frequently appears on this list, usually released in April.
Generics make up the vast majority of India's domestic $15 billion pharmaceutical market, according to the Associated Chambers of Commerce and Industry of India. The country exports many of these drugs worldwide. The U.S., for example, imports 40% of its generics from India.
The global pharma industry sees compulsory licensing as a way India can unfairly boost its domestic generics industry at the expense of brand drugmakers. India, however, emphasizes it is operating within international law and has the right to use the tool to protect its domestic population.
"Even as Government of India is conscious of the need to spur innovation and protect individual rights, it retains the sovereign right to utilize the flexibilities provided in the international IPR regime," the government statement said.
Under the leadership of Prime Minister Narendra Modi, India has taken steps to engage with the U.S. on the issue of IP protection. A number of initiatives have been advanced, including the creation of a high-level working group between the two countries to take positive action to address IP issues. However, U.S. industry still sees IP challenges for companies operating in India.
According to the document filed by the U.S. Chamber of Commerce, "The Modi Government should restore the confidence of innovative pharmaceutical industry by formally closing these matters and send a clear and unmistakable signal that intellectual property rights will not be disturbed unless there is just cause," the U.S. Chamber said in its filing with the USTR.
To date, India has used compulsory licensing only once and recently denied an application by Lee Pharma to manufacture AstraZeneca's saxagliptin.