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The beginning of the end of affordable generics
Médecins Sans Frontières (MSF) - International
http://www.msf.org
March 23, 2005
People who rely on low-cost medicines will have to wait three years before
a generic company can even make an application for a right to produce
the drug. Whereas people in wealthy countries will have access to new
medicines immediately when they are proved safe and effective, people
in poor countries will have to wait years.
Generic companies ... will pay royalties to be set by the government
to the patent holder. International norms for royalties are in the range
of 3-4%. This new law however does not set a fixed royalty rate. In South
Africa, GlaxoSmithKline attempted to charge 40% royalty until activists
and the courts intervened.
Under a new bill approved today, India will start granting product patents
for medicines - something they have not done since 1970 - without the
necessary procedures in place to safeguard against wholesale hiking of
medicine prices.
India amended its 1970 Patent Act in order to be compliant with the requirements
of the World Trade Organisation.
A key safeguard to assure availability of affordable medicines is the
procedure of compulsory licenses - government grants patents but allows
generic companies to make their versions of the patented medicines against
a payment of a royalty to the patent holder.
However, in the bill that passed the Lower House (Lok Sabha) today procedures
are still extremely complex and there is no control on levels of royalties
to be paid, which will lead to endless litigation and delays.
The new bill "grandfathers" products that are already on the
market by allowing for automatic right to produce. The generic companies
in such cases will pay royalties to be set by the government to the patent
holder. International norms for royalties are in the range of 3-4%. This
new law however does not set a fixed royalty rate. In South Africa, GlaxoSmithKline
attempted to charge 40% royalty until activists and the courts intervened.
The worst-case scenario for people living with life-threatening diseases
has been averted, but only in the short-term.
People who rely on low-cost medicines will have to wait three years before
a generic company can even make an application for a right to produce
the drug. Whereas people in wealthy countries will have access to new
medicines immediately when they are proved safe and effective, people
in poor countries will have to wait years.
In addition, with this bill the government has crippled the critical
right of the members of the public to oppose patent applications on medicines,
the so-called "pre-grant opposition". It is has been rendered
ineffective because the essential information on which to base the opposition
will be withheld from the public.
The bill will go before the Upper House (Rajya Sabha) for a final vote.
It is expected that the Upper House will approve the bill in its current
form.
http://www.msf.org/countries/page.cfm?articleid=A871B9D0-7233-4971-8BFE19BF73C3005B
Copyright MSF
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