An exploration of compulsory licensing as an effective policy tool for antiretroviral drugs in India.

Author:Jain, Dipika
 
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ABSTRACT

Access to affordable drugs for the treatment of HIV/AIDS and other diseases is increasingly challenging in many developing countries such as Brazil, South Africa, and India. These challenges are in part the result of strengthened patent laws mandated by the 1994 Trade-Related Aspects of Intellectual Property Rights (TRIPS) treaty. However, there are underutilized instruments within TRIPS that governments can use to limit the adverse effects of patent protection and thereby ensure a supply of affordable generic drugs to their people. One such instrument is compulsory licensing, which allows generic manufacturers to produce pharmaceutical products that are currently subject to patent protection. Compulsory licensing has been used by a number of countries in the last few years, including the United States, Canada, Indonesia, Malaysia, Brazil, and Thailand, and is particularly significant for countries such as India, where large numbers of people are infected with HIV. This Article explores the feasibility of compulsory licensing as a tool to facilitate access to essential medicines within the current patent regime in India, drawing on the experiences of other countries.

CONTENTS INTRODUCTION I. TRIPS AND ITS IMPLICATIONS FOR INDIAN LAW II. TRIPS FLEXIBILITIES III. COMPULSORY LICENSING UNDER THE INDIAN PATENTS (AMENDMENT) ACT OF 2005 IV. COMPULSORY LICENSING IN CANADA V. PHARMACEUTICAL INDUSTRY POLITICS CONCLUSION INTRODUCTION

Antiretroviral (ARV) treatment remains the only proven treatment to extend the lives of individuals living with HIV/AIDS. (1) Nevertheless, access to affordable ARV drugs is increasingly challenging in many developing countries including Brazil, South Africa, and India. According to a 2007 joint report of the World Health Organization and the United Nations Program on HIV/AIDS, 2.5 million people in India are infected with the disease. (2) The infection is manageable in these developing countries only because of the emergence of ARV drug treatment, also known as antiretroviral therapy, highly active antiretroviral therapy, or potent combination antiretroviral therapy. (3)

The US Food and Drug Administration approved the first antiretroviral HIV drug, zidovudine (AZT, sold under the brand names Retrovir and Retrovis) in 1986. (4) the discovery that AZT, a drug originally intended to treat cancer, could effectively reduce HIV in the body, represented hope for a better life for the tens of thousands of HIV-positive people around the world. As one of the most expensive drugs ever to reach the market, (5) AZT also represented the beginning of a struggle for affordable treatment that continues today. The drug was prohibitively expensive for the vast majority of HIV-infected persons in developing countries.

The emergence of generic ARV drugs from India brought some relief beginning in 1991, selling for one-quarter of the price of the original AZT. (6) India soon emerged as a world leader in the generic manufacture of AIDS drugs, bringing prices within reach of not only those in India, but also many more around the world. India remains the supplier of choice for medications in most developing countries, producing medicines of respected quality that meet international standards at the lowest cost. (7) A study comparing the prices in India and other countries where patent protection exists found that drugs are up to forty-one times more expensive in countries with patent protection than in those countries without it. (8) A 1990 study by an economist from the International Monetary Fund reported that drug prices in Malaysia, where drug product patent protection already existed, were from 20 to 760 percent higher than in India, (9) which did not have drug product patent protection at the time. The Indian pharmaceutical industry has been an important supplier of generic ARVs both domestically and to the less-regulated markets of Africa, Asia, and Latin America. Today, India continues to be a major supplier of finished products, including vaccines and ARVs, to buyers around the world.

At the same time, certain international developments over the past two decades have threatened access to essential medications. In 1995, the establishment of the World Trade Organization (WTO) and its Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) (10) committed most nations to implementing or strengthening patent legislation that would require pharmaceutical products (in addition to processes) to be eligible for patent protection. A patent is a right granted by a government to an inventor that allows that inventor, for a limited period of time, to exclude others from making, using, selling, or importing an invention. This Article examines the exclusionary function of patents that allows brand-name drug companies to temporarily exclude generic drug manufacturers from producing life-sustaining medications.

Patent protection is often cited as one of the primary reasons for the limited availability and affordability of medication for HIV/AIDS. (11) Although patents are generally available for inventions related to any type of drug, the effects on HIV/AIDS drugs is particularly pointed because HIV/AIDS emerged quite recently in medical history and so the drugs that treat it are relatively new. Although patent rights are temporary and will eventually expire, not enough time has yet elapsed for most HIV/AIDS drugs to come off patent. Thus, there are often few effective options for patients who cannot afford newer, patented medications.

Historically, many developing countries lacked strong protection of intellectual property rights, (12) and even many developed countries did not allow patents to issue on pharmaceutical products until recently. Italy, for example, extended patent protection to pharmaceutical products only in 1978 as the result of a decision of its supreme court. (13) Similarly, France began to recognize pharmaceutical product patents only in 1960; Japan in 1976; Germany in 1968, Denmark in 1983; Norway in 1992; and Finland in 1995. (14) The TRIPS Agreement thus reinforced an existing trend toward extending patent coverage to include pharmaceutical products. Although the processes used to make pharmaceutical products were already patentable in many countries, there are often many different ways to synthesize a particular drug. (15) As a result, it can be relatively easy to "invent-around" a process patent, weakening the effect of the patent holder's right. In contrast, it is often difficult or impossible to "invent around" a product patent. The extension of patent protection to drug products (as distinct from the processes used to make them) therefore greatly strengthened the ability of pharmaceutical companies to exclude others from making those products.

Developing countries such as India, China, and Brazil were permitted to delay implementation of their obligations under the TRIPS Agreement until 2005. (16) This negotiated delay allowed those countries time to readjust and plan for the eventual phase-in of stricter intellectual property laws. Eventually it was realized that even this ten-year phase-in period was insufficient for the least-developed countries, and in 2002, the TRIPS Council (the WTO body that oversees the TRIPS Agreement) issued a decision extending until January 1, 2016, the date by which least-developed country members had to institute pharmaceutical patent protection. (17) A list of least-developed countries is maintained by the United Nations Office of the High Representative for Least Developed Countries. (18) India is not a least-developed country (neither are China or Brazil) and so it does not benefit from the extended deadline.

Consistent with its TRIPS obligation, the Indian government passed a new Indian Patents (Amendment) Act in 2005 (2005 IPA), extending patent protection to cover pharmaceutical products for the first time since the elimination of colonial-era drug patents in 1970. (19) The 2005 IPA protected generic drugs already on the market as of January 1, 2005, from the institution of infringement proceedings, allowing companies to continue to sell these inexpensive generic products upon the payment of a reasonable royalty. (20) However, many new AIDS therapies continued to be developed. (21) Significantly, some of these new therapies help to combat the virus once it develops resistance to existing combinations of antiretroviral drugs. (22) These newer drugs are therefore known as "second-line" ARV therapies, (23) and contingency "third-line" ARV treatments also exist. (24)

While many first-line ARVs were produced and marketed in India prior to 1995 and therefore escape the 2005 legislation, the availability and affordability of any drugs introduced in India after that date remain in question. Branded products may be priced out of reach, while generic versions introduced to the Indian market on or after January 1, 2005, are generally illegal and therefore not allowed in the Indian market unless authorized by the patent holder. (25) As a result, the 2005 IPA precludes the generic production of newer, more expensive second-line treatments that are needed for people living with resistant strains of HIV/AIDS until the patents on those newer drugs expire. Though patent-protected ARV drugs are relatively few in number, their high cost means that they nevertheless represent a very large percentage of health and treatment budgets. For example, of fourteen ARV drugs in the Brazilian National AIDS Program, three accounted for 63 percent of total program costs. (26) With new waves of ARV drugs being produced to combat resistance, access to the newest treatments will only worsen because these new drugs will generally be subject to patent protection and priced accordingly.

Because membership in the WTO meant conforming to its patent policies, country representatives repeatedly voiced concerns regarding access to medicines. (27) In 2001...

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