"Under the new legislation, we will see new medicines only available for the rich, while old treatments are the only ones available to the poor."

The upper house of the Indian Parliament has passed the law to allow India to 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.

"Under the new legislation, we will see new medicines only available for the rich, while old treatments are the only ones available to the poor," said Ellen't Hoen, the director of policy advocacy and research of Médecins Sans Frontières (MSF). "For instance, some people with HIV/AIDS will develop resistance to the first generation of AIDS drugs and will need newer treatments. But without the Indian generics medicines industry, where will they get cheap drugs from?"

This is worrying for MSF's patients and others relying on affordable generic drugs in developing countries: we have lost a simple and dependable system that ensured affordable generic medicines produced in India. The new law makes it fairly easy for companies to get patents granted. At the same time, it makes it quite difficult for generic companies to get compulsory licenses. The new law will cut off the pipeline of inexpensive future generic drugs.

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 law that passed both lower house and upper house this week the 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 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.

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 law 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 has been rendered ineffective because the essential information on which to base the opposition will be withheld from the public.

India has played a pivotal role in supplying affordable generic versions of medicines used throughout the developing world. Taking ARV drugs as an example, of the 700,000 people currently receiving antiretroviral treatment in developing countries, an estimated 50% rely on Indian generic production. MSF now treats 25,000 people with antiretrovirals in 27 countries around the world, and roughly 70% of the patients in those programmes use medicines that originate in India. Before generic drugs became widely available in 2001, similar treatments cost over US$10,000 per patient per year - 40 times more than the average price of ARV treatment in MSF programmes today (US$250). The availability of affordable fixed-dose combination therapy, or three-in-one pills, manufactured in India has revolutionised AIDS treatment in developing countries.



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