PhRMA Disputes Use Of Compulsory License To Ease Drug Shortages In India

Inadequate Infrastructure is acutely evident in India, and the prime reason for the country’s poor healthcare system, says the trade body.

MUMBAI - The Pharmaceutical Research and Manufacturers of America has disputed the reasons cited for invoking compulsory licenses in India. The foremost industry association that represents leading U.S.-based drug makers questioned whether shortage of a life-saving drug can be bridged by using provisions such as compulsory licensing.

Earlier this year, the Indian Patent Office granted the first compulsory license to India’s Natco Pharma Ltd. for Nexavar (sorafenib), a drug used to treat kidney cancer on grounds that Bayer AG– the innovator – has not been able to supply sufficient quantities of the drug at an affordable rate (Also see "India Grants First Compulsory License To Natco For Bayer’s Nexavar; Disappointed, Bayer May Challenge Decision" - Scrip, 11 Mar, 2012.).

Handling Shortages: U.S. And India

Without naming any Indian trade associations, Jay Taylor, VP, International, PhRMA, countered the argument that the U.S. has used similar provisions to handle drug shortages by allowing importation. “This assertion is wrong for several reasons,” he said, adding that “U.S. FDA’s decision to allow temporary importation to address critical cancer drug shortages is not a compulsory license – no patents were revoked, waived or violated,” Taylor said in a statement, marking a break from a long silence on the controversial subject.

“Compulsory licensing will never cure the many issues facing healthcare around the world, many of which are attributable to a lack of core healthcare infrastructure” – Jay Taylor.

The Indian Pharmaceutical Alliance – a group of large generic drug makers in India – has in the past maintained that the U.S. has worked on policies that allowed imports for drugs that are in short supply. Earlier in February, for instance, U.S FDA allowed India’s Sun Pharmaceutical Industries Ltd. to import doxorubicin to ease a severe shortage (Also see "Doxil Shortage Solution: FDA Chooses Middle Ground, Allows Import Of Unapproved Version" - Pink Sheet, 19 Mar, 2012.).

Taylor argued that the U.S. government only resorted to temporary importation of foreign drugs when a shortage is critical to patient health and cannot be resolved by manufacturers of the approved U.S. drug. Importantly, he said the imports are done with the consent and cooperation of the manufacturer.

Importation Not Patent Violation

“Temporary importation is not used to resolve intellectual property disputes nor does it address pricing issues. The drugs prescribed in crisis are not necessarily patented and the importation of a substitute product may not be covered by the patent or have any intellectual property implications,” he noted.

In the most recent case, the drugs prescribed were not under patent, nor were prices of imported drugs manipulated or altered by the process, Taylor said while recognizing that compulsory licensing is a valuable tool for addressing true public health emergencies. He reminded that a compulsory license is not intended as a mechanism for furthering local industrial policies or achieving commercial advantage.

“Compulsory licensing will never cure the many issues facing healthcare around the world, many of which are attributable to a lack of core healthcare infrastructure and inadequate financing mechanisms. This is acutely evident in India, where less than 1% of all medicines in the market are patented and none of the medicines on India’s Essential Drug List are patented. Nevertheless, the World Health Organization estimates that a mere 20% of the country can afford those off-patent treatments,” Taylor added.

Asked how the IPA would see the missive from PhRMA, D.G. Shah, IPA’s secretary general declined to comment, noting that an appropriate response will be conveyed soon. By all counts, the story of Indian generic players pitted against global innovators is far from over.