The World Trade Organization (WTO) established in the last millennium has a philanthropic objective of achieving a single world market and economy. It views a world with no trade barriers of social, political, cultural and geographical nature. It wants a vibrant economy to play in the whole of the world. The advents in communication technology, co-operations in science are in fact giving a futuristic vision of one world and one economy. But practically there is a vertical division of the world in to developed and developing countries. The rise of patent regimen, General agreement on tax and tariff (GATT) and Trade related intellectual property rights (TRIPS) has given suspicion in the minds of the developing countries policy makers that WTO is used a device to maintain the economic scale of development always remains ahead of developing countries than developed countries.
The poor infrastructure, fragile economy, unemployment and poverty are in fact holding back development of economy in developing countries. Pharmaceuticals are health inputs and are not to be treated par with consumables.
World health organization (WHO) essential drug policy clearly aims at providing a health for all and accessibility of primary health care and medicine to all the human beings of the world, irrespective of color, creed and economic status. It is continuously impressing upon governments of developed and developing countries to make prizes of the drugs such that for want of money no one get deprived of medicines and suffers morbidity and mortality due to diseases.
Accordingly many governments have their own regional drug laws and infrastructure to make available of the essential drugs to the needy people. Among developed countries, essential drug policy of Australia is ideal. In Australia, the drugs listed as essential are reimbursable by the patients.
Among developing countries the Bangladesh, health policy is acclaimed as a model essential drug policy for developing countries. It is of very great importance to acknowledge the contributions of Sukhdev Lal Hathi, who framed an excellent report after through study of the dynamics of the Indian society economy and its requirements. Some silent features of the essential drug policy of Bangladesh include;
· No propriety formulations in the market.
· Drugs are to be manufactured locally depending on requirement of the local needs.
This has worked wonders for economically starved Bangladesh to provide an efficient health care system.
The beginning of major drug policies in India took place with the establishment of Hathi Committee to look into price trends, competitiveness and feasibility of making Indian drug units to become self-sufficient. There were two major concerns that were on the cards. First, India was dependent largely on western countries for its supply of medicines. The growing monopoly of MNCs in Pharmaceutical Industry was the issue of concern. Second, though the Indian drug prices were comparatively quite low internationally, the MNCs tried to produce much of the inessential drugs and kept the prices of essential drugs high when compared to the purchasing power of the Indian masses.
Based on the Hathi Committee's recommendations, the profiteering attitude, which neglected the welfare of the Indian people, was tackled with the establishment of first Drug Price Control Orders of 1978 and 1979. For the first time, comprehensive price control was introduced in the drug industry (though few measures had been in force since 1970).
The new DPCO then grouped the drugs in four categories:
Category - I (Life saving)
Category - II (essential)
Category - III (less essential)
Category - IV (non essential/simple remedies)
Among these the first three categories were price controlled with mark up (profits allowed) of 40%, 55% and 100%, respectively. In all 347 drugs (about 90%) came under this price control categories. The philosophy behind the graded system was to make essential drugs cheaper. This approach of control on the price of essential drugs resulted in the shift in production pattern and this made the availability of essential medicines difficult than before, as can be seen from Table 1.
Table 1: Drug Production in Response to Price Policy (in percentages)
| DPCO Category | 1978 | 1979 | 1980 |
| I Life saving | 4.5 | 4.2 | 3.6 |
| II Essential | 16.7 | 14.8 | 13.2 |
| III Marginal | 67.1 | 67 | 68.6 |
| IV Decontrolled | 11.7 | 13.2 | 14.6 |
Source: T.L.Narayana (1982)
A second major reform at the manufacturing unit level took place around the same time with the liberalization process. The MNC's started to pressurize the government to bring down the number of drugs under DPCO. Government decontrolled some of the drugs from the purview of DPCO, reducing them to 166 only. But this was not free from a hike in price of few decontrolled drugs. Further, the price difference between the MNCs and indigenous firms became very significant.
Further the outcome of DPCO 1982 has resulted in the increase in the number of nonessential dosage forms by the MNCs to keep the margin of profit high.
The liberalization policy continued with more and more drugs going out of control from DPCO. The drugs under DPCO decreased by 1995, as few as 73 and 39 drugs by 2002 remained under the purview of DPCO.
The outcome of dilution of DPCO was evidently the increase in prices of drugs in India particularly of decontrolled drugs. The average increase in price among 18 major drugs was observed to be 44.6% during 1993-1999.
It clearly reveals that the average change in this significance of Patent act 1970 which helped Indian Pharmaceutical Industries to come up with the generic version of the existing drugs.
Invariably, fixing the criteria for keeping or withdrawal from DPCO was the most difficult task. It was observed that every time the drugs were brought out of the DPCO, there was a hike in the price of medicines coming out of DPCO. This was mainly due to the criteria used by DPCO. The Drug Price Control Order mainly considers the total sale, monopoly and competition in the production and marketing of a particular drug. The concept of essentiality is absolutely misquoted in this context. Any drug, which has sales less than the prescribed amount, would qualify to automatically come out of the purview of DPCO. Many a time the price of drugs under DPCO has been less than that of the ceiling price fixed by DPCO/NPPA. The system of ceiling price is slowly becoming absolute due to market driven price. Thus the role of DPCO is effective only if the producer has monopoly prices over and above the ceiling prices. Thus two forces were acting simultaneously. While the prices of drugs going out of DPCO's control were to go up, the competition driven market has always succeeded to keep the prices of such drugs below that fixed by the DPCO/NPPA. Competition emerged due to the process patent. Furthermore, it is the function of NPPA to keep a watch on the prices of drugs and to fix the ceiling price for new drugs/dosage forms.
DPCO also was finding it increasingly difficult to fix the drug prices due to (a) increasing number of formulations (about 75,000) due to relaxation in the patenting system, and (b) time taken by the authorities to fix a ceiling price for the formulations and the bulk drug being very large, leading to lot of inconvenience in the production pattern of the required drugs. Further the need for DPCO's intervention to control will arise only when the prices are driven by the monopoly and not by the competitive system, which grew due to the process patent system that made India to develop in to technologically advanced country in the field of Bulk drugs. This makes it necessary to have a close look at the Patent system in India.
In such a scenario the WTO and its policies are going to change the scene of market topsy-turvy. The WTO emphasizes on product patent and does not recognize process patent. There may be a very convincing argument for the above rigidity in the policy its impact on a developing country and its intellectual development will be halted for just want of sophisticated technologies, which are too expensive to offer by an innovator from a developing country.
The developing countries, especially India is rich in its human resources. The human resources of India are rated best and are hired by leading economies of the world. This is also a true for the pharmaceutical market. The scientist of India were able to develop a technology to manufacture an anti-AIDS drug, which was so expensive that many developing countries of Asia and Africa would have suffered very dearly for want of medicine and lack of money. It was estimated that AIDS cocktail estimated at 10,000 US$ was brought down to 500 US$ per annum per patient and made the therapy affordable by the patients of the developing countries. The developing countries being poor in infrastructure are also lacking certain important features of the developed countries like health insurance. In an environment of economic insecurity, how the patients could be helped should be the concern of the WTO instead of encouraging solely the intellectual proprietary and economies and rights of an inventor, after all inventor also part and parcel of the universe and might have taken help from so many people in order to develop the technology.