A group of civil society groups have urged the prime minister to scrutinise the mergers and acquisitions in the pharma sector in the last five years and also to constitute of Parliamentary panel to examine concerns emerging out of acquisitions of Indian pharma companies by the multinationals.
Despite this impressive performance of Indian pharmaceutical industry there is huge unmet domestic needs. Access to affordable medicines continues to be critical concern in India and which still warrants immediate action. This situation may worsen in the coming days due to two important developments viz. introduction of product patents and MNC acquisitions of the Indian pharmaceutical companies, they claimed.
MNC acquisition would threaten the availability of affordable generic medicines in many ways. “First, generally, a generic company can invoke provisions of the Patents Act to introduce generic versions of the drug in the case of abuse of monopoly or unmet public demand. Through acquisition, MNCs eliminate this potential threat from the generic companies and create freedom to charge monopoly prices. Second, using the well established distribution network of acquired generic company MNCs can push their patented products instead of the generic products. In other words, these MNCs may withdraw the generic products of the acquired company and push their highly priced patented products,” the letter said.
“Third, as series of MNC acquisitions would eliminate the hard earned self sufficiency and create dependency on MNCs. This would create a serious challenge to India’s self-reliance in health and potentially threaten the health security of Indian people,” the groups said, pointing out that there are no effective legal or policy tools to address the concerns and government had not made any effort to assess the threats.
The NGOs urged the government to scrutinize all the M&A activities that have taken place in the last five years within Indian pharmaceutical industry and its implications on access to medicines. They also called for notification of the M&A provisions of Competition Act at the earliest to facilitate the scrutiny of the competition commission on MNCs’ acquisition of Indian pharmaceutical companies.
The groups urged the Prime minister to appoint a parliamentary committee to examine the threat of patents and acquisitions on access to medicines to people of India and recommend suggestions to address those threats, and to review the investment policy of approving 100% FDI in pharmaceutical sector with an objective of curtailing the MNCs control on Indian pharmaceutical market.
The groups included All India Drug Action Network (AIDAN), Centre for Trade and Development (Centad), Drug Action Forum, Karnataka (DAF-K), Delhi Network of Positive People (DNP+), International Treatment Preparedness Coalition – India (ITPC – India), Initiative for Health Equity & Society (IHES), and International People's Health Counci (IPHC- South Asia).