As the sound and fury over the Compulsory Licensing of Bayer's  Nexavar dies down, a moot question surfaces. Is the  discovery of a new drug aimed at saving the humanity or for fleecing it?.

If the production cost of a dose of drug is Rs  80 or Rs 800 and a generic version of the drug costs Rs 8,800 and the same drug is sold for Rs 2,80,000 by a multinational , is the drug discovery just a façade for making exorbitant profits for multinationals in the name of serving humanity ?

While the ostensible purpose of research is public service and  many a time the molecules used by Big

Pharma to develop new products is  based on publicly-funded research, why the products should not be used to serve humanity instead of degrading research into a crass commercial enterprise for minting money ?

The drug, patented by Bayer in India in 2008, is used for the treatment of liver and kidney cancer, and costs Rs. 2.8 lakh for a month’s dosage. At  Rs 2.8 lakh for a month's treatment, Bayer's  Nexavar or Sorafenib pricing is almost out of reach for  the common masses in a country like India. Given the fact that a sizeable proportion of Indians live below poverty line, many of our patients cannot afford even this lower generic price. In effect, the patent is not serving the purpose in such situations since the benefits of the invention are not available to the needy.

It punctures the very foundations of the Hippocratic Oath , the  oath historically taken by physicians and other healthcare professionals swearing to practice medicine ethically, thus by eviscerating the  the very core of the medical profession itself .

The world over,non - availability of life-saving drugs at affordable prices is a major cause for concern.  Spread of life style diseases amongst the middle class and poor sections of the society has aggravated this dilemma as these diseases cannot be cured and medicines have to be taken life long. And most of the medicines required for controlling the life style diseases are under patent and pricey putting the poor patients in dire straits.

There are numerous instances  where the patient 's families have to  exhaust  their entire savings  for treating the life style diseases. Patient groups and social activists have been thus fighting against the patent - based monopoly pricing policies of multinational drug companies for many  years. Most of the governments world over have timidly accepted the 20 years patent claim for new drugs of the multinationals without much debate on the pricing policy. And patented drugs always remained outside the price control of governments.

In this context , the Indian patent office issue of the first  ever-compulsory licence  for the manufacture of cancer drug Nexavar or Sorafenib to Hyderabad -based Natco  by the Patent Controller in India is a thumping victory for several patients and health activists who have been fighting exorbitant pricing strategies of multinationals for the past several decades.

This also opens up a new avenue of availability of lifesaving drugs at an affordable price to the suffering masses in India. In fact, it is more a relief to thousands of cancer patients of the country rather than an incentive to the Indian generic company.

After Bayer’s rejection of Natco’s request for a commercial  license to manufacture Nexavar , the Indian company applied for a compulsory licence in last September to make a generic version of the drug.

Natco’s argument was that the patent holder had failed to meet the needs of the local market and it was able to provide the drug only to a small group of patients. While granting the CL under Section of 84 of the Patent Act, the office of the Patent Controller directed that Natco's  price for the drug should be Rs. 8,880 for a month’s dosage and also directed the company to pay six per cent of net sales as royalty to Bayer.

The Patent Controller’s order is the first bold step towards using the flexibilities provided under TRIPS against the abuse of patent rights. For Indian generic companies, the order is a major morale booster and can encourage them to fight monopoly pricing policies of the multinationals in India.

As India has one of the widest compulsory licensing provisions in the world, it is satisfying  to see that what was on paper is finally translating into reality. This move by Natco is likely to have a cascading effect as it would  spur other generic manufacturers to resort to Cls when originator drugs are prohibitively priced.

The government has also  asserted that India would invoke the flexibility it had under the WTO agreement on Trade Related Intellectual Property Rights (TRIPs) for compulsory licensing of patented drugs to ensure availability of life saving drugs at affordable prices to its people.

Commerce and Industry Minister Anand Sharma, under whose administrative purview the controller functions, has told that India would resort to compulsory licensing of patented drugs if it is absolutely necessary for the public good. The Patent office has informed that they may certainly consider accepting CL applications in future also, if circumstances demand so.

At the core of the patent system lies the effort to make available to the largest numbers the fruits of any new innovation, while providing a fair return to the innovator.

A CL is a key instrument in maintaining this balance. It allows regulators to break a patent holder's monopoly in situations where the monopoly is misused to deny access to the innovation to the masses.
Many patent law systems provide granting of CLs in various situations. The Paris Convention of 1883 provides that each contracting state may take legislative measures for the grant of compulsory licenses. The agreement on TRIPs also has  specific provisions if  a CL  is issued.

An example for  a  case pertaining to CL under Section 92 A was when Africa was in the grip of HIV/AIDS epidemic. At that time the patents for anti-retroviral drug combination (ARV) was with a few pharmaceutical companies like  GSK and Merck among others who were exclusively marketing the drugs at prices around $10,000 per patient annually.

At this juncture Cipla, offered a generic version of the drug at about three  per cent of the price. When the African government procured the drug from Cipla, they were sued by drug MNCs for violating their patent rights. However they were forced to withdraw the suit due to an outrage by the international community. This incident came up  in international forums like WHO, UN, UNCAD and WTO ministerial conference at Doha, in November 2001 where the issue of pharmaceutical patent and public interest was taken up and a declaration was made on ‘TRIPS Agreement and Public Health’.

The Patent Controller’s  order will significantly alter the landscape of the global pharma industry by forcing multinational  companies to adopt differential pricing strategies to make available drugs at much cheaper prices in poorer developing countries. At present  many of the leading cancer drugs are priced almost the same in India as they are in the US and EU.

This  watershed order in many ways prove to be a middle path in the debates surrounding pharma patents and  affordable drugs accessibility. Patents may now be more acceptable  to critics, if their  monopoly effects can be successfully moderated through instruments such as compulsory licensing.
Thus CLs can be important tools in  balancing  the competing interests of various  stakeholders. On the one hand while  it rewards innovators and also assures that they get a share of the profits made by the generics in the form of royalty, on the other it  puts a rein on excessive pricing and thus proving to be a deterrent for exorbitant profits.

However despite the heated public discourses  over  the pros and cons of  CLs, one question remains  unanswered – is profit the only motive for doing research? This is all the more glaring as  there are a plethora of reports now about dubious clinical trials as well as fake  clinical trials reports to authenticate drug tests.