Intellectual property rights (IPRs) have far reaching consequences, not many of which are beneficial to the common man. More often than not, these exclusive rights are being used as per individual convenience. The impact of global patent in the form of the WTO's Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement has far-reaching effects for the research-based pharmaceutical industry and global health. TRIPS restricts the access of poor patients to medicines and provides a wide range of benefits to the pharma sector in particular. These benefits include a higher growth rate, to develop generic medicine and engage in new innovative research as well as increasing the presence of and collaboration with multinational drug makers. The exclusive right to market a product during the life of a patent allows the holder to recoup some or all of their initial investment by charging more for the product. However, the cost to society, particularly in developing countries, would be high if IPRs were used beyond the original intent of stimulating innovation, and as a commercial tool that overly restricts competition.
IPRs have been defined as ideas, inventions and creative expression on which there is public willingness to bestow the status of property. IPRs provide certain exclusive rights to the creator to exclude others from the use of certain intangible creation or innovations for a period of time. For the implementation of such a provision, TRIPS was established on March 5, 2005. But this provision is being used as per convenience of various people with varied interests.
Developed countries support the idea that there should be a strict IPR regime. The reason for this is that there is relatively less competitiveness. They cannot recoup their costs on the extensive R&D work carried out by their companies if the IPR regime is weak. The developing nations counter this argument on the basis that a strict IPR regime denies supply/availability of essential and life saving drugs to the needy and that any technological innovation should be a public good and not a private capital good.
On May 8, 1981, former prime minister, late Indira Gandhi, addressing the World Health Assembly in Geneva, said: "Affluent societies are spending vast sums of money understandably on the search for new products and processes to alleviate suffering and to prolong life. In the process, drug manufactures have become a powerful industry. My idea of a better-ordered world is one in which medical discoveries would be free of patents and there would be no profiteering from life or death".
Why does such diversified opinions on IPR persist? The answer lies in the impact of IPR on the pharma sector. IPR affects the trade of newer drug molecules. The high cost of medicines in most countries is the result of a strong IPR regime. The accessibility and affordability by import and export of drugs are also affected by IPR. In India, certain drugs are available at a comparatively cheaper rate. But this may only be due to the process patent followed here before 2005. Patents on newer processes for manufacturing of already existing drugs molecules are found to be registered while there is very less number of patents on the newer drug molecules. Ranitidine is sold by Glaxo in India at approximately Rs 7.20, while it is sold at higher prices in Pakistan, UK and USA by the same company. This shows the impact on accessibility of drugs.
Effect of IPR
The effect of IPRs will become clear if one takes the example of antiretroviral (ARV) agents used to combat the HIV virus. The invention of such a drug molecule has changed the face of the disease from a fatal to a more manageable one. But this has become possible only in developed countries whereas in the developing nations, the scenario is not so encouraging.
Of the six million people in developing countries who are in urgent need of ARV therapy, only eight per cent are receiving it.
MNCs and their patent rights are directly at fault here. But again the price problem is not completely unsolvable, as the availability of medicines is a socio-welfare issue and the government does interfere in price control and thus drugs are subject to government regulations. Such an idea of drug price control has also been successful in evoking another debate by pharmaceutical giants on the non-appreciative behaviour for the extensive research they carry out. Thus, the IPR has an impact on R&D too.
India, without a doubt, recognizes that there is perhaps no industry that relies as heavily on patents as the pharma industry. Before TRIPS was established, India was considered a hub for generic bulk drugs as Indian companies concentrated mainly on finding and patenting newer ways and processes of manufacturing known bulk drugs - a glorious example of the Indian workers' skill in reverse engineering, a polite term for organized piracy.
And now that the Patents (Amendment) Act, 2005 provides for the TRIPS regime, it is indeed very important to understand the impact it will have on the $4.5 billion Indian pharmaceutical industry representing 1.6 per cent of the global market. Cross-country analysis suggests that as the quality of intellectual property protection improves, expenditure on R&D as a whole will climb, and that will happen exponentially. Specifically, the switch from process patents to product patents will transform the pharmaceutical industry, and has already changed, the businesses of the indigenous generic pharma industry. Also with the TRIPS agreement expanding the scope of patent protection to include all fields of technology, similar transformation could sweep the biotech industry, and to a lesser extent the software industry, off its feet.
Today, reverse engineering skill is useful only for drugs going off patent. Nowadays research is carried out only for drugs that can garner big profits and this is again attributed to the IPR regime.
Amit Sen Gupta, a member of the National Working Group on Patent Law, says: "These drugs are being researched not because of the health need, but because they bring in profits. That is why you have research money going into drugs for baldness or erectile dysfunction but the last drug for tuberculosis was 30 years back. When you deny people of cars or washing machines they don't die, but when you deny people of medicine, they die in millions."
The debate is unending. In the words of Richard Gerster, the famous economist and activist from Switzerland: "The Indian pharma industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent." The critical point is that the pharma industry should not forget the true goal of drug innovation, saving lives. The Indian companies should be based on the ground rule of providing medicines at affordable prices to the needy Indian population on one hand and leveraging the Indian intellectual process on the other so that India can create its own intellectual property.
(The authors Mrunali Rashmin Patel, Kinjal Mistry are with Indukaka Ipcowala College of Pharmacy, Sardar Patel University, New Vallabh Vidyanagar 388121. Rashmin B Patel is with AR College of Pharmacy & GH Patel Institute of Pharmacy, Sardar Patel University, Vallabh Vidyanagar 388120, Gujarat)