Indian pharma cos see hope as US retreats on data exclusivity
Economic Times (India) | 15 May 2007
Indian pharma cos see hope as US retreats on data exclusivity
KG NARENDRANATH
NEW DELHI: A section of India’s generic drug industry has claimed that its ability to export generic drugs to over a dozen countries with which the US is planning FTAs will increase, if a “conceptual agreement” reached last week by the US’ House of Representatives speaker Nancy Pelosi and the Bush administration is ratified and implemented.
This because the agreement could prevent the US government from casting exacting obligations of “data exclusivity” on its future FTA partners-a situation which would have curtailed export of generic drugs to these countries.
Data exclusivity is a sort of legal assurance which the governments concerned give to the companies that invent drugs (most commonly they are patent holders) that the new drug-related data which they furnish before regulators for necessary approvals would not be disclosed to a third party. This is arguably an obligation on all signatories to the WTO’s trade related intellectual property rights (TRIPS) agreement.
A more flexible interpretation of the multilateral obligation is that it merely requires the drug regulators to ensure that the data on the new drugs is not relied upon by a third party for “unfair commercial use”. Another contentious issue in this connection is whether the tenure of data exclusivity could extend beyond the life of the relevant patent.
US has been asking its potential FTA partners to legally provide for data exclusivity in the more rigorous form: non-disclosure plus separate tenures of data exclusivity and patent. This is where the proposed agreement between the House and the Bush Administration would become relevant. As per the agreement, US’s future FTA partners will simply require to provide for data exclusivity that runs concurrently with patent protection. Which means this right would not exist beyond the patent life of the product. Hence, exporters of generic drugs would advance their entry into the markets of US’ future FTA partners.
As per the conceptual agreement hammered out by Nancy Pelosi, data exclusivity obligation would not preclude FTA countries from taking measures to protect public health in terms of the TRIPS agreement. It would also do away with the requirement that drug regulators would withhold approval of generics till it is able to certify that no patent would be violated. Also, there would be no obligation on the governments to extend patents in case of delays in patent or regulatory approvals process.
Says YK Hamied, chairman, Cipla, one of the largest domestic drug firms and a leading exporter of generic drugs: “It would certainly be good for the third world if US agrees not to insist on separate tenures for what they call data exclusivity and patents.” Indian government has, for quite long, been deliberating on whether to legislate for providing for “data exclusivity” in whatever form. “We should drop the term data exclusivity from our discourse,” Mr Hamied, who strongly opposes the concept, said. DG Shah, secretary-general, Indian Pharmaceutical Alliance, said that it marked the diminishing clout of the “Big Pharma” on the US Trade Representative.
If the proposed shift in the US trade policy occurs, it will impact the ongoing FTA negotiations with Columbia, Peru, Panama and perhaps Korea. Of course, these countries are no major export destinations for Indian companies. But the agreement could also impact FTAs and trade blocs which the US is likely to enter into in future and that could really benefit Indian drug companies.
