Is Novartis ruling a watershed?


"It is a landmark judgement," Sakhtivel Selvaraj, a leading Delhi-based health economist, tells me, hours after the Indian Supreme Court's decision to reject a plea by Swiss pharmaceutical firm Novartis to patent an updated version of its cancer drug, Glivec.

Monday's decision means generic drugmakers can continue to sell copies of the drug at a lower price in India, one of the fastest growing pharmaceutical markets in the world.

For one, Dr Selvaraj says, the judgement upholds India's "progressive" patent laws that throw out frivolous patents and clearly distinguish between what is new and what already exists.

"The law sends out the signal that we don't want to encourage companies to take patents on substances which already exist."

More importantly, the decision is a major boost to cheap life-saving drugs in a country where the healthcare system cannot cope with the demands on it and most people end up buying their own medicines if they can afford to.

India spends a little over 4% of its GDP on healthcare, compared with an average of 8-9% among developed countries.

Some 70% of this spending is by individuals and households. A substantial amount of household spending in India is on medicines, government figures show. Most of that is on generic drugs as patented drugs comprise less than 10% of drug sales.

That explains how critical cheap drugs are to saving lives in India.

Also, as experts like Dr Selvaraj point out, the judgement will be happy tidings for people around the world.

India, they say, is the "pharmacy of the world".

Some 40% of the drugs produced by its $11bn pharmaceutical industry, one of the largest in the world, are exported. The majority of the exports comprise cheap generics.

Not surprisingly Novartis is unhappy with the ruling - it says the move "discourages innovative drug discovery essential to advancing medical science for patients".

The company had sounded out a warning ahead of the judgement.

"If the situation stays as now, all improvements on an original compound are not protectable and such drugs would probably not be rolled out in India," Paul Herrling, former Novartis's head of research and development, told the Financial Times.

"Why should we?" he added

Experts like Dr Selvaraj believe such warnings are specious.

"India can actually hold such a threat out to other developing countries, not the other way round. A substantial amount of its generic drug market is in Europe and the US," he says.

Also, India possibly doesn't need to worry about this decision affecting foreign investment in its drug industry, which, at less than 2%, is low.

Most foreign pharmaceutical companies appear keener to acquire Indian companies, or they trade in imported medicines.

"They make very little medicine here," Dr Selvaraj says.

Glivec, which is used to treat chronic myeloid leukaemia and other cancers, costs about $2,600 (£1,710) a month. The generic equivalent is currently available in India for just $175.

Do drugs really have to be so expensive? asks Michelle Childs of Medicins Sans Frontiers.

It's a good question.

"It is true that innovative new drugs can change the way we treat people and we need more of them," she wrote in an article on the BBC News website last week. "But innovation is of little use if people cannot access new treatments because they are so expensive."

Clearly, as Michelle Childs says, a new approach is needed.

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  • rate this

    Comment number 2.

    Indian entities and individuals should not be allowed to hold patents and copyrights in the EU.

  • rate this

    Comment number 14.

    Generic products should meet the same standards as branded drugs to obtain a licence. 4 phases of study + all the regulation for branded whereas only bioavailability studies required for generics. There are some very good generics, but equally a lot of very poor ones. If it was a more level playing field then standards would improve, or branded drugs would have further scope than 10 years

  • rate this

    Comment number 11.

    Re 9. RoyalBengal

    But the period over which pharmaceutical companies can make profit is only about 10 years due to clinical trials. If these pharmaceutical companies don't make profit, there is no room for innovation, particularly vital now considering the prominence of antibiotic resistance. Perhaps indefinite patents would drive down costs.

  • rate this

    Comment number 19.

    Seeing Indians in pics hailing this ruling celebrating in the streets makes me laugh and cry. What will you the common Indian get out of this - absolutely nothing, greedy co owners who have merely ripped off intellectual prop and investment by western drug cos to line their pockets. It isnt about helping the poor, furthest from their minds. It will only discourages drug development, hurts us all.

  • rate this

    Comment number 15.

    Re 14. Tc1234:
    Good idea - for some drugs the formulation doesn't really matter, but there are others (including some antibiotics) where the generic version is less than 50% as effective as the branded drug, because the generic manufacturer only needs to prove appropriate drug concentrations and absorbtion in vitro, not whether it actually works in vivo (ie in the real world).


Comments 5 of 105



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