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A Policy Shift

Compulsory Licensing of Pharmaceutical Patents in India

The trend of continued rejection of compulsory licence applications in India goes against the local generic drug manufacturers and public health safeguards incorporated in the Indian patent law. It raises serious questions about the intervening role of the state in patent monopoly to equalise the competing interests between patent holders and consumers of “public good.” This trend indicates a policy shift of the government regarding compulsory licensing.

The compulsory licensing of patented essential medicines has been a contentious issue after the introduction of the World Trade Organization (WTO) Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) in 1995.1 TRIPS made profound structural changes in patent laws of WTO member countries by dramatically expanding the rights of patent owners requiring high levels of patent protection. The harmonisation of patent laws through TRIPS shows increasing power of pharmaceutical multinational corporations (MNCs) in international politics to influence government decision-making and actively shape the patent legislation of a foreign sovereign government to protect their markets (Sell 2003: 1). However, TRIPS guarantees and the Doha Declaration on TRIPS and public health affirm that the WTO member countries retain essential policy options, flexibilities, and safeguards, including the liberty to determine the grounds for issuing compulsory licences (CLs) to protect human health (WTO 2001).

Nevertheless, in recent years, many developing countries are facing escalating extralegal pressure from the developed countries backed by pharmaceutical MNCs to change their patent policy primarily to serve the interests of pharmaceutical MNCs. Against this backdrop, the recent grant of a CL by the Government of Malaysia for hepatitis Cvirus (HCV) drug and the grant of a temporary CL by
Germany’s Federal Court of Justice (FCJ) for the antiretroviral medicine can be viewed as a balance of rights and obligations to protect public health in compliance with TRIPS flexibilities. However, these two recent decisions lead to a crucial question as to why in India there is a continuous rejection of CL applications for patented medicines. In this article, we analyse this contentious issue and its implications for the compulsory licensing regime in India after the Natco–Bayer dispute.

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Updated On : 24th Jun, 2020

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