What Can We Learn From India? A Lot
The Article: India’s Patent Law: A Standard We Should All Follow by Nima Desai in The Speckled Axe.
The Text: Recently, The New York Times featured an eye-opening series of articles about lawsuits filed by Bayer and Novartis in which the Indian Supreme Court has controlled the prices of expensive cancer drugs under the country’s own patent laws as well as new public health laws created by the World Trade Organization (WTO).
While there are nuanced legal issues that frame these decisions, mainstream media outlets do not report on them fully. A possible reason for the lack of coverage may be because the ruling struck a serious financial blow to the pharmaceutical industry—one that will most likely total billions of dollars lost in annual revenue. One of the major issues left unaddressed? Evergreening, a cunning pharmaceutical business tactic that will soon become a huge issue in courts around the world.
The sly tactic focuses on patent owners making superficial changes to a patented drug to extend the life of their exclusive right to manufacture and sell said drug beyond its legal expiration date. For example, some of these changes could be as minor as the color of a capsule, dosage amounts, or the use of the isomer or mirror-image of the molecular structure of the patented drug.
The longer a company maintains a patent, the longer manufacturers cannot produce and sell generic versions of these drugs. The longer generic drugs cannot be sold by third parties, the longer a pharmaceutical company can retain a de facto monopoly over sales. The consequence of this monopolization is that drugs remain out of reach to the sickest and most vulnerable individuals.
For those with adequate health insurance, the impact of evergreening is not as dramatic as described above, as insurance coverage mitigates the cost of extremely expensive medicines that remain patented. But for those across the globe who do not have health insurance or have inadequate health insurance, the expiration of a patent means that a cure is within their reach.
How The Endless Growth Of Evergreening Begins
Evergreening requires artful legal manipulation paired with unscrupulous scientific imagination. Here are the players and their playbook:
Lawyers for pharmaceutical companies work with Research and Development (R&D) to take advantage of legal and procedural loopholes present in the system. In so doing they prepare a series of patent applications that, when crafted correctly and are timely filed, extend the patent term of a drug for as long as legally possible.
The desired extension typically lasts for 20 years, which ultimately translates to tons of money finding its way into the pockets of the pharmaceutical companies. But of course, they can only win a patent term extension if they have mastered the procedural rules in the given country where they first filed the patent. As a result, the process of evergreening a patent is akin to a twenty-year long, high stakes chess game with patent offices and courts throughout the world.
Suffice it to say that the drafters of the US Constitution didn’t really envision others gaming the system this way. Nevertheless, given its high domestic profitability evergreening is commonplace in the United States as well as Europe.
In both areas, evergreening hinges on the mistaken belief that patent laws exist solely for the protection of the inventor and his livelihood. But make no mistake: this is utterly false, as the fundamentals of patent law do not support the practice.
This is how the patent law actually works: federal governments across the globe grant patents to reward and protect the inventor as well as the public, defined as the theoretical players in the “marketplace of ideas,“ which for pharmaceuticals means scientists, academia, and generic drug manufacturers. This is the basic covenant between the government and the inventor and is something steeped in American constitutional law and derivative laws worldwide.
India And The West: Tales Of Contradictions And Controversies
Despite the fact that evergreening contradicts the theoretical underpinnings of patent law, the United States and Europe still support the practice. While pharmaceutical companies like Bayer and Novartis have successfully implemented this tactic in countries where insurance companies end up footing the bill, India’s case is different.
Why? Most of India’s citizens don’t have consistent health coverage so their law doesn’t tolerate evergreening. But it’s not only the lack of widespread insurance coverage that has affected the Indian Supreme Court’s view on patents; India’s current patent law is also a byproduct of early Indian nationalism & socialism.
After gaining independence, India fervently sponsored domestic manufacturing as well as immediate, emergency responses to critical public health issues. Thus, many ignored patent law for a considerable time in the country’s early days, all while pharmaceutical manufacturing (and reverse manufacturing) boomed with support from Indian judicial and political branches. But by the 1970’s India’s patent laws had been firmly entrenched within society and soon thereafter were updated as lawmakers scribed and adopted international treaties.
And so, the recent Indian Supreme Court rulings seem to echo a time in the young nation’s history when foreign companies were viewed with suspicion. As a result, the big losers here are large multinational pharmaceutical companies that–equipped with modern power and international influence–rival the much-hated The East India Company of yore.
In the case against the Swiss company Novartis, evergreening played a crucial role. Here, the Supreme Court rejected a second patent term for the popularly dubbed “magic cancer bullet” medication Gleevec used to treat ten different types of cancers.
Why did the Court strike down the second term? The answer is remarkably simple: lack of innovation. In order to renew a patent, a clause in Indian patent law requires greater efficiency as well as some sort of legitimate and new “innovation.” And in comparison to the broad definitions of “innovation” in the US and Europe, the Indian bar is much higher.
Though in the case against Bayer, evergreening did not play an important part. Rather, the Indian Supreme Court addressed the costs of recently developed patented medicines that treat less-common diseases and cancers so expensive that they are out of reach for most Indian citizens. This extreme pricing scheme is the result of another successful business tactic that attempts to fill the revenue gap left by blockbuster (and now generic) drugs like Prozac and Lipitor.
Ultimately, the Indian Supreme Court ordered the German company to license its drug class patent rights to Indian-owned manufacturing companies as long as minimal royalties were paid to Bayer. As a result, India became the first country to invoke a new WTO rule that allows a country to override a patent if it prevents access to a life-saving medication.
Access To Generic Drugs: The REAL Human Rights Issue Of Our Time
India’s complex legal history has been a boon for other developing nations that benefit greatly from its export of cheap, high-quality generic drugs. The major beneficiaries are those afflicted with HIV/AIDs who get generic forms of anti-retroviral medication.
Currently, India exports 80% of the medicine now used to treat over 6.6 million people living with HIV/AIDS. In Zambia, for instance, generic Indian anti-retrovirals annually cost $120 a patient as opposed to the brand name versions that cost ten times that amount per year.
Despite massive evidence to the contrary, some critics in India and Europe claim that India’s patent rulings will not affect the most vulnerable populations who cannot even afford generic prices. In essence, they’re saying that the ruling was poorly considered and based primarily on emotion. But when put under a microscope this highly misleading argument simply doesn’t pan out: it’s common knowledge that along with other developing countries, India’s middle to lower-middle class is growing at a dizzying rate.
The protection against evergreening and other predatory business practices may literally be the difference between life and death for those suffering from diseases that now have new, promising, but patented cures. But if the patents of brand-name drugs are allowed to continue indefinitely, high prices will always keep lifesaving drugs outside the reach of millions. There’s no developing from that.
