Events & Issues

New Delhi, 4 June 2012

India on Watch List

US ACTION UNCALLED FOR

Dr. PK Vasudeva

The US continues to revel in its ‘big brother’ syndrome, despite the fact that equations are changing regularly. Nations can be upset with such an attitude. And India, for one has reason to be miffed over being on its ‘watch list’. It is not shying away from badgering its protest and hopes that the Americans will pay heed. It’s been over a month and little headway has been made in the case.   

The United States Trade Representative (USTR) had in April-end released its Special 301 Report, an annual review of the global state of Intellectual Property Rights (IPR) protection and enforcement. While reviewing 77 trading partners for this year’s Report, the USTR placed 40 countries on the priority Watch List or Section 306 monitoring list. India is among these 40.

An upset Commerce and Industry Minister Anand Sharma has flayed the Americans decision to place India again in the group of nations with insufficient intellectual property protection, and asserted that the country is WTO-compliant. The Ministry has insisted the USTR for a comprehensive re-look at the intellectual property regime in India “with an open mind,” and that India is willing and ready to discuss all its concerns.

Describing the US step as “unfortunate and unjustified”, New Delhi has informed the USTR clearly that: “India has been found to be compliant with all WTO regulations including Trade Related Aspects of intellectual Property Rights (TRIPS) Agreement, in the recent review of India’s trade policy carried out in the WTO.”

India continued to be included in the US priority watch list of countries together with 14 others like China, Pakistan, Canada and Russia. This means that these nations will be the subjects of particularly intense bilateral engagement during the coming year. The report has regrettably noted that India has made limited progress on IPR protection and enforcement in 2011, and its legal framework and enforcement system remain weak.

However, the Commerce Ministry is perturbed and insists: “India has maintained a stable IPR, which is fully Trips compliant and we have a strong enforcement mechanism in place. India’s IPR regime has witnessed many steps in the recent times to improve efficiency and transparency in the Intellectual Property Office and measures have been taken to accede to the Madrid Protocol.” But, the Americans have to agree, which seems difficult so far. 

Additionally, the US, in its report, has raised concerns about the issuing of compulsory license (CL) by India. It has said that it would closely monitor developments concerning compulsory licensing of patents in India following the broad interpretation of Indian law in a recent decision by the Controller General of Patents. India, however, maintained that it had not bent any rules and its steps were strictly as per the flexibilities contained in Trips to address public health concerns of its people.

Only last month, India witnessed a similar debate boil-over, with the Patent Office issuing a compulsory licence (CL) in favour of generic drug-maker Natco. The CL allowed Natco to make a generic copy of Bayer's advanced kidney cancer drug Nexavar, on the payment of a royalty to the innovator (Bayer).

The Patent Controller's judgment was a path-breaker, signalling the Indian Government's commitment to step-in if required, to bring critical and expensive medicine within the reach of more people.

Close on the heels of the Indian Patent Office issuing a CL to Natco, the Kenyan High Court, ruling on the country's anti-counterfeit law, has said that citizens right to health is supreme. Health above all else is the unambiguous message from the High Court of Kenya, in its recent judgment relating to the country's Anti-Counterfeit Law, 2008.

Recognising the danger of the definition of counterfeit coming in the way of generic medicines being supplied into Kenya — the Court has asked the Kenyan Government to review provisions in the Act and ensure that a citizen's right to health, life and dignity is not jeopardised.

The ruling is significant since, across different markets in the world, health and the protection of intellectual property are pitted in a head-on collision. And when called to sit on judgment in such a confrontation, the Courts are increasingly casting their lot in favour of public health.

The Kenyan ruling also clearly outlines that generic drugs are not counterfeits, a distinction that Indian generic-drug-makers, for instance, have had to fight for several times in overseas markets.

Generic drugs are legally manufactured, chemically similar versions of innovative medicines that have outlived their patent-exclusivity period. They are also much less expensive than the innovative medicine, since they do not have to recover research or development costs, and have to only undertake bio-equivalence tests to prove they are qualitatively similar.

Indian generic drug-makers have in the past had constant run-ins with the European authorities, when their consignments (merely transiting through a European country) were seized on allegations of patent-infringement. New Delhi even took the Dutch authorities to the WTO's Dispute Settlement Body. In 2008, 16 of 17 export seizures by Dutch authorities on the basis of an anti-counterfeit EU regulation were from India. The standoff weakened eventually, with European authorities assuring India that their products would be allowed to transit.

The Kenyan ruling says, the Anti-Counterfeit Act, if implemented as it is, poses a danger to accessing essential medicine — and this was “far greater and more critical than the protection of the intellectual property rights that the Act seeks to protect. The right to life, dignity and health of the petitioners must take precedence over the intellectual property rights of patent holders.”

Also making a strong pitch for public health in the Kenyan counterfeit case, was a submission as “friend of the court” by Lawyer's Collective's Anand Grover, who filed an amicus curiae in his capacity as the United Nations Special Rapporteur for Health.

“The Act as it stands contains an ambiguous definition of counterfeiting that if misinterpreted would impact adversely on the right to life enshrined in the Kenyan Constitution; specifically through the definition potentially conflating issues of intellectual property rights and quality control.”

Put simply, it said, there was clear danger that generic medicines would be seen as counterfeits. Delighted with the final ruling, Grover expected the ruling would have ramifications in the other African countries as well, as Courts follow precedents.

This case clearly shows that the USTR action of placing India under Special 301 priority Watch List for violation of IPR is uncalled for. India is fully compliant to TRIPS of the WTO and has mostly avoided using CL even when the need arose except in the case of Natco, which is fully justified under the Trips agreement. How long will it take for the US to take a re-look is the big question? ---INFA

(Copyright, India News and Feature Alliance)