Mini-WTO like a placebo: Industry

NEW DELHI: A closer look at the ‘‘gains’’ from the recent WTO mini-ministerial meet at Sydney reveals that the pharma industry, for one, is far from happy from the outcome of the talks.
Indian pharma firms see little progress in the area of drug exports to developing countries under the compulsory licencing agreement.
Under compulsory licence, any pharma firm can supply patented drugs to governments (not for commercial purposes) even before the expiry of the patent period.Such licences are issued only when there are national emergencies, and only applies to certain diseases (like AIDS, malaria, tuberculosis). Many domestic firms see this segment as a sunrise area, thanks to a traditional low-cost manufacturing base.
While three key demands of the Indian government have not been accepted, a sub-group of five nations (US, EU, South Africa, India and Brazil), under the chairman of TRIPS council, have been set up to discuss and deliberate on the issues.
To start with, Indian government was looking at a waiver for a compulsory licence from the domestic government when the company already has a licence to export drugs — in case of a national public health emergency — from a foreign country.
The Indian government felt that this would not only make the process smoother, it would save time, according to industry experts. However, this was not favoured.
As things stand, the mini-ministerial body wants to make the compulsory licence obligation from the domestic government mandatory. As this approval would have to be done on a case-to-case basis, a firm would need to apply for separate licences for each different drug.
‘‘This will make the whole process very bureaucratic and time-consuming,� says a senior official of a pharma firm. Even under this condition, there is a rider, under Article 31 (F), saying, the export volume component should not exceed 49.9 per cent of the total production of the drug. ‘‘This is also a problem as export component of certain drugs may be higher,’’ says another firm.
Then, the government wanted pricing and royalty issues to be determined by the capability to pay of the importing country.
However, the WTO mini-ministerial body also ruled that price must include a royalty component, which needs to be decided, denying a waiver. ‘‘This again limits the scope of exports as most poor countries may not have the capability to pay the price and royalty,’’ a company official said.
Finally, India also wanted to remove the rider that the exporting firm, under compulsory licence, needs to manufacture exactly the same quantity of the drug required by the importing nation.
This again wasn’t agreed to. ‘‘Limiting manufacturing capability might affect the cost-effectiveness of the plant,’’ a pharma expert said.