China has amended its intellectual property (IP) laws to allow for compulsory licenses, which could anger some large multinational drugmakers because it enables local companies to produce and export generic versions of brand drugs that have not lost their patent protection.
“Big pharma companies have invested significantly in China, so it is unlikely that they will pull out entirely,” D’vorah Graeser, founder and CEO of Graeser Associates International, said. “But of course this will depend upon the extent to which compulsory licensing is used in China.”
According to China’s IP office, the compulsory licenses will be granted for purposes of public interest, national emergency or extraordinary circumstances. Generics granted the licenses also may be exported to countries where life-saving drugs cannot be obtained or are unaffordable.
The new regulations culminate a long consultative process on revisions to Chinese IP policy, PhRMA spokesman Mark Grayson said. The compulsory licensing policy isn’t expected to affect foreign drugmakers’ investment in the Chinese market, he added.
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