WTO DECISION COULD BOOST INDIAN GENERICS MAKERS

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Media reports claim that Indian drugmakers could gain from new WTO trade rules easing developing countries' access to generic medicines. The WTO has recently amended its TRIPS intellectual property agreement to allow countries without the capacity to produce their own generics to import from fellow WTO members.

A group of developing countries -- comprising China, Israel, Korea, Kuwait, Mexico, Qatar, Singapore, Taipei, Turkey and the United Arab Emirates -- have stated that they will make use of the new rules, but only when importing drugs in emergencies or extreme situations.

Market sources claim that the new system will have a limited impact on revenues for the drug majors, as many multinationals do not generate globally significant income from emerging markets. However, low-cost generics makers in India could benefit, although any benefits are expected to be "low margin."

Nevertheless, Indian firms will be able to exploit compulsory licensing regulations to work on new formulations -- such as HIV treatments -- well before their patents expire. When these drugs do eventually lose protection, Indian companies will be well positioned to capitalise.