Multinational Relief as New Indian Patent Law Approved

Despite fierce resistance from NGOs and leftist political parties, India's government has secured final approval for its amendment to the country's Patent Ordinance. The measure at last brings India into line with its obligations under the international TRIPS accord on intellectual property, and has been warmly received by the research-based multinational sector.

However, the government appears to have bowed to pressure to allow continued exports of some essential drugs to less developed countries, as the new framework will only protect new discoveries and will not affect drugs patented before 1995. Indian generics makers including Wockhardt and Cipla have welcomed this development, as it will allow continued production of many key products.

The continued capacity of some Indian drug producers to produce medicines that are still under patent in the West will be favoured by a number of global factors. The WHO's list of essential medicines includes Indian-made drugs, and the US government's PEPFAR initiative allows the purchase of some HIV/AIDS drugs that are still subject to US patents, provided the products are exclusively used in pandemic areas.

While these factors may not silence criticism from activists, as many innovative treatments will be affected, the government insists that the new amendment will bring major long-term benefits. A key consideration will be India's R&D industry, the expansion of which is a major strategic goal. Further, now that the patent law has received final approval, the international drug industry is in a stronger position to increase activities on the Indian market, with potential foreign investment gains from the new law claimed to be as much as US$10bn. Nevertheless, the industry's attention is now certain turn to whether India is able to enforce intellectual property protection in its post-Patent Law era.