It has taken a long time for India to realize that patents and the benefits that result from them to inventors, be they individuals or companies, are not immoral, but fruits of intellectual labour. Yet the idea that companies should not make “undue” profits and that the government should have an upper hand, at all times, to check them never dies. The recent debate over compulsory licensing should be seen in this light.
Some months earlier, the department of industrial policy and promotion issued a discussion paper on compulsory licensing. It also invited comments and feedback on the subject. Predictably the response was divided: foreign companies arguing against the measure and many local firms in favour of a compulsory licensing policy. Compulsory licensing allows the government, for example, during a national emergency, to override the patent and allow a third-party to manufacture a patented product—a medicine in short-supply—without the permission of the patent-holder.
India has a huge number of poor persons who may not have the financial means to afford expensive treatment. The case of anti-cancer drugs, which are expensive, is often cited as one example of the drawback of patents. This is disingenuous. There are other means to tackle this problem. To give a few examples, the government can purchase these drugs in bulk and then subsidize them for the poor. In many instances, especially in developed countries, pharmaceutical companies also have programmes to help poor patients to avail these medicines at affordable rates or even for free.
Yet these are not the issues at hand even if the discussion paper couched them in these terms. A look at the “issues for resolution” covered in the paper shows the government’s ambitions clearly. To give one example, issue No. 5 for resolution, that of using compulsory licensing as a remedy for anti-competitive practices, is a dead giveaway. This could be a handy tool in the hands of the government to intervene in a number of pharmaceutical production and pricing decisions.
One big objective of changes in India’s patent laws was to prevent such distortions in markets at the hands of the government. Now this seems to be making an entry through other means. These measures have the potential to derail India’s reputation as a market that values and protects innovations.
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