By Ranjit Devraj
NEW DELHI, Mar 24 2005 (IPS)

Boxed in by pressures from its communist allies on one side and the ultra-nationalist opposition on the other, the ruling Congress party-led United Progressive Alliance has managed to pass a patent law in the Indian parliament that broadly conforms to World Trade Organisation rules while protecting national interests.

The Patent (Amendment) Act was passed Tuesday in the law-making Lok Sabha (lower house) on Tuesday and ratified by the Rajya Sabha (upper house) on Wednesday. It now awaits the largely ceremonial presidential assent before it can be gazetted.

”We were satisfied that the government made the changes we demanded for the sake of national interest,” said Nilotpal Basu, a parliamentarian from the Communist Party of India – Marxist (CPI-M) which along with other communist parties provides critical outside support to the pro-reform government of Prime Minister Manmohan Singh.

The ultra-nationalists, right-wing Bharatiya Janata Party (BJP) not only opposed the patents law but also staged protest walkouts claiming that it gave too much away. Ironically it was a BJP-led coalition that had proposed the original bill in 2003.

Leader of the BJP, Vijay Kumar Malhotra said the party, which lost elections in May after a six-year stint in power, would now take to the streets to protest against the new law. Malhotra said the price of drugs would rise steeply due to the new act because Indians would now have to pay high royalties to foreign patent holders.

Indeed the general opinion is that the communist parties, which enjoy more clout in the present national government than at any time since India’s independence in 1947, have come away from months of bitter wrangling over the controversial bill smelling the cleanest.

Commented the widely circulated, pro-business ‘Hindustan Times’ daily in an editorial on Thursday: ”The Bill was passed with the BJP playing politics, the Congress being clever and the Left surprisingly constructive.”

Among the changes the communist parties can claim credit for is the rewording of the bill to curb the ”ever greening” of drugs by pharmaceutical companies to read that ”the mere discovery of a new form of a known substance, which does not result in the enhancement of the known efficacy of that substance”, will not be sufficient ground for granting of a patent.

Ever greening is a subterfuge resorted to by pharmaceutical companies to renew an expired patent by citing a new use for the same drug.

The law, which passed by a voice vote in parliament’s upper house was in the end not as restrictive as drug activists had feared.

They won a provision allowing generic manufacturers to copy patented products under a reasonable royalty, and they gained for local companies a right to contest patent applications before patents were granted.

Also enacted were strict ”compulsory licensing” provisions, in which the government could allow patents to be broken if generic drugs were required for a health emergency.

In spite of the positive steps pushed by the communists, several voluntary agencies expressed fears that the price of several life-saving drugs produced by Indian pharmaceutical companies would see a phenomenal rise.

Well-known cardiologist and president of the Delhi Medical Association Krishan Kumar Aggarwal said it was reasonable to expect that ” thanks to the new law several existing generic drugs would soon disappear from drug stores.”

”We are looking at a situation where soon no pill will be available for less than a dollar and pharmaceutical prices of effective drugs for ailments such as diabetes and cardio- vascular ailments would be closer to international levels though perhaps not as high,” he told IPS.

”The profits will be in the sheer volume of business that the manufacturers of patented medicine can reap in an untapped market of over a billion people, though admittedly the poorer sections are bound to be left in the lurch,” added Aggarwal.

The new rules do not apply to drugs patented before 1995 but Amit Sen Gupta, a medical doctor with the Delhi Science Forum, pointed out that the real danger was in the drugs going obsolete fast.

Under the act, drug makers will have the same 20-year patent monopolies as they have in the west. But as AIDS patients develop resistance to old drugs, new treatments will become less affordable.

Although the new patent regime has provisions for compulsory licensing the procedures may prove too complicated to provide quick enough relief in the case of an epidemic, said Sen Gupta and his colleagues at the Forum.

For more than two decades Indian law recognised only process patents rather than product patents and this allowed Indian’s pharmaceutical companies to make cheap copycat versions of patented drugs which helped not only this country but also millions of people in the developing world.

Unfettered by international patent laws, India’s pharmaceutical industry burgeoned to become one of the biggest in the world and also one of the most fragmented with over 5,000 firms, both big and small, in the business.

This vast industry was churning out medicines that were selling at a fraction of the original price of the patented ones found, for instance, in neighbouring Pakistan. As a result of this, Indian generics constituted a major item of contraband for smugglers.

One expected result of the new law would be a series of mergers with the bigger pharmaceutical companies, swallowing up the smaller ones that cannot afford to go into research and development.

”Consolidation is bound to happen,” said Malvinder Singh president of the Indian-owned multi-national Ranbaxy. The company has invested heavily in research and development and the new law will protect its interests – just as it would for any global pharmaceutical company that does original research.

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