In the mesh of FTAs, whither generics?

As India goes about negotiating free trade agreements (FTAs) with economic powerhouses, a key question emerges — where would low-cost generics fit in the new regime?

India is currently negotiating FTAs with three behemoths—European Union (EU), Japan, and the European Free Trade Association (EFTA), which includes Switzerland, Iceland and Liechtenstein.

All the three blocs are pressing for a measure called data exclusivity — a period during which the innovator drug company’s clinical trial data cannot be relied upon to register a generic (exact off-patent version of the innovator drug, which is 40-80% cheaper).

If this provision is acceded, then generic drugmakers would have to conduct the entire expanse of trials to introduce the drug, which would indefinitely delay the entry of cheaper versions.

As negotiations with EU for a FTA gather momentum, experts tracking the agreements say that Japan would now be in a hurry to ink its own FTA with India.

According to an intellectual property (IP) expert from Third World Network, a non-profit organisation involved in development issues, the FTA with the EFTA cannot be ignored, as Switzerland is a key member. “The Swiss would definitely work to ensure that their local drugmakers don’t stand to lose out.”

Says Gopakumar G Nair, founder of Mumbai based IP consultancy and legal advisory firm Gopakumar Nair Associates, “Any weakness on India’s part while negotiating would be detrimental.”

Moreover, the FTAs with EFTA and EU demand patent term extensions, while the one with Japan is calling for making patent infringement a criminal liability.

Says the IP expert from Third World Network, “All these provisions would lead to continued monopoly of expensive innovator drugs, thereby depriving people from accessing low-cost generics.”

The problems while negotiating FTAs are multiple, says an IP lawyer based with an international humanitarian aid organisation. “During negotiations, countries make some demands and agree to some. Different bureaucrats are negotiating different FTAs and are taking diverse stances. Some of them are not interested in hearing out to views expressed by public health groups on the implications of giving in to certain provisions.”

The IP lawyer says that there is no clear negotiating strategy and often, bureaucrats fail to understand the subtle manner in which IP provisions get inserted into the FTAs. “There are chances that India may give in to the data exclusivity or patent extension demands in any of the FTAs.”

Patent experts also argue that the demand for data exclusivity goes beyond the boundaries of the TRIPS (trade-related aspects of intellectual property rights) agreement of the World Trade Organisation, which India is party to.

“Article 39.3 of TRIPS requires signatories to protect innovator company data against disclosure and unfair commercial use, but nowhere does it state that countries should
provide exclusive rights to the innovator for some period. The drugs controller relying on innovator data to register generics is TRIPS compliant, as the regulator is not a commercial body.”