Natco’s compulsory licence has had the intended effect

The message in the compulsory licence granted to Natco Pharma to sell a generic version of patented cancer drug Nexavar appears to have hit home.

Earlier this month, Cipla, which was already selling generic Nexavar at Rs28,000 for a month’s course, cut the price drastically to Rs6,840.

“Cipla has reduced prices for its other cancer drug as well. But the crux remains that the compulsory licence was a key factor that led to the reductions,” said Amit Sengupta from the People’s Health Movement, a pro-patient lobby.

To recall, Hyderabad-based Natco had filed an application with the patent office last year seeking approval to market a generic version of the kidney and liver cancer drug on account of its high pricing --- Nexavar is sold by its patent holder, German firm Bayer for Rs2.8 lakh for a month’s treatment. Natco got a compulsory licence from the patent controller in March, following which it launched its generic version for Rs8,800 for a month’s course.

A patent expert said Nexavar would have continued to be out of reach for most people had Natco not been granted the compulsory licence. Also Cipla, against which a patent infringement case is pending, would have continued selling its generic version at Rs28,000.

Leena Menghaney from international humanitarian organisation Medecins Sans Frontieres concurred. “Compulsory licence in this case has attained its objective of bringing down prices drastically by encouraging generic competition,” she said.

Experts, in fact, hint that there is scope for prices to fall further.
“Even after a CL is granted to one player, other interested firms can also apply for compulsory licence. The idea is to allow generic competition and not restrict the field to create monopolies,” said Sengupta.