The Intellectual Property Appellate Board order upholding the compulsory licence granted to Natco Pharma to produce a generic version of Nexavar, or Sorafenib, a cancer drug patented by Bayer Corporation, is a strong endorsement of lawful action taken in public interest. Access to essential medicines is fundamental to the human right to good health. India’s amended Patent law and the Trade Related Aspects of Intellectual Property Rights clarified by the Doha declaration are unambiguous when it comes to invoking compulsory licensing provisions to benefit people who cannot otherwise afford treatment. The pharmaceutical industry has done itself a disservice by pricing essential drugs beyond the reach of the average citizen. The phenomenon is graphically illustrated by the Nexavar case: the patented and generic equivalent are priced at Rs. 2.8 lakh and Rs. 8,800 respectively for one month’s dosage, a staggering differential. Although the licence given in the Natco case resulted in voluntary price cuts on other cancer drugs by some companies, several key branded drugs remain unaffordable in India. This is partly due to the failure of States to centrally procure and distribute them. Where such procurement exists, manufacturers are ready to sell to official agencies, such as the Tamil Nadu Medical Services Corporation, for a fraction of the retail price.

The Twelfth Plan points out that availability of essential medicines in public sector health facilities free of cost is critical today. Equally, the list of essential medicines should be expanded, and States must set up special stores to make the drugs prescribed in the private sector available at low cost. What stands in the way of people benefiting from availability of new medicines in cancer treatment, among other areas, is the post-2005 product patent dispensation which has created manufacturer monopolies. This can be mitigated through compulsory licensing and that too by facilitating large scale manufacture in the public sector. India’s pharmaceutical market based on private sector care is worth about Rs. 56,000 crore annually, the major part being spent on non-essential medicines. The High Level Expert Group on Universal Health Coverage points out that the industry spent over a quarter of its annual turnover on sales promotion and a mere seven per cent on research and development. It is disingenuous, therefore, to argue that compulsory licensing will affect innovation. The Centre must persist with compulsory licensing and aggressive drug price controls. Favourable patent provisions must be protected and used without hesitation to advance universal health coverage.