'90% of the drugs used in the country are not patented'

In the background of huge investments being made for research and development (R&D) in the pharma sector, there are possibilities of a rise in the prices of drugs, especially those that are life saving.

The increase in prices might come into effect in event of the proposed third amendment to the Indian Patent Act to be affected from January 2005.

India is slated to amend its patent laws by January 2005 with a view to fulfill its commitments to World Trade Organisation (WTO) norms.

The amendments might include patenting of products that include substances or materials per se relating to food, medicine, drugs, product of chemical reactions, alloys, semi-conductors and inter-metallic compounds.

According to Malathi Lakshmi Kumaran of New Delhi-based consultancy firm Lakshmi Kumaran & Sridharan, at present 90 per cent of the drugs used in the country are not patented. At present, the drug prices in the country are almost 15-fold lower than global prices.

With the proposed enactment coming into force the drug prices are expected to rise, although the existing drugs will not be patented, she said.

Kumaran said that the pharma companies, on the pretext of the new patent regime, would take advantage of the situation and bring about an increase in prices to meet their R&D costs running to Rs 70-80 crore.

The prices of the remaining 10 per cent already patented drugs that are used in the country may also rise, she said.

According to Kumaran, companies are under the misconception that registering for patents is expensive. "Compared to the other costs like R&D, filing for registration of patents is nominal in India," she said.

Kumaran also said that the proposed new amendment to the Patent Act would encourage innovative process and development in the industry. She said that the amendments would allow second use of patented drugs that is not allowed at present. This can be done through cross licensing and would increase availability of drugs.

"The proposed changes in patent laws include patenting of micro-organisms and changes in the definition of invention to accommodate new product or process, involving inventive steps and capable of industrial application," Kumaran said.

The chemical processes to be patented will include bio-chemical, bio-technical and micro-biological processes. The patent rights will have a uniform term of 20 years.

Pending the proposed enactment to the existing law the mail-box provision was provided to receive applications for patenting of new drugs and agro-chemicals. Already 5,000 applications have been received.

Keeping in view the new enactment, India made a provision for exclusive marketing rights (EMRs). The EMRs provide for marketing patented drugs including their exports and imports.

Citing the example of four companies, she said that EMRs were accorded to United Phosphorous for agro-chemical, Wockhardt for chemicals, Novartis for its product Glivac and to Eli Lily for one product. However, the EMRs given to Eli Lily were subsequently withdrawn.

Kumaran said that according to patent laws, innovations and inventions could be patented but not discovery. "There is an issue of patenting micro-organisms. India can take up this issue and say that micro-organisms fall in the realm of discovery and are thus not liable to be patented but when such micro-organisms are genetically modified they can be patented," she said.

Regarding the patents for genes, she said that in other countries, the patenting of genes is allowed as this involves the process of isolation and study of properties for use.