The Intellectual Property Appellate Board of India on March 4 rejected the German firm Bayer AG's appeal of a ruling last year that allowed Hyderabad-based Natco Pharma to produce a cheaper generic version of Bayer’s kidney and liver cancer drug Nexavar. This would result in a treatment that more people would be able to afford. Our cover story for September 1-15, 2012 issue went behind the scenes to narrate how the initiatives of policymakers brought about this welcome change. In light of the latest ruling, we revisit that cover story.

Shanta Kumar heads the parliamentary standing committee on commerce that is examining the impact of foreign direct investments (FDI) in pharmaceuticals. In an interview with Pankaj Kumar, the BJP veteran discusses drug pricing, the generic-patent debate and the role of multinationals in this key area. Edited excerpts:

As per health ministry findings, multinational companies’ market share has increased from 15 percent to 25 percent in the last five years, affecting the availability of cheaper domestic essential medicines.'
In a country like India where 70 crore people live on meagre Rs 20 a day, each and every commodity should be made available at cheap rate, and especially medicines must be available to everyone.

Before 1970, there was no patent protection in India. So production of generic medicine got a boost and it increased so much that India started being called the “pharmacy of the world”. But after 2004-05, with the advent of patent protection, the situation has changed rapidly.

Also read: When policy is matter of life & death

But people have a Right to Life. Generic medicines should be produced in abundance by keeping peoples’ interest in mind. At the same time, the quality and standards of generic drugs must be maintained.

But doctors as well as patients suspect that the quality and effectiveness of generic medicines is not assured.
It is the duty of the government to regulate the quality control mechanism of generic drugs so that its credibility never gets questioned. Adulteration in medicine is a serious offence and it must be dealt through a stringent mechanism.

The World Health Organisation has found that generic medicines are available only in 20 to 40 percent of Indian public hospitals it surveyed. People are thus forced to go to private shops to purchase medicines which are likely to be branded and hence costlier.
It is all because of multinational companies’ influence. They give a cut and perks to doctors. Doctors are given the licence to practise by the government of India. Can’t we issue them the licence on the condition that they will prescribe generic medicines to the extent possible? They will prescribe MNCs’ drugs only when no options are there among generics. As per MCI (Medical Council of India) rules, doctors should prescribe cheaper drugs whenever possible and in my opinion if doctors violate (this rule) for their selfish interests, their licence must be cancelled.

For the first time in India, ‘compulsory licence’ was invoked and the generic version of patented drug Nexavar, which is 97 percent cheaper than the original, has come to the market. Do you favour more compulsory licences for such generic substitutes?
This is a bold and welcome step and the government should carry it forward. In the field of medicine we could progress and develop without FDI. We got recognition in the whole world. Then why is FDI needed? It is a serious question. But one thing is for sure that availability of cheaper medicine to people is a must and whatever needs to be done for that should be done.

India invoked compulsory licence under WTO provisions, but MNCs have strongly opposed it, arguing that there was no national crisis to justify this move.
In a country like India, a lifesaving drug of Rs 8,800 is sold at Rs 2.8 lakh: is it not a national crisis? What can be a bigger crisis than this? We should fight for our own people and national interest must not be sacrificed.

But MNCs’ argument is that the high price funds research and development and if there is a shift towards more generic drugs, R&D and invention will be affected.
R&D must be taken care of. The government should finance it. R&D should be there for the welfare of humankind and it must not be a licence to extort people.

The committee you are heading is examining the impact of FDI in the pharmaceutical sector. How do you look at recent cases of the takeover of several Indian firms by MNCs? Will the trend  ultimately push up the prices of essential drugs?
It is a very serious and important question. Whether FDI is needed in the pharma sector or not, whether it is required in ‘greenfield’ (new ventures) or ‘brownfield’ (existing ventures)? Our standing committee is studying the issue and we will give proper advice to the government. It is a serious question whether MNCs should be given freedom (in price matters) or not without caring for our population.

Aamir Khan met the panel you head against the backdrop of the demand to promote generic drugs. What exactly did he speak about?
The questions Aamir Khan has raised are also the questions we are considering. Our thinking is affordable healthcare should be available to everyone. If cheaper drugs can be made available, why should there be costlier drugs [prescribed]? Generic drugs should be available to common people and for that the public sector must be revived.

India is a welfare state, which means the government must take care of the poor patients. If that can happen in a country like Canada, why should it not be the case in India? But multinationals have been given freedom to loot our country. Indian companies were acquired (by MNCs) at the four-five times’ their cost on the condition that they will quit the pharma sector. Don’t you think that it is all being done to create monopoly in the market? Loot ki chhoot bandh honi chahiye (This loot must be stopped).

[This interview appeared in the September 1-15 issue of Governance Now.]