IP fixation is bad for health
IPN Opinion article
Economic Times, India
Following the defeat of pharmaceutical giant Novartis in Madras High Court over a patent case last week, many have claimed a great victory for the health of the poor. Activists had campaigned hard to convey the misleading impression that weakening intellectual property rights (IPRs) would magically give the poor the best drugs available.
Indeed, Oxfam and MÈdecins Sans FrontiËres, the NGOs behind this campaign, claim that a victory for Novartis would have prevented Indian companies from manufacturing and exporting cheap (but good) 'generic' copies of medicines that are off-patent or were patented before the stronger IP laws of 2005. But the case had nothing to do with this. In fact, these organisations are campaigning more broadly against business and against all patents: they want medicines to be invented and produced by government laboratories.
This 'patients not patents' campaign has a simplistic appeal but it undermines growth and it distracts attention from the real causes of ill health, delaying difficult reform where it is most needed. Thailand has been the main focus of this campaign, where the military government recently issued a number of 'compulsory licences' that breach patents on medicines, citing as justification the loosely-worded terms of the WTO's Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement. The junta claimed that the prices of these patented medicines made it impossible to supply all Thai patients.
Screaming headlines diverted attention from what mattered most: the state of the Thai health system, suffering hospital closures and staff shortages. Without hospitals and doctors, cheap drugs are not much use ó and doling them out willy-nilly would do much more harm than good.
This is a road India went down many years ago. In 1972 India weakened its IP laws in the hope of cutting medicine prices. It certainly made some drugs less expensive but it was no panacea. About 60% of Indians do not have access to basic, off-patent ('generic') medicines. Children go without routine vaccinations. Simple generic anti-infectives are out of reach of the majority of the rural poor. Despite pumping out cheap generic AIDS drugs for years, only 5.5% of India's AIDS sufferers were receiving any drugs by the end of 2006.
For the Indian poor, IP is not the issue. The real issue is healthcare infrastructure. Government healthcare is in a shambles. According to a 2005 report by Transparency International, the health system is the most corrupt service sector in India. The transport network is so bad that rural people struggle to get to a clinic, even if one exists within 200 km of their home. Meanwhile, dirty water and smoky cooking fuels exact a terrible toll on the poor ó an estimated 400,000 Indian children under five die each year from preventable diarrhoea. As a result, an Indian child is almost twice as likely to die before the age of five as an Indonesian child and almost five times more likely than a Sri Lankan.
Undermining intellectual property rights would do nothing to address these fundamental problems but it would damage India's new economic growth. India strengthened its IP laws in 2005 in order to accelerate development by making the country safe for local and foreign investment, for innovation and for hi-tech production. It was able to do so because the people did not see any threat from stronger patent laws to their everyday lives. What they want are hospitals, clinics, doctors and nurses. Without these things, you can give drugs away for free and they still won't get to the most needy.
In the event, the prices of medicines have not shot up, despite activists' gloomy prognostications. Indeed, intellectual property is a crucial guarantee that patients will get high-quality, effective medicines. Copy-drugs that do not meet stringent international standards are likely to encourage mutated, drug-resistant strains of disease, particularly dangerous for malaria and HIV/AIDS ó and there are still Indian manufacturers making untested drugs.
Yet health minister Anbumani Ramadoss threatened in April that India might be ready to follow Thailand: 'India has not used compulsory licensing so far,' adding 'so we shouldn't be pushed towards that.' Although he was speaking about the Novartis case, the threat was clearly wider because Novartis gives away free the drug at issue before the court.
In the end, it is patients who are suffering from the current fixation with patents and prices. It is diverting attention from what really matters: infrastructure, doctors and nurses. Prosperity is the key to those services and intellectual property is one of the keys to prosperity: Indians must not let their growth be damaged by populist propaganda and the vested interests of a few producers of poor-quality copy-drugs.
The authors are analysts at International Policy Network, a development think-tank based in London