Cancer ruling opens door for cheaper drugs in India

By Kaustubh Kulkarni and Henry Foy

MUMBAI (Reuters) - India's move to strip German drugmaker Bayer of its exclusive rights to a cancer drug has set a precedent that could extend to other treatments, including modern HIV/AIDS drugs, in a major blow to global pharmaceutical firms, experts say.

On Monday, the Indian Patent Office effectively ended Bayer's monopoly for its Nexavar drug and issued its first-ever compulsory license allowing local generic maker Natco Pharma to make and sell the drug cheaply in India.

It is only the second time a nation has issued a compulsory license for a cancer drug after Thailand did so on four drugs between 2006 and 2008, also on affordability grounds. Thailand also issued licenses for HIV/AIDS and heart disease treatments.

"This could well be the first of many compulsory rulings here," said Gopakumar G. Nair, head of patent law firm Gopakumar Nair Associates and former president of the Indian Drug Manufacturers' Association.

"Global pharmaceutical manufacturers are likely to be worried as a result ... given that the wording in India's Patent Act that had been amended from 'reasonably priced' to 'reasonably affordable priced' has come into play now."

The new wording is seen as a lower threshold for compulsory licenses, which can be issued under world trade rules by nations that deem major life-saving drugs to be too costly. The licenses allow them to authorise the local manufacture or importation of much cheaper, generic versions.

Global drugmakers see emerging markets such as India as key growth opportunities, but remain concerned over intellectual property protection. Nair said HIV-related medicines were likely to be the most at risk by compulsory licenses in the future.

India has one of the world's fastest-growing rates of HIV and heart disease is also the country's biggest killer, but widespread poverty in Asia's third-largest economy makes many non-generic drugs unaffordable for millions.

Currently, Pfizer and GlaxoSmithKline sell a modern HIV/AIDS drug known as Selzentry through their joint venture firm ViiV Healthcare. The treatment costs more than 60,000 rupees for one month's dosage in India.

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Cancer ruling opens door for cheaper drugs in India