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Rediff.com  » Business » Drug prices: India, UNCTAD differ

Drug prices: India, UNCTAD differ

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April 05, 2005 09:44 IST

The government on Monday disagreed with the findings of a draft UNCTAD study which had concluded that the prices of some drugs could increase while the prices of some others could fall in India under the product patents regime.

According to the draft UNCTAD study, there would be certain welfare losses to the Indian consumer under the TRIPS regime.

This welfare loss is not only in terms of higher (or lower) drug prices, but also in terms of lesser product variety in the near future, the study said.

Responding to the findings of the study, Industry Secretary Ashok Jha said the econometric analyses carried out by the UNCTAD were based on two important assumptions.

One, that there was no drug price control order and hence the government had no way to intervene in case of a price rise. Two, there was no compulsory licensing if drug prices increased.

"The reality is, however, quite different, as there is a Drug Pricing Control Order and an extensive compulsory licensing regime. Therefore, the conclusion one will arrive at based on the assumptions will be far from accurate," he said.

Jha said the Patents Act had clear provisions to protect the interests of the pharmaceuticals and chemical industry as the domestic industry could continue to manufacture patented products even after a patent is granted in respect of mailbox applications, on payment of a reasonable royalty to the patent holder.

He also reiterated the point that nearly 97 per cent of the drugs in the market and 100 per cent of all essential drugs were not covered by patents.

Jha said the government would today constitute a technical committee comprising legal and field experts to look into the issue of micro-organisms and chemical entities.

He said the government was also in the process of framing the revised draft rules and guidelines, defining the scope of patentability.

He added that there were few countries in the world that provided for both pre -and post-grant opposition, a provision included in the Patents Act.
BS Economy Bureau in New Delhi
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