Fair comments on "Fake Drugs" ?

Recently, two analysts from International Policy Network, London wrote a piece entitled “Fake scare about Fake drugs” alleging that claims of ‘over-protection of intellectual property rights’ and at the same time, ‘not protecting patients interests’, which are being used by developmental NGOs (in their words, “Oxfam and other activist NGOs”), are false as well as dangerous. I would like to take this chance to react to their article, published by IP-Watch, as it contains a number of disputable, if not plainly misleading statements. Readers can access their article here.

Firstly, while striking an emotional chord with their readers by insisting that poor patients around the world are dying due to these medicines, they fail to deal with the crux of the matter at hand. They disregard the main issues which Oxfam and HAI had put forward in their recent report on the drug seizures and EU policies. Ironically, they use the same method they accuse the activists of using, i.e., of claiming to be protecting poor dying patients interests so as to manipulate policy in one particular direction, while ignoring the actual issues that the policy matters deal with. The main problem at hand is that the mere suspicion of infringement is sufficient for the customs officials to seize goods, regardless of a rational due process clause. The intent to delay drug shipments, whatever the means to this be, be it through alleging trademark infringement or patent infringement, is what is troubling ‘activist NGOs’. Delays of this kind are doubly problematic. Firstly, because it increases barriers to medicines and thereby reduces consumers’ supply; and secondly, generic pharmaceuticals cannot always bear the cost of delay, sometimes even leading to abandoning of consignments.

The authors seem to be justifying EU’s policing actions by stating that they are doing the developing world a ‘vital public service’. Are they implying that a self-appointed pharma police is a good thing? The authors also keep equating ‘suspected’ infringement with ‘actual’ infringement. However, even looking at past seizures that we have reported on, we see many instances where suspected infringement has included transfer of generic drugs legit in both the sending and receiving country as well as cases where drugs with International Non-Proprietary Names were stopped for ‘suspected trademark infringement’. This shows the ease with which a case can become a ‘suspected’ infringement one.

No doubt there are cases of fakes originating from India, and these are probably not isolated instances either, but its difficult to get to any real information or even numbers or statistics with obscure data and elastic, changing, and often intermingling definitions of fakes, counterfeits, substandard drugs and generic products. To add further confusion to it all, as pointed out on SpicyIP earlier, even all the so called fakes made in India, may not actually be made in India, with China even issuing an apology for having exported fake drugs improperly labelled “Made in India”.

The often-raised point on the legality of regulation 1383/2003, which empowers the EU to make these seizures, hasn’t been discussed in the article either. The recent Nokia Customs case shows that there is some ambiguity in the interpretation of the regulation as well. While the Nokia decision has caused some shifting of standpoints, it would be interesting to see how it would affect the seizures of in-transit drugs, since the case deemed such seizure not to be necessary.

Finally, with respect to the Free Trade Agreements, the authors state that a probable cause for these ‘allegations’ are to derail the EU-India FTAs. In this, though more appreciative of it than they, I may agree with them. The draft EU-India FTA sets a higher standard than TRIPS for IPR protection, and would severely and adversely affect India’s strong generic pharmaceutical companies, as well as large populations who aren’t able to afford expensive medicines, by introducing measures such as extending patent terms and delaying generic entry. Thus, a more balanced set of negotiated terms and conditions in an FTA would be more beneficial, and therefore some sort of (though not total) ‘derailment’ may actually be helpful. TWN provides a more detailed analysis of the EU-India FTA here.