Innovation Patent

Taking IP on a spin – round 2


This is the second post of a two part series where I am looking into the manner in which certain industry lobbies have worked towards creating a certain perception/narrative of IP in which maximalist IP policies are hailed as the best and only way forward. In part 1, I discussed the heavy industry influence in the creation of the TRIPS agreement as well as the intellectually dishonest methods in which IP maximalist policies were justified.

Continuing from where I left off, this post shall look into how these tactics are being used today with regard to Indian developments which are currently making certain Big Pharma companies very uncomfortable.

Capturing the Rhetoric – no longer

storytellingA couple of days ago, a court invalidated a re-issue patent covering Pfizer’s fourth best-selling product, the painkiller Celebrex. Experts estimate that Pfizer would’ve received about $3 billion more in sales had the patent not been invalidated. Fortunately though, this invalidation was held by a US court. I say “fortunately” because while I don’t know anything else about the case, I do know that had this exact case happened in India, some branch of the US government (and lots of the press) would’ve immediately heard something about how India’s patent regime is terribly harmful for innovation and for “American jobs”. 

Indeed, there has been a concerted effort at building a perception that India’s IP regime is somehow an ‘illegal’ one. “India misuses its own IP laws to boost its domestic industries”, US Senator Orrin Hatch claimed while releasing the US Chamber of Congress’ GIPC 2014 report. As we’ve written on the blog before, the GIPC 2014 report appears to be nothing more than a sham report aimed at arriving a predetermined result list. Soon after the announcement of the GIPC report were the two hearings directed at ‘examining’ India’s pharmaceutical patent policy – one by the US International Trade Commission (USITC) and one by the US Trade Representative (USTR). These incidences, along with other similar efforts, all have 2 things in common – (a) Attempts to move proceedings outside the WTO-TRIPS system; and (b) Letting the perception they wish to spread gloss over some relevant facts.

The reasons for wanting to move outside the TRIPS regime are obvious. The WTO TRIPS, even if lopsided in origin, is highly unlikely to deem India’s pharma patent policies illegitimate. On the other hand, multi-lateral treaties such as the controversial Trans Pacific Partnership (of which PhRMA and Pfizer were the two biggest lobbyists), bi-lateral agreements such as the EU-India “Free trade” agreement or even the uni-lateral measures such as the USTR’s Special 301 process – are all much more malleable in terms of deeming India’s policies illegitimate as they all seek to create new norms altogether – norms that have little to no evidence supporting them as being beneficial. Attempts at painting this picture have been going on for years now but this last one year has seen a big increase in pressure tactics. After all, it’s one thing for India to have outsmarted Big Pharma on paper through its clever use of TRIPS flexibilities. It’s a different thing for India to actually use these flexibilities – at least that’s what I can gather from the trends in pressure tactics.

In the midst of this criticism though, I would like to take a moment to appreciate the tremendous use of rhetoric by Big Pharma lobbies – a factor I would give a lot of credit to as it has a big role in creating a public perception that India’s policies are indeed problematic. They have constantly called for “higher” standards of IP. Yet, one of their biggest problems seems to be with a higher standard – the anti evergreening provision. This provision creates incentives towards more useful pharmaceutical innovation and reduces incentives for spending money on drugs which will not bring about better health results. They have described India’s policies as being directed towards boosting their domestic industries and discriminating against MNCs. This puts forth a non-ridiculous (on the face of it at least) argument, that perhaps the Indian drug industry is doing what the American drug industry has been doing for all these years – successfully lobbying their government. However, it is nothing more than a baseless allegation without even attempts at providing circumstantial ‘evidence’ that may indicate the same. Their argument seems to simply be that since Big Pharma is not making the most profits, the reason must be bias favouring Indian generics. The Big Pharma lobby, perhaps out of habit, seems to forget that there is another massive stakeholder present here – the public. It also ignores that MNCs are benefiting from the Indian generic market.

However, with these latest increases in pressure tactics, Big Pharma may have taken one step too far. Suddenly a lot more voices have been speaking up more strongly against their factual misrepresentations and pressure tactics that have been used against India’s policies. These voices may not weild the same amount of influence on policy as Big Pharma’s but its getting to a point where it’ll be hard to continually ignore them as well. For instance, though there must be background reasons for speaking up, it is hard to ignore that Boeing issued a strong statement at the USITC hearing that they have had a positive experience with India’s IP regime. However, Boeing aside, there were some excellent submissions at the USTR hearings that properly capture the ‘factual’ side of events that don’t seem to be present otherwise. I’ve also been pleased to see that the past few weeks have seen several op-eds and reports coming out strongly against these attacks on India’s policies. This is a very positive step. After all, the power of story telling can work both ways. I’m linking to some of them below and would strongly recommend a read.

Submissions

1. Dilip Shah on behalf of IPA to USTR: Click here. (Focusing on the clash between the perception and facts).
1.1 Dilip Shah on behalf of IPA to USITC: Click here. (Focusing on the business environment in India in response to issues arising during the hearing)

2. Profs S. Raghavan, S. Flynn & B. Baker to USTR: Click here. (Focusing on the Special 301 process as well as the legality of India’s policies. As a side note, we’re also proud to note that SpicyIP blog posts were cited to thrice in this submission. Our blog post denouncing the GIPC report was also reproduced in full as part of the submission)

3. Prof S. Flynn of American University, Washington College of Law to the USTR: Click here (On the Special 301 process being a violation of US and International law)

For more on submissions provided before the USTR for the Special 301 process, you can check out the helpful collation (as well as their own submission) that KEI has made available here.

Others

1. S Basheer, S Barooah, “Patent error”
2. DG Shah, “Can’t buy American stories”.
3. Arvind Panagariya, “India must call the US’ bluff on patents”
4. IP-Watch: Intergovernmental South Centre Issues Statement On “US Attacks On Indian IP Policy”
5. Business Standard: Now, Indian industry raises its voice against US
6. IP-Watch: Battles over Patents – Is India changing the rules of the game?
7. NDTV: India may take US to the WTO over IPR row

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