Reddy panel holds hope for drug cos

NEW DELHI:: While MNC drug makers have reasons to smile at Satwant Reddy panel’s view that their new formulations be protected from ‘unfair competition’ from low-cost generics in the long run, desi companies need not worry too much. Domestic drug makers may get a long rope before the government decides to disallow low-cost me-too drugs, which now get a springboard entry into the market without having to generate elaborate research data.

Indian firms can look forward to a transition period of up to 10 years to switch to a new regime of ‘no-full data-no-approval’. The Reddy panel, which recommended a ‘calibrated approach’ to granting MNCs exclusive right over their data, has left a decision on the transition period to the government.

Government sources told ET that as a developing country, India can have a transition period of up to 10 years. India was granted a similar transition period to introduce patents on pharma products by January 2005. Like product patents in pharma and agrochemicals, data protection too is a WTO commitment. But the vague wordings in the Trips agreement has led to different interpretations by various countries. Domestic pharma companies are likely to campaign for making the transition period as long as possible.

The panel’s cautious approach in recommending a two-phase shift to data exclusivity also leaves enough flexibility for the government to decide the extent of limited monopoly to be granted to MNCs on their new drugs.

The panel has given two options. One is a narrow definition that means only very rare and genuinely new chemicals would get protection from low-cost generics. This is close to the criterion for patenting. Therefore, a drug that is not new enough to get a patent cannot get market monopoly by preventing others from using its data.

The other definition is as broad as the definition of a ‘new drug’ and, if adopted, would give protection to a large number of drugs that may be minor variations of older medicines. Adopting the narrow definition would be in the interest of generics companies.