PhRMA speaks out against compulsory licensing in India

Home/Policies & Legislation | Posted 13/04/2012 post-comment2 Post your comment

The decision by the Indian government to issue a compulsory licence for the first time has led the research-based pharmaceutical industry to raise concerns regarding research and innovation.

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The 2005 Indian Patents Act provides broad grounds for issuing a compulsory licence including: a) the reasonable requirements of the public with respect to the patented invention have not been satisfied or; b) it is not available to the public at a reasonably affordable price and; c) the patent is not being worked. The recent issuing of Natco with a compulsory licence for sorafenib by the Indian government is a rare instance globally where a general compulsory licence has been issued, not bound by ‘government use’ provisions or those allowed only in cases of ‘extreme urgency’ or ‘national emergency’.

The Pharmaceutical Research and Manufacturers of America (PhRMA), the industry group representing innovator companies, said that ‘While India has not routinely issued compulsory licenses, PhRMA believes it is not an appropriate tool even if granting compulsory licenses may be a legal option. Assessments of particular compulsory licensing policies and decisions need to be made on a case-by-case basis, taking into account a number of factors. Legitimate health emergencies that require making exceptions to intellectual property rights can and should be accommodated under the international framework, but only after exhausting all other efforts and under extraordinary circumstances.’

PhRMA did not want to go into the details of the Natco compulsory licence, which enables the company to launch a generic version of Bayer’s liver and kidney cancer drug Nexavar (sorafenib) before the patent expires on the originator [1]. However, it did comment on the fact that ‘one aspect that is particularly troublesome is the contention that ‘working’ a patent requires a company to manufacture within India. It is our firm belief that this is fully at odds with India’s TRIPS (Trade-Related Aspects of Intellectual Property Rights) commitment as well as its broader WTO obligations, and distorts what was intended as a public health exception into an industrial policy.’

PhRMA President and CEO Mr John Castellani concluded by saying, ‘The research- based pharmaceutical industry fully supports the objective of improving access to innovative medicines, however, compulsory licenses cannot solve India’s larger problems regarding access to medicines and healthcare. If countries begin to routinely use compulsory licenses, we could see a ‘race to the bottom’ in which governments in the developing world walk away from their responsibility to support research and innovation in public health. In the absence of the investment made by our members, and the resulting research and development, there would be no generic medicines for the world’s patients. The responsibility to promote development of new drugs lies with all countries, not solely those in the developed world.’

Editor’s comment
Is compulsory licensing in India an exception or is it likely to become the rule?

Please feel free to share your thoughts via email or in the comments section below. What are your views on compulsory licensing in developing countries? Should India consider licensing other products? Do you think that this will lead to lack of investment in research into new drugs?

Related article

India at the biotech crossroads


1.  GaBI Online - Generics and Biosimilars Initiative. Indian government issues first compulsory licence []. Mol, Belgium: Pro Pharma Communications International; [cited 2012 Apr 13]. Available from:

Source: PhRMA, The Times of India

comment icon Comments (2)
Post your comment
Posted 07/06/2012 by Jodi H, GaBI Online Editorial Office
Response to 'Source of PhRMA'

Dear Belinda,
We would be happy to provide you with the full URL of the sources. If this is something you are still interested in, please email me at and I will send you all the necessary information.
Thank you and regards,

Posted 21/05/2012 by belinda
Source of PhRMA

Hello, Can you please link the source of the PhRMA quotes? Thanks

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