The EU and WHO are pursuing strategies that will have serious consequences for developing countries.
In bits and pieces news has been trickling in of different shipments of medicines and pharmaceutical from India being seized at ports of the European Union (EU). None of these consignments was destined for Europe; they were en route to Latin America. It was not till mid-January when news broke of a shipment from Dr Reddy’s Laboratories bound for Brazil being impounded in Amsterdam that all hell broke loose here.
Dr Reddy’s is India’s top pharmaceuticals exporter with annual sales in the region of $1.4 billion and the EU action fluttered the administrative dovecots. An incensed Commerce Secretary Gopala Krishna Pillai described it as “an act of piracy by the EU”. In an exceptionally strong statement, he called it “a dangerous thing” and “totally uncalled for”. Reflecting what industry lobbies and health activists have been claiming for long, Pillai said: “It is part of the strategy by these countries to target generic drugs from India.”
What the EU is doing is using Council Regulation (EC) No. 1383/2003 to impound drugs that are suspected of violating patents registered in member-countries even if these are simply in transit. The regulations permit customs to hold these goods for a minimum of 10 working days while informing the patent holder of the seizure. The patent holder then applies to a civil court to initiate legal proceedings in order to prove that infringement has taken place.
Dr Reddy’s told Business Standard that the impounded consignment consisted of 500 kg of Losartan potassium valued at $55,000 that was bound for Brazil. “Apparently, Losartan is protected in the Netherlands by a product patent of Merck/DuPont which is valid until September 2009,” says the spokesman for the Hyderabad-based company who questions the validity of the seizure. “We are sceptical that it can be called an act of patent infringement when goods are in trans-shipment and merely pass through the customs of an EU member-state, especially when there is no possibility that these goods could be sold on the market in these countries.”
This might seem like a singular attempt by the EU to show extreme zeal in protecting the rights of pharmaceutical patent holders in the EU. But it has to be viewed against the backdrop a of a host of moves initiated by the developed world to ramp up intellectual property (IP) protection, far in excess of what is required under the TRIPS regime of the World Trade Organization (WTO), under the guise of public health concerns. These initiatives to enforce ever higher standards of IP protection have roped in global organisations with completely different mandates, such as the World Health Organisation (WHO), the World Customs Organisation and Interpol among others.