India has historically invalidated U.S. pharma patents to protect the profits of it's booming generic drug industry and has used the threat of patent invalidation to intimidate foreign companies into supplying drugs at cut rate pricing...
Critics of the pharmaceutical industry contend that drug makers focus too much on profits, and in so doing, they don't fulfill their obligation to provide affordable access to their products. Novartis countered this notion by pointing out in its statement that it gives Glivec away for free to 95% of Indian patients who are prescribed the drug. The other 5% receive some sort of reimbursement, the company said.
Merck, which was also stung by a negative Indian patent ruling, has long talked up its "tiered pricing" plans for some drugs. In 2009, the company rolled out a tiered pricing strategy for some of its vaccines and HIV treatments in developing countries. A spokesman for Merck said in an e-mail that the company has a plan that includes "India-specific, responsible pricing" for its diabetes drugs. "We continue to believe our patents for Januvia and Janumet are valid and enforceable, and we are committed to exploring all legal options to defend them."
It's no surprise that India's government wants to protect the country's burgeoning drug business. PwC estimates that India's domestic pharmaceutical industry will grow from $11 billion in annual sales in 2009 to $30 billion by 2020. Much of that growth will be driven by India's famed generic drug manufacturers, such as Dr. Reddy's Laboratories, Cipla and Aurobindo Pharma. "This is a matter of self interest for Indian industry," Gordon says. "The determining factor was India's generics industry -- made up of big companies run by rich families -- versus multinational companies. India frames this as 'our companies versus the rest of the world's companies.'"
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