While MNCs in the pharmaceuticals sector keep complaining about Indias patent laws, the traditional argument advanced by Indian authorities is that the policy is WTO-compliant and that India is simply preventing the kind of frivolous patenting that many countries in the West have. The policy on compulsory licensing was a bit more difficult to defend especially since, though the costs mattered a lot to those who were affected by the disease, their numbers were not large enough to justify a compulsory licencethis is usually supposed to be used in the case of a national emergency, say the outbreak of a new virus or something. Bayers Nexavar, for which a compulsory license was given and which lowered the price of treatment from R2.8 lakh per month to R8,000, is used by just 36,000 patients across the country. Given the large costs involved in R&D for new drugs since just 1 in 15 molecules really takes off, it does seem the compulsory licensing regime needs to be used very carefully. More so since India already has so many price controls and so many manufacturers of most medicines.
What makes Indias IPR defence really weak, though, and many US/EU firms have complained about this, is the policy on compulsory licensing for green technologies. In this case, there cant even be any argument about lives being at stake, but the National Manufacturing Policy (NMP) says that the government can invoke compulsory licensing on green technologies or cutting edge nano-technologies if the patent-holder is either unwilling to voluntarily issue a licence or if the licence-seeker is unable to bear the high cost of royalty or if the royalty demanded is unreasonable. The MNP speaks of a Technology Acquisition and Development Fund which will have the option to approach the government to issue a compulsory licence in case it finds royalty demands too high. This is nothing short of expropriation of patent rights. And while it is understandable that the government would want cutting edge technology to help better the lives of millions of people, green technologies are subsidised by governments the world over, surely India can do the same? The other issue that gets missed in the debate against patenting of new medicines also is that many of the companies developing new technology are increasingly going to be Indian. So it is no longer just MNCs whose products are being ripped off. Any slowing in innovation