Tighter IP protection cuts Indian generics production
According to a World Bank Study focused on CNS drugs
A World Bank study has proved that the tightening of intellectual property rights in India has depressed the manufacture of generic drugs and increased market shares for developers of particular active ingredients within patent protected medicines.
The study, Pharmaceutical Patents and Prices: A Preliminary Empirical Assessment Using Data from India, focused on central nervous system drugs (CNS). It concluded that there had been a significant change in the Indian market for these drugs since patent protection increased for medicines under the World Trade Organisation Trade-Related Intellectual Property Rights (TRIPs) agreement in 2005. Previously, Indian companies had been able to reverse-engineer medicines, slightly changing an active ingredient, and then selling a new generic version in India.
A review of market data proved that the TRIPs reforms had prevented this happening.
‘In particular, product patents that were granted on the active ingredient instead of incremental innovations of a drug, led to a significant increase in drug prices, and an increase in the fraction of total quantity sold to the innovator with a corresponding withdrawal of generics from the pharmaceutical market in India,’ the report concluded.
India market shares controlled by original innovators increased by 40% – the report said this could have been higher but for licensing agreements with Indian generic firms.