With the government likely to grant a limited period of protection for new medicines and not complete data exclusivity for patented drugs, Ranjit Shahani, MD of Novartis, says that data exclusivity is a key building block for R&D investment.
He says that data exclusivity is important not only for MNCs, but also for domestic pharma companies. However, he adds that in case of data protection, MNCs may shelve new launches, and may even rethink patent product launches in India.
He feels that data protection will restrict growth for MNC pharma companies, and that clinical R&D in India will thus be affected. He also says that data protection may impact contract manufacturing in India.
Excerpts from CNBC-TV18's exclusive interview with Ranjit Shahani:
What do you make of what the government has said in the last couple of days? Do you think it might change the contours of what MNCs want to do in India if it is indeed data protection and not exclusivity?
I think the first key point is to understand that data exclusivity is a key building block for R&D-based pharma and biotech companies. This is the period during which data submitted by the originator cannot be referred to by a third party for reliance for market authorization.
These are two independent rights; data exclusivity and patents are two independent rights. It is very important for research-based companies, whether multinationals or domestic companies, that they are given data exclusivity.
If one looks at countries like China, Taiwan, Korea, Egypt or Jordan, most of these countries have data exclusivity for a period of five-six years. In fact, there is a feeling that data exclusivity extends the patent's life, but this is not true. In nine out of ten cases it runs concurrently.
I think this whole debate about data protection and data exclusivity, we have become victims by definition. Effectively, this is clinical data, which has been obtained at a great cost on safety toxicology tests done by the originator, which must be protected. And that is the innovator's right.
At this point though the Department of Chemicals seems to be tilting towards data protection and not exclusivity, as an MNC pharma what are your options then and what might you do if that is introduced?
I would imagine that global companies would then not be launching their products in India because both patent and data exclusivity have to run concurrently, they cannot be separated.
Are you saying that companies like Novartis, Pfizer, Glaxo will then rethink launching new products in India at all if this is the case, and you would just do life cycle management of existing drugs here?
This is more than likely to happen.
We believe you were quite close to launching a new drug. Are you saying that if indeed this comes through, you might have to put a stop to that?
I don't think we can get into a debate on products, which are already launched, but I think it will not augur well for the future. In terms of the latest patented products, companies
So if you cannot launch new products, doesn't it seriously restrict the kind of growth that you can see in a market like India?
This has been the case for the last thirty-five years. If you recollect, India was a process patent country and most of the multinationals had not launched products, so growth was restricted.
In fact there are issues on patents as well. I think the definition of patentabilty and those areas have to be clarified. So I think there are quite a few gray areas, it is not only about data exclusivity.
This creates a lot of uncertainty. I think globally everybody is watching India. If we want clinical research, R&D, and new product launches to happen in India, then we have to align with what is happening across the world.
The debate on intellectual property is the last thing that we should debate about in India. We have the largest pool of scientifically talented people here. Going forward, there is no question that we need to encourage research, or to encourage innovation, or reward the innovator.
On the other hand, there are issues of access and availability and also affordability. We have been meeting with the government to discuss theses issues also. As you know, Mr Paswan has formed this committee where we are looking at managing access for below poverty line, BPL, families, ensuring that HIV-AIDS and Cancer drugs, which are not affordable to a large number of population, are available through certain means. This committee, which is working on these issues, is expected to get some clarity by September 30.
What might be a middle path that you could strike, e.g. would an MNC pharma company be open to a longer period of data protection versus no data exclusivity?
I think this is a debate which can go on. The reality is that we should really go for a clean period of data exclusivity which is five years, and this actually is in no way extending the patent life.
I think there is a lot of misinformation that has been put across that data exclusivity extends patent life. In most cases as I said, nine out of ten, it runs concurrently. So honestly as far as I'm concerned, there is no issue about this.
Are you saying that aside from the restrictive impact it might have on multinational companies, this could in some way have a kind of backlash on Indian companies engaged in contract research, those who have tied up with development and marketing for global companies?
I think all this is going to lead to a lot of rethinking in the way that India is actually looking at issues on patent and data exclusivity. I think we are moving in the right direction.
But we need to ground this very fast because global companies and all the forward-looking Indian companies plan ahead. All plans are already made for next five-ten years, and so this uncertainty certainly doesn't help anybody, whether it is global companies or Indian companies.
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