Washington shakes an IPR fist at India
As we had expected in 2013 December, the mutual back-slapping over the WTO ‘deal’ between Indian and the USA evaporated very quickly indeed in the face of American business aggressiveness. For the US industry, business and trade associations and lobbies, ‘partner’ means vassal, ‘deal’ means binding obligation, ‘priority’ and ‘sanction’ become weapons (which hurt the poor and vulnerable the most), and ‘trade’ itself means subservience.
And this is why this week, the last of 2014 February, the National Association of Manufacturers in the USA – which represents some 50 American business groups – asked the US Trade Representative to designate India a Priority Foreign Country in its 2014 report. “This designation appropriately would rank India among the very worst violators of intellectual property rights and establish a process leading to concrete solutions,” NAM said in a letter to US Trade Representative Michael Froman.
In its official foreign policy and business pronouncements on India, the government of the USA, its representatives and its agents adopt a tone reminiscent of the 1950s, when American foreign policy and its agricultural scientists joined forces to bulldoze a green revolution in India. Here and now too, the USA likes to hear itself make statements such as “the promise of the 21st Century depends squarely on a robust US-India commercial and strategic partnership” and “central to this partnership will be the co-development and sharing of our best technologies, as well as free-movement between our economies of our best minds and thinkers”.
But the US doesn’t do diplomacy. America’s manner and approach has always been, my way … or else. And that is why one of the most powerful factors influencing Indo-American business and trade connections, the US India Business Council, through its seniormost officer (Ron Somers, who had worked for the energy company Cogentrix in Karnataka), called “attention to India’s need to calibrate regulations to protect data, or inspire India’s future legislature to adjust its Patent Act to align more wholly with international norms particularly regarding incremental innovation”. The USIBC also bluntly said: “Everyone agrees that India needs to spend more on its healthcare system” and that “evolving ecosystems that reward and protect Intellectual Property will be crucial”.
These disagreements between India and the USA have surfaced anew because the USTR is holding public hearings for its annual report, scheduled to be issued in April. This report will be on countries that the US government thinks are “denying protection of IP rights or fair market access to US firms”. The USTR has said that “India is widely perceived in Washington as a serial trade offender, with US firms unhappy about imports of everything from shrimp to steel pipes they say threaten jobs, as well as a lack of fair access to the Indian market for its goods”.
This is among the most signal, and deliberate, failures of the two UPA terms of government – that its reckless and dangerous chasing of foreign direct investment and its reckless and dangerous opening of domains previously in the public sector to private interests have left Bharat and India in such a crippled state that we as a country tolerate such an insult. There is not the slightest hint of fairness in America’s bullying ways, for it wants nothing less than the capitulation of India’s pharmaceuticals industry, and it wants the handing over of insurance – from life insurance to automotive to weather – to its own freebooting companies whose practices have assisted the plunge of a sixth of America’s population into poverty over the last decade.
What may happen now? There are press reports that India may take the USA to face the WTO’s dispute settlement mechanism if included by the USTR in the ‘Priority Foreign Country’ list for intellectual property rights. American industry and trade lobbies are putting pressure on their government to include India under this list. Thus far, the position held within the central government is that the demand (from the US companies) is “completely wrong” as India’s intellectual property rights are compliant with global laws, including that of the World Trade Organisation (WTO).
It is concerning pharma that the American MNCs are most vociferous. US pharma companies had objected to India’s move to issue a compulsory license in 2012 to Hyderabad-based Natco Pharma to manufacture and sell cancer-treatment drug ‘Nexavar’ at a price over 30 times lower than charged by patent-holder Bayer Corporation.
A delegation from the US International Trade Commission (USITC), described as a quasi-judicial agency, has arrived intending to probe the impact India’s policies on trade and investment have on the American economy (the intention is to supply the USTR with ammunition and to prepare for a WTO dispute confrontation; the Americans involved perhaps cannot see or appreciate the irony of the USIBC also praising India for investing in the USA and creating jobs there).
The USITC has raised the Natco matter, and has also raised the rejection of patent to Bristol-Myers Squibb’s Sprycel and Novartis’ Gleevec. It has stated that Indian IPR laws are not Trade Related Aspects of Intellectual Property Rights (TRIPS) compliant under the WTO. The response of the government of India has been to ask all its officials to stay away from any interaction with the USITC delegation.
But we have stood firm till here. Swiss pharmaceuticals manufacturer Novartis AG had lost a legal battle for getting its blood cancer drug Gleevec patented in India and to restrain Indian companies from manufacturing generic drugs. The Supreme Court had rejected the multinational company’s plea last year in a judgement that was loudly and widely hailed in all countries of the South. This came as a blow to the US-EU pharma MNCs who see the very much larger populations of the South as new markets. Hence the threatening fist-waving by the US government.
The complaint by American companies that India refuses to implement laws to provide data protection and to provide patents for bio-pharmaceutical companies is framed in terms of being against the interest of Americans in terms of jobs and ‘fair’ competition in the global marketplace. To support such nonsense, the US Chamber of Commerce’s Global IP Centers issues what it calls an International Intellectual Property Index, which compares the IP laws and implementation of those laws of 25 countries. In the 2014 Index, India received the lowest overall score, with a score of 0 for ‘Membership and Ratification of International Treaties’ and 0.25 for ‘Trade Secrets and Market Access’.
India’s policy on generic drugs has so far refused to accept ‘evergreening’, a scheme used by pharmaceutical companies to continue having a patent over a drug – even after its patent has expired – by modifying it slightly. India’s decision to grant compulsory licenses (within Indian and WTO rules) to anti-cancer drugs by Novartis and Bayer has infuriated Big Pharma in the US. To retaliate, the USA banned Ranbaxy selling medicines from its fourth plant in the USA – so much for being ‘fair’ at home in America; why does Ranbaxy continue to want to do business there?
India’s generic drug policy is guided by the need to provide cheap medicines to a large population that cannot afford even a fraction of the international patent-protected prices of these medicines, as several authoritative civil society responses to the matter have competently pointed out. This is the practice the judiciary has supported and this is the practice that must not change under any circumstance and regardless of the threats and blandishments by Froman and his shylockian collaborators.