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Bayer Joins List of Multinational Companies Wary of Indian Patent Laws

Bayer joins list of multinational cos wary of Indian patent laws [Financial Express (India)]

From Financial Express (India) (November 17, 2011)

Multinational pharmaceutical companies continue to be wary of the alleged 'loopholes' in India's patent laws, when it comes to launching their patented products in the country. Bayer, the 35-billion euro German chemical and pharma company, is the latest to join others like Novartis and Pfizer to call for strengthening India's patent laws to protect their intellectual property (IP).

"For a company like Bayer, which is modelled on innovation, IP is very important, and is a key mechanism to protect our rights," said Marijn Dekkers, chairman of Bayer, which makes painkiller Aspirin and heart medicine Avanta, among other drugs.

Bayer will look to double its revenues from India from 500 million euros (R3,400 crore) in financial year 2010 to 1 billion euros by 2015, but much of this will come from its crop sciences and material sciences division, rather than healthcare. "We spend up to 2 billion euros in developing a drug, so look to a level of exclusivity from the country," he told journalists at a press conference in Shanghai on Tuesday, broadcast across centres in India, Indonesia and Vietnam. "The world is moving towards better regulation in IP."

Since 2005, India allows multinational pharma companies to patent their exclusive products, but not those that are extensions of existing products, a process called 'evergreening' or 'incremental innovation' in industry parlance.

"Almost 80% of new drugs from multinationals in the developed world are incremental innovations," said an analyst with a foreign consultancy, who did not want to be quoted as he is not allowed to speak on IP issues. MNCs also feel their confidential data on development of drugs is not protected in the country, he added.

"The other sore point is, the government can go in for 'compulsory licensing' of drugs or forcefully intervening to allow other firms to make the same drug cheaper," he said.

Domestic drug firm Natco Pharma has applied for compulsory licensing of Bayer's liver and kidney cancer drug Nexavar, saying the drug is too expensive for the common man. "There is a backlog in the Indian patent offices," said Stephan Gerlich, MD, Bayer Group in India. "We will fight for our rights as per the laws in this country."

Swiss company Novartis CEO Daniel Vasella had said that though there was progress in India in protecting IP, it's not "up to the standard that company would make an investment in discovery-led research," Reuters had reported on November 13, 2009. Novartis' application to patent its cancer drug Glivec in India was rejected by the Chennai patent office on grounds that it was the tweaking of an earlier formula. The Supreme Court is now hearing the matter.

Bayer's healthcare division in India contributes just 10% or 50 million euros (R340 crore) to the group's revenues from India, and focuses on products for women's healthcare, diabetes, animal health, cancer, and diagnostics. "We will make sure modern medicine is accessible for Indian patients," Bayer India's Gerlich added.

"But we can understand this. In India, things take its own time." Bayer, which has 4,000 staff in India, has 67% of its revenues coming from selling pesticides and insecticides, and the rest from materials like polycarbonates, coatings and adhesives, and healthcare.

Copyright 2011 The Indian Express Online Media Ltd., distributed by

Posted: November 2011