Srihari Yamanoor
2003-12-30 21:42:16 UTC
Indian drug rush is bitter pill for US companies SARITHA RAI BANGALORE, DECEMBER 29 At 2 that cool winter morning last year, when news trickled in that Dr Reddys Laboratories had successfully challenged the patent on a blockbuster hypertension drug in a New Jersey court, jubilant senior executives uncorked a bottle of champagne.
By daybreak, however, the celebration at Dr Reddys, the leading Hyderabad-based Indian drug maker, had come to an abrupt end. The patent holder, Pfizer Inc, loathe to give up rights to the drug Norvasc, with worldwide sales of $3.8 billion last year, had announced that it would take the challenge to a higher court.
One year later, Dr Reddys version of the drug is still on hold, awaiting an imminent ruling from a federal court in Washington, even though the company received final approval from the US Food and Drug Administration. Pfizer has sued the agency over that approval too.The Norvasc dispute is just one of many battles being fought between aggressive Indian generic drug makers and global companies fierce about protecting their turf. For decades, Indian drug makers have honed their skills under a domestic policy that allows them to make copies of best-selling, patent-protected drugs and to sell them domestically or in unregulated countries as long as they use a different manufacturing process.
Now generic companies like Dr Reddys and Ranbaxy Laboratories, two of Indias largest, all eager to expand in or enter foreign markets, are combining their re-engineering skills with legal ingenuity to challenge patents held by the worlds leading drug companies.
The intense overseas focus comes in part because the domestic market is stagnant, with hundreds of manufacturers vigorously competing with versions of every big brand name drug. More urgent, however, is a looming deadline for India to recognise international product patents granted after 1995, to comply with World Trade Organisation requirements. Under that agreement, a product patent system will replace the current process patent system in India in 2005.
The patent fights over the US generics market, worth $17 billion, are particularly ferocious. The US is an attractive market for Indian exporters, whether shoes, software or drugs, admits G.V. Prasad, chief executive of Dr Reddys. It is huge, fast-growing and offers the biggest margins.
India can produce drugs at a fraction of what it costs to make them in the West. And, according to Jyotivardhan Jaipuria, head of research at DSP Merrill Lynch: Indian generics have been generating much higher margins in the US by being among the earliest to enter the market when patents expire. Drugs with combined annual sales of $60 billion to $70 billion in the US are expected to go off patent between now and 2010.
The first generics maker to request and receive approval to sell a drug gets exclusive marketing rights in the US market for six months. After that other generics companies often pile in and prices drop.
Indian chemists can reverse-engineer a patented molecule within months. Copies of global brands like Pfizers top-selling cholesterol drug Lipitor and Bristol-Myers Squibbs popular anti-clotting drug Plavix were sold in India within two years of their global introduction. These reverse-engineered drugs were then exported to unregulated markets in Asia and Africa, sometimes a whole decade before their patents expired in the US.
Predictably, the holders of patents in the US have been busy filing lawsuits to battle these generics makers at the FDA. William J. Heller, chair of the Intellectual Property and Information Technology practice at McCarter & English, a Newark-based law firm that represents many brand-name pharmaceutical companies, including Pfizer, says the patent challenges undermine basic patent law. Generics will whittle away the incentive to innovate, jeopardise the investment into new and much-needed drugs and, with shortcuts to approval, will sacrifice consumer safety in the name of cheaper and less safe and effective medicines, he said.
To keep generic competitors from eating into their profits, firms like Pfizer and GlaxoSmithKline have also been patenting component chemicals and processes in addition to the drug itself.
Experts say that Ranbaxy, with 25 pending approvals, has one of the best pipelines in the generics industry. In the 1980s, western drug makers sneered at Indias drug entrepreneurs asking, Who are these madcaps?, says Dr K. Anji Reddy, chairman and founder of Dr Reddys. Today, they are staggered by our never-say-die attitude.
(The New York Times)
URL: http://www.indianexpress.com/full_story.php?content_id=38201
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By daybreak, however, the celebration at Dr Reddys, the leading Hyderabad-based Indian drug maker, had come to an abrupt end. The patent holder, Pfizer Inc, loathe to give up rights to the drug Norvasc, with worldwide sales of $3.8 billion last year, had announced that it would take the challenge to a higher court.
One year later, Dr Reddys version of the drug is still on hold, awaiting an imminent ruling from a federal court in Washington, even though the company received final approval from the US Food and Drug Administration. Pfizer has sued the agency over that approval too.The Norvasc dispute is just one of many battles being fought between aggressive Indian generic drug makers and global companies fierce about protecting their turf. For decades, Indian drug makers have honed their skills under a domestic policy that allows them to make copies of best-selling, patent-protected drugs and to sell them domestically or in unregulated countries as long as they use a different manufacturing process.
Now generic companies like Dr Reddys and Ranbaxy Laboratories, two of Indias largest, all eager to expand in or enter foreign markets, are combining their re-engineering skills with legal ingenuity to challenge patents held by the worlds leading drug companies.
The intense overseas focus comes in part because the domestic market is stagnant, with hundreds of manufacturers vigorously competing with versions of every big brand name drug. More urgent, however, is a looming deadline for India to recognise international product patents granted after 1995, to comply with World Trade Organisation requirements. Under that agreement, a product patent system will replace the current process patent system in India in 2005.
The patent fights over the US generics market, worth $17 billion, are particularly ferocious. The US is an attractive market for Indian exporters, whether shoes, software or drugs, admits G.V. Prasad, chief executive of Dr Reddys. It is huge, fast-growing and offers the biggest margins.
India can produce drugs at a fraction of what it costs to make them in the West. And, according to Jyotivardhan Jaipuria, head of research at DSP Merrill Lynch: Indian generics have been generating much higher margins in the US by being among the earliest to enter the market when patents expire. Drugs with combined annual sales of $60 billion to $70 billion in the US are expected to go off patent between now and 2010.
The first generics maker to request and receive approval to sell a drug gets exclusive marketing rights in the US market for six months. After that other generics companies often pile in and prices drop.
Indian chemists can reverse-engineer a patented molecule within months. Copies of global brands like Pfizers top-selling cholesterol drug Lipitor and Bristol-Myers Squibbs popular anti-clotting drug Plavix were sold in India within two years of their global introduction. These reverse-engineered drugs were then exported to unregulated markets in Asia and Africa, sometimes a whole decade before their patents expired in the US.
Predictably, the holders of patents in the US have been busy filing lawsuits to battle these generics makers at the FDA. William J. Heller, chair of the Intellectual Property and Information Technology practice at McCarter & English, a Newark-based law firm that represents many brand-name pharmaceutical companies, including Pfizer, says the patent challenges undermine basic patent law. Generics will whittle away the incentive to innovate, jeopardise the investment into new and much-needed drugs and, with shortcuts to approval, will sacrifice consumer safety in the name of cheaper and less safe and effective medicines, he said.
To keep generic competitors from eating into their profits, firms like Pfizer and GlaxoSmithKline have also been patenting component chemicals and processes in addition to the drug itself.
Experts say that Ranbaxy, with 25 pending approvals, has one of the best pipelines in the generics industry. In the 1980s, western drug makers sneered at Indias drug entrepreneurs asking, Who are these madcaps?, says Dr K. Anji Reddy, chairman and founder of Dr Reddys. Today, they are staggered by our never-say-die attitude.
(The New York Times)
URL: http://www.indianexpress.com/full_story.php?content_id=38201
Progressing towards two years of its existance, my homepage:
http://www.geocities.com/yamanoor/
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