Opposition lawmakers walked out of the parliament in protest when the law was passed in the Lok Sabha, the lower but powerful house of the twin-chamber Indian parliament.
The bill was passed in compliance with India's commitment to the World Trade Organization's Agreement on Trade-related Aspects of Intellectual Property Rights, or TRIPS. The bill will now be presented before the Rajya Sabha, or the upper house, and is expected to be passed into law since the government enjoys parliamentary majority.
The Congress Party government has pledged to its leftist allies and other opposition lawmakers that the new law won't push up the medicine prices in the country.
India's pharmaceutical market has thrived in the last three decades since India's current patent law allows patented drugs to be copied, as long as a different manufacturing process is used to make them. The companies were legally producing generic versions of medicines that were under patent elsewhere, including the much in demand low-cost AIDS drugs for 50 percent of nearly 1 million HIV patients taking antiretroviral medicines in developing countries.
Some of the AIDS drugs made by reputable Indian companies cost about 5 percent of the price of similar drugs sold by U.S. and EU pharmaceutical firms.
The news of the new law is honey to the ears of international pharmaceutical companies but health advocacy groups have warned that the new law would spell doom for the access to medicine in poor and developing countries by sky rocketing the drug prices, making them unaffordable.
Indian pharmaceutical majors like Cipla and Ranbaxy were spearheading making AIDS drugs and exporting them to African nations at a very low cost as compared to multinational pharmaceutical majors. All this seems to be changing now.
"It (was) a very sad day for India when the (Patents) Bill was passed. It spells long-term disaster for India in segments such as food, agriculture and health," said Yusuf Hamied, Cipla's Chairman and Managing Director and a vociferous campaigner in the affordable drugs movement.
Cipla had virtually become a household name in the African countries, as its generic or chemically similar AIDS drugs took on multinational companies selling in the market, Business Line daily reported. In Africa, exports by Indian companies, helped nose-dive the annual price of antiretroviral treatment down from $14,000 a decade ago to about $200. They also simplified the therapy by making pills containing three AIDS drugs.
Generics make up about 15 percent of the India's $10 billion pharmaceutical industry that has 300 large and moderate-sized firms, plus 10,000 small companies, making 8 percent of the world's drugs. According to pharmaceutical industry statistics, nearly 70 percent of production is by the top 100 firms and about a third of that is exports, which are rising 25 percent a year.
"Indian companies will not be able to make copies of over-priced western drugs, which will affect poor countries around the world," said Khalil Elouardigh of Paris-based NGO Act-Up.
A large number of AIDS activists have assembled in India to oppose the new law.
"The WTO obligation does not require India to grant patents on new uses of known drugs, or combinations of known drugs," said Anand Grover, project director, Lawyers Collective HIV/AIDS unit. However Indian lawmakers have included double-usage patents in the bill.
"A drug like AZT, which was used against cancer in the mid '70s and now used for HIV, can be patented simply on the grounds of new usage," Grover told Mid-Day daily.
Y.K. Sapru, Chairman of the Cancer Patients Aid Association, said that five cancer drugs such as Gefitinib, Temozolomide, Zoledronic acid, Letrozole and Ganciclovir were set to see a multi-fold increase in prices, as a result of the Patents Bill. Prices on these drugs will increase between two and 12 times, he lamented.
"Because India is one of the world's biggest producers of generic drugs, this law will have a severe ripple effect on many developing countries which depend on imported generic drugs from India," said Samar Verma, Regional Policy Advisor of British charity Oxfam.
Under the agreement on intellectual property at the WTO, India had to introduce amendments to its existing patent act by Jan. 1, 2005. Unfortunately, the Indian government waited until the very last minute and then rushed it through the parliament, leaving no space for democratic debate and consideration of wider public health implications, Oxfam said in a statement.
The France-based Medecins Sans Frontieres (Doctors without Borders) wrote a letter to Sonia Gandhi, president of India's governing Congress party, highlighting its concern. "We are deeply disturbed and concerned that you are failing to listen to the voices of your people who have entrusted you with their welfare," it said.
But the Indian government says it has enough safeguards to protect the interests of poor.
"All safeguards have been put in the regime and the government will have enormous powers to deal with any unusual price rise," India's Commerce Minister Kamal Nath said.
International pharmaceutical companies have hailed the new law, saying it would take India into global pharmaceutical research and development market.