MNCs are big boys; they don’t need the US to front for them

The US government has always been a mouth-piece of American big business. That is why the protest of US commerce secretary John Bryson against India giving a compulsory licence to Natco Pharmaceuticals to produce a generic version of a patented anti-cancer drug leaves a bad taste in the mouth

Granted, it has been a unipolar world since Mikhail Gorbachev made it so, though Ronald Reagan took credit for defeating the "evil empire". Granted, the US can now justifiably claim the post of the world's big and only policeman.

In an ideal world, one of the roles of the policeman is to protect the poor from the predators (please don't laugh; it happens sometimes.) That is why the protest of US commerce secretary John Bryson against India giving a compulsory licence to Hyderabad-based Natco Pharmaceuticals to produce a generic version of a patented anti-cancer drug leaves a bad taste in the mouth.

The government has allowed Natco to produce a generic version of Bayer's patented cancer drug called Nexavar. This will bring down the price of the drug by 97%. Natco will sell the drug at around Rs8,880 for a month's therapy of 120 tablets against Rs2.8 lakh charged by Bayer. Experts say that this decision paves way for cheaper drugs in several other areas.

The US government has always been a mouth-piece of American big business. A large portion of its diplomatic effort is aimed a protecting "big, vulnerable MNCs" from the depredations of "poor, small, bad wolves" protecting the poor in their countries.

Therefore it was no surprise when commerce secretary Bryson repeated, almost word to word, Bayer's arguments against India granting the compulsory licence to Natco.

Mr Bryson told Anand Sharma that India's action would discourage new investments in drug R&D (research and development) and dilute the international patent regime. He said "pharmaceuticals is a very competitive area and heavy investments went into research and development every year. Any dilution of the international patent regime is a cause of deep concern for the US". Considering the tremendously cheaper price at which Natco will supply the drug, the US commerce secretary's words leave a bad taste in the mouth.

Now, let us take a look at this news item reported by Sky News, the British television channel.

A man suffering from the deadliest form of skin cancer told Sky News how a new drug brought him back from the brink of death. Charlie Jones woke up two weeks ago from emergency surgery on tumours that had spread to his kidneys to be told he had a matter of hours to live.

But doctors at the Christie Hospital in Manchester decided to try out a drug called Vemurafenib that has only just become available. To their amazement, his response was almost immediate. He is now much better and has returned home.

"Since I've been taking the drug I have been getting stronger and stronger," he said. "I'm getting colour in my face. My body is feeling a lot better. It's helping me feel like the old me."

Charlie and his girlfriend Louise Howard now hope to get married.

The drug is expected to be supplied to other cancer patients through Britain's National Health Service (NHS), which means it will be practically free.

Doesn't this make us all feel better and take away the bitter taste left by the US commerce secretary's words?

 (R Vijayaraghavan has been a professional journalist for more than four decades, specialising in finance, business and politics. He conceived and helped to launch Business Line, the financial daily of The Hindu group. He can be contacted at [email protected].)

K B Patil
1 decade ago
Mr. Shashibhushan, what about affordability. For argument's sake, let's assume that there are about 1 lakh patients in India who need to take this drug. At Bayer's price of Rs.2.8 lakhs per month, I doubt whether even 1% of the patients could afford it. At Natco's price (Rs.8880), at the minimum atleast a 1000 patients can be given the drug paying either from their own resources or through charitable hospitals, trusts etc. When it comes to money, all corporates take leave of their conscience. Hence, this talk of spending on R & D needs to be taken with a pinch of salt.
In Delhi, corporate hospitals were given land at concessional rates on the condition that certain percentage of beds be reserved for the poor. A sting operation by a TV channel revealed that almost all the hospitals violated this provision.
Replied to K B Patil comment 1 decade ago
I am not claiming that all hospitals or pharma companies are very good and honest, but feel that they are as bad as the rest of society since they are made of people from the same.

I understand the angle of affordability but what about their investments? If companies know that their IPR won't be honored why would they think of launching new products in India at all? May be some model like capping profit to let's say 20% of their costs could be levied, which would take care of both sides. However, I am not sure how loopholes can be plugged in implementation of this.

In that case do you think we should file complaints against those hospitals or the hospitals near our houses who are violating the provision?
1 decade ago
Thinking from pharma companies point of view, it takes millions of dollar investment for invention of a new drug molecule and its clinical trials before it can be made available in market for safe consumption by patients.

Pharma companies are not a charity and rather except for notable exceptions everyone in this world including you and me are in non-charity (business, job, etc). They why expect pharma companies to forgo returns that are used to cover up the expenses already incurred and earn out of their invention?

It may sound very insensitive, but its truth. Its good to talk about social justice and patients who cannot afford and that it is unfair, but as is said in the movie Lagaan: "so is life". Do you feel that the state (through tax collected from taxpayers) can ever subsidize for healthcare for each citizen forever in best way? Such things have been tried in West for sometime but they come with their own pitfalls and mounting financial deficits. Tell me, are you "personally" ready to pay say Rs. 10,000/- more in tax every year for medicine research? and then what about the cost of management of the process? I feel it is easy to sympathize and ask someone to sacrifice, but is completely different when it is our turn to sacrifice. I believe that eventually (I know the wait could be challenging) nature and markets (without govt. intervention) are great levelers.

The comments at this link express this perspective more precisely:
Replied to Shashibhushan comment 1 decade ago
Dear Shashibhushan ji, your points are valid when seen from only one perspective - that of the pharma industry and the support industries therein (industries like soft drinks, narcotics, tobacco et al) who provide the "push" for people to head for the said pharma industries.

The economies of the Indian Ocean have suffered enough because of the western economies, and a wee bit of payback is not out of place.

Replied to malq comment 1 decade ago
Dear malq ji,

My only relationship to pharma industry is as a customer. Till date by god's grace I have the privilege to afford medicines for the common problems faced in our family, but try to do my bit to help not so privileged.

I am aware that there are paybacks in various forms and they are huge. Also, I agree that preventive medical care - exercise, diet and lifestyle modifications is the true solution to the problem.

However, I could not imagine no role for medicines in today's world and also how pharmaceutical companies would find incentive to invest millions to invent drugs that treat the ill if their return is not assured through intellectual property protection laws.
Replied to Shashibhushan comment 1 decade ago
Shashi ji, it is my humble submission that science and technology are for a greater good, including for mankind. Whether a pharma company "discovers" something today at a high cost or somebody else does it for free at a later/earlier stage, these are timelines, the basic premise does not change.

That's my main point.

The rest, that of big pharma using a push-pull model to motivate customers to come to them with disease, is also relevant.

1 decade ago
Today, the biggest stake-holder in many mission critical American MNCs is the US Government - and vice versa also holds true. Their interests are common - and global domination at any costs is part of the basics of what is called the American way of life.

Other nations, and their interests, are co-lateral.

It doesn't get simpler than that!!
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