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India to speed up research,

development for drug industry

NEW DELHI: The Indian government, fearing the worst for domestic drug firms once patent protection legislation is in force, is prescribing a strong dose of research and development for the industry.

"Incentives to speed up research and development such as reductions in duty on equipment imports and tax benefits will be announced soon," said Shantanu Consul, Joint Secretary in the Department of Chemicals.

Indian patent law does not recognise product patents in the agriculture sector or pharmaceuticals, allowing Indian drug manufacturers to mass produce low-priced replicas of Western medicines using an altered process.

Under global trade rules, India and other countries are required to fall in line with international patent norms within 10 years.

A new patent bill is pending in the Indian parliament.

But the legislation has run into opposition from critics who say it could result in drug prices beyond the means of the average citizen in a country with a per capita income of just 300 dollars a year.

"The patents (legislation) will hit us hard." Consul ackowledged in an interview. "But India is committed to the World Trade Organisation and cannot make exceptions to that."

He said the government would have a National Pharmaceutical Pricing Authority in place within two months and would lift price controls on more drugs to encourage research and development by domestic firms.

With the Indian drug industry complaining about poor revenue because of price controls, the government in September 1994 announced a new drug policy and halved the number of drugs whose prices is set by the state to 69 from 147.

It also said a National Drug Authority (NDA) would be set up to monitor quality standards and announced automatic clearance for foreign technology agreements.

"The government is serious about the quality of drugs being produced in the country and will give shape to the NDA within an year," Consul said. "Better enforcement of quality will mean more access to global markets."

Since the new drug policy was unveiled last year, some 80 foreign drug manufacturers have submitted proposals to the government, asking to either increase their equity in existing joint ventures or to set up new ones.

The proposals are currently being examined by the Indian authorities.

"It has been decided that equity beyond 51 percent will be considered by the government on a case-by-case basis and a firm interested in manufacturing specific drugs not made here would be encouraged," Consul said.

A number of firms in India's 2.3-billion-dollar drug industry have branched out into non-medical areas because of the squeeze on profits caused by price controls.

The projected demand for medicine in India is put at 2.3 billion dollars by the turn of the century.-AFP