Rema Nagarajan, TNN | Apr 11, 2013, 05.31 AM IST
While Novartis and the Big Pharma have threatened that they would not make R&D investment in India because of inadequate patent protection, the Australian review panel says: “It is difficult to see why a pharmaceutical firm would choose to conduct R&D in Australia, merely because the government decided to offer an extension of (patent) term here.” The panel report noted that it was fundamental issues such as relative costs of R&D and skill availability which influenced the location of R&D spending.
The report recommended that the current model of using the patents system to subsidise pharmaceutical R&D indirectly through patent extensions should be replaced with a direct subsidy. It observed that direct subsidy also had an additional benefit because it could be directed towards investment in pharmaceuticals which were not well addressed by the patent scheme, such as too little research for newer antibiotics, pharmaceuticals to address rare diseases, paediatric illnesses and endemic health issues in low income countries.
The patent review panel pointed out how the life of patent protection in Australia has been extended beyond even the 20 years mandated by the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights ( TRIPS) because of a separate free trade agreement (FTA) that Australia signed with the US.
According to the review report, this FTA was signed “without careful regard to whether this was in our own economic interest” .