Double Standard for Counterfeit Drugs in India

Indian drug manufacturers and the International Federation of Pharmaceutical Manufacturers Association (IFPMA), which represents multinational, research-driven, pharmaceutical companies around the world, recently clashed over the production of counterfeit drugs in India. In late January 2003, IFPMA accused the Indian pharmaceutical industry of producing fake drugs while drug manufacturers in India retorted with claims of “mudslinging” by the IFPMA. However, India does have a serious problem with counterfeit drug production. Of approximately 20,000 drugs manufactured in the country, only 4,000 are registered. It is estimated that up to 40% of pharmaceuticals manufactured in India are fakes.

During the World Trade Organization (WTO) meetings held in December 2002, heated debates also ensued as a result of conflicting interpretations of the implementation of the Doha agreement. The agreement touched upon the means by which cheaper drugs can be sold to poorer countries. India was among the advocates of extending compulsory licensing, which allows patented drugs to be manufactured without the patent holder’s consent. Countries such as the United States, however, lobbied to restrict compulsory licensing to drugs used to treat diseases more common to poorer countries such as AIDS, malaria, and tuberculosis. According to WTO agreements, India and other developing countries must recognize drug patents by January 1, 2005.

Although India has been slow to control the production of counterfeit drugs within its borders, the government has stepped up its efforts to prevent the importation of fake drugs from other countries such as China. The Drug Controller General of India (DCGI) has recently instituted new laws preventing counterfeit drugs from being imported into India. Beginning on January 1, 2003, all imported drugs must be registered before they can enter the country. However, on December 24, 2002, the DCGI extended this deadline to March 31, 2003 to allow leeway for drugs already being shipped to India. Foreign drug manufacturers must pay fees of Rs 75,000 ($1,500) to register overseas manufacturing facilities and Rs 50,000 ($1,000) for each individual drug imported into the country. The new rules will also require all drugs, with no exceptions, to have import licenses.