More U.S. pressure on India sought over patent issue

By Bill Berkrot

REUTERS - The U.S. Chamber of Commerce on Friday called on the government to ratchet up pressure on India over intellectual property rights, in a move that could help prevent Indian companies from producing cheap generic versions of medicines still under patent protection.

In a submission to the Office of U.S. Trade Representative (USTR), the Chamber of Commerce requested that India be classified as a Priority Foreign Country, a tag given to the worst offenders when it comes to protecting intellectual property and one that could trigger trade sanctions.

Other trade groups, including those representing the pharmaceutical and manufacturing industries, echoed the call for a tougher stance on India.

The recommendations, which were due by Friday, were for a document known as a Special 301 Report prepared annually by the Office of the United States Trade Representative.

India is on the U.S. government's Priority Watch List for countries whose practices on protecting intellectual property Washington believes should be monitored closely.

DETERIORATING ENVIRONMENT

In its new submission, the Global Intellectual Property Center (GIPC) of the Chamber of Commerce said: "We highlight India as a country with particular challenges with respect to intellectual property protections."

"Because India has not shown a record of engagement on these issues and the environment has deteriorated significantly since last year, we are now recommending that India be designated a Priority Foreign Country," it said.

India received the lowest score in the trade group's IP Index released last week, performing poorly in all six rating categories: patents, copyrights, trademarks, trade secrets and market access, enforcement, and membership and ratification of international treaties.

The perspective from India is that many patented drugs are too costly for most of its people. The government in New Delhi is pushing to increase access to life-saving treatments in a country where only 15 percent of 1.2 billion people have health insurance.

Pharmaceutical Research and Manufacturers of America (PhRMA), the U.S. industry trade group for drugmakers, acknowledged in its submission "the challenges India faces in extending healthcare access to its large and growing population."

But the trade group also is calling for India's classification downgraded, "to encourage increased examination of India's actions and to foster enhanced bilateral engagement," Mark Grayson, the group's spokesman for international issues, said in an emailed statement.

"The situation in India continues to deteriorate for the U.S. research-based biopharmaceutical industry and other innovative U.S. industries," Grayson said.

The National Association of Manufacturers joined the chorus of calls to reclassify India, writing in its submission: "India's egregious acts, policies and practices, as well as its failure to enter into good faith negotiations to address them, support such a designation."

The pharmaceutical industry's push for a tougher line on India was revealed on Thursday by a Reuters report, although at least one member, British drugmaker GlaxoSmithKline , called for constructive engagement with Indian officials rather than a harder stance.

Calls for increasing pressure on India come as an Indian government committee reviews patented medicines sold by foreign drugmakers to see if so-called compulsory licenses, which in effect break exclusivity rights, can be issued for some in an effort to bring down costs, two senior government officials told Reuters.

The drugs being considered for such patent-breaking licenses are used for treating cancer, diabetes, hepatitis and HIV, said the sources, declining to give details.

No timeline has been given for completion of India's review process.

(Reporting by Bill Berkrot; Editing by Stephen Powell and Amanda Kwan)