[india-drug] Novartis to move Indian R&D(1)

["Reji K Joseph" <rejikjoseph55@yahoo.com>]

Novartis to move Indian R&D(1)
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Please see the report saying that Novartis is planning to move R&D from India
   
   
  Novartis to move Indian R&D
By Andrew Jack in London

Published: August 21 2007 22:01 | Last updated: August 21 2007 23:52

Novartis, the Swiss pharmaceutical group, is to switch hundreds of millions
of dollars in planned investments from India in the next few years in
response to a court ruling that weakens intellectual property rights on new
medicines.

In his first detailed comments on the rejection earlier this month of his
attempt to protect the patent on the company's cancer medicine Glivec,
Daniel Vasella, chief executive of Novartis, told the Financial Times that
his "concrete plans" for investments in research in India stalled during the
trial and would now go elsewhere instead.

The decision comes at a sensitive time for pharmaceutical companies in Asia,
with many hesitating between India and China as an investment location
against a backdrop of patent uncertainties.

Mr Vasella said: "This [ruling] is not an invitation to invest in Indian
research and development, which we would have done. We will invest more in
countries where we have protection. It's not a punishment, it's just a
question of the culture for investment. Do you buy a house if you know
people will break in and sleep in your bedroom?"

India has enjoyed an upturn in investment by some pharmaceutical companies -
including several fast-growing Indian groups - following the introduction of
tougher patent rules in 2005, matched by strong market growth and the
presence of skilled and affordable doctors and researchers.

However, other international drug makers have so far held back or made
larger investments elsewhere in Asia, notably in China and Singapore,
spurred by stronger legal protection .

Novartis had appealed against an earlier Indian ruling to reject patents on
its leukaemia drug Glivec. The court argued that "incremental innovation"
did not qualify it as a new chemical entity justifying protection.

The company said such an interpretation violated World Trade Organisation
agreements and would be a disincentive for investment, because much
pharmaceutical innovation occurs through incremental research.

The case became a rallying point for non-governmental organisations, which
mounted a campaign against Novartis to drop the legal action.

Campaigners argued that tougher patent rules were undermining India's
pivotal role in providing cheap medicines for the developing world through
its low-cost generic drugs industry.

Mr Vasella said he had no plans for a fresh appeal against the latest court
ruling, arguing that it was a matter for the WTO.

Copyright The Financial Times Limited 2007

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© Copyright The Financial Times Ltd 2007
   
  Reji K Joseph
  Consultant
  National  Commission for Enterprises in the Unorganised Sector (NCEUS)
  New Delhi
Reji K Joseph <rejikjoseph55@yahoo.com>
       
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