Power brake

The com­pe­ti­tion law is be­ing used against drug patent hold­ers to en­sure they don't abuse their mar­ket power

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The com­pe­ti­tion law is be­ing used against drug patent hold­ers to en­sure they don't abuse power

ON THE face it, in­tel­lec­tual property rights which con­fer mo­nop­oly rights on the holder and anti-trust reg­u­la­tions which aim to en­sure fair com­pe­ti­tion would seem to be in di­rect con­flict.

What af­ter all is a patent? It is a right or own­er­ship that al­lows the paten­tee for a fixed pe­riod to en­joy a mo­nop­oly right on his in­ven­tion by ex­clud­ing others from mak­ing, us­ing or sell­ing it. The com­pe­ti­tion law, on the other hand, aims to foster com­pe­ti­tion by en­sur­ing that mo­nop­o­lies do not abuse their dom­i­nant po­si­tion to con­trol the mar­ket. Al­though the two laws would ap­pear to be an­ti­thet­i­cal to each other, both aim to en­sure a bal­ance be­tween op­pos­ing in­ter­ests.

Le­gal ex­perts ar­gue the ul­ti­mate aim of both the laws is to pro­tect pub­lic in­ter­est. It would seem that agen­cies charged with en­sur­ing com­pe­ti­tion are tak­ing a stricter view on mar­ket abuse by patent hold­ers, es­pe­cially in phar­ma­ceu­ti­cals. Pub­lic health ex­perts are heart­ened by a June 28 de­ci­sion by a US dis­trict court which found two drug firms guilty of abuse of mo­nop­oly power by block­ing the en­try of com­pe­ti­tion from gener­ics. Judge Har­vey Bar­tle of the Dis­trict Court of Penn­syl­va­nia was rul­ing in a suit filed by the Fed­eral Trade Com­mis­sion, the equiv­a­lent of the Com­pe­ti­tion Com­mis­sion of In­dia (cci), against Ab­b­Vie and its part­ner Besins Health­care, who were know­ingly pur­su­ing a sham patent in­fringe­ment case against com­peti­tors to block the en­try of generic ver­sions of their testos­terone re­place­ment ther­apy. They were also or­dered to pay dam­ages of US $448 mil­lion.

At home, too, there has been a sim­i­lar de­vel­op­ment with cci putting pharma gi­ants on no­tice for abuse of mo­nop­oly power. In 2017, cci had or­dered in­ves­ti­ga­tion against drug ma­jor Roche for its ac­tions re­lated to its block­buster bi­o­log­i­cal can­cer drug Tras­tuzumab on a com­plaint filed by Bio­con and My­lan Phar­ma­ceu­ti­cals, which had pro­duced biosim­i­lar ver­sions of the drug. cci said that when base­less anti-com­pet­i­tive lit­i­ga­tion is launched by a dom­i­nant en­ter­prise, it amounts to abuse of mar­ket power if it is es­tab­lished that the im­pugned ac­tion is in­tended to ha­rass the ri­val com­pa­nies or to elim­i­nate com­pe­ti­tion. It found prima fa­cie that the prac­tices adopted by Roche Group to “cre­ate an im­pres­sion about the pro­pri­ety of the ap­provals granted, the safety and ef­fi­cacy of biosim­i­lars, the as­so­ci­ated risk and the out­come of the on-go­ing court pro­ceed­ings in the med­i­cal TARIQUE AZIZ / CSE fra­ter­nity,” as a col­lec­tive ef­fort aimed at block­ing the pen­e­tra­tion of biosim­i­lars in the mar­ket.

And it is not just the le­gal let­ter­ing of the law that cci cited in its rul­ing. It pointed to the so­cial obli­ga­tion in sec­tion 4(2) which places a spe­cial re­spon­si­bil­ity on the dom­i­nant en­ter­prise not to in­dulge in abu­sive con­duct. In­creas­ingly,

cci may be called upon to play a pro-ac­tive role in forc­ing drug ma­jors, how­ever strong their patents may be, to act in a more re­spon­si­ble man­ner on the pric­ing of medicines and en­sur­ing a more level field for generic com­peti­tors. Ex­perts be­lieve the com­pe­ti­tion law may be a crit­i­cal tool in con­trol­ling the run­away prices of drugs since gov­ern­ments are re­luc­tant to take other mea­sures.

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