Need for disclosure-based data exclusivity norms in the time of pandemic

The outbreak of Covid-19 has set the eyes of the world towards finding a suitable vaccine for the virus. Undoubtedly, the vaccine will have a huge global demand once it is prepared. Whatever the fate of the drug be, it becomes very pertinent to see our dependency on pharmaceuticals industry. In the latest development, two […]

The outbreak of Covid-19 has set the eyes of the world towards finding a suitable vaccine for the virus. Undoubtedly, the vaccine will have a huge global demand once it is prepared. Whatever the fate of the drug be, it becomes very pertinent to see our dependency on pharmaceuticals industry. In the latest development, two of the firm, Hetero and Cipla will be introducing the generic version of Gilead’s Remdesivir in India, by the approval of Drug Controller of India. In the introduction of the generic version, many issues come up which act as a hindrance for the manufacturer, especially the generic ones. One of the most important parts of patent is a highly debatable issue of data exclusivity. The literal interpretation of Data Exclusivity can be found under Article 39.3 of the Agreement on Trade Related Aspect of Intellectual Property Rights (TRIPS). The adoption of TRIPS which formed a part of agreement establishing the World Trade Organization (WTO), established a minimum level of protection with respect to various forms of Intellectual Property Rights, replacing the erstwhile General Agreement of Trade and Tariff (GATT). The protection given to IPR holder is always attributed for providing an economic incentive. But at the time of pandemic, this can be of much concern, since the TRIPS framework, especially on data exclusivity, can largely affect the access to medicine, more particularly cheaper medicine. The advantage of the process of test data protection under the TRIPS regime, especially for the developing countries, has to be understood and examined in the present context of the pandemic.

The genesis of Data Exclusivity

TRIPS can be said to be the first international agreement to set up a minimum standard for protection of test data submitted to the authority for the marketing approval. This protection of test data submitted is commonly known as Data Exclusivity. Data Exclusivity is the period of non-reliance and non-disclosure that is provided to new chemical entities and pharmaceutical composition. Data Exclusivity can be ‘inherently’ inferred from the reading of Article 39 of TRIPS.

Article 39 does not explicitly talk about data exclusivity; the literal interpretation of article 39.3 does provide us a reasonable inference to operate on data exclusivity standard. Article 39.3 clearly states that the submission of ‘undisclosed test or other data’, origination of which involve ‘considerable effort’ shall be protected by the member states. Hence, the obligation will automatically come to play as soon as the originator submits ‘undisclosed data’ involving ‘considerable effort’. In spite of clear indication that the exclusivity regime for protection of test data was not intended to be the WTO requirement, the developed countries, especially USA and EU, asserted the interpretation that require the countries to include data exclusivity framework. In India, we don’t find an explicit understanding of data exclusivity. The primary legislation dealing with drug regulation is Drugs and Cosmetic Act, 1940. Under this act, the primary regulatory requirement which include the clinical trial data is explicitly discussed under Drugs and Cosmetic Rules, 1945 (DCR). Under these rules, we find the definition of ‘New Drug’ under Rule 122E. Rule 122A talks about regulatory requirement of ‘import’ of ‘New Drug’ and Rule 122B, talks about the manufacture of the ‘New Drug’. Schedule ‘Y’ of DCR talks of Requirement and Guidelines on Clinical Trials of drug imported or manufactured. Hence, in spite of not having an explicit definition, combining Rule 122A, Rule 122B, Rule 122E and reading with Schedule ‘Y’ of DCR, gives us the presence of Data Exclusivity in India [i]. Many committees have been formed by government of India by time to time, giving different interpretation for strict regime of data exclusivity, the discussion of which is outside the scope of the article.

Data Exclusivity: ‘No’ to generic manufacturer

For our discussion, Data Exclusivity becomes very important as it prohibits the regulatory authority to rely on the originator data in approving the product of prospective generic competitors. In simple term, if a patentee ‘X’ submits its patent with the test data ‘A’ for the purpose of market approval. The regulatory authority by virtue of article 39.3 will be restricted to use test data ‘A’ for the original patentee ‘X’ and not for other generic competitors, in spite of the fact that patent of both original and generic are of same composition. This way, data exclusivity delays the process of marketing approval for the generic drug, which might prove very costly in the days of pandemic. There can be multiple arguments in favor and against such conundrum.

The regulatory authority has to be satisfied with the safety, efficacy and the quality of drugs. To this, much reliance has to be paid on the test data submitted which include pre-clinical and clinical drug trials conducted in the manufacturing process. If this data is used for the purpose of registering generic substitutes, it can have various repercussions. This implies that the generic manufacture will be allowed to enter the market without considerable investment thereby giving a huge economic loss to the originator and selling the product at significantly lower cost. This gives three options to the generic manufacturer for accessing its market approval. Firstly, the generic manufacture should make its own test data, investing considerable time and money. Secondly, it can wait for the expiration of the test data protection for the originator. Thirdly, it can license the test data by giving considerable amount to the originator again investing in it. In all option, it has to suffer through rigorous, time consuming and expensive process or to wait till the expiration creating substantial effect on the market entry of the drug, resulting into the delay in accessing cheaper medicine [ii]

Economics behind test-data : How viable?

Pharmaceuticals companies will be a major supporter for the data exclusivity framework to be adopted by countries, especially developing countries. Moreover, data exclusivity cannot be considered like that of patent-style novelty, and cannot be lost only because of the delay in the marketing approval. It is because of these factors that big pharmaceuticals companies sought these protections so assiduously. If we try to analyze the economic perspective of protecting the test data, most of the justification follows the tendency to respond to positive incentive and rewards. But to the primary concern, this incentive must be locked up in a certain way at least ‘temporarily’ for providing a net benefit to society.

The contention to protect test data can be met by stiff resistance due to technological know-how to utilize test data, which is not known outside the periphery of the manufacturers of that drug. This clearly indicates that in spite of the assumption that there being no protection to test data, the generic manufacturer would have to generate a comprehensive regulatory dossier, thereby incurring significant cost. Hence, even if there is no vaccine for the pandemic, as in the present developing stage, the relaxation of the test data protection, will not result in a huge economic impact, since the generic manufacturer, in any case, will be investing a considerable amount of money for obtaining the requisite know-how of the drug before coming to the clinical test trial data process

[iii]. Generic manufacturer can face lot of hindrance like that of insufficient incentive mechanism, lack of technical assistance due to which they are not able to promptly register their therapeutic equivalents. Now adding data exclusivity in its absolute form will definitely prevent the generic manufacturer to respond to compelling public health issues [iv].

 To this, various organizations have started a global patent pool for the availability of drugs. But do we require that? In this pressing time, what is more required is a total drug based information and not just the drug. Drug based information consisting of the clinical trial data along with the dosage and the process of delivering it. The role of the government is to regulate the entire drug; thereby the term access to medicine should not be restricted only to patents but also to complete drug based information.

What next?

The conflict of interest for data exclusivity between the developed and developing countries are doctrinally weak which prejudices the historical, epistemological and jurisprudential foundation of intellectual property. Healthcare specialist considers that non-disclosure of test data would seriously prejudice the right of the public to be informed about the efficacy and safety of the drug they use. If we have a “disclosure” based test data protection, the scientific community will always favor this type framework, based on transparency and disclosure. This framework will definitely save the generic manufacturer from wasteful repetition or bearing higher cost, since all scientific development are built upon a pre-existing knowledge and concept. Pharmaceuticals test data should be protected from competing generic drug producer from free riding on the original data. But having a stringent protection of the test data will definitely bar the generic manufacturers to develop drug in the pressing situation like Covid-19. Adoption of disclosure based data exclusivity model will definitely solve the interpretative ambiguities. Not only to this, it will also result into a research having maximum productivity and generate market certainty [v].

Indian pharmaceutical companies, predominantly, are largely against data exclusivity, since it being a hub of generic manufacturer but it does support data protection in India. Disclosure based norms will be beneficial for Indian pharmaceutical sector, not only in the current scenario but also on a regular basis. Use of data by the authorities for granting approval for generic product will constitute a harmonious balance between public and private interest.

Saransh Chaturvedi, LLM, 1st year, Indian Institute of Technology, Kharagpur.