Drug price cut signal after court victory

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By AMIT ROY
  • Published 4.04.13
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London, April 3: Yusuf Hamied has described the Supreme Court judgment against the Swiss pharmaceutical giant Novartis as “a major victory”.

Although other Indian companies were also involved in the litigation, the running was made by Cipla, said Hamied, who is now the non-executive chairman of the company. “But it is not a victory for me,” he added. “It is a victory for the public of India.”

Hamied was with his wife Farida at their holiday home in Spain on Tuesday, saying he was looking forward to a visit by “my very close friend, Tony Lewis,” a Welshman who once captained England at cricket. Both are alumni of Christ’s College, Cambridge.

As Hamied enjoyed the spring sunshine, he tried to assess the long-term implications of the Supreme Court judgment. Cipla makes the generic drug imatinib which is the equivalent of Glivec that is manufactured by Novartis.

The drug keeps alive some 300,000 patients in India who suffer from a blood cancer called chronic myeloid leukaemia. “Without the drug, they would die,” said Hamied. “It arrests the cancer.”

While Glivec costs Rs 1.2 lakh for a month’s course, imatinib sells for Rs 9,000.

But isn’t that still prohibitively expensive for the poor in India?

Hamied revealed that “now that we have won, we may be able to reduce the cost further”, though he declined to give the size of the possible discount.

There is apparently a psychology to pricing. “If you make it too cheap or give it away free, people won’t take it — they will think it isn’t the real thing.”

The legal battle with Novartis had been going on for several years. “We have been marketing our drug for seven years.”

The original patent for Glivec was taken out by Novartis in 1992. After making modifications, Novartis sought a fresh 20-year patent.

“That would have taken the patent through to 2018,” Hamied pointed out. “But the judge said the patent in 1998 was no different from the patent in 1992. This is known as greening (when firms make minor adjustments to a drug in an attempt to extend the patent).”

Hamied made his position clear. “I am not against science, I am not against invention. What I am against is monopoly. There should be a compulsory licensing system.”

Under his proposal, Indian firms would pay a royalty of 4 per cent on net sales for making generic drugs.

He set out his philosophy: “I do believe anybody manufacturing products for healthcare cannot regard it truly as a 100 per cent business: it is business plus a humanitarian approach to society because you are saving lives. You are playing with people’s lives.”

Cipla was founded by his late father in 1935. Hamied, who is 76, said he had now formally retired from day-to-day activity at Cipla.