October 12, 2012

Indonesia acts to over-ride patents on HIV drugs

By Matthew Bigg

JAKARTA | Fri Oct 12, 2012 8:18am EDT

JAKARTA (Reuters) - Indonesia's government has taken steps to over-ride patents for HIV drugs, following the lead of other Asian states that have allowed the production of cheap generic drugs that cut into the sales of global pharmaceutical companies.

President Susilo Bambang Yudhoyono quietly issued a decree last month authorizing the use of patents for seven HIV/AIDS and hepatitis medicines held by the likes of Merck & Co, GlaxoSmithKline, Bristol-Myers Squibb, Abbott and Gilead.

The companies affected did not provide immediate comment.

The decree states Indonesia implemented the measures to "meet the urgent need for antiviral and antiretroviral treatments".

An estimated 310,000 people are living with HIV in Indonesia, Southeast Asia's largest economy. The prevalence rate among the 15 to 49-year-old population is 0.2 percent, according to 2009 statistics from the U.N. Aids website.

Unreported cases mean that the true figure could be higher.

Under World Trade Organization rules member countries are permitted to take measures to over-ride patents when it is deemed necessary to protect public health.

Yudhoyono signed the decree without fanfare on September 3 and it was only recently highlighted by Western groups campaigning for increased access to drugs in the developing world.

The issuing of the decree follows a decision by India in March to strip German drugmaker Bayer of its exclusive rights to a cancer drug.

India's highest court also heard final arguments last month in a landmark case over drug patents involving Novartis's leukaemia drug Glivec that could change the rules for the country's healthcare sector and potentially curb its global role as a supplier of cut-price generic medicines.

At the same time, China in June overhauled parts of its intellectual property laws to allow local production of patented medicines in another initiative likely to unnerve foreign pharmaceutical companies.

The amended patent law allows Beijing to issue compulsory licenses to eligible companies to produce generic versions of patented drugs during state emergencies, or unusual circumstances, or in the interests of the public.

If implemented to the full, the measure taken by Indonesia would introduce widespread generic competition and generate big cost savings in the world's fourth most populous country.

It is not the first time that Indonesia has made an order giving government control over HIV drugs but the latest decree goes further than earlier ones in 2004 and 2007.

"Indonesia has set an important precedent, not just for the people living with HIV within its country, who have been campaigning for this, but also for other developing countries," said Michelle Childs of Medecins Sans Frontieres.

"This is one of the widest licenses issued by a government and rightly reflects the reality that a range of treatment options are needed," Childs said.

(Additional reporting by Ben Hirschler in London; Editing by Jeremy Laurence)


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