Quite simply, from pharmaceuticals to films and software, India is stealing our goods. India ranks last among the largest economies in terms of intellectual property rights protection, according to a comprehensive analysis by the United States Chamber of Commerce. And despite numerous talks and visits by Secretary of State John Kerry and Vice President Joe Biden over the past year, respect for property rights in India continues to deteriorate. It is time for the administration to get tough and designate India as a priority foreign country in its 2014 Special 301 Report, making it clear that India will face consequences if it continues on its current course.
The need for this move is being widely emphasized by all corners of the American business community. In a detailed public comment, the U.S. House strongly recommended designation for India, noting that its “environment has deteriorated significantly over the past year.” The letter, submitted by more than fifty local business groups along with individual technology and biopharmaceutical companies, was even more blunt, stating: “We are outraged by the allocation of foreign priority country status, India’s systematic discrimination against American innovators, and the increasing theft of American intellectual capital. less.”
They’re right.
Starting in March 2012, India is issuing mandatory drug licenses as part of a up-to-date policy requiring local production, which is clearly illegal under international trade law. The first compulsory license was issued for Nexavar, Bayer’s cancer drug. They then began invalidating patents altogether, starting with Sutent, for which Pfizer clearly holds a valid patent recognized in over 90 countries. Similar moves to invalidate and deny valid patents were made against Tarceva from Roche and Glivec from Novartis – even though Novartis was giving away Glivec for free to 95 percent of the Indian market, making every excuse that these moves to seize American property were justified on humanitarian grounds. Over the past two years, India has challenged the patent rights of at least fifteen drugs.
India is a market of over a billion people. According to the Tufts Center for the Study of Drug Development, the total cost of bringing a up-to-date drug to market is currently $1.2 billion, due in part to regulatory compliance and litigation costs. Strong protection of innovators’ intellectual property rights is absolutely indispensable to raising capital and justifying its investment in the development of up-to-date medicines. The biggest threat to such innovations around the world today is India’s misguided policies.
The problems are not restricted to drug patents. When it comes to copyright, the Film Distributors Association ranks India as one of the worst havens for distributors of pirated films, with up-to-date films appearing online in India on average 3.15 days after their theatrical release. More than half of all feature films in the Asia-Pacific region take place in India.
The music industry estimates that in 2012, about 90 percent of music downloads in India were done without a license, costing the industry and defrauded artists $431 million. In 2011, the software industry estimated that 63 percent of computer software had been looted, amounting to $2.9 billion. This means higher prices for the rest of the world.
Voices across the political spectrum have long been sounding the alarm.
In a acute, bipartisan, bicameral letter, the chairman and leading members of the Senate Finance Committee and the House Ways and Means Committee – Max Baucus, Orrin Hatch, Dave Camp and Sander Levin – stated: “Beyond any specific actions taken by India, the government has announced a broader the policy objective of developing and supporting Indian domestic industry by forcing foreign companies to use local facilities and suppliers and transfer their intellectual property to Indian entities.”
Ahead of John Kerry’s trip to India last year, 40 senators signed on to a letter from Republicans Rob Portman of Ohio and Bob Menendez of New Jersey urging Kerry “to make clear to his Indian counterparts that the United States will consider all trade tools to get rid of her.” , if India does not stop its discriminatory practices.”
However, diplomatic pressure still did not work and it was time to heat up the atmosphere.
Designating India as a priority foreign country would trigger a formal investigation by the U.S. Trade Representative, potentially leading to retaliatory sanctions. Of course, no one wants a trade war with India, but until we show a willingness to act, India will probably not stop stealing our goods.
