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Trade agreements

India-UK Free Trade Agreement: Key Provisions and Impact on Generic Drugs Industry

Strategic Insights

— 1 min read

The recently signed Comprehensive Economic and Trade Agreement (CETA) between India and the UK has been hailed as a major milestone in the nations' economic relations. However, the agreement has sparked controversy over its provision on patent term extensions and data exclusivity, which are commonly used by innovator companies to extend their patent monopolies. According to the commerce and industry ministry, the agreement does not mandate these provisions, thereby protecting the interests of the domestic generic drugs industry.

Key Takeaways:

  • The India-UK CETA does not require patent term extensions or data exclusivity, which are two common tools of evergreening of patents.
  • India's patent law provisions on patentability criteria under Section 3(d) remain fully protected, prohibiting the grant of "evergreening" patents.
  • The agreement ensures that generic manufacturers can enter the market without unnecessary delay, once the patent has expired or is challenged.
  • India is not giving any concession on sensitive items like apples, pineapples, oranges, and pomegranates in the CETA.
  • Over 95% of Indian tariff lines or product categories in the agri sector will now enjoy zero-duty access to the UK market.
  • The CETA will allow Indian farmers to fetch premium prices for their products in the UK market, granting parity with major EU exporters like Germany and Netherlands.
  • Companies from the UK will be able to offer services in telecom and construction in India without setting up a local presence.
  • British firms will be treated on par with Indian firms in services sectors.

Statistics:

  • India's generic drug industry is estimated to be about $25 billion.
  • The industry exports 50% of its produce.
  • The CETA will provide zero-duty access to the UK market for over 95% of Indian tariff lines or product categories in the agri sector.
  • Provisions for patent term extensions and data exclusivity would have added 40% to the price of a generic drug, according to a study cited by the ministry.
  • India is giving duty concessions to niche British agricultural products like cranberries, durians, certain varieties of mushrooms, leeks, lettuce, and artichokes under the trade pact.

Sources:

  • The India-UK free trade agreement.
  • The commerce and industry ministry.
  • A study cited by the ministry (exact source not mentioned in the article).
  • Times of India (press reports).
  • Timescontent.com (for Reprint Rights).

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