SC raps Centre for not granting compulsory licences to more pharma companies for manufacture of drugs

The Supreme Court has once again rapped the Centre as to why it did not consider granting compulsory licences to more pharma companies for the manufacture of drugs to tackle the emergency brought in by the second wave of COVID-19 pandemic.

A special bench, comprising Justice DY Chandrachud, LN Rao and SR Bhat, during the suo moto hearing on the prevailing health crisis in the country asked Solicitor General Tushar Mehta whether the Centre considered to invoking Section 92 of Patents Act. It also asked about the issue of compulsory licences so that drugs can be manufactured while royalty is sorted or HC may decide so. “If the government and patentee is not able to reach a decision on patent price, the HC can decide?”

“This is a public health emergency. You have no less than 10 PSUs that can take over and start manufacturing. This is a national emergency. Drug Control Order empowers you,” the apex court said. It highlighted that it was only concerned about the health of the people and “it is not to pass a value judgment.”

The bench said it will formulate a proper order about important policy changes that the government needs to consider. As such, compulsory licences can be granted with sunset clauses which shows that such licences will be over once the pandemic is over. Highlighting the Doha Declaration of TRIPS, the court said it shows that member states can take such steps to protect right of public health. “Why should the court not issue directions under Section 100 and Section 92 to enable generics to manufacture these drugs without the fear of legal action? Is the logistical concern more important than right to health?” the judges asked.

Moreover, the bench also noted that under the existing regime, India can bypass the patent rules for remdesivir by importing the drug from Bangladesh and can also take a licence from the neighbouring manufacturer to produce remdesivir in India.

The court also questioned the government about the pricing of vaccines. “Why is the government not buying 100% of doses produced this time? Why should there be two prices for the Centre and the states? What is the rationale? The same companies are selling at lower prices to foreign nations. Pricing issue is extraordinarily important.”

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Justice Bhat said AstraZeneca is providing vaccines at a far lower price to the US citizens, then why should we be paying so much? It also asked Mehta if the Government of India had made any advances to Serum Institute of India (SII) and Bharat Biotech which produce two COVID vaccines – Covishield and Covaxin respectively. “We know what is the capacity of SII and BB. You need to ramp up the manufacturing and need additional units for manufacturing.”