SC asks Centre why it did not consider granting compulsory licenses to more pharma companies for manufacture of drugs

The Bench also said that that under the existing legal 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 Supreme Court on Friday asked the Centre why it did not consider granting compulsory licences to more pharma companies for the manufacture of drugs to tackle the emergency that has arisen due to the Covid-19 pandemic.

During the suo moto hearing on Covid crisis, a Special Bench comprising Justice DY Chandrachud, LN Rao and SR Bhat asked Solicitor General Tushar Mehta that “has the Centre considered to invoking Section 92 of Patents Act and issue 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 that 10 PSUs that can take over and start manufacturing. This is a national emergency. Drug Control Order empowers you,” the apex court said, adding that it was concerned only about the health of the people and “it is not to pass a value judgment.”

The SC will pass a slew of interim directions on Saturday which will govern the situation for the next 10 days. “We will formulate a proper order. It is about important policy changes that Centre needs to consider,” the Bench said, while posting the matter for further hearing on May 10.

Compulsory licences can be granted with sunset clause which shows that such licences will be over once the pandemic is over, it said. “Doha Declaration of TRIPS show 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.

The Bench also said that that under the existing legal 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.

It also questioned the Central government over the pricing of vaccines. “Why is the government not buying 100% of doses produced in 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.”
AstraZeneca is providing vaccines at far lower price to the US citizens then why should we be paying so much?, Justice Bhat said.

It also asked Mehta if the Government of India had made any advances to Serum Institute of India (SII) and Bharat Biotech (BB) 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,” the judges said.

According to the top court, the government must follow the “national immunisation model which we had followed since independence.” “Why cannot follow the national immunization program policy and procurement is centralised but distribution be decentralised. Pricing issue is extraordinarily serious. How will poor people find money to get vaccinated? We can’t have this private sector model in a crisis like this,” Justice Chandrachud told Mehta.