India's crackdown on fakes

To hear NGOs and the BBC tell it, by finally passing a law that bars domestic companies from copying patented drugs, India's heartless parliament will make it impossible for medications to reach the needy. Of course, it's the complete reverse. India's government deserves praise for standing up to the likes of Oxfam and Medecins Sans Frontieres (MSF) and passing a law that will allow it to be a respected partner in drug development.

What India has done is simply ensure that the market capitalism that has made the Western nations and Japan prosperous, with corresponding improvements in public health and welfare, can function better in India. It can only thrive when property, intellectual or otherwise, is protected by law. Without such protections, the Indian pharmaceutical industry will continue to operate in a sort of legal limbo, where the safety of efficacy of its products are uncertain.

So by approving patent legislation that will finally put a stop to decades of simply copying someone else's pharmaceutical breakthroughs, the Lok Sabha on Tuesday brought India into line with the advanced world. It was yet another step in bringing India out of its years of economic isolation, which has only induced lethargy and dire poverty. The bill is expected to become law later this week.

The Congress Party at the heart of the 12-party governing coalition deserves praise for steering the legislation through the shoals of anti-capitalism. In the end, it did accept amendments demanded by communists who support the government while remaining outside the coalition. But such is the price of any action in India these days.

The amendments apply to the definition of what constitutes a "new" drug, preventing companies to tinker with existing drugs in order to gain new patents. The amendments throw unnecessary sand in the gears, but don't completely render the new legislation toothless.

Despite the efforts to weaken the law, Julian Morris, the director of the International Policy Network, a London-based think tank, told us that, "This legislation represents movement in the right direction."

You wouldn't think so from the attacks India was subjected to in the past few days. In a letter to Congress Party leader Sonia Gandhi, MSF said: "We are deeply disturbed and concerned that you are failing to listen to the voices of your people who have entrusted you with their welfare." Oxfam claimed that "this law will have a severe knock-on effect on many developing countries." While these organizations obviously don't see it that way, what they are advocating is legalized theft.

Much of the criticism right now is being targeted at the World Trade Organization, which demanded that India pass the patent law. India joined the WTO in 1994, but it wasn't until India started to subscribe to the Trade Related Intellectual Property Rights (TRIPS) agreement on Jan. 1, that it needed a law to comply.

But the need to protect the intellectual property of India's growing pharmaceutical industry, now worth $5 billion a year, also acted as an incentive. The new law will attract new foreign investment and even more outsourcing to India. And perhaps the next breakthrough in medicine will come from India rather than being merely copied there.