The Supreme Court recently stayed a Kerala High Court DB order directing the Central Government to bear the expenses of one month’s treatment of an SMA patient. Remarkably this is the second such order by the Supreme Court wherein it has stayed a High Court decision asking the government to take positive steps to ensure accessibility of a treatment to patients suffering from rare diseases. Looking at different flexibilities under the Patent Act, like compulsory licensing, government use etc., it can be seen that the government can step in and avail these levers to ensure access to these life-saving medicines. The argument to use these levers to ensure access to essential drugs for SMA patients has been discussed by Sabeeh previously on the blog here in light of MP Haris Beeran’s letter to the Government making a similar request. Adding to the discussion on exploring the viability of the argument regarding invoking these levers, Prof. Prabhat Kumar Saha argues why the government should invoke these policy measures in light of the obligations under the Right to Health. Prof. Saha is an Associate Professor of Law, Faculty of Law, Banaras Hindu University. His previous post can be accessed here.
Right to Health and the Issue of Compulsory Licensing for Exorbitantly Priced Risdiplam
By Prof. Prabhat Kumar Saha
By an interim order, the Supreme Court of India stayed the Division Bench judgement of the Kerala High Court—which directed the Central Government to bear the cost of one month’s treatment for a petitioner suffering from Spinal Muscular Atrophy (SMA). In its stay order, the Supreme Court has instead asked the petitioner, an SMA patient, to try and arrange for financial aid from other sources for her treatment. The Court also suggested that the petitioner and the Union of India can directly talk to companies manufacturing the treatment to ensure the economical treatment of SMA patients. This interim order has broader ramifications on the sacrosanct state duty to protect the fundamental right to health of its people, as well as the solemn oath of the constitutional courts to safeguard fundamental rights, including the right to health.
Further, the case also involves the fundamental issue of limits of patent monopoly especially in critical areas like lifesaving medicines. The general understanding is that patent law needs to balance the private and public interests, i.e., the interest of the patent holders vis a vis public interest like access to medicines. The Indian Patents Act has incorporated various public interest safeguards in the Patents Act such as compulsory license (Sections 84 and 92), government use license (Section 100) etc. However, there is no clarity with regard to the deployment of these tools to protect public interest such as facilitating access to affordable medicines.
The complexity arises mainly due to numerous myths, unfounded apprehensions, and assumptions within the bureaucracy and judiciary alike. For instance, in response to the Supreme Court’s sou moto petition on COVID 19 the Centre Government termed the idea of using compulsory license/government use as counterproductive. Similarly, on the above mentioned appeal of the Centre Government the Supreme Court reportedly observed that the use of compulsory license/government use license might have international ramifications. However, this is a misplaced and self-defeating notion.
The SMA Petition
SMA is a rare genetic disorder characterised by progressive muscle weakness and wasting, affecting the nerve cells responsible for controlling voluntary muscle movement. SMA has an estimated incidence of 1 in 7,744 live births in India. Considering the country’s annual birth rate of approximately 25 to 27 million, this corresponds to an estimated 3,000 to 4,000 new SMA cases per year.
A patented drug, Risdiplam (marketed as Evrysdi), owned by Roche, is effective in managing SMA. However, Risdiplam is exorbitantly priced in India at Rs. 6.2 lakh per bottle, making the cost of treatment approximately Rs. 72 lakh per year. Patients weighing up to 20 kg require one bottle per month, while those with higher body weight may require up to three bottles, rendering long-term treatment financially toxic and impractical.
Seba P.A., an SMA patient, filed a writ petition before the Kerala High Court, seeking a writ of mandamus or other directives to the Central Government to issue a compulsory license under Section 92 or Section 100 of the Patents Act, 1970. The petition is still pending before the Court. As an interim remedy, the petition sought urgent access to Risdiplam, which the Single Bench granted under the National Policy for Rare Diseases 2021 (NPRD), which provides a one-time assistance of Rs. 50 lakh for treatment.
On February 6, the Division Bench of the Kerala High Court directed the Central Government to provide Risdiplam to the patient for one month beyond the Rs. 50 lakh cap under NPRD and requested the single-judge bench to prioritise the matter.
Against the Division Bench judgment, the Central Government filed a petition for special leave (SLP) to appeal. It argued that the Kerala HC judgment could still create an “unsustainable financial burden” if each case were considered unique, given that there are over 3,000 SMA patients in India. However, the Bench orally observed that the Indian government might be avoiding such measures due to “international ramifications.” The Bench further remarked, “Why would the Indian government not be interested? They will be very much interested. It’s easy to be critical of that. They would have tried their level best to get the prices down.” However, unlike Pakistan and China, the price of these drugs stays high despite the Court’s assumption of all the efforts by the government to reduce it.
Is Government Use a Discretion of the Government?
The right to life and right to health is guaranteed under Article 21 of the Constitution of India. (see Vincent Panikurlangara v. Union of India and Parmanand Katara v. Union of India and Others) The Supreme Court has held that “Article 21 does not impose upon the state only negative obligations not to act in such a way as to interfere with the right to health. This Court also has the power to impose positive obligations upon the state to take measures to provide adequate resources or access to treatment facilities to secure effective enjoyment of the right to health.” The right to access medicines has been recognised by several courts in India, and courts have intervened in executive actions, directing them to provide free treatment. (For instance, see Mohd. Ahmed (minor) v. Union of India and Karukola Simhachalam vs Union Of India.
It is the state’s positive duty under Article 21, which creates an obligation on the Government of India (GOI) to take legal and policy measures to change the status quo regarding access to highly priced, life-saving medicines like Risdiplam, instead of simply asserting that the price is high and nothing can be done to reduce it. There are a range of options available to the GOI, such as price negotiations or the use of a government use license.
GOI can initiate negotiations with Roche to substantially reduce the price of Risdiplam to make the drug affordable for sustainable access without financial toxicity. If negotiations fail or Roche refuses to lower the price, the Central Government should issue a compulsory license for “public non-commercial use” under Section 92 or under Section 100 of the Patents Act, 1970. The term “public” used in Section 92(1)(ii) and other provisions of the Patents Act, 1970 leaves no doubt that “public” before “non-commercial use” refers to ‘people in general.’ “Non-commercial use” pertains to the nature of the transaction, meaning that the government or its ministries/departments can set the price for the licensee.
Dr. Melissa Barber, an expert in health economics at Yale University, has submitted a detailed statement before the Kerala High Court, revealing that the annual treatment cost of an adult SMA patient with Risdiplam is only Rs. 3,024. This figure includes production costs with a 20% markup and 25% tax. Therefore, if a compulsory license is issued, the government could procure Risdiplam from local manufacturers at a negligible cost compared to Roche’s current price. Interested readers can also look at this post discussing the issue in detail further.
The TRIPS Agreement provides a clear mandate to issue compulsory license, which is clearly reflected in the Doha Declaration on the TRIPS Agreement and Public Health that states “Each member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted.” Thus, it is not the legal ramifications but the political ramifications might be behind the reluctance of GOI.
The notion that issuing a compulsory license would displease developed countries to the extent of triggering retaliatory actions is a myth. Despite several developing countries issuing compulsory licenses, none have faced actual retaliatory actions or trade sanctions from developed nations like the USA. Since the COVID-19 pandemic began, many countries have taken steps to relax patent monopolies. In a few cases, such as in Germany and Canada, laws were amended to provide for public health-related exceptions, while in others, compulsory licenses were actually granted. Notably, in recent years, the U.S. government has authorized many government use licenses far more than any other country. Therefore, concern over the “international ramifications” of issuing a compulsory license is entirely unfounded and mythical.
However, the critical question is whether GOI can assert discretion in the invocation of powers under Section 92 or Section 100 when the non-invocation results in continuous violation of the right to life and right to health.
Constitutional morality requires an expectation of behaviour from institutions that will not meet just text but the soul of the constitution and must be held accountable for not doing so (See Govt. of NCT of Delhi v. Union of India). The Judiciary is expected to provide an answer to this question while it examines the merit of the appeal, which will determine the life and death of 1.4 billion citizens.