Journal of Generic Medicines: The Business Journal for the Generic Medicines Sector

With the adoption of the World Trade Organization’s (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (henceforth, TRIPS), the WTO members agreed to provide a minimum level of Intellectual Property (IP) protections to a broad range of subjects, including “undisclosed test or other data.” However, following the entry into force of TRIPS, some WTO members (particularly, developed countries) have concluded Free Trade Agreements (FTAs) that consist of TRIPS-plus provisions, which go beyond the minimum standard established under TRIPS. One of the agreements that represent such a trajectory is the newly renegotiated agreement between the U.S, Mexico and Canada. The agreement has been negotiated, among other issues, to replace the North American Free Trade Agreement (NAFTA). This trilateral agreement also changed the name NAFTA to the United States-Mexico-Canada (USMCA) Agreement or NAFTA 2.0. The new agreement contains rules that govern undisclosed test or other data (hereafter, test data), which biopharmaceutical companies submit to Health Regulatory Authorities for the purpose of obtaining the right to market biological medicines (hereafter, biologics). Drawing upon the aforementioned background, this article examines if and how USMCA’s test data rule contravenes the obligations of the USMCA Parties to fulfill, protect and respect the right to biologics, as contained under the International Covenant on Economic, Social and Cultural Rights (hereafter, ICESCR) and other international human rights instruments that cover the right to health. The first section provides an overview of USMCA, the second section addresses the nature of legal protection given to test data under the TRIPS Agreement, the third section is devoted to examining the nature of obligation as contained under USMCA’s rule on test data, the fourth discusses the legal basis of the right to biologics, while the fifth section assesses if and how the rule on test data impedes the USMCA Parties from realizing the right to biologics. The last section provides a conclusion.

The objective of this study was to evaluate the population behavioural influence towards generic medicines use in a Klang Valley. A self-administered questionnaire in the Klang Valley, Malaysia, was distributed conveniently. A total of 222 respondents have participated in the study (response rate 57.8%). The majority of the respondents (87.7%) have reported considerable amount of knowledge on the generic medicine availability in the market. In comparison of sociodemographic influence, only household size was found to influence the respondent’s knowledge and curiosity. For the perception, there was a statistically significant difference in attitude scores for respondents who had good level of knowledge (M = 3.322, SD = 0.516) and poor level of knowledge (M = 3.011, SD = 0.591) towards generic medicines; t(220) = –4.180, p < 0.05. In terms of subjective norms, data findings indicate a statistically significant difference in scores for respondents who had good level of knowledge (M = 3.456, SD = 0.704) and poor level of knowledge (M = 3.057, SD = 0.616) towards generic medicines; t(220) = –4.393, p < 0.05. Similarly, this study found a statistically significant difference in perceived behavioural control scores for respondents who had good level of knowledge (M = 3.605, SD = 0.548) and poor level of knowledge (M = 3.121, SD = 0.577) towards generic medicines; t(220) = –6.350, p < 0.05. Therefore, these results reveal that good level of knowledge really influence the level of perceptions among consumers of generic medicines. It is imperative that more initiatives to be introduced by the government to promote the practice to prescribe generic drugs to the population. The need to educate both health professionals and patients on the availability of the cheaper and bioequivalence medicine should be put into formality, thus increasing the awareness of the patient of the generic medicine and next reduce the dependency of the costlier innovator brand medicine in the prescription at both public and private healthcare settings.

Over the past decade or so, API industry has lost out to Generics in attracting investments due to prevailing industry structure which favoured greater returns from Generics – faster growth and better margins among others. In the past three to five years, with Generics losing sheen with normalised margins and returns, API businesses are getting back onto investor radar. With inherent chemistry and engineering complexity, API manufacturing has the potential to create businesses protected by better moats. Another pain point of the API industry was Chinese exuberance in offering APIs at irrationally low prices, which eventually destroyed value for the entire industry as a whole. A slew of recent measures and events has established parity among all players – Chinese, Indian and European, with the anticipation that it should better industry wide performance. Indian API companies are well positioned to leverage the situation and improve their standing in the API industry. Financial markets have begun to recognise some of these players like Divis Laboratories, trading at market capitalisations comparable to generic companies with 10 times higher revenue. Besides large players like Divis, a bunch of upcoming Indian API suppliers led by MSN Labs have focused on developing a large number of niche, low competition APIs for supplying to the regulated markets. Such portfolio lends towards above industry average realisations and wider customer penetration. Besides public listing, API companies have been sought after targets for adjacent players in CDMO space, chemical companies, chemical distributors for forward/backward integration and creating additional revenue streams. A bunch of private equity players have already setup or in the process of setting up platforms to consolidation API companies, as we speak. For an investor, it is the key to understand the various business models and the key factors driving the choice of targets to ensure the strategy is well designed to succeed.