By Patrick Rosenstiel for Scranton Times-Tribune
As Secretary of State John Kerry travels to India this month to represent U.S. interests at the 4th Indo-U.S. Strategic Dialogue, I echo Sen. Bob Casey's recent statement urging Mr. Kerry to confront the government of India on its egregious intellectual property violations. As we negotiate bilateral and multilateral trade agreements around the globe, a top priority must be protecting the intellectual property rights of U.S. companies.
Mr. Casey rightly points out that IP violations in India have a severely negative impact on Pennsylvania's pharmaceutical firms and their 200,000 employees. More broadly, IP-related industries in Pennsylvania support upwards of 2.5 million jobs - almost half the total private sector jobs in the state - and account for over $30 billion in annual exports. Indian government officials must understand that when they issue compulsory licenses, or fail to protect or enforce intellectual property rights, they not only adversely affect U.S. industry, but Indian companies and workers as well.
In April, India's Supreme Court denied Novartis, a Swiss pharmaceutical company, patent protection for its Glivec cancer medication. Forty other countries - including the U.S., China and Russia - recognize Novartis' basic intellectual property right in Glivec. The Supreme Court's defenders say the price of the medication puts it out of reach for most Indians. The fact is, 95 percent of Indian patients using Glivec get it for free, and the remaining 5 percent receive it at reduced, subsidized prices.
Without clear IP rights, innovative companies that require significant up-front costs have little incentive to invest billions of dollars and decades of time into creating new products that benefit society at large. This is especially true in the area of medical research, where bringing a life-saving treatment concept to fruition requires an average of $1.3 billion in investment and 10-15 years of research.
The implications of the Indian Supreme Court's decision are far-reaching and not limited to medicines. The lack of respect for intellectual property rights displayed in this case will give pause to any innovative industries considering investing in India. The Indian government must recognize IP protections that allow companies like Novartis to pursue innovations that save lives while creating jobs and stimulating economic growth.
Free trade works and protectionism doesn't, but free trade requires intellectual property protocols that both incentivize and protect private U.S. investment abroad. On behalf of Pennsylvania's IP-related industries and all U.S. trade interests, I thank Mr. Casey for his forward-looking leadership on this issue, and I urge Secretary Kerry to use his dialogue with Indian government officials to make it clear that, without good faith IP reforms soon, we'll decide to take our business elsewhere.