Slow-Walking Innovation

Recent Regulatory Reforms Are Hampering Efforts by Innovators

By: Lila Feisee, Vice President International Affairs, Biotechnology Industry Organization (BIO)

Indian Prime Minister Narendra Modi’s new government came into office with a mandate for “More Governance, Less Government”.  If “less government” implies fewer regulations, we are not seeing much to cheer about so far.

Modi’s recently announced closing of India’s Planning Commission, which has historically micromanaged private enterprise, should have been a bright spot; however, his government also announced its replacement by the National Development and Reforms Commission, which sounds suspiciously like China’s National Development and Reform Commission, which serves to micromanage the Chinese economy.  Similarly, during the important rollout of the new budget in the beginning of July, the new Modi government made a few tepid changes but ignored the vast majority of the biotechnology industry’s requests to improve the regulatory and IP environment for innovative companies.

Regulations can serve a useful purpose in organizing an industrial sector, ensuring that the needs of the public at large are well served and preserving the credibility of innovators and producers. However, irrational, burdensome regulations are the bane of business and innovators alike, and in India, the life sciences sector is rapidly and rashly going from a state of under-regulation to a state of over-regulation. When the industry was under-regulated, we saw abuses that quickly became news headlines, such as the improper approval of new medicines by unqualified reviewers and ethics committees. Innovative companies have stepped back from the market as a result of a few bad apples dampening enthusiasm in India for the critical role of clinical research and evaluation in bringing new medicines to market. As no new drugs can be approved without clinical trials to ensure their safety and efficacy, no new medicines are being introduced into the Indian market, thus throwing the plans and investments of numerous innovative biopharmaceutical companies into disarray. In the meantime, Indian patients are denied access to new medicines waiting for regulatory approval, and Indian biopharmaceutical companies are looking outside of India to conduct their clinical trials.

Rather than seeing the new government bend its considerable mandate toward improving the Indian economy by creating an enabling environment for innovation and research, we have seen startling examples of the opposite. Not only do new or unreasonable regulations threaten to choke development of new technologies and medicines, but the threat of compulsory licensing and patent revocations still loom large over those technologies which companies have managed to develop. While it is still early in the new government, if not addressed, such policies will not only leave India’s patients without the medicines they need, but will also impede India’s economic growth potential.

Sensible, well thought-out regulations and policies, which are equitably enforced, are necessary to setting a level playing field for industry, particularly the life sciences industry, as well as safeguard patient interests. India is slowly, perhaps hesitantly, making its way toward a fully-regulated industry which reflects the global best regulatory practice. However, the pace of reform is too slow, not reflective enough of best practices, and in some ways contrary to realizing the goal of India’s biotechnology industry becoming a strong and robust contributor to its economy.  Before India can legitimately claim the mantle of an innovation economy, it needs to pay more time and attention to optimizing its regulatory ecosystem.