Dutch Seizure of Generic Drugs Sparks Controversy

28 January 2009

The recent seizure of a shipment of generic drugs by Dutch customs authorities sparked controversy at the World Health Organisation’s Executive Board meeting this week and elicited a strong reaction from Brazil and India (see related story, this issue). Some observers warned that the actions of the Dutch authorities could set a negative precedent for the delivery of affordable medicines to the developing world.

Although the exact facts and details have yet to be fully established, the incident, according to news reports, involved customs authorities in Rotterdam seizing shipments of the generic drug Losartan, which is used to treat high blood pressure - manufactured in India and in transit to Brazil. It appears Dutch authorities were acting on the request of a company that allegedly has patent rights over the drug in the Netherlands. Losartan is not under patent protection either in India or Brazil and thus can be imported freely in Brazil. The drug shipment has been returned to India.

In a particularly contentious exchange at the WHO meeting, the Brazilian ambassador criticised the seizure. She stated that the “Brazilian Government considers that the decision by the Dutch authorities to detain an input which is strategic to public health in a developing country, and exported in conformity with the existing international norms, represents a grave drawback in the treatment of the issue of the universal access to medicines

The Netherlands’ decision represented a “distorted use of the international intellectual property system, supposedly upheld by European Union legislation, and contrary to the spirit and provisions of the Doha Declaration on TRIPs and Public Health,” the ambassador added.

Brazil indicated that “other possible reactions will be taken into consideration according to how this problem evolves, including within the World Trade Organisation (WTO)”.

Reports indicate that India’s commerce department also reacted strongly to the seizure of the medicines. Indian Commerce Secretary G.K. Pillai said the action by the EU customs officials was unnecessary and that his department has raised the matter with the European Commission, The Mint, an Indian business newspaper, reported. Further reports from the Hindustan Times added that the Indian ministry indicated that it “may have to take the issue to the WTO and challenge it.”

A number of stakeholders and experts, particularly public health advocates and NGOs, are concerned that the Dutch seizure of the generic drugs might set a bad precedent for public health by creating yet another barrier to the delivery of quality, affordable generic drugs to developing countries.

According to Frederick Abbott, Professor of Law at Florida State University, the seizure of the generic drugs is “troubling on several accounts.”

“It is particularly unfortunate that customs authorities in The Netherlands are now taking a position diametrically opposed to the principles of the Doha Declaration on the TRIPS Agreement and Public Health that the Dutch government so strongly supported,” Abbott told Bridges.

“As a general matter, if European Union member states take the position that legitimate goods in transit through EU ports are subject to the full European regulatory regime – including internal EU IP regulation – this will create enormous impediments to global trade and operate precisely contrary to the preamble of the TRIPS Agreement ‘to ensure that measures and procedures to enforce intellectual property rights do not themselves become barriers to legitimate trade’,” Abbott said.

The situation will no doubt continue to generate commentary from both perspectives of the controversy, as observers consider the full implications of the seizure.

ICTSD reporting; “India may drag EU to WTO on seizure of drugs,” HINDUSTAN TIMES, 18 January 2009; “Brazil to object to Dutch seizure of generic drug,” REUTERS, 23 January 2009; “Dr Reddy’s consignment of drugs to Brazil seized,” THE MINT, 15 January 2009.

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