The Ministers believe that the waiver will help safeguard the Indian public from potential shortages of medicines. Compulsory licenses allow the intellectual property on medicines to be set aside in order to allow production by local manufacturers to answer some pressing public health need, but the proposed legislation as it stands would include a lock-in period of three years, preventing this fom taking place.
If the Indian Parliament approves the waiver, it would allow the government to sidestep patents by invoking licenses any time from the date of patent grant, according to local new sources.
The country's long-awaited Third Patent Amendment Bill is likely to be introduced in Parliament at its winter session in December, and according to World Trade Organisation stipulations should be in force by 1 January 2005.
The new waiver recommendation is expected to be included in the Bill when it is introduced. An Indian government official said the removal of the lock-in period would deter multinational companies from misusing the product patent regime by overpricing their products.
On the whole, India's 280-billion rupee (€4.8bn) pharmaceutical industry is thought to be looking forward to the launch of a new patent regime, because they believe it will lead to an increase in the number of foreign companies - once assured of product patent protection - seeking local partners to manufacture drugs.
However, many of the small and medium companies making a living now by marketing and exporting copied but patented drugs may have to shut down
One key element of benefit to the Indian industry will be its standing as a source of active pharmaceutical ingredients (APIs). Industry sources expect the domestic pharmaceutical sector's revenue from the US generic market alone will quadruple in the next five years to $2.17 billion (€1.68bn), with similar growth expected from Europe. The US generic market was worth $16 billion in 2003, with Indian companies capturing a 3.5 per cent share.