MK tightens patent monopoly practices for medicines: Will medicine prices in Indonesia automatically become cheaper?

● ‘Patent evergreening’ is a practice of extending a drug monopoly through minor modifications of an old drug. ● The Constitutional Court has revived regulations that limit such patent claims. ● This ruling does not automatically lower drug prices or create an obligation to transfer technology.

Drug patent rights generally can last at least 20 years. After they expire, local companies may produce generic versions that are sold at prices many times cheaper.

However, some giant pharmaceutical companies try to continue monopolizing patented drug prices through the practice of patent evergreening. They file secondary patents through minor modifications of old drugs.

New drug formulations are indeed worthy of protection if they bring real clinical benefits. The problem is that many drug modifications filed do not significantly improve efficacy in curing patients.

For example, companies change a drug’s form from powder to crystal, alter the daily dosage, combine it with other drugs, and even sell the same drug for different diseases.

Patent evergreening often targets drugs for chronic diseases, such as cancer, diabetes, and HIV. The impact of this unscrupulous practice can make drug prices perpetually expensive, thereby jeopardizing patients’ access to life-saving treatment.

As of August 28, 2026, the Constitutional Court’s latest ruling (MK) restored the rules on standards for the development of old drugs that cannot be patented in Indonesia.

However, I believe this ruling cannot automatically lower drug prices or create an obligation for technology transfer from pharmaceutical patent-holding companies to the national industry.

Many rogue pharmaceutical companies

In developing a drug, economists Mariana Mazzucato and Henry Li note that the biopharmaceutical industry tends to prefer playing it safe by polishing old drugs through evergreening and me-too drugs, rather than investing heavily in innovation for new disease drugs to meet public health needs.

They refer to data from 2000–2014 showing that 51% of the 1,345 drugs claimed to be “new” in Europe were modifications of old drugs without added efficacy for patients.

Such weak claims can be challenged by the public. A well-known example is the lawsuit by Indian cancer survivors together with the patient organization Cancer Patients Aid Association against Swiss pharmaceutical giant Novartis over its attempt to patent a new form of beta-crystalline imatinib mesylate during 2006–2013. Beta-crystalline imatinib mesylate is the main active ingredient used in the blood cancer drug Gleevec/Glivec.

The Supreme Court of India rejected it because the proposed modifications were not proven to improve the drug's efficacy—although the ruling does not prohibit incremental pharmaceutical innovation.

Read more: Patent monopolies make drug prices very expensive and make Indonesia dependent on imports

What does the Constitutional Court ruling look like?

In 2024, the government, through Law No. 65 of 2024, deleted Article 4 letter f of the Patent Law, which prohibited pharmaceutical companies from repatenting old medicines with weak secondary patent claims:

First, a new use for an existing or known product.

Second, a new form of an existing compound that does not result in a meaningful increase in efficacy and has known related chemical structural differences.

Through Decision Number 255/PUU-XXIII/2025, read at the end of last August, the Constitutional Court stated that the deletion of the article was contrary to the constitution.

The Constitutional Court then reinstated Article 4 letter f along with its explanation, which affirms that not every new formulation and use of a drug can automatically be patented.

The return of this article gives the country's patent examiners a strong legal basis to immediately reject weak secondary patent applications.

The Constitutional Court itself recognized that downstream instruments—such as compulsory licensing, government use of patents, parallel imports, and the Bolar exemption—are not effective enough to prevent monopolies that harm the public.

To protect the public’s right to affordable medicines, prevention must be carried out firmly from the registration stage.

The door to public oversight is also being widened

This ruling also broadens the space for oversight of the public interest.

Advocacy and patient groups, consumer institutions, health organizations, and independent researchers may challenge the granting of made-up pharmaceutical patents.

For example, in this case there was the Coalition for Advocacy of Patients’ Rights to Access Medicines, which is a coalition of patient organizations, civil society organizations, and individuals fighting for fair access to medicines and health technologies in Indonesia.

Read more: How patents affect the distribution gap for COVID-19 vaccines

Medicine prices do not automatically fall

Unfortunately, the Constitutional Court’s ruling does not automatically annul secondary patents that have already been issued. Its impact depends on the examination guidelines of the Directorate General of Intellectual Property, the practice of the Patent Appeal Commission, and cancellation lawsuits in specific cases.

Medicine prices also do not necessarily fall right away. Once patent barriers are removed, generic manufacturers still need raw materials, process knowledge, standard-compliant facilities, testing and marketing authorization, distribution networks, and purchasing certainty. If only one or two suppliers are able to enter, price competition remains weak.

This ruling also does not create a technology transfer obligation. Patent holders are not automatically required to share formulas, data, process knowledge, or training with Indonesian manufacturers.

Therefore, there are three agendas that must be monitored after the ruling:

1. Require production again in Indonesia

Article 20 of the Patent Law in force still provides a loophole for patent holders not to produce the patented medicine in Indonesia.

The government and the House of Representatives need to review this relaxation so that the monopoly granted by the state makes a real contribution to technology transfer, skills, jobs, and the resilience of domestic medicine supplies.

2. Regulate patent abuse in competition law

The revision of the Competition Law needs to give the Business Competition Supervisory Commission (KPPU) clearer tools to assess patent thicket practices, dispute settlements that delay the entry of generics, or licenses that unreasonably hinder technology transfer.

3. Require transparency of research costs and public funds

Producers who benefit from public procurement, tax incentives, or monopoly protection need to disclose the components of research and development costs for medicines, public support, and the basis for price setting proportionally.

That information is important so that the government can assess procurement prices, design fair royalties, and distinguish innovation costs from strategies to maintain profit margins.

Keep watch continuously

The Constitutional Court's decision is important for broad public access to medicines, competition, and room for further innovation. However, one patent barrier cannot replace industrial and health policy in its entirety.

The success of the decision must be measured by three outcomes: generics can enter more quickly, Indonesian producers gain real room to learn and produce, and patients pay more reasonable prices.

To achieve this, the government needs to connect patent law with competition law, procurement policy, cost transparency, and technology transfer strategies. The role of the civil society coalition is very important to keep a watch on these matters.