Print Friendly, PDF & Email

Insights EDITORIAL ANALYSIS : The Indian Patent Regime and Its Clash with the US Norms

 

Source: The Hindu

  • Prelims: Current events of national and international importance(Patents, WTO, TRIPS,Covid-19,).
  • Mains GS Paper II: Reforms in international organizations and laws, Patent laws, TRIPS,etc)

ARTICLE HIGHLIGHTS

  • The U.S. TradeRepresentative (USTR) said in a report released last month that India was one of the most challenging major economies as far as IP protection and enforcement is concerned.
  • It has decided to retain India on its Priority Watch List along with six other countries—Argentina, Chile, China, Indonesia, Russiaand Venezuela.
  • Among the issues raised in the report are India’s inconsistencies regarding patent protection,
  • India undertook an intellectual property review exercise last year, where a ParliamentaryStanding Committee examined this subject.

 

INSIGHTS ON THE ISSUE

Context

What are Patents?

  • It represents a powerful IP right and is an exclusive monopoly granted by a government to an inventor for a limited, pre-specified time.
  • It provides an enforceable legal right to prevent others from copying the invention.
  • Patents can be either process patents or product patents.
  • A product patent ensures that the rights to the final product is protected and anyone other than the patent holder is restrained from manufacturing it during a specified period. This is applicable even in the cases if they were to use a different process.
  • A process patent enables any person other than the patent holder to manufacture the patented product by modifying certain processes in the manufacturing exercise.

Patents and India:

  • It became a party to the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement following its membership to theWorld Trade Organisation(WTO) on January 1, 1995.
  • India is also a signatory to several IPR related conventions, all of which govern various patent related matters.They include:
  1. Berne Convention-which governs copyright.
  2. The Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure
  3. The Paris Convention-for the Protection of Industrial Property,
  4. The Patent Cooperation Treaty (PCT).
  • India moved from product patenting to process patenting in the 1970s, which enabled India to become a significant producer of generic drugs at global scale.
  • India later adopted process patenting rather than product patenting, and built up a huge generic industry which allowed companies like Cipla to provide Africa with anti-HIV drugs in the 1990s.
  • Obligations arising out of the TRIPS Agreement, India had to amend the Patents Act in 2005 and switch to a product patents regime across the pharma, chemicals, and biotech sectors.

 

Recent issues with the Indian patents:

  • The S’s Special 301 report, its annual review highlighting the state of intellectual property rights protection in different countries which are its trading partners around the world.
  • In its India section, the report highlighted following issues:
  1. Copyright and piracy
  2. Trademark counterfeiting and trade secrets
  • It said that India “remained one of the world’s most challenging major economies with respect to protection and enforcement of IP.”
  • It said patent issues continued “to be of particular concern in India,” highlighting:;threat of patent revocations;lack of presumption of patent validity and narrow patentability criteria as issues which “impact companies across different sectors.”
  • The USTR had also released a similar report in 2021, addressing much of the same concerns.

 

Indian Patents Act, 1970:

  • It replaced the Indian Patents and Designs Act 1911.
  • The Act was amended by the Patents (Amendment) Act, 2005, wherein product patent was extended to all fields of technology including food, drugs, chemicals and microorganisms.
  • After the amendment, the provisions relating to Exclusive Marketing Rights (EMRs) have been repealed, and a provision for enabling grant of compulsory license has been introduced.
  • The provisions relating to pre-grant and post-grant opposition have also been introduced.

 

Article 3(d) of the Indian Patent Act:

  • One of the main points of contention between India and the U.S. has been Article 3(d) of the Indian Patent Act.
  • Section 3 deals with what does not qualify as an invention under the Act, and Section 3(d) in particular excludes:
  1. The rediscovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance.
  2. Mere discovery of any new property
  3. New use for a known substance of the mere use of a known process,machine or apparatus unless such known process results in a new product or employs at least one new reactant” from being eligible for protection under patent law.
  • It prevents the mere discovery of any new property or new use for a known substance from being patented as an invention unless it enhances the efficacy of the substance repetitively . This prevents what is known as “evergreening” of patents.

 

Issues addressed by Parliamentary Committee on Patents:

  • Threat of patent revocations, lack of presumption of patent validity and narrow patentability criteria as issues which “impact companies across different sectors were extensively tackled by the Parliamentary Standing Committee which undertook a ‘review of the intellectual property rights regime in India.
  • Parliamentary Standing Committee pointed out that the section 3(d) “acts as a safeguard against frivolous inventions in accordance with the flexibility provided in the TRIPS agreement.
  • According to the Committee’s report, Section 3(d) allows for “generic competition by patenting only novel and genuine inventions.”

 

TRIPS Agreement:

  • It was negotiated in 1995 at the WTO, it requires all its signatory countries to enact domestic law.
  • It guarantees minimum standards of IP protection.
  • Such legal consistency enables innovators to monetise their intellectual property in multiple countries.
  • In 2001, the WTO signed the Doha Declaration, which clarified that in a public health emergency, governments could compel companies to license their patents to manufacturers, even if they did not think the offered price was acceptable.
  • This provision, commonly referred to as “compulsory licensing”, was already built into the TRIPS Agreement and the Doha declaration only clarified its usage.
  • Under Section 92 of the 1970 Indian Patents Act, the central government has the power to allow compulsory licenses to be issued at any time in case of a national emergency or circumstances of extreme urgency.

 

Issues with TRIPS:

  • The process of vaccine development and manufacturing has several steps, and involves a complex intellectual property mechanism.
  • Different types of IP rights apply to different steps and there is no one kind of IP that could unlock the secret to manufacturing a vaccine.
  • The expertise to manufacture it may be protected as a trade secret, and the data from clinical trials to test vaccine safety and efficacy may be protected by copyright.
  • Manufacturing vaccines will need to design the process for manufacturing the vaccines, source necessary raw materials, build production facilities, and conduct clinical trials to get regulatory approvals.
  • The manufacturing process itself has different steps, some of which may be subcontracted to other parties.
  • Thus, a patent waiver alone does not empower manufacturers to start vaccine production immediately.

 

Compulsory Licensing:

●    It allows governments to license third parties (that is, parties other than the patent holders) to produce and market a patented product or process without the consent of patent owners.

●    Any time after three years from date of sealing of a patent, application for compulsory license can be made, provided:

1.     Reasonable requirements of the public have not been satisfied.

2.     Patented invention is not available to public at a reasonably affordable price

3.     Patented inventions are not carried out in India.

●    Compulsory Licencing is regulated under the Indian Patent Act, 1970.

●    The TRIPS Agreement does not specifically list the reasons that might be used to justify compulsory licensing.

●    Doha Declaration on TRIPS and Public Health confirms that countries are free to determine the grounds for granting compulsory licenses, and to determine what constitutes a national emergency.

 

World Trade Organization (WTO):

●    It is the only global international organization dealing with the rules of trade between nations.

●    WTO has 164 members (including the European Union) and 23 observer governments (like Iran, Iraq, Bhutan, Libya etc).

●    WTO’s global system lowers trade barriers through negotiation and operates under the principle of non-discrimination.

●    The WTO’s system deals with these in two ways:

1.     One is by talking: countries negotiate rules that are acceptable to all.

2.     By settling disputes about whether countries are playing by those agreed rules.

●    Underlying the WTO’s trading system is the fact that more open trade can boost economic growth and help countries develop.

●    The WTO can encourage good governance. Transparency, shared information and knowledge levels the playing field.

Way Forward

  • General issues regarding IPR were extensively tackled by the Parliamentary Standing Committee which undertook a ‘review of the intellectual property rights regime in India.
  • Nudging Voluntary Licensing: An assertive posture on compulsory licenses would also have the advantage of forcing several pharmaceutical companies to offer licenses voluntarily.
  • India has historically played a leading role in mainstreaming TRIPS flexibilities like the compulsory license at the WTO. In this global and national health emergency, the government should inexplicably make use of compulsory licenses.
  • Government’s effort to strengthen National IPR policy, IP appellate tribunal, e-governance and commitment to abide by the TRIPS agreement of WTO in letter and spirit will help in improving perception of India globally.
  • An efficient and equitable intellectual property system can help all countries to realize intellectual property’s potential as a catalyst for economic development and social & cultural well-being.
  • It is important to ensure fair, affordable, and equitable access to all tools for combating pandemics and, therefore, the need to build a framework for their allocation.
  • The report also highlighted some positive steps taken by India in the recent past, such as the accession to the World Intellectual Property Organization (WIPO) Performances and Phonograms Treaty and WIPO Copyright Treaty, collectively known as the WIPO Internet Treaties, in 2018 and the Nice Agreement in 2019.

 

QUESTION FOR PRACTICE

India has gradually aligned itself with international regimes pertaining to intellectual property rights(IPRs). Critically analyse. (200 WORDS, 10 MARKS)