Law – Patents Act, 1970, amended in 2006

Ministry – DIPP, Ministry of Commerce and industry

The object of patent law is to encourage scientific research, new technology and industrial progress. The price of the grant of the monopoly is the disclosure of the invention at the Patent Office, which, after the expiry of the fixed period (20 years) of the monopoly, passes into the public domain. The fundamental principle of Patent law is that a patent is granted only for an invention which must have novelty and utility. It is essential for the validity of a patent that it must be the inventor’s own discovery as opposed to mere verification of what was already known before the date of the patent. A patentable invention, apart from being a new manufacture, must also be useful.

Evergreening of patents is not allowed: In order to be patentable, an improvement on something known before or a combination of different matters already known, should be something more than a mere workshop improvement, and must independently satisfy the test of invention or an inventive step. It must produce a new result, or a new article or a better or cheaper article than before. The new subject matter must involve “invention” over what is old.

It allows Compulsory Licensing: This strikes a balance between two objectives – Rewarding patentees for innovation and to make sure that patented products, particularly Pharmaceutical ones, are available to public in developing and underdeveloped countries at affordable prices.

In March 2012, India granted its first compulsory license ever. The license was granted to Indian generic drug manufacturer Natco Pharma Ltd for Sorafenib tosylate, a cancer drug patented by Bayer. Non-governmental groups reportedly welcomed the decision.

TRIPS also allows for compulsory licensing under certain circumstances. The principal requirement for the issue of a compulsory license is that attempts to obtain a license under reasonable commercial terms must have failed over a reasonable period of time. Specific situations in which compulsory licenses may be issued are set out in the legislation of each patent system and vary between systems. Some examples are – Unaffordable prices of particular drug for masses or inability of patentee to fulfill demand in markets. Further, TRIPs also provides that the requirements for a compulsory license may be waived in certain situations, in particular cases of national emergency or extreme urgency or in cases of public non-commercial use.

It allows both Product and Process patent: Prior to the 2006 amendment, only processes was allowed to be patented. It means that if the same product is manufactured using some process different than that which was patented, there shall be no infringement.

System of pre-grant and post-grant oppositions: Introduced in 2005, ensures that only deserving patents are granted. It is now possible to raise objections both before and after the patent has been granted.

Data exclusivity: Indian Patent Act doesn’t specifically provide for data exclusivity. Companies spend significant time, energy and money on research and clinical trials. During all this they gather a large amount of useful data. While obtaining permission for launch of product in markets or while applying for patents, these companies have to provide data to authorities. By provision of data exclusivity, companies want authorities to not to share such data with any third party for a certain period.

Article 39(3) of the TRIPS states that that “Members when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilize new chemical entities, the submission of undisclosed test or data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, Members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that data are protected against unfair commercial use“

But it should be remembered that Article 39(3) does not talk about “Data Exclusivity” but only about “unfair commercial use” and it is this phrase that is interpreted by Multinational companies as containing “Data Exclusivity” provision and thus demanding data exclusivity law.

Data exclusivity however, is opposed on following grounds –

  1. If generic drugs manufacturers are denied access to such data then they will have to do separate clinical trials which will increase costs.
  2. Further, there are ethical issues with clinical trials as it involves experimentation on animals or humans.
  3. TRIPS agreement not at all mentions ‘data exclusivity’. It is just creative interpretation of MNCs.
  4. It can become an alternative to patentability and can be used for evergreening. Data exclusivity concept is different from patent. If a company manages to protect data, then it may continue to maintain its monopoly by incremental improvement in products and generation of new data.

There is no need of a “further protection” to pharmaceuticals in the form of “Data Exclusivity” as the protection under the Patents Act, 1970 is not only sufficient but also in conformity with the TRIPS Agreement. The protection in the form of “Data Exclusivity” is a “TRIPS plus” provision to which Indian does not owe any obligation.

The Health Ministry has said that India already has necessary legal provisions to protect data and hence there is no need for any further protection, while Satwant Reddy committee was of the view that there is no legal provision to protect test data. It is alleged by the Health and Human right activist that government is under pressure from Multi-National Companies and western countries to enact law on data exclusivity.     

India has adopted a balanced approach towards patent law.   It is committed to protect innovation while promoting the larger goal of welfare of its citizens. Courts and tribunals have upheld key provisions of India’s patent law by their authoritative pronouncements. The system of pre-grant and post-grant oppositions introduced in 2005 ensures that only deserving patents are granted.

It is expected that there would be a steady evolution of patent jurisprudence in India. Patent filings too have gone up by 10.56% from 2008-2009 to 2013-2014. Over 75% of patent filings are by foreign entities and so there is a need for concerted action to be taken to increase filings by Indians.