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Patents and Public Health - an Indian perspective

As the world is grappling with the ongoing Covid-19 pandemic and the alarming number of cases being reported on a regular basis, particularly in India, the biggest concern for everyone is the affordability, availability and accessibility of drugs which would be used for the prevention and cure of the Covid-19 virus.

Patents and Public health/interest are always pitted against each other. It is often perceived that if a drug is protected by a patent, it is not affordable and accessible due to the monopoly granted on it through a Patent.

This is an ongoing debate and therefore it is imperative to understand the relationship between the two and how to balance them.

I. Why do we need Intellectual Property?

An Intellectual Property Right is a monopoly granted for a certain period of time, over tangible objects of the person whose mental efforts have created it. On the expiry of the term, the same falls in the public domain for use, without any permission from the owner of the Intellectual Property Right.

There are multiple theories that rationalize the grant and existence of Intellectual Property Rights. Intellectual Property Rights incentivize innovation and because of increased innovation, the society is tremendously benefited. A world with no Intellectual Property Rights will lead to little or under production of new works.

Another theory that supports Intellectual Property Rights is the right to property. The essence of this theory emanates mainly from John Lock’s idea that an author has a natural right over the productions of their intellectual labour.

II. Why Patents are important?

A Patent grants a monopoly right to use and license use of an invention for a certain period, usually 20 years.

Patents, like other Intellectual Property Rights gives great impetus to research and development. A Patent right is a quid pro quo with the government wherein the inventor gets limited monopoly for a certain period of time and in return, he adds to the pool of knowledge by disclosing his invention which consequently benefits the society. The inventor could have reaped the fruits of his invention by keeping it secret, for an unlimited period of time. Patents also reward the inventor for years of investment in terms of labour, capital, expenses etc. and incentivize innovation.

The Patent system encourages and ensures continuous flow of inventions. Through inventions and disclosures, the development of new technology is accelerated and enriched. The Patent system economically and technologically benefits the society.

III. Patents in the pharmaceutical industry and the drug discovery process

Pharma patents involve inventions in the chemical or pharmaceuticals industry. Since public health is of paramount importance, Patents in the pharmaceutical industry have always raised major concerns, particularly in the present times.

However, it must be borne in mind that pharma inventions involve complex, expensive and lengthy drug development and discovery process which may take up to 10-17 years. It thus becomes crucial to allow the innovators to recoup not only their investments but also reward them so as incentivize further research. The grant of a patent itself may take up 7-8 years out of the 20 years’ term, thereby reducing the period of exclusive monopoly.

IV. Limitations and Safeguards under the Indian Patent Law to address Public Health concerns

Patents are governed in India by the Patents Act, 1970 (Act). The provisions in the Indian Patents Act have been drafted to strike an optimum balance between the rights of the Intellectual Property holders and public use of the invention. Some such provisions with special emphasis on the Patents pertaining to inventions in the pharmaceutical industry, are being analyzed below.

1. Grant of a PatentThe grant of a patent involves strict scrutiny and rigorous examination by the Indian Patent Office. It involves a thorough prior art search to ensure that the invention sought to be patented is novel, has inventive step, has industrial application and is patent eligible.

2. Multiple challenges to a Patent- a patent application or a patent may be challenged at multiple stages since the time a patent application is filed, as detailed below:

-> Pre-grant opposition -Under Section 25(1) of the Act, where an application for a Patent has been published but a Patent has not been granted, any person may in writing represent by way of opposition to the controller against the grant of the Patent.

-> Post-grant opposition –Under Section 25 (2) of the Act, at any time after the grant of Patent but before the expiry of a period of one year from the date of publication of grant of Patent, any ‘person interested’ may oppose the Patent granted.

-> Revocation- Revocation of the patent grant may be filed on various grounds mentioned under Section 64(1) of the Act.

-> Counter-claim in a law-suit- An order of revocation may also be passed in a counter-claim in a suit for infringement of the patent, by the High Court.

3. Section 3(d) of the Indian Patents Act

Section 3(d) of the Act, provides an additional test for grant of chemical and pharma patents. As per Section 3(d), the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or 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, is not patentable.

Section 3(d) was introduced to prevent abuse of product patent in medicines and chemical substances, by forbidding any attempt at repetitive patenting or extension of patent term on spurious grounds (ever-greening), as also held by the Apex Court in India in Novartis AG v Union of India (UOI) and Ors. 2013 (54) PTC 1 (SC). However, Section 3(d) recognizes incremental innovations in pharmaceutical patents.

4. Compulsory license

A compulsory license is a license granted by the Government to use the Intellectual Property without the consent of the right holder but a certain royalty/license fees fixed by the Government, is granted to the right holder. Government issues compulsory licenses to ensure access to technology for public welfare.

Under Section 84 of the Act, a compulsory license may be granted by the Controller, upon an application, at any time after the expiration of three years from the date of the grant of the patent, if the reasonable requirements of the public have not been satisfied with respect to the patented invention; or the patented invention is not available to the public at reasonably affordable price or the patented invention is not worked in India.

In addition, under Section 92 of the Act, the Central Government may, by notification, grant compulsory license in respect to a patent, if the Central Government is satisfied, that circumstances of national emergency; extreme urgency or public non-commercial use, necessitates the same. Compulsory license may even be granted under Section 92A of the Act for manufacture and export of patented pharmaceuticals products to any country having insufficient or no manufacturing capacity in the pharmaceutical sector for the concerned product to address public health problems.

Further, Section 100 of the Act, empowers the Government to use the invention for its purposes and sell the same on a non-commercial basis. Additionally, the Government has the powers to revoke a patent in public interest under Section 66 of the Act.

5. Working requirements

Patents also ensure that the inventions are worked on a commercial scale. Under Section 146 of the Act, the controller general has the power to call for information or a periodical statement (Form 27) from the patentees about the extent to which the patented invention has been commercially worked in India. Form 27 requires details of the extent of commercialization of the patented invention which includes number of licenses granted (if any), revenue/sales generated and statement that public requirement is being met at a reasonable price. Failure to fulfil the obligation by the Patentee to work the Patent in India on a commercial scale and to the fullest extent possible, is a ground for the grant of a compulsory license, as discussed above.

6. Bolar exemption

Bolar exemption is provided under Section 107A of the Act wherein if the patented invention is being used for research and development purposes only, the same does not constitute infringement. This allows generic companies to conduct research on a patented drug, even during the lifetime of a patent, for developing data and obtaining regulatory approvals, to ensure immediate launch of generic medicines upon patent expiry.

V. Conclusion

In addition to the aforesaid safeguards and the limitations, various initiatives are usually taken or may be taken by the Patent holders to ensure that public health and public interest concerns are resolved. Various pharmaceutical companies offer patient assistance programs through which they provide financial assistance or drugs for free to low income individuals. During the recent ongoing Covid-19 pandemic, many companies have not only employed patient assistance programs for Covid related drugs but have also made donations to the affected nations.

It must be the endeavor of the pharmaceutical companies and the various authorities and players involved, to ensure that there should be increase in supply of Covid treatment drugs and vaccines through scaling up manufacture, labour and raw-material required, during the present times. Innovator companies may even consider entering into collaborations through Voluntary License agreements.


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