patent laws and issues- marudavanan

8/11/2019 Patent Laws and Issues- Marudavanan

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Laws and Patents in India

Contents:

1. Prologue2. Laws, Treaties and Reports to Remember

3.

Important Terms4. Historical Background5. Provisions of IPA 19706. WTO and TRIPS7. IPA 1970 Vs TRIPS8. Laws Enacted to comply with TRIPS9. The Novartis Saga10.Supreme Court Verdict 201311.Novartis: Timeline12.Misc

.

Prologue

Asked in Mains 2013, the importance of this topic much broader since it covers some more topicsin GS syllabus. They are

a. Effect of policies and Politics of developed and developing countries on Indias Interest.b. Issues related to IPRsc. International institutions, Agencies their structure and Mandate.

2. Laws, Treaties and Reports to Remember:

1. Patents Laws of British Model enacted in 1852, 1857 and 1859

2. The Indian Patents and Designs Act, 1911

3. Tek Chand Report, 1950 and Ayyangar Report, 1959

4. Indian Patents Act, 1970 amended in 1999, 2002, 2005

5.

National Drug Policy, 1970, Drug Price Control Order, 1970 Replaced in1995 and 2013, National Pharmaceutical Pricing Policy 2012 for 348Essential Drugs under DPCO 2013.

6. Drugs and Cosmetics Act, 1940

7. Monopolies and Restrictive Trade Practices Act, 1969 replaced by IndianCompetition Act, 2002 as amended in 2007

8. WTO, TRIPS, WIPO

. Important Terms:(Some Important Definitions we should know to avoid confusions in further read)

(i) Radical Innovation:Involves a new product, process (or) system that results from atechnological breakthrough. In Pharmaceuticals it has limitations like side effects, extremelycostly, high risk etc.,


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(ii) Incremental Innovation:Involves technical modifications of an existing product, process (or)system that results in some improvement (or) enhancement thereto. It helps increasedeffectiveness over prior known drug products and ensures social & economic values bysupporting new drug discovery, risk mitigation etc.,

(iii) Types of Patents:1. Ordinary Patens

a.

Product Patentsb. Process Patents2. Combination Patents3. Selection Patents4. Convention Patents5. Pipeline (or) sealed box Patents

(iv) Product Patents: Innovation relating to manufacturing of machine, article, substance which isnew, novel, useful and the patent asked for is called Product patent.

(v) Process Patents:Same but the series of steps (or) methodsfor manufacturing of machine,Multi-active article, substances and patent asked for is called process patent. Ex. Making Coke

(vi) Bulk Drugs:Also called Active Pharmaceutical Ingredient(API) is the chemical molecule in

a pharmaceutical product. Other words, it is the substance responsible for the product being amedicine. Ex. Penicillin. From product to product the Bulk Drugs remains same as it is theidentity of the medicine.

(vii) Formations:The medicines in the form of tablets, capsules, syrups, drops, intravenous fluidsetc., are called Formulations. Other words these are we buy in the Pharmaceutical shops.

(viii) Generic Medicines:A derivative of already patented medicines of MNCs manufactured by localdomestic companies available at low cost in the market is called Generic medicines. They servewho cant afford the expensive brands of Big Companies.

(ix) Compulsory Licensing: It is one of the provisions of Law issued to products/process for variouspublic interest reasons where the patent owner refused to make the invention available toeveryone. Indian Patent Laws provides for safeguards against the overuse (or) misuse of patentmonopoly by patent owner through the provisions of Compulsory Licensing. This is given tolocal drug manufacturers by controller of patents @Indian Patent Offices.

4. Historical Background:

Has beginning in the Act VI of 1856 based on British modeled Patent law of 1852. This hadsome exclusive privileges granted to inventors of new manufacturers for a period of 14 years.

The Act was repealed followed by Act IX of 1859 gave exclusive provisions in order to helpBritish patent holders gain control over the Indian Markets.

The Patents and Designs Act of 1911first introduced Controller of Patents. The term was 16

years from the date of filing the application. Extended upto 7 years for certain cases additionally.

The Act of 1911 prevented domestic pharmaindustry from making reverse-Engineered drugs

for which foreign pharma companies held patent rights in India. After Independence, Our country in need of revamping since the Pharma industry in bad shape

compare to other industries. Prices of Life saving Medicines were high and controlled by MNCsin the Late 50s.

First set up Tek Chand Committee in 1950 to look into matters prevailing in the Act of 1911and in its report gave information about the failure of the industry to serve the main purpose.

Second committee setup under Justice Rajagopala Ayyangar in 1957and based on this report

new law was enacted as Indian Patent Act 1970and Indian Patent Rules 1972.


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Law was enacted to suit changed political condition and economic needs for providing impetustechnological development by promoting inventive activities in the country.

From then because of the provisions of IPA 1970 India go on to become The Pharmacy of thePoor (or) The Pharmacy of the Developing Countries

5.

Provisions of IPA 1970: The Act revoked product patent on Food, Medicines, Drugs, Chemicals either produced or

prepared. It paved way for domestic generic drug makers use extensive technology of researchfellows and manufactured huge sum of drugs, Thus making India Pharmacy of the Poor.

Allowed making process patents for making pharmaceutical compounds.

@present India is biggest producer of generic drugs by volumes & leading exporter of medicinesto developing countries, Leading supplier of AIDS medicines. Before 1970 MNCs share was68% in the market.

Act imposed very broad Compulsory Licensingfor pharma process patents. Within 3 yrs of

the grant, the patents were deemed Right to license. Means, anyone could use the process ifthey paid royalty to the patentee. It encouraged lot of competitors and household drug industry.

It also given in cases of, Reasonable requirements of public not satisfied, Patented Inventionis not available to public @affordable Cost and Patented Invention if not worked in the

Territory of India.

Simply, Pharmaceutical products had no patents & Process patents were protected for only3 years if a royalty given and 5 years if royalty not given.

6. WTO and TRIPS:

The End of Uruguay round in 1994 led establishment of WTO and so TRIPS(Trade RelatedIntellectual Property Rights). Countries signed WTO must adopt TRIPS Compliances.

US led talks to make developing countries to come under its purview and to enact law to protectpatent holder, piracy, dumping of products in International Market.

TRIPS gave 10yrs Waiver as transition period till 2005 to become fully compliance with itsLaws to developing countries in place of Green Box and Exclusive MarketingRights(EMR)provisions.

Green Boxproviso is applying for patents, for anything process(or) product, those who applied

earlier given patent rights once the transition period completes and TRIPS compliances werefulfilled (Sort of First Come First Serve).

EMRprovisions were given to applicants in Green Box and they all facilitated with supportsfrom government to be big player in the Market.

At the end of Doha Development Roundin 2001, the TRIPS under WTO allowed membercountries to formulate laws within its framework & they are free to adopt national policies &Right to Health. Art 27 to 34 of TRIPS=Particularly to Patents.

Some of the Provisions are below(i) Patents should be available for all fields of technology including product patents to

Food, Medicines, Agro Chemicals etc.,(ii) Patent rights should be without discrimination whether locally made (or) imported.(iii) Provisions defining Infringements.(iv)

Compulsory Licenses to be allowed only under strict conditions(v) Patent term should be at least 20 years from filing.


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7. IPA, 1970 Vs TRIPS

IPA, 1970 TRIPS

Only process not product patents in food,medicines and chemicals.

Process and product patents in almost allfields of technology

Term of patents 14 years; 5-7 years inchemicals, drugs.

Term of patents 20 years

Compulsory licensing- In a compulsory license,a government can force the holder of a patentright to grant use to the state or others.

Limited compulsory licensing- under specificcircumstances only compulsory license canbe granted.

Several areas excluded from patents (method ofagriculture, any process for medicinal surgicalor other treatment of humans, or similartreatment of animals and plants to render them

free of disease or increase economic value ofproducts)

Almost all fields of technology patentable.Only area conclusively excluded frompatentability is plant varieties; debateregarding some areas in agriculture and

biotechnology

Government allowed to use patentedinvention to prevent scarcity

Very limited scope for governments to usepatented inventions

8. Laws Enacted to Comply with TRIPS

The First Amendment of IPA, 1970:

(i) The Indian Patent (Amendment) Act 1999was enacted after much deliberation anddelay. Since India agreed to Mail Box and EMR provisionsof TRIPS in 1995, itdid not make them as a law. So US dragged India to WTO dispute settlement

mechanism in 1997 and India ensured them in the amendment of 1999. The Second Amendment of IPA, 1970:

(i) The Indian Patents(Amendment) Act 2002was further included the TRIPScompliance of patent term for 20 years

(ii) This Act also cemented Indias accession to the Paris Convention & Patent Co-operation Treaty (1970).

(iii) These two treaties are part of WIPO (World Intellectual Property Organization) andIndia a signatory since 1998.

(iv) Paris Conventions national treatment principle- Prohibits discriminatingtreatment of foreign applicants as well as its rights of priority.

(v) The Amendment also includes new definition for invention and Inventive Step.

(vi)

Also included patentability of micro-organisms and gave broader definitions toCompulsory Licensing.

The Last Amendment:(i) Much importantIndian Patents (Amendment) Act, 2005was the last step to fulfill

TRIPS compliances.(ii) For the first time since 1970, India allowed patents protection to substances &

being used in Food, Medicines, Agro Chemicals etc.,


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(iii) Made some flexibilities to help domestic drug makers and so the people through

sec 3(d) to counter Ever Greening.(iv) Ever Greening- Patentees kept on applying for new patent rights for their old

products though it is expired by modifying their earlier products a little.(v) Ever Greening results in monopoly in the market and Expensive.

(vi)

Under Sec 3(d) patents would not be grantedon following grounds onlya. Mere discovery of known substances does not result in the enhancement of theknown efficacy of that substance.

b. Mere discovery of any new property (or) new use for known substancesc. Mere use of a known process, Machine (or) employs at least one new reactant.

(vii) So simply Known Substance=Same Substance unless differ in property regardto efficacy.

9. The Novartis Saga:

Started in 1997, Novartis applies for patent right through Green Box provision for its Beta-Crystalline of Imatinib Mesylate. brand name Glivec

Filed petition before Chennai patent office and claimed Novartis invented the B-crystallineMolecule, a salt form of free base Imatnib.

In 2003, Glivec was granted EMRs in Indian Market. In parallel obtained orders preventing local

drug makers to form & sale generic drug version of Glivec. Sold Glives @ $2666/Person/yr,though in generic it would cost $177 to $266/person/yr.

Pre-grant opposition filed by Indian Pharma associations & by an order of 2006, Chennai patentoffice restricted granting of Glivec under sec 3(d). Novartis went to Madras HC in May 2006.

Novartis argued its violating Art-14 of Indian constitution and Sec 3(d) is not complying withTRIPS.

Patentability of Glivec was heard by Intellectual Property Appellate Board (IPAB). That istechnicality of new product.

Both HC & IPAB ruled against Novartis. Particularly the IPAB decision of Patentability ofimatinib made them to go Supreme Court.

IPAB ruled, since imatinib was patented earlier in 1993, the efficacy of the New B-CrystallineMolecule is same as that of old one. That is Beta form Imatinib Mesylate was not newsubstance because bioavailability is not the same as therapeutic Efficacy.

Efficacy = ForEx, If one molecule cures Cancer in 10days, the new one should cure it in

5days. The ability to produce desired therapeutic effect is called Efficacy of the Drug. AlsoIPAB held the cost of Glivec is too high.

0.Supreme Court Verdict 2013:

Only Patentability decision of IPAB challenged @SC by Novartis.

Supports from larger groups for the sake of poor all over world wanted to upheld Sec 3(d) andUS lobbying group, R&D MNCs wanted to repeal the Sec 3(d).

Since it is on the interest of developing countries, the whole world was looking @IndianJudiciary.

SC used Oxford Dictionary to get the exact meaning of Efficacy given in Sec 3(d).

Finally held against Novartis. Said Efficacy- Ability to produce the desiredof the Imatinib issame as that of earlier version of Imatinib filed in 1993 as part of Zimmerman Patents in USand Other Countries.


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So Sec 3(d) is upheld. Domestic Drug maker and interest groups rejoiced over the verdict.

Novartis said itsgoing to cut the spending in R&D in India.

US and other western lobbying MNCs on the SC verdict said, the consequences would be felt inthe future.

1.

The Novartis : Timeline Novartis had sought to overturn a clause in Indian Patents Law that restricts patent

protection for newer forms of existing molecules. The case started in 1997 when Novartis

filed a plea for a patent for Glivec.

1997: Novartis files a patent application in India for its drug Glivec2005: India introduces the Indian Patent Act preventing frivolous patents.Jan 2006: The Patent Controller in Chennai denies Novartis a patentMay 2006: Challenges the Indian government and four other companies in the Madras HCAug 2007: The Madras High Court rules against Novartis caseJune 2009: The Intellectual Property Appellate Board rejects a fresh appealAug 2009: Novartis approaches the Supreme Court of India

April 1, 2013: Supreme Court rejects Novartis plea for patent

2.Misc:

The Obligation of TRIPSagreement relate to provision of minimum standard of protection within themember countries legal systems and practices. It provides IPRs in following areas

Patents

Copyrights

Trade Marks

Geographical Indications

Industrial Designs

Layout Designs of Integrated circuits Protection of Undisclosed Information(Trade Secrets)

Plant varieties

Legislations Coverings IPRs in India

Patents:Indian Patents Law, 1970 (Amended Three Times in 1999, 2002, 2005)

Designs:The Designs Act , 1911 (Newly enacted as The Designs Act, 2000)

Trade Mark:The Trade and Merchandise Marks Act, 1958(Newly Enacted in 1999).

Copy Right:The Copyright Act, 1957 as amended in 1983, 1984, and 1992, 1994, 1999 andCopyright Rules 1958.

Layout Design of Integrated Circuits:The Semiconductor Integrated Circuit Design Act 2000.

Geographical Indications:The Geographical Indications of Goods (Registration andProtection) Act 1999.

Merits and Demerits of SC Verdict (asked in Mains 2013)(My Points are Limited Since it has Different Views)

Merits: Will help in high production of low cost generic medicine.

Export will be more.


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Will help 300,000 cancer patients with affordable cost in India.

Benefit the Developing countries.

Demerits: R&D would be in danger not only in Pharma Industries but also agrochemicals,Nanotechnology etc., since there would be a fear of patentability.

Negative impact on MNCs = Low FDI= High CAD= High Balance of Payments=Inflation=Low

Growth=#EPIC FALL

Indian Competition Policy 2002

In India, the competition policy is set out in the Competition Act, 2002. Replaced MRTP Act,

1969. The purpose = upholding competition in the Indian market.

The principal objective of suppliers of goods and services who are in a position to manipulate themarket is to maintain their profits at pre-determined levels. Agreements for price-fixing, limitedsupply of goods and services, dividing the market etc., are the usual modes of interfering withthe process of competition and ultimately reducing or eliminating the competition. Wherecompetition is adversely affected to an appreciable extent, such agreements would be anticompetitive.

The new Competition Act focuses on four core areas:(1) Anti- Competitive agreements. (Sec 3)(2) Abuse of Dominance position. (Sec 4)(3) Combination Regulation (mergers, alliances etc.) (Sec 5)(4) Competition Advocacy. (Sec 49)

Competition Commission of India (CCI)

The Competition (Amendment)Act 2007lays responsibility on CCI on matters of Promotion of

competition Advocacy, Creating Awarness, Imparting Training about competition Issues,Organises Interactive Meeting, Workshops, Seminors with different regulatory bodies, Policymakers, trade organisations, Consumer associations etc

Also develops research capability in the area of competition economics, Law and policy etc., The Act also estabilishes Competition Appellate Tribunalto mitigate the issues.

Misc Terms: LetsKnow Them Too

(i) Bolar Provisions:

The United States permits testing to establish the bio equivalency of drugs before theexpiration of the term of the patent. On the other hand, stock piling before the expiration ofthe term of the patent is prohibited. A similar provision is sought to be introduced underSection 107A of the Second Amendment Bill of 1999. Where there are acts that are notdirectly related to production, but are still damaging to the patent owner, an injunction can beobtained under the Civil Procedure Code.

(ii)

Cross-Subsidy Model:The rich pay full price and the poor pay a subsidizedprice or the government

purchases for the poor and supplies through government hospitals. (This would benefit theMNCs who spent Billions in R&D)

(iii) Tiered Pricing:An approach by Big Pharma MNCs prices their drugs differently for the developed and

developing markets.


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Other Important Patent Cases @Present

Pharma giant Bayerspetition in the Bombay High Court against the issue of compulsory licenseto Natco(Domestic Drug Maker) is one in a series of patent infringement suits filed againstgeneric drug companies.

To Manufacture Sorafenib tosylatefor Liver and Kidney Cancer treatment. (Brand Name

Nexavar) Another Case pharma giant Bristol-Myers Squibb (BMS)filed a patent infringement suit

against BDR Pharma in Delhi HC.

Lot of information does available in Mrunal.org/Article Submission contest. To be studied along withthem to cover the syllabus on this particular topic.

(In case of Wrong data, infos are deeply regretted. Correction and return intimation are welcomed.Thanking You.)

Name:Marudavanan.S

List of References:

1. A lot of study/Research papers available in google in PDF on Patents and IPRs.2. The Hindu/Business Line and Frontline for Novartis Case.

patent laws and issues- marudavanan

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