International Law

Dodging the Constant Lobbying

By Kshitij

After resisting constant American lobbying for amending India?s patent laws (blogged by us here), the Department of Industrial Policy & Promotion (DIPP) has recently thwarted efforts of lobbying by another foreign agency for amending the Indian patent laws and policies. A recent report suggests that DIPP has categorically denied European Union?s request, which was forwarded by the Prime Minister Office (PMO), for reconsidering the patent laws, and specially reconsidering section 3 (d), which excludes patenting of any new form of a known substance until the new form shows enhanced efficacy.

Just to give a brief background on the issue, section 3 (d) was included in our patent laws in 2005 amendments of the Indian Patent Act, 1970 to keep a check on the practice of ever-greening of patents, especially ever-greening of pharmaceutical patents, a practice shrewdly adopted by high technology pharma companies in 1980′s and 90′s. It will be appreciated that most of the patent regimes across the world provide patent protection for a term of 20 years from date of first filing for a patent. However, the pharma companies by adopting ever-greening strategies were able to elongate this term to a period much greater than 20 years. What these pharma giants used to do was to obtain a patent on a fundamental drug molecule, and when the term of the patent approached exhaustion, file for patents on incremental innovations of the fundamental drug molecule. This increased the term of the monopoly on a particular drug molecule. There have been reported cases where the pharma companies by this practice were able to enjoy a monopoly on a drug molecule for even 36 years.

As you will be aware, before 2005, no patents were awarded corresponding to drug molecules in India. The amendments of 2005 allowed granting of patents on the drug molecules in compliance with TRIPS agreement, which India ratified in 1996. The TRIPS agreement required all WTO member states to comply with minimum requirements with respect to patents, to provide a level playing field to inventors and companies of other WTO member states, and to refrain from exclusions of any field of science and engineering from the ambit of patents. However, the TRIPS agreement also gave the freedom to member states to device the patent laws in such a way so as to put reasonable restrictions on the kinds of patents to be granted in the technological fields based on internal public policies of the member states. Though restrictions on patenting drug molecules were lifted in compliance with TRIPS by the 2005 amendments, India retained few reasonable restrictions on the kind of patents to be granted in the field of pharmaceuticals. One such restriction was the grant of patents on incremental innovations on a known drug molecule.

Section 3 (d) has been contentious right from its incorporation, and has been challenged time and again in Indian courts. In Novartis V. Union of India, one of the landmark rulings on sec 3(d), Novartis had challenged the constitutional validity of the provision in Madras High Court. The Madras High Court turned down the challenge of Novartis by holding the provision valid and TRIPS compliant. The matter is now pending in Supreme Court after Novartis challenged the Madras High Court decision of rejecting its plea.

There have been contrary views on the issue of sec 3(d). A majority view, which is echoed and amplified by the domestic generic pharmaceutical manufactures surviving on producing and exporting bioequivalent drugs to mainly 3^rd world countries, is that our patent policy is independent of the whims and fancies of the west, and pharma MNCs have no authority to subdue or influence our internal state policies. The majority view lay emphasis on the provisions of TRIPS agreement, which allows member states to put reasonable restriction against types of pharma patents granted. On the other hand, a minority view, which is echoed, amplified and lobbied by pharma giants and western governments, is that section 3 (d) is contrary to the fundamental principles of TRIPS agreement that ensures WTO member states do not put any restriction on any field of science and technology. Actually, the pharma giants are making a hue and cry about the issue because most of their blockbuster drug molecules invented in 1980?s and 1990?s cannot be patented now in India because most of these drug molecules have lost their novelty being in the public domain, and any incremental innovation to these drug molecules is ineligible for a patent, thanks to section 3 (d).

Personally, I am inclined to agree with the majority view, but, the minority view also is appealing. A sovereign state has full rights to decide the state policy on issues, taking into consideration all its foreign commitments. Indian governments of the past have always been skeptical of granting pharma patents in light of needs of domestic pharma companies, and public welfare. The 2005 amendments have allowed giving patents on drug molecules, but, with a number of checks and balances.  However, the concern of MNC pharma companies is also genuine. These companies point out that even if section 3 (d) is abolished, there are still mechanisms in Indian patent laws by which the exploitation of patent monopolies can be checked. One such mechanism highlighted is the mechanism of compulsory licensing, which allows any interested person to approach the patent office and ask for issuance a compulsory license to manufacture and sell a panted drug on grounds that the patented drug is not available to the public at reasonable prices.

Therefore, till the issue is addressed by the Supreme Court and finally taken to a long wanted conclusion, there will be continued debates on this already over-debated topic. But, one thing is for sure, any such discussions will be an interesting heed!

Image from here

Full post as published by India Law & Tech on January 21, 2011 (boomark / email).