[Ip-health] Indian Patent Act: Patently left and right, too

[Ram]

>From Businessworldindia

Patently left and right, too

The new patents is a big victory for domestic pharma companies.


latha jishnu

If the domestic pharmaceuticals industry is not breaking out champagne
over the Patents Bill passed by the Lok Sabha on Tuesday, put it down
to weariness. Weeks of hectic lobbying, followed by a cliff-hanger
weekend prior to the introduction of the Bill have worn it out. It is
clearly celebration time though.

First, the big prize. Patent protection on mailbox applications will
be available only prospectively from the date the patent is granted,
and not retrospectively from the date of application by the patentee.
The mailbox was a transitory provision offered by the government from
1995 to 2005 to enable drug firms interested in getting a patent to
stake their claim till a patents law was put in place.

The Bill also says that after a patent is granted: "...patent holder
shall only be entitled to receive reasonable royalty from such
enterprises which have made significant investment and were producing
and marketing the concerned product prior to 1st day of January, 2005
and which continues to manufacture the product covered by the patent
on the date of grant of the patent and no infringement proceedings
shall be instituted against such enterprises." In simple terms, it
will
be business as usual for Indian generic companies. As one industry
analyst points out: "It means Indian companies have as good as got
compulsory licences for the 200-odd new molecules that have been
patented in the past five years."

Passed by Lok Sabha

1.Domestic companies can continue to make patented items after paying
reasonable royalty to patent holders if they had been manufacturing
prior to January 2005; no action can be taken against such companies

2. Pre-grant opposition to patents strengthened. All 11 grounds
available earlier brought back

3.Patentability clearly defined to prevent evergreening; inventions
have to prove technical advance

4.Compulsory licensing regulations relaxed to facilitate exports


5. Negotiation between patentee and company seeking compulsory licence
fixed at six months

Yet to be sorted out

1. Definition and patentability of new chemical entities and
micro-organisms referred to committee of experts

2. The other windfalls: pregrant opposition to patents have been
strengthened =97 and very clearly so. The 11 grounds for objection that
were embodied in the original Act, but deleted from the 27 December
Ordinance that the Bill seeks to replace, are all back. And just as
significant, the Bill seeks to address the major concern of the
generics industry by a definite rejection of 'evergreening', the
practice resorted to by drug companies to lengthen the commercial life
of a drug through incremental inventions. The Bill says that salts,
esters, ethers, polymorphs, metabolites, mixtures of isomers, and
combinations and derivatives of known substances won't qualify.

How did the Bill undergo a major change from the form in which it was
introduced? How is it vastly different from the 27 December Ordinance?
Union commerce and industry minister Kamal Nath, who piloted the
legislation, says it is, " not multinationally-driven, but nationally-
driven". That sums up neatly the big change in his formulation.

The folktale is that the Left parties stood firm and were responsible
for the pro-domestic industry swing. True enough. But the Left was
also willing to push through a more diluted version of the Bill in its
eagerness to clinch a swap deal on the Pension Fund Development and
Regulatory Authority Bill, which it succeeded in stalling.

However, well-informed political sources say credit must go to the
Opposition NDA, primarily the BJP, for the sea-change. The BJP's
learning curve has been sharp since its law minister Arun Jaitley
introduced the first version of this Bill in December 2003. It was
adamant over the weekend that it would not allow Kamal Nath's first
draft to pass. In fact, the NDA had, till the last, insisted that the
ruling UPA's draft be referred to a standing committee of the commerce
ministry, which is headed by Murali Manohar Joshi. Only when the Left
found it was being upstaged by the BJP on its so-called pro-people
policies did it decide to harden its own position.

The outcome has upset the two opposing camps. Krishna Sarma, president
of the Corporate Law Group which represents the MNCs, believes that
some provisions "make a mockery of India's TRIPS obligations". The
other camp consists of global and Indian health activists, including
Affordable Medicines, Treatment Campaign and Lawyers Collective. They
fear the wording of some provisions is open to interpretation, and
thus "poses a threat of potential infringement suits".

Storylink: http://www.businessworldindia.com/apr0405/indepth02.asp


--
Prabhu Ram,
Max-Planck-Institut for Intellectual Property, Competition and Tax Law,
MarstallPlatz 1,
80539 Munich
GERMANY

Tel: + 49 89 24246226
Mob: + 49 17629830521