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NATIONAL SEMINAR ON PATENT
NOVEMBER 22, 1988
LAWS
INDIA
INTERNATIONAL CENTRE
40, Lodi Estate, New Delhi- 110 003
OCCASSIONAL
PAPERS
- VOLUME III
CONTENTS
PAPER NO.l
CONQUEST BY PATENT BY DR.RAJEEV DHAVAN
PAPER NO.2
THE NEW INDIAN PATENTS LAW BY
DR.S.VEDARAMAN
PAPER NO.3
WHO - POLICY ON PATENTS
PAPER NO.4
HOW THE WORLD EMINENT PERSONALITIES
FEEL ABOUT-THE PATENT SYSTEM
PAPER NO.5
IMPORTANT PRESS CLIPPINGS - INDIAN PRESS
PAPER NO.6
IMPORTANT PRESS CLIPPINGS - FOREIGN PRESS
NATIONAL WORKING GROUP ON PATENT LAWS
B-1, 2ND FLOOR, J-BLOCK, LSC SAKET, NEW DELHI-110017
National Working Group on Patent Laws
CHAIRMAN
DR. NITYA NAND,
Ex-Director.
Central Drug Research
Institute
CONVENOR
MR. B.K. KEAYLA.
Forum for Preservation of
Indian Patent Laws
(Phone 6416088)
JOINT CONVENOR
MR. DINESH ABROL.
CSIR Scientific Workers’
Assn
(Phone 588113)
MEMBERS
DR. AMIT SENGUPTA.
Delhi Science Forum
DR. RAJIV DHAWAN.
Public Interest Legal
Support & Research Centre
DR. MIRA SHIVA.
Voluntary Health Assn
of India
WING. COMDR SATNAM SHAH.
Consumer Forum
MR. N.N. MEHROTRA,
Academy of Young
Scientists
MR. L.P.S. SRIVASTAVA.
Forum of Financial Writers
MR. ASHOK RAO.
National Confn of Officers'
Assn of Central Public
Undertakings
ATI ON
MR. HARDEV SINGH.
All India Lawyers Union
National Campaign Committee
on Drug Policy
MR. DINESH PATEL.
Forum for Preservation of
Indian Patent Laws
Drugs & Pharmaceutical
) tra
Community Health Cell
Library and Documentation Unit
BANGALORE
OCC
CONQUEST
BY
PATENT
BY
RAJEEV
ONE
HUNDRED
DHAVAN '
LATER
YEARS
....
It is over a hundred years since the Paris Convention
was agreed by powerful nations in 1883.
Those that
defend the Convention visualise its history as a
linear development, with each change as an improvement
over what went before.
It is also possible, however,
to see the major changes that were proposed and accepted
as clumsy political compromises, each
in its own milieu.
to be explained
-The linear view is part of a
nineteenth century legacy which projects history as
progress.
The disaggregated view of events is essentially
cynical but also more hard edged in its emphasis on the
need to examine the more immediate context in which
historical changes occur.
The linear view concentrates
on the growth of ideas; whilst the disaggregated view
is more concerned with how these ideas were appropriated
and used as vehicles for social and economic action.
To combine both would be to learn the seeingly easy
lessons of history with unease.
If we have looked at
the discourse of ideas, it is because our cynicism has
not been fed with the availability of enough data to
fill out the context in which the discussion
* Director, Public Interest Legal Support &
Research Centre (PILSARC)
occurred.
In one sense, we can see the concept of ’patents* as
an ideological construct.
The justification for this
construct is the inventive genius of man; and, of course,
the duty owed to the inventor.
But, the inventor -
although an important part of the justification - has
long since ceased to occupy centre stage, either as a
subject or object of concern or even as a justification
for the vast apparatus of patent laws and policy built
ostensivly to protect his creativity.
The Paris Convetion
continues to honour his memory in a grand, but otheriwse
sad, gesture in Article 4 ter which reads
" The inventor shall have the right to be
mentioned as such in the patent"
With this obituary, the file on the inventor is closed.
His work and labour have been systematically appropriated
by powerful interests in society.
They are the real
actors in the drama even if the poor inventor
was the
sine qua non of the initial justificatory principle.
But,there is a vast difference in providing a just
recomepnse for creative genius; and finding a less absolute
business equity for someone who has either stolen or
appropriated the creator's work or simply footed the bill.
And,
so the argument shifts from creativity to business.
Unsatisfactory questions loom large in both areas, for
even creativity
is never individual but builds on what
went before and a great deal of inventive work cannot
really be personalised as exclusive.
The nineteenth century origins of the Paris Convention
1883 are apparent from its inclusion of just about
everything within the notion of industrial property.
Everything was to be treated as invention; and
Article 1(3) unabashedly includes "wines, grain, tobacco
leaf, fruit, cattle, minerals, mineral waters, beer,
flowers and flour".
shopping list.
And, this was only part of the
No nation could cope with such a list
or even pretend to enforce the law if all these were
included in the definition of patents.
. part of the Convention has been ignored,
it is redundant.
However,
Yet, if this
it is because
it remains an important part
of the rapacious principle that even common property
which belongs to all of us can be appropriated and
clothed with a patent right.
It is better to start
at the other end to being with the assumption that all
invention and discovery belongs to society, subject to
some reward for the discoverer or inventor.
Very
fundamental notions of property are at stake in this
discussion.
Yet, even those would become trivialised
if the amplitude of patent rights should extend to the
limitless excesses of the Paris Convention.
But, if the inventor and the absurd expanse of patent
ability have both exited from the scene, what we are
left with is hard business demands.
Industrialists
and businessmen who have either commissioned or bought
the product of Research and Development (R&D) claim
a price for it far greater than they paid.
It is the
complexity of the price demanded that needs to be de
constructed for more considered attention.
It should
not be overlooked that the R&D is subsidized by the
State in which the R&D work is taking place (through
tax incentives and tax deductions) as well as through
the under-payment of scientists and others whose future
claims are not part of patent law but contingent on the
generosity of the largesse of the patent holder. This is
assuming that the inventors can be identified.
And,
even then, they would be the first to acknoledge that
their genius is built on the cumulative endeavours of
persons in. the past and elsewhere in the world. In this
scenario, the claim for a patent is something like a
lottery.
Whoever gets there first gets the prize - not
just a part; but all of it.
And, the question is whether
the prize (or the price, depending on how we look at it)
should be a world wide domination of a particular sphere
of economic activity; and 'for how long 2
There is a threat in all this-
The argument ersatz
inventors is that if they are not assured world domination
for an extended period of time, they will quit^. They will
stop research and development.
They will stop being inventive.
Or, they will simply become terribly secret.
This is not
a threat; it is a bluff even if there are times when we
tend to agree to take it seriously.
The inventors will
continue to invent although society must think through
less commercial ways in which their creativity can
be given support.
The profiteers will continue to
seek profits having lost only
an initial advantage,
with their loss being the gain of the world. And, yet
the argument is never about wholly taking away their
advantages; but, how much and to what extent ?
So,
let us return to the quest for world domination
as a prize of having got there first.
As things stand
at pressnt, they are not denied this world domination.
They always have the option to register their patent
in indidiual countries, with each country negotiating
its own terms through its laws.
Someone else may get to some
to our patent holders.
other country first.
But, this is not.acceptable
Why enter into a race
can pre-determine the result "?
when you
The technique to do this
is the right to priority in the Paris Convention (Article 4).
This is the twelve month edge : a patent, howsoever
incompletely , registeredn one country can be registered
in all the others.
And because the Convention decrees
the independence of each patent in each country, one
registration is not contingent on the others, including,
perforce.
With the prospect of world wide domination assured, the
next task is to work out the obligations that are owed
to the countries who have permitted such domination. The
first question is whether any serious obligation is owed
to the country in question.
The Paris Convention started
off on the basis that no obligation was really due. The
patent holder could simply use his patent rights as an
import monopoly with no obligation to commercially work
the patent in that country.
The recipient country was,
thus, treated as a dumping ground for goods, processes and
technical information on
patent holder.
terms wholly dictated by the
This initial position was so untenable,
so unmistably absurd and so embarassingly one-sided that
the entire history of the Paris Convention for the last
hundred years has been taken up in correcting its absurdity.
But,this process has been slow and grudging.
The
suggestion that the patent holder should be forced
after three years to compulsorilylicense someone
was immediately undermined by allowing the patent holder
to wriggle out of such a demand by pleading justification
for his inaction for not working the patent in that country.
And, the terms of the justification can be exasp eratingly
wide.
The injunction tnnt two years after the compulsory
licence was granted, the patent should be revoked is
de-limited by the requirement of a generous examination
of whether the abuse of non-working has been rectified
by the compulsory licence.
In this way, the patent holder
has his way all the way, with a formal concession to the
recipient country that it can - in the ultimate analysis force the patent holder to actually commercially work the
patent in a country which he had hitherto simply used as
an exclusive import zone.
The ultimate success of the Paris Convention lay in
the fact that by creating terribly harsh sounding
restrictive concepts like compulsory licensing, revocation
and forfeiture, it gave the appearance that it was
taking a very tough line on patent holders.
The truth
was less harsh and much more pleasing for the patent holder.
With all the advantages of exclusivity, he was faced with
some widely phrased stumbling blocks which if kept low-key
and ambiguous were surely surmountable in any event he had
a wide choice of potential licencees on payment. The
Paris Convention appears to have made concessions to the
public in erest by mystifying both the discourse and the
need to define international objectives more clearly.
The fidelity of multinational corporations and the more
powerful nations to the Paris Convention rests on the
fundamentally unca: ny truth that they Convention has
given away much less of the patent holder's right than
it appears.
One of the real difficulties with all these discussions
is that it is assumed that all the nations who are
signatories to any international agreement are, by and
large, equal'in their economic prowess and capacity for
technology. But,they are not. The result is that any
international convention of this nature works elliptically
to the advantages of the more economically and
technologically powerful nations of the world. The
assumption of equality is unfounded; but, as long as
it is made, the sharp division of the world
nations
eludes a formal description for the record.
But, we need to return to basic questions about nature
of the patent right.
Never has so much been claimed by
one entity for the work done by others.
There is no
reason why our starting point, like that of the Paris
Convention, should be to create a mystical individual
property right around what is the collective creation of
society.
Having cheated society by isolating a social
creation as an individual right, we have conceded too
readily to the patent holder's claim for national and
world domination in that sphere of activity.
asked, and readily given,
or global price.
The price
is too high as either a national
The responsibility assumed by the patent
holder is too low, treating nations and socieites as
market dumps and manufacturing sweat shops.
The blackmail
to whithold future technology and start a trade war is
unconscionable; but, it helps to tell us what the debate
is really about.
The weaker nations are surely right
to
say that they will not pay the price, accede to the
blackmail or give up their right to be treated as more
than a market dump or a sweat shop.
Yet the more powerful
nations persis in their quest to divide the world into
an over-expanding number of finite monopolies.
The argument is not one of principle; but of greed. That
it is backed by the force of threats does not add to the
argument.
It simply unmasks it.
No. 1 1972
New Indian Patents Law
O<< 4is m a/4 t
S. 1 'edaraman "
The New Indian Patents Law
The new Patents Act,' which was passed by the Indian Parliament in Sep
tember 1970, was on the anvil for quite a long time and evoked consider
able interest both in India and abroad. The passing of the Act has been
widely acclaimed, despite some criticisms in certain quarters concerning
the legislation. Naturally, divergences of opinion and criticisms are bound
to exist with such a complex piece of legislation as this, in which several
interrelated interests have to be reconciled and accommodated.
The Joint Committee to whom the Bill was referred by the Parliament
for a carefid and detailed consideration not only received written mem
oranda from several individuals^ business organisations and other associa
tions, but also personally heard evidence given by as many as 35 associa
tions and individuals from both India and abroad, although the process
occupied the Committee for quite a length of time.2 The Parliamentary
Committee’s decision to invite memoranda and oral witnesses from all
areas of the world in a matter which concerned the Indian economy was
widely acknowledged. Dr. Hans Harms of the Federation of the Pharma
ceutical Industry of the Federal Republic of Germany had this to say: “I
find it both remarkable and an expression of exemplary fairness that you
have decided to study the opinion of organisations and experts of ether
countries concerning the provisions under consideration. The very fact
that the Indian Parliament, before changing the existing patent law, is
thoroughly weighing the pros and cons, and for this reason has again
called in a Joint Committee, has been respectfully acknowledged in the
Federal Republic of Germany.”’
Before I proceed to explain the important aspects of the new legislation,
I think it will be useful to state in brief the fundamentals of the patent
system with reference to its legal, social and economic aspects, partic” Dr. jur.; Controller-General of Patents, Designs and Trade Marks, Bombay, India.
1
The Patents Act, 1970 (Act XXXIX of 1970) (1970 The Gazette of India Extra
ordinary, Part II, Sect. I). The Act was passed by Parliament and received the assent
of the President on September 19, 1970, and is to come into effect shortly.
2
3
Joint Committee on the Patents Bill, 1967, C.B. II, No. 239 (October 1969).
Dr. Hans Harms, Evidence Before the Joint Committee on the Patents Bill on Jan
uary 23, 1969.
I rdaraman
IIC Vol. 3
ularly from the viewpoint of economically underdeveloped and develop
ing countries such as India.
Introduct'n.
The material progress and advancement of any society depend on the
capacity of its individuals to apply their minds and to invent new pro
cesses, products and mechanisms for the enrichment and betterment of
the life of its people. The society receives with great gratitude the prod
ucts of invention which make human existence richer, more worthwhile
and less burdensome, and which in turn advance the frontiers of knowl
edge and open up new avenues of enquiry for breeding further inventions.
It is, therefore, imperative that the society should provide the necessary
incentive to stimulate new innovations and technical improvements, since
the desire for economic reward is an important factor motivating inven
tions. An invention which has been made but not disclosed or used is of
no economic benefit to the community. Various incentives have been and
are being tried, of which monetary plans, status recognition, inventor’s
certificates and the patent system are the most conspicuous. The monetary
plans include cash and bonus awards, profit sharing schemes and retire
ment funds. The status recognition is made, for instance, by means of
promotion to superior rank and increases in salary. Under the scheme of
inventor’s certificates, the right to exploit the invention vests with the
State, but the inventor has a claim for appropriate remuneration. Some
of the inventors might be content simply with the feeling of accomplish
ment of having their inventions recognised through publication in scien
tific and technical journals, though such instances might be. few and far
between.
Of all these schemes, experience has shown that the patent system —
stemming from the desire to obtain proprietary rights in commercially
valuable inventions — provides the most effective incentive to inventors,
industrial undertakings and other research sponsoring organisations who
derive from inventors the right to commercially exploit their inventions.
For this reason, the system of granting patents for inventions has come
to be universally adopted as the means for stimulating and encouraging
inventions and for establishing and promoting industries within a coun
try. Even the countries which had for some time abolished the system
were forced to reintroduce the same in view of its economic importance
to the evolution of inventions for the benefit of society.
A patent is a statutory grant by the Government to inventors and to
other persons deriving rights from the inventors, for a limited duration,
conferring on them the right to exclude others from manufacturing and
No. 1'1972
New Indian Patents Law
selling the patented article or using or imitating the patented process or
vending the resulting product.
The legal basis of the patent grant arises from the concept that the inven
tor is entitled to enjoy the fruits of his invention which resulted from
the exercise of his brain and skill. The patent does not give him any posi
tive right with respect to his invention in the sense that the inventor docs
not derive the right to work his invention solely from the patent grant,
but it does give him the right to exclude others from making, selling and
using his inventions. But this right is to be subject to certain conditions
in the public interest. No patent legislation contemplates an absolute or
perpetual right of the inventor in his invention. For the sake of the public
interest and in order to promote the economic development of the coun
try, the legislation contains some restrictions on the patent grant such as,
for instance, a limited term of patent protection for the invention, the
requirement of compulsory working of the invention on a commercial
•scale, the licensing of the patent as a measure against abuse of the patent
monopoly by the patentee; and, in accordance with the public interest,
even the revocation of the patent for non-working, exclusion of certain
categories of inventions from the scope of patent protection, etc. Inven
tor’s rights must be recognised, but not without placing them in the
proper perspective. Society should not submerge the interest of the in
dividual inventor by denying him any right, nor should it allow him to
run riot by giving him an absolute right in his invention. The patent sys
tem, therefore, provides the necessary checks and balances on the public
and private interests in the invention: the interest of the inventor in his
creation on the one hand, and the social interest of inducing the inventor
to make the invention, the interest of the public in using the invention
once it is marketed and the interest of the Government in promoting the
economic development of the country on the other hand. As aptly put
by P. J. Michel, “Patent systems are not created in the interest of the
inventor but in the interest of the national economy. The rules and reg
ulations of the patent system arc not governed by civil or common law
but by political economy.”'1
History of Indian Law
The Indian patent system had its origin in the “Act for Granting Exclu
sive Privileges to Inventors” of 1856,3 which provided for the protection4
5
4 1 P. J. Michel, Introduction to the Principal Patent Systems of the World 15.
5 Act VI of 1856. Sec 2 Theobald's Legislative Acts of the Governor-General of India
in Council 397 (1868).
ledaruman
IIC Vol. 3
of inventions in India. Owing to certain formal deficiencies,“ this Act was
repealed in 1857, but the provisions of the repealed Act were later re
enacted with slight modification in 1859.’ The “Patents and Designs Pro
tection Act’”- was passed in 1872 for the purpose of legally protecting
designs,•and an amending Act affording protection to inventors desirous
of exhibiting their inventions at exhibitions was passed in 1883.° In 1 888,
the law contained in the three Acts of 1859, 1872 and 1883 was con
solidated into a single Act,1" which was subsequently revised and replaced
by the existing Indian Patents and Designs Act of 1911." This latter Act
has also been amended from time to time, one of the notable amendments
being the provisions introduced in 1952 relating to the compulsory licens
ing of patents in the field of food or medicines at any time after the seal
ing of the patent.vAs may be seen, the patent system has thus been in vogue in India for
nearly one hundred' and fifteen years. But it has not led to encouraging
results in India since it is a developing country. It was obvious that the
patent law of a country such as India, which is in its developing stage
and which is being provided with a dynamic industrial base, should be
so designed as to enable the country to achieve rapid industrialisation and
to obtain, as quickly as possible, a fairly advanced level of technology,
giving inventors and investors sufficient inducement and protection
through patent grants while at the same time safeguarding its national,
economic and social interests. To this end the law required substantial
changes to provide for compulsory working of patented inventions for
the public advantaee, compulsory licences, and licences of right to prevent
abuse of patent rights by patentees who use the system merely as a means
of securing an importation monopoly without exploiting the patented
invention by actually manufacturing within the country that granted the
patent and thereby promoting the interests of its national economy and
industry. The need for a comprehensive revision of the law relating to
patents in India to suit our country’s developing economy was, therefore,6
12
11
78910
6 Because the Queen had not given previous sanction, it was advised that the Indian
Legislative Council was not competent to pass the Act, and therefore, the Court of
Directors of the East India Company disallowed it.
7 Act XV of 1S59.
8 Act XIII of 1872, passed in the form of an Act amending the 1859 Act.
9 The Protection of Inventions Act, 1883 (Act XVI of 1883), passed as a preliminary
to the Calcutta Exhibition of 1883 and 1884.
10 The Inventions and Designs Act, 1888 (Act V of 1888).
11 The Indian Patents and Designs Act, 1911
(Act II of 1911) (Calcutta, Supdt. Govt.
Printing, 1911).
12 Act LXX of 1952, adding Sec. 23CC to the Indian Patents and Designs Act, 1911.
No. 1/1972
New Indian Patents Law
recognised soon after independence; and the matter was the subject of
two Expert Enquiries, the first by the Patents Enquiry Committee13 and
the second by Shri Justice Rajagopala Ayyangar.11 Both the enquiries re
vealed that “the Indian patent system has failed in its main purpose,
namely, to stimulate inventions among Indians and to encourage the
development and exploitation of new inventions for industrial purposes
in the country so as to secure rhe benefits thereof to the largest section
of the public.”15 The new Patents Act is based mainly on these studies,
although incorporating a few changes in the light of further examination
at various levels, particularly with reference to patents in the important
fields of food, drugs and chemicals.
I may now briefly refer to the salient features of the new Patents Law
in India.
General Principles 0/ Patent Grant
The Act recognises the importance of stimulating inventions and encourag
ing the development and exploitation of new inventions for the industrial
progress of the country. Section 83 of the Act enunciates the general
principles of patent grant and also broadly the general philosophy of the
Act in the following terms:
“(a) that patents are granted to encourage inventions and to secure that the
inventions are worked in India on a commercial scale and to the fullest extent
that is reasonably practicable without undue delay; and
(b) that they are not granted merely to enable patentees to enjoy a monopoly
for the importation of the patented article.”
Principle of National Treatment
The new Patent Act docs not put any' limitations or restrictions on for
eigners in the matter of applying for or obtaining patents in India.
Science and technology has no territorial barriers, and, as such, there is
no discrimination between nationals and non-nationals in any respect;
13 Patents Enquiry Committee 1948-1950, Interim Report (August 1949), Final Report
(April 1950).
14 N. Rajagopala Ayyangar, Report on the Revision of the Patents Law (New Delhi,
1959).
15 Patents Enquiry Committee 1948-1950, Interim Report 165 (August 1949).
!
I'rdaraman
IIC Vol. 3
and all the provisions of the Act are applicable mutatis mutandis to both
nationals and foreigners. However, Section 134 of the Act provides that
where any country does not accord to the citizens of India the same
rights with respect to the grant of patents and protection of patent rights
as it accords to its own nationals, no national of such country shall be
entitled to any privilege under the Indian Law.
Inventions Not Patentable
The kinds of inventions which are not patentable arc codified in the Act.
In the past, the question of patentability had been governed generally by
British precedents, but with the rapid expansion of technological devel
opments and the broadening of the area of inventions and discoveries, it
was considered necessary that there should be a specific provision in the
law concerning this matter. Section 3 of the Act stipulates that the fol
lowing are not inventions within the meaning of this Act and, hence, arc
not patentable. As may be seen, the kinds of inventions included in this
Section are almost universally not patentable.
”(a) an invention which is frivolous or which claims anything obviously con
trary to well established natural laws;
(b) an invention the primary or intended use of which would be contrary to
law or morality or injurious to public health;
(c) the mere discovery of a scientific principle or the formulation of an ab
stract theory;
(d) 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
precess results in a new product or employs at least one new reactant;
(c) a substance obtained by a mere admixture resulting only in the aggregation
of the properties of the compounds thereof or a process for producing such
substance;
(f) the mere arrangement or re-arrangement or duplication of known devices
each functioning independently of one another in a known way;
(g) a method or process of testing applicable during the process of manu
facture for rendering the machine, apparatus or other equipment more efficient
or for the improvement or restoration of the existing machine, apparatus or
other equipment or for the improvement or control of manufacture;
(li) a method of agriculture or horticulture;
(i) any process for the medicinal, surgical, curative, prophylactic or other
treatment of human beings or any process for a similar treatment of animals
No. 1/1972
New Indian Patents [.aw
or plants to render them free of disease or to increase their economic value or
that of their products."
Under Section 20 of the Atomic Energy Act of 1962, inventions relating
to atomic energy are already unpatentable. Accordingly, Section 4 of the
Patents Act of 1970 specifically excludes inventions in this field from
being patentable so as to make the Patents Act self-contained.
Search for Novelty
The Indian Patents and Designs Act of 1911 did not contain any specific
provision requiring the Controller to make a compulsory search to ascer
tain the novelty of an invention before its acceptance. Nor did the Act
deal clearly with the problem of what constituted anticipation. The new
Patents Act, however, removes this ambiguity and provides for a com
pulsory search, extending to prior publications not only in India, but also
in any other part of the world.16 The basis of this provision is that an
invention which is published abroad before the date of the corresponding
application for a patent should not qualify for the grant of a patent.
Accordingly, publications which are capable of constituting anticipatory
prior art include publications in India and elsewhere appearing before the
priority date. This brings the legal position in India, in this respect, in
line with most of the other countries of the world.
We are aware of the problems and difficulties in organising the search
system with the ever increasing volume of search material and the devel
opment of narrow fields of science and sophisticated technology. This has
rendered the examination of inventions more difficult than ever before.
However, we have been trying to organise and equip our Patent Office
adequately, not only for the purpose of fulfilling the statutory provisions
of the Act, but also to enhance the utility of the Indian Patent Office by
rendering it an effective instrument for diffusion of scientific and tech
nical knowledge.
Patentability of Inventions
in the Area of Chemicals, Food and Drugs
Section 5 of the Act provides that in the case of inventions relating to
substances intended for use as food, drugs or medicines, or substances
16 See. 13(2).
Vcdararnan
11C
Vol. 3
produced by chemical processes, patentability will be limited to claims
for the methods or processes of manufacture only. In other words, pat
ents containing claims for the substances themselves arc not allowable in
such cases. It should be appreciated, however, that this provision is neither
unique nor novel. Many of the European countries, during the last
100 years, particularly when they were in the developmental stage, had
similar restrictions with regard to the patentability of such inventions.1718
19
Mr. Justice Rajagopala Ayyangar, on whose recommendation this provi
sion is based, had observed: “I have considered the matter with the ut
most care and have readied the conclusion that the chemical and phar
maceutical industry of this country would be advanced and the tempo of
research in that field would be promoted if the German system of per
mitting only process claims were adopted.”11’ It is clear that if claims for
the products themselves are allowed, it might act as a brake on further
scientific research and retard the development of new manufacturing pro
cesses. Suda a practice is, therefore, undesirable, particularly in underde
veloped and developing countries. In this regard, there are many coun
tries which impose restrictions on the patentability of chemical inventions
by allowing claims only for processes. In such countries, the restrictions
are even more stringent in the case of inventions relating to food, drugs
and medicines, in view of their importance to public health.
Term of Patent
Under Section 53 of the new Act, the term of a patent is 14 years from
the date of patenting, viz., the date of filing the complete specification.
However, in the case of inventions in the fields of food, drugs and medi
cines, which, as I said earlier, are vital for national health and well-being,
the term of patent protection is stipulated as 7 years from the date of
filing the complete specification or 5 years from the date of sealing, which
ever period is shorter.11' In other words, as against the duration of 14 years
for other categories of patents, the duration of patents for food, drugs and
medicines will be 7 years from the date of filing the complete specification.
The term of 5 years will be reckoned from the date of scaling only if the
patent is scaled within a period of 2 years. Now that the tempo of devel
opment'and evolution of new processes all over the world is so rapid,
many inventions are becoming obsolete much faster than in the past.
Many drugs and pharmaceuticals are being replaced by more effective
17 /£.g., Austria, Germany, the Netherlands, and the Scandinavian countries.
18
Rajagopala Ayyangar, supra note 14, at 36.
19 See. 53(1) (a).
No. 1/1972
A’fu Indian Patents Law
and better ones within a short period of time. Accordingly, it is felt that
a shorter term for patents in this field would not in any way prejudice
the interests of the patentees, and would be adequate. The pharmaceutical
industry, particularly in the international area, feels that if the term of
the patent is short, it will not enable them to obtain a reasonable return
and realise the expenses incurred with respect to research. However, it
should be appreciated that all such research expenses may be recovered
not only from a single market but from markets all over the world where
patent rights may also have been secured. Apart from this, in a majority
of cases the expiration ot the term of any particular patent docs not, by
itself, immediately result in adoption of the invention by a number of
competitors in the country, thereby prejudicing the interest of the pat
entee. In other words, the patentee himself continues to enjoy the priv
ilege of his patent despite the fact that the invention has fallen into the
public domain. This is particularly so in developing and underdeveloped
countries which lack the necessary technological base.
In this context, I may state that there was a strong section of opinion in
India advocating that there should not be any patent protection at all for
inventions in the important fields of food, drugs and medicines, which are
deemed indispensable to the sick, babies, invalids and convalescents. The
medical profession in India, and perhaps also in other countries, considers
it unethical to take proprietary rights for such inventions and make them
a means of profiteering. It may be recalled that the Royal Commission in
Canada highlighted the fact that exorbitant prices for drugs and phar
maceuticals were due largely to patent protection, and they recommended
that nothing short of abolition of patents in these fields would serve th!
interest of the public.20 The Sainsbury Committee in England also came
to a more or less similar conclusion in this respect and recommended that
a shorter term of patent protection coupled with provisions for licensing
patents in these fields would be adequate,21 though it is true that the
subsequent Banks Committee2223
*in England did not endorse the suggestion.
Even in the United States, there is a contingent thinking along these lines.
The recent testimony before a U.S. Senate Committee25 regarding the
exorbitant prices charged by U.S. firms with respect to pharmaceutical
20 Sec the recent report on these matters by the Restrictive Trade Practices Commission.
21 Report of the Committee of Enquiry into the Relationship of the Pharmaceutical In
dustry with the National Health Service 1965-67, Cmnd. No. 3410 (1967).
22 The British Patent System. Report of the Committee to Examine the Patent System
and Patent Late, Cmnd. No. 4407, al 112-119 (1970).
23 See, e.g., the reports by the Monopoly Subcommittee of the Senate Small Business
Committee (1967) and by the Subcommittee on Antitrust and Monopoly (1961).
J <•</.: rjnun
1IC Vol.
products, particularly in the developing and underdeveloped countries,
would seem to be very revealing. 1 am referring to these matters just to
emphasize that the special steps taken by the Government of India
through this patent legislation were dictated by social needs and the
public interest, and that these steps are supported by opinions held even
in the developed countries. The Government and the Parliament in India
have considered the views of all schools of thought regarding this issue
anti have brought about a fair and reasonable compromise between the
extreme views, viz., total abolition of patents in these fields on the one
hand and a liberal protection of patent rights on the other, keeping in
view the interest of the patentee as well as the interests of the public at
large.
The term of grant for drug patents as laid down in the Act would thus
seem to be adequate to ensure a fair return to the patentee. Besides, this
shorter term of patent protection might also stimulate quicker and wider
commercial exploitation of patented inventions within the country,
thereby making available these common necessities in adequate quantity
and at reasonable prices.
Licensing Provisions
As I said earlier, one of the serious handicaps which India in common
with other countries has been experiencing has to do with patents which
are not worked for the benefit of indigenous industrial development but
which are merely held to secure a monopoly lor importation. The Act
thus includes elaborate provisions to discourage abuse of patent rights.
Compulsory licences can be applied for at any time after the expiration
of three years from the sealing date of the parent. The provisions for
granting compulsory licences-1 are more or less along the lines of the pro
visions contained in the statutes of the United Kingdom and other Com
monwealth countries. In order to obtain a compulsory licence an appli
cant has to prove one or more grounds (under Section 90 of the Act) and
satisfy the Controller as to his ability to work the invention and as to
certain other facts. The procedure in such cases is basically the same as in
the past. The new Act also provides for an appeal to the High Court
from the decision of the Controller in such cases.2’’ Involving as it docs
protracted legal proceedings before courts of appeal, experience has
shown that the provision relating to compulsory licensing has not
been, nor is likely to be, very effective even under the new Act since
24
Sec. 84.
25
Sec. 116(2).
No. 1/1972
AVu.' Indian Patents Law
the patentee can delay the actual grant of the licence by resorting to
judicial processes. By the time the case is finally settled, the patent itself
might already have expired. While this situation can be tolerated in
ordinary cases, remedial measures have to be found and provided for in
the vital areas of public interest. Accordingly, in view of their paramount
importance to public health and well-being, it was considered necessary
that the legal procedure for the granting of licences for food, drugs and
medicines be simplified. Because chemicals are directly related to the pro
duction of pharmaceuticals, apart from their general importance in the
context of industrial development, it is obvious that the granting of licen
ces with respect to such patents should be handled similarly. The statute
has, therefore, provided that all patents granted under the new Act in
the area of food, drugs, medicines and chemicals shall, upon the expiration
of a period of 3 years from the dates of their grant, be deemed to be
automatically endorsed with the words “Licences of Rights”,20 and that
any interested person shall, as a matter of right, be entitled to a licence
under such patents2’ subject, of course, to the payment of royalties. The
Controller may, before the terms of the licence have been mutually
agreed upon or decided by him, permit the prospective licensee to work
the patented invention on such terms as the Controller may, pending
agreement between the parties or decision by the Controller, think fit to
impose.26
28 This provision is intended to ensure that legal proceedings do
27
not delay the establishment of production in such vital fields as food,
drugs, medicines, and chemicals.
Provisions in the patents Jaws relating to the endorsement of patents as
“licences of right” are not infrequent. There is, for instance, a provision
for the endorsement of patents, at the request of the patentee or on ap
plication by the Government or a third party in the U.K. Patents Act.2’
Even in the Model Law for the Developing Countries on Inventions
drawn up by BIRPI, similar provisions have been referred to.30 The sig
nificant difference in the recent Indian Patents Act, however, is that the
endorsement is automatic and statutory,31 although the effect of such an
endorsement is the same. Only recently, the Economic Council of Can26 Sec. 87(1).
27 Sec. 88(1).
28 See. 88(4).
29 Patents Act, 1949, 12, 13 & 14 Geo. 6, c. 87, § 35.
30 BIRPI, Model Law for Developing Countries on Inventions 67 (Geneva, 1965).
31 The automatic endorsement applies only to food, medicines, drugs or chemicals. How
ever, according to Sec. 86 the Government may apply for endorsement of any partic
ular patent as a "License of Right", and in such cases the Controller does make an
investigation similar to that for “compulsory licences.”
JJ iLir.lir.
lie
Vol
3
ada, after tour and one-half years ot study, has made a similar proposal
that all Canadian patents should normally become eligible for an auto
matic non-exclusive licence to manufacture in Canada 5 years after the
application for the patent.3- We do not have, however, any information
concerning the result ol this recommendation. But, the special provision
in India,32
33 as may be seen, is limited to the vitally important sectors of
national health and welfare and does not apply in.other cases. Here again,
the endorsement is effected only after 3 years from the date of sealing in
the same manner as is the case for the compulsory licensing provision.
This is in keeping with the spirit of the Paris Convention.
In this connection, it has been questioned why the Controller should not
look into the technical competence and the financial ability of the appli
cant for a licence under an endorsed patent just as in the case of an appli
cation tor a compulsory licence. But it may be pointed out that though
such questions would be relevant in the case of an application lor a com
pulsory licence, in the case of a patent endorsed with the words “Licence
of Right”, such requirement will be out of place. After a patent is en
dorsed with the words “Licence of Right”, the licence is to be granted
as a matter of right, and any questions which may have the effect oi
denying him the right to a licence will be doing violence to the language
of the expression “Licence of Right”. After all, a licence under a patent
is not a manufacturing licence but only a legal protection against infringe
ment of the patent. It may be mentioned that in such important fields as
food, drugs, and medicines, the prospective manufacturer — be he either
the patentee or a licensee — will have to obtain a licence under the Drugs
and Cosmetic Act or the Prevention of Food Adulteration Act, as the
case may be, and satisfy the Government that the products conform to
the required standards.
In this regard it is relevant to recall BIRPI’s commentary on Section 45
of the Model Law:
“There is a substantial difference between compulsory licences and licences of
right in that in the case of compulsory licences the applicant must justify his
request . . . and meet certain requirements . . . whereas this is not the case as
far as licences of right are concerned. This system may be specially attractive
to developing countries because once a patent is thrown open to licences ot
right it will no longer depend on the will of the owner of the patent whether
32 Ei osomic
Cocm it
oi
Caxsda, Report on httellectii.il and Industrial Property 91
(Ottawa, Information Canada, 1971).
33 Sec. 87 (providing for the automatic endorsement for patents in the fields of food,
medicines, drugs and chemicals).
No. 1 1972
A'ctc- Indian Patents Law
the patent will be exploited in the country; anybody can obtain a licence, and.
on the basis of that licence, work the patented invention in the country."1'
T he effect of the provision in the new Patents Act is precisely as above.
If the Controller were to make any sort of investigation before granting
a licence, it would result only in delaying the grant ot the licence and
wotdd defeat the very purpose of the provision. In order to protect the
interest of the patentee, the statute, however, provides lor an appeal to
a superior court of law on the question of the terms and conditions of
licences granted with respect to patents endorsed or deemed to be en
dorsed under the Act.’5
It should be appreciated that the basic intention of these provisions is to
ensure that essential articles like drugs, medicines and food will be avail
able to the public in sufficient quantity and at reasonable prices, and at
the same time ensure a reasonable return to the patentee on his invention.
The patentee will have a period of 3 years from the date of the grant of
the patent in which to establish production in the country and to take
steps for making the patented products available to the public at a reason
able price. If this is done, there is no reason why1 anyone else should con
sider entering the same business in an attempt to compete with the pat
entee by securing a licence, even though one could be secured as a matter
of right. In other words, it can be seen that the provision regarding the
granting of licences under patents automatically endorsed will become
really effective and advantageously utilized only if the patentee fails to
discharge his obligation.
Royalties
Section 95(1) provides that in settling the terms and conditions of a com
pulsory1 licence, the Controller shall endeavour to secure —
“(i) that the royalty and other remuneration, if any, reserved to the patentee
or other person beneficially entitled to the patent, is reasonable, having regard
to the nature ol the invention, the expenditure incurred by the patentee in
making the invention or in developing it and obtaining a patent and keeping
it in force and other relevant factors;
(ii) that the patented invention is worked to the fullest extent by the person
to whom the licence is granted and with reasonable profit to him;
(iii) that the patented articles arc made available to the public at reasonable
prices,”
The above provision, which contains the guidelines to the Controller in
the matter of fixing royalties and settling terms in granting a compulsory
34 BIRPI, supra note 30, at 67.
35 See. 116(2).
lie Vol. 3
licence, corresponds to Section 39 (1) (a) ol the U.K. Patents Act of 1949
and Section 69 ol the Canadian Act of 1935.:"'
However, in the case ot patents relating to food, drugs and medicines, by
reason of their importance to public health and welfare, the statute pro
vides that the royalty and other remuneration reserved to the patentee
under a licence (granted as of right) shall not exceed 4% of the net ex
factory sale price in bulk of the patented article?1' Needless to say, 4°/o
is only the ceiling or the maximum royalty allowable, and each case will
be decided within this limit depending on its own merits. This statutory
ceiling, however, as already indicated, is applicable only with respect to
patents within this special field, viz., food, drugs and medicines, and does
not apply to other categories of patents, where the allowable royalty (in
the case of a compulsory' licence) will be determined in light of the pro
vision in Section 95(1) of the Act.
I would like to point out one important aspect in this connection, name
ly, that the maximum rate of royalty, viz., 4°.'o for patents relating to
food, drugs and medicines, is not arbitrary or without basis. The normal
practice in connection with licences granted under Section 23CC (inven
tions relating to food, drugs or medicines) of the existing Indian Patents
and Designs Act of 1911 has generally been to fix a royalty' not exceed
ing 4% of the ex-factory' wholesale price of the manufactured articles.
Even in cases other than compulsory licensing, the royalties allowed gen
erally were ranging between 2 and 5% of net sales in the field of medi
cines and pharmaceuticals.36
*38 It will, therefore, be appreciated that the
statutorv fixation of a ceiling on the royalty should not be a matter of
concern to anvone, since what the new law does, in effect, is to give stat
utory effect to the existing practice, and then, too, only in the case ol
such essential items as food, drugs and medicines. This is intended to
enable the prospective licensee to know his maximum liability' as regards
royalties and to assure a reasonable return to the patentee, while at the
same time guarding against high prices of products in the sensitive fields
of food, drugs and medicines.
Use o] Patented Inventions by the Government
The provisions relating to Government use of patented inventions arc
contained in Section 100 of the Patents Act and are basically along the
36 The Patent Act, 1935, 25 & 26 Geo. 5, c. 32, « 66, 67.
57 Sec. SS(5).
38 Report oj the Reserve Ii,inlt of hult.i on toreign Collaboration in Indian Industry
(1968).
'■ > 11972
.Wu- lv.di.ui Patcn-.f L..-V
lines of the provisions in Section 46 of the U.K. Patents Act of 1949.
Similar provisions are also to be found in Section 125 of the Australian
Act.3''
The use of a patented invention under this section is subject to the pay
ment of royalties in an amount agreed upon by the Government, or
its authority, and the patentee, or in the case of default of agreement, in
an amount to be determined by the High Court under Section 103 of the
Act. Thus, the interests of the patentee are fully safeguarded.
However, in the context of the responsibilities which a welfare state as
sumes, it is necessary to ensure that the existence of patent rights does
not hamper its development programmes or its welfare activities. There
fore, for this purpose and in order to ensure that a scarcity of the pat
ented article, including drugs and medicines, docs not arise and lead to
high prices, the Government is vested with powers of an enabling nature
whereby it can make use of or exercise any patented invention merely for
its own purpose. Under this provision (Section 47 of the Act) the Gov
ernment can import patented drugs and medicines if they are merely for
its own use or for distribution in any approved medical institution, with
regard to the public service that such institution renders. It is the inten
tion not to go beyond this limited use, even when the circumstances so
warrant in the interest of the common good. Under this section it is also
provided that use for experimental purposes of patented articles or pro
cesses, as well as the articles or products made by a patented process or
a patented machine or apparatus, will be exempted from infringement
actions.
In this connection, I may refer to the observations made by the U.N.
Secretary General in his Report on the Role of Patents in the Transfer
of Technology to Developing Countries. The report says —
“In spheres of production vital to the national interest and the development
of special resources, or to public health, limitations on patentability or pro
vision for limiting the scope of the patent grant by special working or com
pulsory licensing in the public interest are natural, as is evidenced by the
inclusion of such limitations in the legislation of many countries.”10
Appeals
Under the provisions of the Indian Patents and Designs Act of 1911,
appeals from ^pcisions of the Controller were to lie in the majority of
39
40
Patents Act 1952 (Act 42 of 1952).
U.N. Sr.< nr i auy-Gi.ni h.\i., The Role oj Patents in the Transfer of Tctbnology to
Under-Developed Countries 22 (1964).
cases with the Central Government." Under the new Act, however, in
all cases appeals front the decisions, orders anil directions of the Con
troller will lie only with the I ligh Court, which is the highest court in
each state in India.'-’ The normal judicial process in accordance with the
rule of law is tints assured to parties in all proceedings under the Act.
International Arrangements
As regards reciprocal or Convention arrangements, in the past such recip
rocal arrangements lor the mutual protection ot inventions have been
limited to only the United Kingdom and the Commonwealth countries."
The new Act has removed this limitation and enables the Government
to conclude bilateral or multilateral arrangements or treaties with any
other country or countries for the mutual protection of inventions.4'
Conclusion
From what I have stated above, it should be clear that the main object
of the Act is to promote research and inventions and to accelerate the
indigenous industrial growth and, through a well-regulated patent sys
tem, to prevent the exploitation of a monopolistic patent position. The
Act is also calculated to make our country free from continued external
dependence as regards the supply of materials and machinery. As I have
already clarified, the Act seeks to accord equal treatment to both nation
als and non-nationals in all respects, and to provide to them or their
licensees ample opportunities to commercially work their inventions with
in the country; and if they make the best use of these opportunities there
should be no necessity to have recourse to any of the special provisions
in the Act in order to ensure that patents are not used in such a way as
to retard the economic development of the country.
The new Patents Act is the result of a detailed study of the economic
conditions of the developed as well as the developing countries of the
world with reference to their laws relating to patents, and has been de
signed to suit the special needs of our country. It has been the subject of
careful consideration at various levels before enactment, including two
expert committees, a Parliamentary Committee and the Parliament itself
more than once. The enactment has been widely welcomed by different
sections of the public and industry in India.
%
•11 Secs. 5(2), 9(3), 16(5), 17(6), 43(4).
42
Sec. 116(2).
43
The Indian Patents and Designs Act, 19)1, Sec. 78(A).
44
Sec. 133(1).
WORLD HEALTH ORGANIZATION
EB77/INF. DOC./3
ORGANISATION MONDIALE DE LA SANTfi
6 November 1985
OCCASIONAL-
EXECUTIVE BOARD
n/o
3.
Seventy-seventh Session
Provisional agenda item 14
POLICY ON PATENTS
Information paper on WHO patents policy
The Thirty-fifth World Health Assembly requested that progress in
implementing the WHO policy on patents be reported periodically.
WHO
agreement forms have been adapted to facilitate the achievement of the
objectives of the Organization in the most common funding situations.
No significant change has occurred in the number of patents held or
applied for, though WHO's use of its interests in patents held by
research institutes is beginning Co be reflected in concrete
arrangements with industry for the making available of health-related
products in the public interest.
1.
Introduction
Pursuant to a recommendation of the sixty-ninth session of the Executive Board,1 the
Thirty-fifth World Health Assembly (May 1982), in resolution WHA35.14, decided that it should
be the policy of WHO to obtain patent rights or interests in health technology developed
through WHO-supported projects where such rights and interests are necessary to ensure
development of the new technology, and to promote its*wide availability in the public
interest.
This information paper updates a report on the early progress made in implementing
the new policy, which was considered by the seventy-first session of the Executive Board2
and the Thirty-sixth World Health Assembly.3
2.
General provisions
2.1
The implementation of resolution WHA35.14 is being increasingly linked with the growing
collaboration between WHO and industry, as partners in promoting the development and wide
availability of health technology.
In most cases, patent rights in themselves, that is to
say the patents or other forms of industrial property and applications actually owned by WHO,
are of little direct benefit to WHO, which lacks the facilities and resources to exploit
them.
On the other hand, they may be essential to an industrial enterprise interested in
collaborating with WHO, in order to protect the often substantial investment required to
develop and market useful technology.
2.2
Whenever a research project results in useful technology that may be patentable, the
first question that has to be answered in accordance with resolution WHA35.14 is whether or
not patent rights are necessary for the technology’s development and wide availability.
The
basic answer is that, if the technology can be perfected and made widely available at a
relatively low cost, patent rights may not be necessary and the interests of the Organization
may best be served by placing the technology in the public domain.
Where, however,
development involves considerable investment and commercial risk, patent rights should be
sought.. Normally, this question cannot be answered at the outset, and the first steps in the
patent protection process have to be taken in order for the rights to be safeguarded.
The
Resolution EB69.R7.
Document EB71/22.
Document A36/6.
EB77/INF.DOC./3
page 2
protected rights can be abandoned later before substantial costs are incurred or they can be
continued, where necessary, until taken over by an appropriate non-profit entity or
industrial partner.
2.3
The specific provisions agreed between WHO and collaborating enterprises vary from case
to case, but they are designed to reconcile two general interests:
the interest of the
Organization in ensuring that the finished products of the technology, and in certain
circumstances the technology needed to make that product, are available to the public health
sector on preferential terms, particularly in developing countries, and the interest of the
enterprise in obtaining a reasonable return on its investment.
2.4
The Organization has recently revised its standard "Technical Services Agreement"
covering WHO-funded projects with research institutions.
Previously there were two
alternative forms of this agreement;
one of them vested the patent rights initially in the
Organization, and the other vested the rights initially in the research institution, with WHO
retaining a patent interest in the form of free availability of the rights to it or its
nominees.
The Organization will continue to ensure that it retains patent rights in
justified cases, particularly where it is providing most of the funds or intellectual input
for the research;
but, for other cases, the agreement no longer attempts to specify the
patent interest to be accorded to the Organization if a useful invention should materialize.
Instead, if and when the research results in an invention, the parties are placed under an
obligation to negotiate an agreement covering the exercise of the intellectual property
rights granted to the research institution.
Such an agreement will be based on the
attainment of the following objectives in the following order of priority:
(1)
the general availability of products resulting from the project;
(2)
the availability of those products to the public health sector on preferential
terms, particularly in developing countries;
and
(3)
the grant to each party of additional benefits, including royalties, account being
taken of the relative value of each party's financial, intellectual and other
contribution to the research.
3.
Patent rights
As of 15 October 1985, there have been 10 inventive efforts resulting in 16 patent
applications filed by or on behalf of the Organization, of which four applications concern
one particular invention and four other applications concern a related group of inventions.
Of the 16 applications, one was rejected, six have been abandoned, six have been granted
(one of which - a certificate of utility - has expired), and three are still pending.
Of the
five patents which the Organization currently holds, two concern inventions which are not
actively being pursued (Drug delivery system and Tubal occlusion method);
two involve the
same invention, which is currently undergoing toxicology testing (Steroid synthesis);
and
one involves an Invention (Long-acting esters) which is currently being tested and which is
covered by a first-option agreement with a commercial enterprise, which contains provisions
facilitating the making available of the product to the public sector.
A list of WHO’s
patent rights is set forth in an annex to this information paper.
4.
Patent interests
4.1
In addition to the Organization’s patents and patent applications, WHO holds a
considerable number of interests in patents obtained by research institutions funded by it.
The term "patent interest" is used to refer to the right to demand a licence under a patent
or the transfer to WHO of certain patent rights.
4.2
In cases where there is a potential for further development of the subject of the patent
into a useful health—related product, WHO has exercised its interest in the related
intellectual property rights so as to ensure the wide availability of the product in the
public interest, in particular for developing countries.
Two cases in which WHO has recently
exercised its interests are for a malaria vaccine and a fertility predictor.
In the case of
each enterprise selected by the research institute to develop the product concerned, WHO has
concluded an agreement which contains provisions facilitating the making available of the
product to the public health sector, in particular of developing countries.
EB77/INF.DOC./3
page 3
5.
Consultations with other international organizations
)
5.1
The Secretariat consults appropriate services of the World Intellect-^-1 Property
Organization (WIPO) as the need arises on relevant issues of intellectual property law in
order to best protect the interests of the Organization and the public sector.
It also
follows certain aspects of the work of WIPO which are of particular interest to the
Organization, such as improving industrial property protection of biotechnological inventions.
5.2
The Secretariat also has provided information to the United Nations Industrial
Development Organization (UNIDO), at its request, in order to assist that organization in
developing its own patent policy.
EB77/INF.D0C./3
page 4
ANNEX
LISTING OF WHO PATENTS AND PATENT APPLICATIONS
Filing date and country
Inventor <
programme
Subject
Current status
’10.4.1979
Decker
(HRP)1
Electro
coagulator
Rejected
3.5.1979
USA
Heller
Drug delivery
system
Pat. No.
4 261 969
20.7.1979
USA
Nakamura
(HRP)
Spermicides
Abandoned
CrabbS
(HRP)
Steroid synthesis
(anordrin)
Certificate of Utility
No. 79-20926 expired
(b) 15.4.1980
USA
CrabbS
(HRP)
Steroid synthesis
(anordrin)
Pat. No.
4 309 565
(c) 29.7.1980
FRG
CrabbS
(HRP)
Steroid synthesis
(anordrin)
Abandoned
(d) 14.8.1980
UK
CrabbS
(HRP)
Steroid synthesis
(anordrin)
Pat. No.
2 061 278
Buckles
Barrier
contraceptive
Abandoned
(HRP)
Hoffman
(HRP)
Improved tubal
occlusion method
Pat. No.
4 359 454
7. (a) 29.1.1981
USA
Archer et al.
(HRP)
Long-acting esters
(certain cycloalkyl
derivatives)
Abandoned, since covered
by United States patent
No. 4 507 290 on longacting esters
(b) 7.4.1981
USA
Archer et al.
(HRP)
Long-acting esters
Pat. No.
(c) 19.5.1983
UK
Archer et al.
(HRP)
Long-acting esters
Abandoned, since now
covered by EPA2
(d) 31.1.1984
EPA2
Archer et al.
(HRP)
Long-acting esters
Pending
1.
USA
2.
3.
4.(a) 4.8.1979
France
20.11.1979
5.
USA
16.12.1980
USA
6.
(HRP)
4 507 290
8.
3.12.1982
USA
Bone
(CFNI3/
FHE4)
Haemoglobin
screening device
Abandoned
9.
20.12.1984
UK
Rickman & Reed
(TDR)5
Microscope’
Pending (original 20.12.83
filing allowed to lapse;
immediately refiled)
10.
2.7.1985
Crabbe et al.
(HRP)
Testosterone
esters
Pending
1 Special Programme of Research,
Development and Research Training in Human
Reproduction (HRP).
2 •
'
’European patent application" (application submitted pursuant to the
Convention on the Grant of European Patents, 1973).
3
Caribbean Food and Nutrition Institute (CFNI).
4
Division of Family Health.
Special Programme for Research and Training in Tropical Diseases (TDR).
HOW THE WORLD EMINENT PERSONALITIES
FEEL ABOUT THE PATENT SYSTEM
In the words of Sir William Holdsworth :
" The foreign patentee acts as a dog in the Manger, sends
the patented articles to this country but does nothing
to have the patented articles manufactured here. He
commands the situation and so our industries are under
our own law starved in the interest of the foreigner."
Sir Robert Reed was more outspoken :
" Nothing can be more absurb or more outrageous than that
a foreign patentee can come here and get a patent and
use it, not for the purpose of encouraging industries
of this country but to prevent our people doing other
wise what they would do.
To allow our laws to be used
to give preference to foreign enterprise is to my mind
ridiculous" .
Sneaking of the American Patent System, while giving
evidence before the National Economic Committee
Mr. Langer said :
" We are doing business abroad and we want to orotect our
article, so that German or English manufacturer is not
able to copy it immediately and go into comoe tition with
us.
In other words, it is a great selling point for our
goods to have a protected export markets."
Patents were, therefore, admittendly taken by foreigners,
not in the interests of the economy of the country granting
patents or with a view to manufacture there, but with the
main object of protecting an export market from competition
from rival manufacturers.
In spite of this grossly apparent misuse and abuses of the
Patent System, the system continues to exist, as Edith Penrose
aptly puts it :
" partly because the custom is old and firmly established,
partly because of the pressure of the vested interests and
partly because the ideals of "International Co-ooeration",
"non-discrimination" and similar laudable sentiments have
been Influential in sharing the thoughts of lawyers and
Statesmen".
- // 0
X”'
____ za <
X- ''------ - 's V A
1
The exploitation and abuses of the patent system by
foreigners, who do not work the patents commercially in
the country of grant but use them merely as a means of
ensuring a monopoly of importation, has not escaped
criticism even in advanced and developed countries.
Speaking of the position of patents in USA, Floyd L, Vaughan
Savs :
" It is a contravention of our patent law and an economic
in justice to the American manufacturer to allow a foreigner
to take out a patent in this country merely-for the purpose
of reserving the United States a market for his patented
product which is manufactured abroad exclusively.
It means
the expulsion of all other would be inventors and competitors
from the industry covered by the patent and at the same time
the building up of the industry in other countries, all to
the detriment of the United States".
IT WAS NATURAL THEREFORE, FOR INDIA TO SHAPE ITS POLICY
ON SIMILAR LINES AND ADOPT ITS LEGISLATION IN ORDER TO
COUNTER THIS TENDENCY OF FOREIGN PATENTEES.
S m t. I nd i r a _G andhi at the World Health Assembl y
a t Geneva on 6th May, 113 1 said :
"
My idea of a better ordered world is one in which
Medical Discoveries would be free of Patents and
there would be no profiteering from life or death".
^AR-T yj? TECHNOLOGY POLICY STATEMENT OF GOVERNMENT OF INDIA
TO DEVELOP A SELF-RELIANT INDIA :
Extracts from Technology Pol icy’Statement of
Government of India 1183 :
" The Government of India's Technology Policy Statement
1183 declares that "Our own immediate needs in India
for the attainment of technological seif-rellance a
swift and tangible improvement in the condition of the
weakest sections of the population and the speedy deve
lopment of backward regions".
It further adds that
"Our future depends on our ability to resist the imposi
tion of technology which is obsolete or unrelated to our
specific requirements and of policies which ties us to
systems which serve the purpose of others rather than our
own, and on the success in dealing with vested interest
in our Organisations : governmental, economic, social and
even intellectual, which bind us to outmoded systems and
institu tions" .
EXTRACT FROM WIPO DOCUMENT NO.WIPO'IPL/
BM/4 DATED DECEMBER 3, 1985
In considering the role of industrial property
in economic development, an initial clarification
needs to be made concerning the nature of the
industrial property system.
The industrial property
system does not exist in order simply to grant legal
protection to various facets of technology.
Rather,
the industrial property system is more correctly
perceived as an instrument of public policy whereby
legal protection is granted to various facets of
technology in order to promote certain social and
economic objectives, which typically include the
disclosure and dissemination of technology, the
stimulation of investment of resources in technology,
and the establishment of a framework for the deve
lopment and exploitation of technology".
lHPc>R7M7'Pfies.s Cli ff/A/ts- IvtxAf/ Mm
- ------------------------------------------------------------------- --------------------------- --------------------------- o^/ow PA-rER. HO 5
ECONOMIC AND POLITICAL WEEKLY - OCTOBER 29,
Tailoring Patents Law to Suit MNCs
BM ____________________________________ ________________________________
The prime minister’s tirade against indigenous technology which is
geared to import substitution serves advance notice that he is
ready to fall into trap of the Paris Convention on patents and the
GATT provision for protection of intellectual property.
CONCERNED scientists and technologists,
legal luminaries and social workers and even
some enlightened business interests have
woken up to the grave and imminent danger
that has emerged on the horizon to Indian
R and D and the contribution that Indian
scientists and technologists can and must
make to socio-economic development with
some measure of self-reliance. They had
been watching helplessly but with con
siderable dismay for quite some time the un
folding of official policy which had tended
more and more to strangulate Indian
R and D, open the doors wide for foreign
technology and capital to take up comman
ding positions in the Indian market and
overwhelm step by step domestic production
capabilities in several critical areas. What
they had not still bargained for, however, was
that the government led by Rajiv Gandhi was
getting ready to revise the well-tested policy
on patent protection and join the Paris Con
vention on patents which the government
had so far rightly refused to do. It is being
suggested that the government may take this
‘bold* step by the middle of December this
year. The ground for this, according to some
well informed sources, is being prepared at
a rather hectic pace. These apprehensions
have been strengthened by the extension of
the so-called Rajiv Gandhi-Reagan Science
and Technology Initiative under which
transfer of high technology to India from
US is being regulated and managed. The
seminar being organised by the Federation
of Indian Chambers of Commerce and
Industry in the last week of November this
year with the active association and par
ticipation of the World Intellectual Property
Organisation (WIPO) is also considered
ominous in this context.
It is freely admitted by concerned high
officials that, though the pressure on India
for straightaway joining the Paris Conven
tion on patents has been somewhat relaxed
considering the sensitivity of the Indian
public on this score, the pressure for amen
ding the patent law of 1970, which had been
adopted in the teeth of the opposition of
multinational corporations and the
developed countries has been greatly inten
sified. What is being demanded is that pro
duct patents in particular should be reintro
duced across the board and the provisions
in the Indian law on compulsory licensing
and licence of right for manufacturing
patented products by the application of pro
cesses developed in India should be diluted.
This would amount to conforming with the
Paris Convention on patents without
formally joining it. It is quite on the cards
that these demands on India will find strong
articulation and support at the proposed
FICCI-WIPO seminar. A committee appoin
ted by the government last year to advice
whether or not to join the Paris Convention
is also about to submit its report and may
well be expected to reinforce the demands
and suggestions of WIPO for amending the
Indian patents law of 1970. This is how the
ground is meticulously being prepared to
force India to accept the line laid down by
WIPO on the patents issue.
The multinational corporations, on their
part, have drawn up a comprehensive plan
of concerted action on the patents issue in
the wider frame of the protection of intellec
tual pioperty rights through the Uruguay
round of GATT. The round has on its agen
da a specific GATT provision for the pro
tection of intellectual property as an urgent
and pressing issue.
The representatives of multinational cor
porations from the US, Japan and western
Europe adopted in June this year a com
prehensive working plan to acltieve their aim
in the GATT round. They have demanded
the adoption of a code similar to the stan
dards or subsidies codes under GATT
auspices in order to sanction “effective deter
rent to international trade in goods where
there is an infringement of intellectual pro
perty provision”. What they are seeking is
an ‘‘effective enforcement mechanism”
under GATT system for countries which do
not join the Paris Convention on patents and
do not amend their national patent laws and
procedures to conform to the norms of the
Paris Convention for the protection of
intellectual property rights. The multi
national corporations have come down par
ticularly heavily on the provision for com
pulsory licensing for production of goods
which enjoy patent protection but are not
actually produced in the country. What is
being demanded is that a patent will be
deemed to have been worked by the patent
holder by only exporting the patented pro
duct and not necessarily producing it in the
concerned country. This demand goes
beyond even the Paris Convention which
allows licensing of production of a patented
product to a third party in the event of the
non-working of a patent. Multinational cor
porations are also seeking to further extend
and refine the scope of patent protection to
1988
REPORTS
high-tech areas such as the ‘layout design’
of a semiconductor chip or biotechnology.
These demands, if accepted and enforced
through the GATT mechanism, will hit the
developing countries, notably those, among
them India, which have acquired and
developed scientific and technological
capability for finding alternative processes
for the production of patented products. The
import substitution effort of the developing
countries is sought to be choked through the
patent system and the GATT provision on
the protection of intellectual property. The
multinational corporations are clamouring
for concerted action by the signatories to the
GATT code on protection of intellectual pro
perty against those who may choose nor to
become party to the code.
What Jill this adds up to is that the
multinational corporations backed by the
governments of the developed countries are
demanding that the developing countries
strangulate their own R and D effort and
dismantle their production capabilities
wh.ch result in import substitution and
which compete with multinational corpora
tions and exports of the developed countries
to the developing countries. The moves of
the ruling establishment in India, encouraged
and supported by compradore business
interests and a section of the corrupt
bureaucracy with close links with multi
national corporations, to review and revise
the patent law of 1970 have, therefore,
caused grave apprehensions among Indian
scientists and technologists and all those,
among them some enlightened business in
terests, who stand for self-reliance and want
to strive to break the foreign stranglehold
on socio-economic and technological
development of the country.
The public affirmation by the prime
minister that the import substitution effort
in technology has been “one of the biggest
mistakes” has come as a shock to these sec
tions. Coming in the midst of mounting
pressure and open arm twisting by the
developed countries, in particular the US the
prime minister’s stand portends ill for Indian
R and D and technology. Rajiv Gandhi
chose to deliver his dictum on technology
policy and its aims in his characteristic hec
toring style on the occasion, ironically
enough, of presenting the 1987 Shanti
Swarup Bhatnagar awards to Indian scien
tists. It is a pity that the Indian scientists pre
sent on the occasion did not have an oppor
tunity to refute his extremely dangerous
position on Indian technology and its tasks
at the present stage of India’s socio
economic development.
The prime minister’s stand on technology
policy and the reasoning behind it are strik
ingly supportive of the mobilisation of
forces by the multinational corporations for
incorporating a provision for the protection
of intellectual property rights under the
GATT charter. This will be a powerful in-
strument for enforcing what is called the
Paris Convention on the protection of
patents, designs and trade marks to cover
not only industrial property, as originally
conceived, but all intellectual property on
a much broader basis. Rajiv Gandhi has
actually argued that “we . are always
substituting third generation or fourth
generation and we are never upfront when
we are doing import substitution”. In
variably, according to him, by the time we
have a breakthrough in import-substituting,
technology of the next generation or perhaps
two generations ahead is already available
to us readily and “that frustrates our scien
tists and technologists and our effort to go
into production”. What he thus made out
is a case for unhindered import of patented
goods and technologies with Indian scien
tists and technologists to act as hired hands
of foreign interests.
India, after a great deal of tussle with the
multinational corporations, which own 85
per cent of the patents registered in the
world, enacted its patents law in 1970. The
•essence of this law is that it provides a solid
and viable basis for Indian R and D to
develop technologies for substituting the
import of patented products and prevent
their unhindered access to the Indian
market. It challenged the monopoly of
foreign business interests to export their
patented products to India and gave a boost
to Indian R and D and indigenous business
enterprises to undertake domestic produc
tion of similar products. The Indian patents
law permits not only product patents which
alone are allowed under the Paris Conven
tion but also process patents for food,
medicines, drug and chemical substances.
Agriculture products and processes for treat
ment of human beings or animals are not
treated as inventions and, therefore, they are
not patentable. Atomic energy inventions are
also not patentable under the Indian law. As
regards the period for patent protection, the
Indian law provides 5/7 years for food,
medicine, drugs and chemical substances
and 14 years for other products. The law,
therefore, gives reasonable protection to
those who invent new products and processes
and the charge of the multinationals that it
encourages imitators and production of
counterfeit goods is totally misplaced.
The real point about the working of the
Indian patents law is that it has helped to
find substitutes for imported goods and ser
vices through R and D in India which has
rightly concentrated its efforts not on
finding brand new products but on finding
new processes for undertaking domestic pro
duction to substitute import of goods pro
duced abroad. This is due to the compelling
rea^bn that discovery of brand new products
requires huge resources in skills and money
which a developing country lacks. In the first
stage of development, a developing country
must concept rate available resources to
achieve optimal results which come by way
of import substitution rather than produc
tion of new products. By adopting the im
port substitution route, Indian R and D has
derived rich returns not only in terms of
foreign exchange savings but directly for
Indian consumers as regards assured sup
plies and reasonable prices. It has slashed
the high monopoly profits which foreign
goods could earlier extract from the Indian
market. This has been most palpable in the
case of pharmaceuticals and food products.
This also explains the frantic lobbying by
international drug firms to drag India into
the Paris Convention on patents. Before the
1970 patents act came into force, finished
drugs and exotic processed foods had free
entry into the Indian market and the con
sumer was mulcted by their producers
abroad in the absence of any competition
from domestic producers. This could go on
under the Paris Convention for as long as
20 years for each product. After 1970,
however, Indian R and D developed costeffective processes for a large number of
basic chemicals, drugs and pesticides in
India. These products are being sold to the
Indian consumer at reasonable prices and
even export outlets on a competitive basis
are being found for them.
What the multinational corporations are
clamouring for is what they call an “effec
tive deterrent to international trade in goods
where there is an infringement of intellec
tual property rights”. They are demanding
that for patent protected products, the pro
duction of an identical product should be
prohibited, it is aisconccrung in mis con
text that with the policy of import liberalisa
tion already seriously affecting domestic
production of a variety of goods and ser
vices, particularly capital goods and the
machine-making industries, and opening the
Indian market for investment and marketing
activities of foreign capital, the government
has initiated moves to review its time-tested
position on the Paris Convention on patents.
The prime minister’s tirade against tech
nology which is geared to import substitu
tion serves advance notice that he has been
persuaded by interested quarters and is now
ready to fall into trap of the Paris Conven
tion on patents and the GATT provision for
protection of intellectual property. Con
cerned scientists and technologists have to
bestir themselves immediately and raise their
voice to block this disastrous move.
A national working group headed by an
eminent Indian scientist, Nityanand, has
already been set up to campaign against the
scuttling of the Indian patents law of 1970.
It is proposed to hold a seminar, backed by
well-documented studies, to enlighten public
opinion on the important and far-reaching
issues involved in the patent system and the
designs of the multinational corporations.
After the seminar, it is also proposed to
institutionalise a ‘National Alliance* for
socio-economic development on the basis of
self-reliance.
ECONOMIC AND_POLITICAL WEEKLY - OCTO BEP 29 z JL988
TECHNOLOGY
The Patent Question
THERE are reportedly significant dif
ferences within the Indian bureaucratic,
political and business elites over the ques
tion of amendment of the Indian Patents
Act, 1970. The nature of amendments that
have been proposed are said to be in line
with the Convention of the Union for the
Protection of Industrial Property, in short,
the Paris Convention or international
patents convention. The proposal for
amendment of the Patents Act came up at
least three years back. There have been
reports of pressures, most notably in the
form of threat of trade sanctions, being
exerted on the Indian government by the US.
It is said that in the context of the Trade and
Competitiveness Act (1988), Washington has
identified countries, such as Brazil and
India, which, according to it, do not extend
adequate protection to the US patents and
copyrights. Further, the US is now holding
out the threat of trade sanctions to pressurise
them to amend their patents acts in line with
its proposal on trade related intellectual pro
perty rights that is reportedly being taken
up at the Uruguay round of trade negotia
tions under the auspices of GATT.
The Indian Patents Act (1970), which
superseded the 1911 colonial act, is based on
the progressive (from a anti-imperialist
viewpoint) recommendations of the Ayyangar
Committee Report of 1959 on the Revision
of Patent Laws. After a decade of concerted
opposition to the Ayyangar Report’s recom
mendations by TNCs as well as sections of
Indian capital, Indira Gandhi’s minority
government, which was then dependent on
the left for crucial support, and in the wake
of a near-scandal over drug pricing, presided
over the passage of the bill in parliament.
The progressive content of the present
Patents Act includes the terms of patents,
the scope of patent coverage, the grant of
compulsory licences, licences of right and
the right of the government to acquire and
use a patent. In the case of foods, pharma
ceuticals, pesticides and other agro
chemicals and veterinary products, the term
of a patent is five years from the date of seal
ing of the patent or seven years from the
filing of complete specifications, whichever
is shorter. For products other than the above,
the term is 14 years from the date of filing.
The US proposal will mean a term of
20 years in general and at least 17 years for
pharmaceuticals and agro-chemicals. For the
products mentioned above, the 1970 Act
gives protection to process patents only,
explicitly excluding “product-by-process pro
tection”. The US proposal specifies patent
protection for both processes and products.
The 1970 Act does not grant patents in the
areas of bio-technology and environmental
pollution control. Adoption of the US pro
posal would imply amending this section.
The Act has provisions for the grant of com
pulsory licences. Any aspiring manufacturer
has a right to be granted a licence to
manufacture a patented product if the patent
holder does not exploit the parent within a
stipulated period of time, on payment of
royalty not exceeding a particular rate. The
US government officials argue that grant of
compulsory licences is detrimental to pro
moting transfer of technology. Indeed,
according to the US administration, foreign
firms are reluctant even to file patents in
India because of the absence of adequate
protection.
From the business opposition to the
amendment of the 1970 Patents Act, it seems
clear that it is the interests of the firms con
trolled by Indian business in the pharma
ceutical and chemicals industry that are
likely to be the most hard hit. The statement
of the Indian Drug Manufacturers Associa
tion, communicated to the government on
August 9, basically articulates the familiar
anti-imperialist position, so convincingly
and comprehensively argued and empirically
validated by Constantine Vaitsos for the
Latin American countries. The represen
tatives of the Indian affiliates of trans
national corporations in the pharmaceutical
and pesticides industries who support the
amendment of the 1970 Act also articulate
the by-now familiar arguments which
however have little empirical validity in the
third world.
It may be useful to reiterate one point in
the argument against patent protection for
bio-technology in the third world Bio
technology is a sort of umbrella term for
processes, developed in the last decade or so,
that produce proteins and other molecules
by the artificial manipulation of genetic
material. It has vast potential in the areas
of agriculture and medicine. The basic
technology of hybrid seeds, for instance, is
the monopoly of a few transnational
corporations who also control proprietary/
patented agro-chemicals that form part of
the technology package for their application
in crop cultivation. These TNCs have, by and
large, genetically upgraded crops by freely
obtaining the germ plasms from the third
world and now want patent protection.
TNCs in the bio-technology field are deman
ding patent protection not only for micro
biological processes and products but even
for the plant and animal varieties, freely
taken from the third world, that they have
genetically upgraded. Even Western European
patent rules on bio-technology do not
concede some of these demands.
The US seems particularly concerned
about the import of generic pharmaceuticals
(after the expiry of US patents) from Brazil
and India. Brazilian patent law, it is said,
does nor provide for patent protection of
pharmaceutical products since 1945 and
pharmaceutical process patent protection
since 1969. US administration officials say
“the piracy of intellectual property" will no
longer be tolerated. There is a period of
protracted negotiations and hard bargaining
ahead. India and Brazil will no doubt use
important related issues as leverages in the
negotiations.
More than 40,000 children in
India become blind each year for
w-ant of vitamin A; yet vitamin A isj
in short supply. Over 60 millioni
people in India suffer from endemic
goitre only for want of iodised salt
Evidently, for drug corporate
power, with its control board abroad.
profits, not people, matter. This
pow er affects the drug policy of India
too
Preventive medicine is neglected,
social medicine is laughed at. The
Indian medical industry, given the
opportunity, has the capability to
develop and meet the national needs
for essential drugs and instruments.
Our medical pluralism, as a great
heritage of the science of healing and
health, suffers the status of a
BOMBAY: THURSDAY, NOVEMBER 27, 1986
Cinderella. Alas, "health for all" is
sacrificed at the altar of western
Even the courts, beguiled by
medical sophistry'
MNCs submissions through leading
For whom is sophisticated medi
advocates, grant stay of orders which
cine meant and for whom is life a
control prices or sale of banned
brief candle? who mailers’’ India
drugs.
Judicial
pharmacopoeia
(private) limited or India’s poor
knows the letter of the law. not the
unlimited?
goal of curing people at a reasonable
Sixty foreign drug companies con
cost
trol 80 per cent of India’s drug
Forty eight per cent of Indians live
production, and
market
their
below the poverty line and it is
astronomically priced products and
By V. R. KRISHNA IYER
estimated that only 20 percent of the
formulations
with
flavoured
people have access to modem medi
advertisements. India’s major na
WO grcai imperatives, one In
The main recommendations of cine. Leprosy, curable at cheap cost,
tional health adversary remains
dian and the other international,
among
tnbals.
Many
the Hathi committee were na rages
"pharmaccuticaJ imperialism".
thousands of children die of diar
should impel the Indian state to
tionalisation of multinational drug
The first charge of the state must
shape its drug policy so as to provide
companies; establishment of na rhoea although orahrehydration
be to offer pharmaceutical rescue
health for all by the turn of the
therapy
at
little
cost
can
save
most
of
tional drug authority; priority pro
shelters
to
the
marginalised,
century The right to a free and
them.
duction of 116 essential drugs; aboli
malnourished categories. This basic
healthy life, central to all human
WHO estimates that 60 to 80 per
tion of brand names and introduc
proposition
takes
us
to
the
nghts. is a constitutional fundamen
cent of the people tn the third world
tion of genenc names; revision and
stranglehold
of
pharmaceutical
have for all practical purposes no
tal of our republic.
updating of the Indian national for
multinationals and their quislings in
The nght to life (article 21 of the
access to medical services. What
mulary; strengthening of quality con
our country capitalising on human
constitution), expanded by other
aggravates the agonising situation is
trol; and elimination of irrational
suffering, importing phoney for
provisions like equal protection of
the absence of the nght drug at the
drug combinations.
mulations. exporting huge profits,
the laws (article 14) and freedom of
nght time at the nght cost and with
glamorising the cull of "west is best"
movement and speech (article 19)
the right information.
and
crushing
the
impressive
and seen in the light of the state s
A social audit will record the
capabilities of the national sector,
duty to reach public assistance in
colossal waste of scarce resources on
A decade has distressingly passed,
public and private.
cases of old age and gender handicap
about 60,000 drug formulations,
governments have come and gone,
The Central government has not
(part IV). is a guarantee of positive
many of which are hazardous and
Mr. Hathi is dead, NAM’s drugs
surrendered before them until now.
health free from disease and disable
irrational. Tie philosophy of "health
deliverance resolutions have become
but pharmaceutical patriotism, if
for all" will remain a grand illusion entrusted to new commute and
more strident But India’s penurious
ment
Article 38 mandates the state to
unless a humanist national drug bureaucracies within the field of
millions arc daily dying without lifepolicy reverses these perversities.
create a social order without econ
saving drugs. "Health for all", as a
influence of foreign firms, may well
omic disabilities and disparities and
Undeniably. India has advanced genuflect before transnationals inc.
lollipop slogan, is noisomcly publi
with social justice in respect of
after independence in the field of the MNCs are now influencing the
cised by state media and yet not a
health The equal, actual nght of the
health and medicine. Smallpox, colonially brainwashed oligarchy to
single proposal of the Hathi commit
plague, cholera and a few other accede to the Paris convention, and
litllesi Indian to free health care at
tee or UNCTAD. WHO or NAM
diehard diseases have been ban unwittingly sign the death warrant
least by 2000 A.D. is a creative
guidelines has become part of a
though belated response by the state
ished.
while malaria and filana have on the indigenous drug industry.
practical national policy.
to egalitarian call of the constitution.
been controlled to some extent
The battle for "health for all” is a
A powerful lobby of political pro
The nght to medical cere for the
struggle for pharmaceutical swaraj
fessionals, subsidised intellectuals,
humblest citizen is integral to evolv
against medical imperialism. A de
call-girl academics, misled medicos
ing an international health erder.
velopmental plan of ’health for all’
A network of dispensaries, hospi and pharmaceutical mercenaries
The aima ata declaration (1979). in
must organise integrated approach to
have put pressure on the Union
tals and specialised institutions has
which 134 nations including India
the many systems like ayurveda,
been
developed and. thanks to medi- 'government to join the Pans con
pledged urgent action to protect and
unam. siddha, homeopathy, Chinese
vention.
These arc strong words. But
cal colleges and allied institutions,
promote health and the resolution of
and. of course, modem medicine.
doctors and oaramedics have be we shall show that accession to the
the 38th world health assembly in
A holistic health strategy relevant
convention
will accelerate the Indian
come available. There has also been '
1985, sponsored by India and other
to the third world countnes. where
drug industry’s defeat in the war
,
countnes. to give this promise prac
nutntional disasters, pharmaceutical an impressive improvement in the against
disease and against the west’s
tical shape, arc some of the inter
privations, and endemic-epidemic indigenous capacity for the pro- ‘monopoly patents.
national instruments to secure good
diseases are common, calls for a ducuon of drugs, pharmaceuticals,
vaccines and hospital equipment
health for ail humanity.
cultural revolution in health care
Nevertheless, the country’s health
The WHO has also enumerated
The dominant diseases that stalk
guidelines for establishing a national
the third world — infectious, para- picture causes concern. To quote a
programme for essential drugs for
$t:c and respiratory — are more or recent report "the mortality rates for
women and children arc still dis
developing countries. These inter
less absent in the west. The socialist
tressingly high....total deaths occur
national instruments are the sinews countnes have developed a socially
among
children below the age of five
of a maturing world health order and
sensitised medical system where, at
supportive global jurisprudence.
a nominal cost. Medicines and hos years; ... infant mortality is around
129 per thousand live births ... the
The centre’s statement on the pital facilities are available to the
national health policy in 1952. fol common people. The scenano in the severity of malnutrition continues to
exceptionally
higii.
Com
lowing the Hathi committee report developing copntnes is sombre. The be
of 1975. and the latest restructttr.r.g WHO estimates that 80 per cent cf municable and non-communicable
diseases will have to be brought
of the 20 point programme, could illnesses are preventive.
effective
control
and
become the foundation of pro
In India 1.5 million children die under
grammes that would grant equal annually from diarrhoeal diseases eradicated".
access to those curative pharma caused bv polluted water. Half of the
ceutical advances which are new world’s TB patients live in India, but
cornered only by the dominant sec we produce only a third of our TB
tion of our society.
drugs requirement.
THE TIMES OF INDIA
I-Right To Health
As A Basic Right
T
Life-saving Drugs
Medical Colleges
II —- Drug Policy And
Right To Health
By V. R. KRISHNA IYER
HE Alma Ata declaration of
the global goal of “Health for
ail’’ by 2000 A D pledged urgent
action by WHO member-states
keeping in view the specific prob
lems of the third world and the
poor availability of essential drugs
at realistic pnees. The negation of
the citizen’s fundamental right to
life (Article 21) is the inevitable
consequence of the de facto denial
of the human right to health reaf
firmed at Alma Ata.
T
The corrupting force of MNCs has
led to many therapeutically irrational.
but lushly profitable formulations The
concentrauon of foreign industrial
might in the drug sector is disturbing.
Jh, 1973-74, 60 firms with foreign
shares accounted for 70 per cent of the
country'stotal drug sales The remain
frig 30per cent was sfrmed by 116 large
and 2.500 small manufacturing com
panies. Foreign companies, which
started here as markcung subsidiaries
ofthcirgiant parents, are not interested
in the production of bulk drugs. They
have been forced by circumstances into
manufacturing acuvity. But this main
ly consists of importing bulk drugs
from parent companies and merely
mixing them together in various
promotions to make various for
mulauons with particular brand
names.
If India’s accession to the Pans
Convention leads to this consequence
in terms of drug availability, it would
be at once unjust, arbitrary and un
reasonable (Maneka Gandhi's case)
and unconstitutional.
A nationalist drug policy, geared to
medicinal self-reliance and modem
technology, is a basic condition of
health s*araj But in a world domi
nated
by
pharmaceutical
trans
nationals manipulating soft states
The national sector has proved to be
whose administrators and expens are
willing to fall victim to their blandish equal to the national needs and many
ments and bullying, a patriotic policy people are asking for self-reliance in
cannot be sustained without a degree of pharmaceuticals Social action groups
and even official committees have
radicalism.
A revolution in health care is the endorsed this demand. Meanwhile the
human essence of the Alma Ala declar MNCs are getting exposed. In a lastation National self-sufficiency in drug ditch battle, they are readying to use
their final weapon — the Pans Con
manufacture, the use of generic against
brand names, elimination of the con vention. The convention represents the
fusing profusion of formulauons, con pharmaceutical cemetery of the Indian
trol of inflated pricing, barricading drug industry and an obituary for the
infiltration into our medical bureauc plan of “Health for all".
The Pans Convention holds that
racy, elevating the public sector to the
commanding heights of the pharma industnal property is pnvate property
ceuticals economy and strengthening and whoever acquires nghts thereto in
the Indian sector io general are some of a country is entitled to enforce those
the preconditions for such a revol nghts for his own benefit; he may
ution. All this demands a battle against prevent any other person from making
the high-tech baloney spread by MNCs use of the industnal property, includ
that they have a monopoly of research ing process, not only in the country in
capability and a passion to catalyse which it is registered but in all coun
indigenous R and D to develop new tnes which are signatories to the con
drugs adpated to our social conditions. vention. At the same rime the holder of
Indian drug manufacturers contend industrial property undertakes no obli
that, given the proper atmosphere and gations incidental to or flowing from
stimuli, they can beat foreign corpor his nghts. The grant of a nght to
ations in cost, quantity and quality. industrial property imposes no cor
The Indian Patent Ad, 1970, has been responding obligations upon the holder
a boon for indigenous drug companies and he is entitled to claim protection
and
Indian
consumers.
It has against invasion of his nghts against
promoted the introduction of a host of the action of a member-state even if
new drugs by Indian companies and that state regards that :t is necessary to
eliminated the monopoly position en invade those nghts in the larger public
interest or as a matter of over-nding
joyed by the transnationals.
Our patent law, based on Indian necessity. The owners’ nghts shall be
realities, has stimulated a competitive enforceable in all countries of the
Indian drug industry. The resultant Union and enforcement of those rights
local competition substantially re will be governed by the law of the state
duced the lead time berxeen the dis in which the right to industnal prop
covery of a drug elsewhere and its erty is recognised or registered and not
manufacture in India. Pnees have also by the substantive laws of the country
dropped in many cases. MNCs are not in which it is sought to be enforced.
Article 5A(4) of the Pans Conveninterested in essential drugs or genenc
products. They have been guilty of Uon provides for compulsory licensing
of
patents in some specified contingen
aggressive promotion of brand names.
sale of drugs at outrageous prices and cies but grants no real protection
against
abuse of the patent. Indepen
even of marketing formulauons
National Needs
banned in their home countries.
Similar Views
dent studies have revealed that compulsoiy licensing is of no value what
Similar views have been expressed
ever because the time lag involved in
obtaining a compulsory license is too by Mr. Justice J. G Shah and Mr. M.
Hidayatullah and other junsu. Mr.
long when viewed in the context of
ensuring the public good. Finally, sig Justice Rajagopala Avyangar in his
report on lhe rev ision of our patent law
natory-countries are obliged to ensure
protection against unfair competition opposed accession to lhe Paris Con
vention as injurious to the developin respect of all commercial activity.
Whether competition is unfair will be ment-of industrial capability. It is a
shame
that tho nation should surrender
determined according to the law of the
country in which the patent is regis to transnational pharmaceutical ter
rorism
on lhe ground that without
tered.
A perusal of the convention reveals accession we may be condemned to
pharmaceutical primitivism
a striking contrast between the
It is sheer lunacy to practice reverse
precision with which the nghts and
discrimination in favour of powerful
pnvileges of the owner of industrial
MNCs without even imposing on them
property are defined and the insignifi
cant protection afforded to the rights of lhe duty to make essential drugs in our
the state or of the nationals of the state country.
which accords these pnvileges. The
The nght to life (Article 21) rests on
convention may therefore be fairty the nght to medicine and if this nght
desenbed as a charier of rights of the is crushed by accession to the Pans
holder of industnal property in the Convention, the action would violate
international field.
Article 21 Foreign monopolies will
The Pans Convention is inspired by acquire the exclusive right to manufac
the ideology of defending industnal ture and import drugs covered by their
(intellectual) property of advanced patents. India, if it accedes, will be
countnes wanting to operate in de bound to grant such pa terrs. Thu is a
veloping countries. Its philosophy is procedure
obnoxious
and
un
maximum freedom for big business to reasonable and violative of Article 21.
make profits while excluding nvala in The Indian manufacturer may justly
the field, undertaking no duty to complain of violation ofhtsnght under
produce drugs and enjoying the privi Article )9(IXG) and (6). Surely, the
lege of importing products heedless of directive principles of Part IV. under
the needs of the third world. This Article 39(B) and (C), interdict the
pnvatisauon of medical relief based on concentration of means of production
profit etn ng from suffering is anathema to the common detriment.
for our constitution.
It is also plain that the existing laws
Drug MNCl with a pa th o logical like the Patent Act. Trade and
addiction to profits will enjoy complete Merchandise Marks Acts. FERA and
freedom in India to secure patents the Atomic Energy Act will have to be
under the Pans Convention if we sign sacrificed in vital aspects to propitiate
it. Moreover, the patents can be lhe clauses of the convention. Even our
claimed for products, not merely for nuclear programme will be exposed to
processes. The Indian researcher is the competition of multinationals.
thus inhibited from making the same There is no partial membership.
products by innovative processes.
An intensive and detailed national
Against these. MNCs are entitled to debate on the dangerous implications
patents under the convention but are of the Pans Convention is imperative
under no obligation to produce the before we cross the nibicon by acceding
patented drugs. As Mr. JuiLice Chan- to it.
drachud has observed; “This becomes
When a poor patient pleads for
possible only because one country survival and his disease can be con
takes out a large number of patents for trolled or conquered by a life-saving
exploitation in the other member coun drug, it is diabolical to deny him that
tnes. The foreign patent holder has no medicine on account of state policy
interest in lhe greater industrialisation which vests a patented monopoly for
of underdeveloped countries. He util its manufacture in a profiteering
ises those countries as a dumping enterprise without putting the latter
ground to which he can. in the name of under a duty to produce and distribute
his patent, export his patented goods. essential drugs on reasonable terms
What is worse, he can obtain a patent while preventing others from maxing
and not use it at all for manufacturing them And yet India’s accession to the
the patented goods. What he achieves Pans Convention will have this very
thereby, which is a most nefarious form impact on millions of poor people.
of trading practice, is to prevent the
I hope the Prime Minister wul re
producers in underdeveloped and de member Gandhiji who once observed:
veloping countnes from manufac "Whenever you are in doubt._ apply
turing those goods. It is a dog-in-the- the following lest Recall the face of Lhe
manger policy’’.
poorest and the weakest man whom
you may have seen, and ask yourself if
the step you contemplate is going tn be
of any use to him".
(Cood tided)
BOMBAY: FRIDAY, NOVEMBER 28, 1986
Section—2
TUESDAY. MARCH 4, 1986
TH
HINDU
India's National Newspaper
Pontod a< Madus. Coimbatore. Bangalore. Hydcabad and Madurai
the convention countries Is a matter of pro
cedure. But that the provisions of the Indian law
will have to be amended In accordance with Arti
cle 25.is indisputable
The'Senate Committee of the US A. pointed
out in 1961. before the 1970 Act of India was
enacted, that India which granted patents on
drug products ranked among the highest,pri.cecfnatTohs of The world, a case of inverse re
.________________■■ lationship________________
between per _____
capita Income and the
level of drug prices. The statutory changes of
HE qucst'On whether India should join the forfeiture of the patent for not working It In any 1970 have moulted in-bringing down the drug
Pans Convention has been the suoject of of the countries cannot be resorted to The forfei prices far below oven- of Britain, where com
considyrat.on and review from time to time for ture clause In any patent legislation Is designed paratively speaking, among the developed coun
nearly four decades. The question appears to to discourage such Imports and to encourage tries’ drugs are cheaper. Tnls Is the result arriv
be again a live issue and. therefore, merits seri local manufacture. This object cannot be pursu ed at by an official study In India of the pre
ed when once a foreign patent is registered In vailing drug prices between the two countries.
ous attention.
tho convention country. The provisions of the
Irnl.r.lri.il pr..|,.-rty r.<>rr.i*.b. <>1 p.iloiit'.. trade
Evon now ono goto reports In newspapers of
marks knowhow etc. With reference to patents convention are thus heavily loaded In favour of manufactured products, sometinH,*s - life-saving
India has enacted a legislation in 1970 re- the inventor or patentee and there is little or no drugs routed through one or more countries.
‘plac-ng the Act of 1911. on the oasis of the re recognition of the public interest of the other and after being imported Into India being sold
commendations of Mr. Justice Rajagopala member countries.
at fantastically hlgn prices. The Pans conven
In fact even in a country like Britain great juri tion would further this tendency on the part of
Iyengar, then of the Madras High Court and
later of the Supreme Court. He has submitted a sts have spoken .against the exploitation by the multinationals and monopolists. They would
comprehensive report in Septembt. 1959 poin- foreign interests by cutting patents registered manufacture the goods abroad and sell them at
mg out the deficiencies In the then existing Sta in Britain. For instance. Sir W.lliam Worl- high prices here. The power to ban such Im
tute He drafted a bill which took a decade to dsworth observed; ‘ the foreign patentee acts ports cannot be exercised as it will be Incon
oe adopted as e Statute, with such modifica as a dog in the manger, sends the patented arti sistent with the obligation* arising under the con
tions as were necessary The Act came into cle of this country (UK). does nothing to have vention.
the patented articles manufactured here (UK). Act will be useless
force in 1972.
The basic purpose of a patent system is to He commands a situation and so our industries
The M.R-T.P.Act designed to end the ex
encourage innovation and the improvement of are under own law starved in the interests of
ploitation of conaumers by Indian Industralists
industrial techniques. In return (or the dis the foreigners."
Sir Robert Reid (later Lord Reid) expressed would be powerless to regulate foreign busi
closure of his Invention by registering it in the
patent registry, the Inventor is given a monopo himself more emphatically when he said: "No ness Interests. The foreign patentee would
ly in the use of it for a specifiea period of years. thing can be more absurd or more outrageous not manufacture the goods In India and wlH h°l
Thereafter it becomes public property. Britain than that a foreign patentee can come here and allow it to be manufactured here relying on his
was the earliest to have a Statute regarding pa get a patent and use it. not for the purpose of patent In order to see that these tactics did
tents right from 1623. The latest law in that coun encouraging industries of this country, but to not succeed, the present Act contains provi
prevent our people doing otherwise what they sion for compulsory licensing, endorsement of
try was enacted in 1977.
would do. To allow our laws to be used to give licences of right, etc.
Other European countries too appear to preference to foreign enterpr.se is to my mind
There la a school of thought that even the pre
have had similar protective legislation even In ridiculous". Sir Robert Finlay (later Lord Finlay) sent law. Is inadequate to deal with the situa
the last century. In order to I.. ve uniformity In has also observed "a patent is supposed to be tion. as the foreign patentee has a long period
the protection of inventions, ten countries of granted for the encouragement or manufacture of six years at the minimum when he can dump
Europe and the U.S.A evolved what is known in this country, but under the existing laws, a his'goods In India and stifle Indian business fnler-'
as the Paris Convention of 1883. Three more large number of patents are taken out by ests during that period. -Our talks of socialism
countr.es jo.ned the convention next year and foreigners solely for the purpose of preventing and helping the weaker sections will cease to
now there are 96 countries which are signato encouragement of manufacture in this country’. have any meaning when India bends before the
ries to the convention China and India among . These observations came to be made more provisions of this convention by Joining It.
others, have not yet become ns signatories. than 70 years ago and are still valid.
An Indian Industrialist is now getting the
Out of the 96 countries, more t' an 62 are de
knowhow of patented process in technical col
velop. ng countries or countries whose indus- Exploitation
laboration agreements which are subject to Gov
Eighty per cent of the patents have been gran ernment approval. They are permitted for short
.•■al development «s behind the advanced ones.
One or tne oasic provisions of this conven ted to multi-nationals of only five developed coun periods. This kind o( arrangement gives a fillip
tion is that any amendment of >ts articles has to tries. The number of patents obtained by Indian to Indian Industries. By India entering Into the
oc n, ur.a* .m.ty among the members. Other inter- inventors Is Infinitesimally small, though India is Paris Convention, there will be a disincentive to
nat una. conventions require only a 2'3rd major said to have the third largest reservoir of scienti enter Into such agreements on the part of
ly lt-e ie$jt s mat over a cer’ury there have fic talent. More than half the population of the foreigners and the development of Indian Indus
beun o’My six amendments to this c >nvention.
world is outside the convention. The main rea tries would suffer thereby.
son for this feature is that in the absence of any
No discrimination
The former Prime Minister. Mrs. Gandhi, had
compulsory requirement to manufacture the
T'.e essentia' features of the convention are goods patented in any particular country, the spoken in no uncertain terms about resisting
this kind of exploitation. Lot us hope that the
tendency is to Import the manufactured goods forelgh overtures would be resisted. Mr. Jus
Tf^re should be no discrimination betv»een a and sell them at the best possible price, re tice Iyengar, who recommended the desirability
national and
one belonqir<i
to other sulting in the process of economic exploitation
of Joining the International convention In rela
f.iuinOt r r.nur’f", in the mater of protection of of the less developed or under-developed coun tion to trade marks, has taken a different view
indujina property rights. On the basis of the tries.
In regard to patents. In paragraph 307 of hlg re
(■•st an;.
«,-• hi any member country, a perIndia, with a large potential market and as a port. he has recommended certain safeguards.
‘-/■i ” .:v (•!( an application (or protection of his leading member of the Third World is wooed by way of revocation to suit Indian Interests
patent n u- , other member country and he and coaxed into Joining the convention by hold and points out that those provisions would be
gets a right of priority over others In those mem ing out all baits. It Is suggested that India need Inconsistent with Article B-A(lll) of the Conven
ber countries The priority dotrj’from his first not oven amend Its laws so as (p bajn cqnfoh . tion. It is hoped that o<J Government would not
application «n any one of the member countries. mity with the convention! This Is a strange bait venture kltb Vvhat is distinctly adverse to Indian
An nppb'.nlion fry a patent in any of the mem- and by Article 25 of the convention every mem interests. In Parliament there was a disclaimer
iy_-' ccuntfu.-j is treated as an independent one. ber joining it undertakes to adopt the measures recently on Joining this Convention. This disso that even J the application is rejected in one necessary to ensure the application of the con .claimer would^ have. to continue to govern the
co.."try >t can oe registered I. any other mem vention. There is no authority to excuse any cour> official attitude to the foreign approaches.
ber country
with-obvious
consequences.
------- / ........
—wacHMcuuca.
try from honouring the commitment following
The patentee can import his goods, manufac- the Joining of this convention.
V. Seturaman
lured abroad, and any statutory provision for .
How this commitment Is. to be enforced by
fiqptid Judge. Me&as H'-gh Court
Petrisconvention
T
BLITZ. DECEMBER 13. 1986 n PAGE 11
Plot io join Pans Convention
"lllllllllll
-s sfflbwstoffl’
llllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll
Q Six years allot his retirement, former Supreme Court Judge
V.R. Krishna Iyer continues to apply his razors harp intellect to
issues of national interest. Here, we reproduce excerpts of his
comments to Blitz on the Pans Convention lor-the Protection ol
Industrial Property, and the disastrous consequences that would
follow if India were to join it. .
This journal has repeatedly warned that such a move would ring
the death knell ol Indian industry (see Blitz Nov. 30. 1985, and
Sept. 20. 1986). Wo had earlier prominently featured the views ol
former Chief Justices of India. Hidayalullah and Chandrachud.
Here we carry further brief comments from them (see box)
together - with a comment by..Justice Shah.another disting.
uishod former Supreme Court judge, to illustrate the amazing
judicial consensus on this issue.
WOULD describe India's
joining the Paris Conven
tion as an act of abdication of
government’s responsibility
to defend the people against
multinational invasion ol their
right tp health and freedom
from sickness, their right to
»hat I would call 'pharma
ceutical : swaraj' Pharma
ceutical multinationals hun
gry for markets in the Third
World are utilising the Paris
Convention on Patents as an
instrument to oaln a strangle-
The provisions ol the Convention
ore obviously detrimental: for one
thing. II ensures the Indian producers
will never be ablolocompolowilhlho
multinational giants Secondly it
ensures they will be unable to
manufacture once patents are
applied for by the mullinalionalsand they will do that the day you enter
the Convention. There will bo a flood
ol foreign companies getting patents
by applications in India.
An obnoxious aspect ol the Paris
Convention is that <1 gives patents nol
only for products, but also lor
processes. In our. country, tho
existing
patents
law.
while it
concedes private Intellectual pro
perly through patentizalion of
products, always encourages bettor.
divergent processes so that inno
vations may be made And that will
reduce the cost also But the
Convention doos not do that It
ensures there will be no competition
as far as.these foreign firms are
concerned?We cannot allow that
Treaty will violate
existing law
Further, the Convention does not
obligate lhe multinationals to
manufacture hero. Tho result is that
they will quietly import what actually
you can manufacture here and save
on foreign exchange So you will be
the loser in several ways. And there is
also no obligation for them to give
you the know-howI cannot tee a tingle advantage
from lhe pharmaceutical angle,
from the health angle of lhe
people, to have these foreign
companies hold our people’t
health to ransom and I say this for
another reason: our people are
poof. And we cannot afford Io buy
the hlgh-coel products which they
will bring here from outside.
You will bo surprised to see that
while I disagree even on fundamen
tals with certain Judges like, shall I
say, Justice Shah or Justice
Hidayalullah—they and I are not
necessarily on the same wavelength .
as regards our value system—there is
nevertheless such a consensus on’
this Issue that that by ilsoil is n
V.R. KRISHNA IYER
guarantee that the Juristic and the
judicial view is against our entry Into
the Paris Convention.
able Io buy medfrclnet to cure
mytelf of my maiatdloi. But II the
Accession to the Convention
would violate the existing patents act
and a number of othbr legislations.
especially done by Executive action
(as rs being presently contemplated
Ed ) It will be contrary to those laws
and. therefore, invalid Without an
amendment in Parliament of all these
enactments, they cannot do this
reasonable price am account of a
Convention that ghres foreign
manufacturers freer rdn, then that
Ib definitely vlolathnc of my right to
life.
However, neither the Cabinel'hor
lhe Parliament can gel rid of the
Indian Constitution which gives
everybody a right under Ari. 19 to
become a manufacturer freedom of
trade, freedom of Business, freedom
of Pairing. all these things ore in An.
19. So any individual has a right to
manufacture these pharmaceuticals.
Even tho Parliament cannot overturn
that.
Tho only justification would be if
there wore grounds for a reasonable
restriction To my mind il is obviously
an unreasonable restriction to stifle,
muzzle and silence tho producers in
India In favour olmanufacturer 3 from
abroad. It Is grossly unreasonable.
unfair and unjust, and therefore.
plainly violative ol Art. 19
From another angle It It
violative of Ari. 21 which says lhe
right to Ilf0 cannot be deprived of,
except by those procedure!
etlabllthed by law. My right to life
at m Indian depends on my being
As Justice Chandrarchud lias said
the right to livelihood iis implied in the
right Io life. I would say that the right
to health is implicit in the right to hie
‘A betrayal! of the
Indian people’
Art
14 of the Constitution
guarantees equality 'before the la*
and equal protection! ol the law ’ A'
must stand on the s.ame fooling as
"B" But here what iis happening is
that the Indan manufacturer is
discriminated against vis-a-vis a
foreign manufacturer. Therefore it
would bo violalivo ol-Art 14 Thus, all
those throe articles of tho Consti
tution aroviolnlcd by accession to the
Paris Convention
I hnvo no doubt th?ii this would f-o a
very perilous step on the part of the
government, and a' betrayal of the
health interests of the
common
millions That any government
should consider appointing a
committee to go irrto whether *e
should enter the Pans Convention al
all. soems to mo a violation ol all
previous statements of pharmaceu
tical policy m this country
held upon, the markets of
countries like India.
Amazing legal consensus
India today is able to produce, from
the pharmaceutical angle, many o!
the items which it needs The Hathi
Committee report, which outlines the
parameters
ol our nationalist
pharmaceutical policy, had gone to
me exteT|t of recommending natio
nalisation of the foreign drug
manufacturers The report empha
sized that we do not need these
thousands ol foreign brand names
presently being dumped on tne
Indian market
What wu ru.illy uuud jhj llio Imml
□rugs, a very limited number, life
saving or otherwise essential drugs
wnich will meet the needs ol the
people These brand names now
circulating are not only not those of
hte-saving or essential drugs, but
also of unnecessary things which are
made attractive by propaganda But
me elimination ol the Indian
competitor can only be achieved by
legal processes, and they have hit
upon the Convention as |usl such a
process.
Patented path
to disaster
Accession to the Convention ol
Pars means acceptance of various
obligations under it One of those
obligations that there must be Iren
access to patentizalion by the
multinationals which have their
patents elsewhere and can make an
application here Under the Conven
tion they would automatically get
patents here.
So the entire pharmaceutical
Industry will suffer privatization
through palenttzation, monopoli
zation through patentizalion,
foreign control through patentizatlon, and total eidolon of the
Indan Industry through patenllxation.Thto to Iboslratgem being
adopted by these multinationals.
Do we want It?
I say this is sabotage of health
swaraj. After having entered the Alma
Ala Convention which has Health for
Ail as its objective, what you are
doing (by joining the Convention) is
suicidal, what you are doing is a
betrayal, what you are doing is a
subversion of the very constitutional
fourxiation which guarantees in its
articles, equil right to health for every
Indan.
Y. V. CHANDRACHUD
M. HIDAYATULLAH
U
NDIA will sutler II the joins the Paris
Convention. Once she joint the cannot
get out ol It.Jor tlx yean. During thia
period ol tlx yean, the (Convention's)
baneful etlecti will flow and may well
destroy many ol our Induatrlea.
/
J. C. SHAH
U
F India Joins the Paris Convention, the
monopoly ol foreign patent-holders Is
bound to Increase...the foreign patent
holder has no Interest In the greater
Industrialisation of underdeveloped coun
tries. He utilises these countries as a
dumping ground to which he can export
hla patented goods.
I
U
N my opinion, In signing Iho
Instruments ol accettlon India will be
tlgnlng a bond of elavery In lavouir Ol other
developed counlrloa whose Indujslrlallsls
are anxious to prevent any further
development of the Industrial beta In India
and simultaneously to destroy whatever
has been achieved during the Jett two
decades as a result ol the protection
afforded by the Indian Patents Act...
/
The Convention Is an Inflexible
document. Framed In 1883, It has been
revised only six times In 100 yean. It caret
little tor the need tor social change which Is
the crying need ol the developing countries
and does nof speak In termi ol public
Interest....we have Io protect ourselves and
not seek to be with those who need no
protection!
What Is worse, he can obtain a patenland
not use II at all for making the patented
goods...thus the monopolist patent-holder
Intensifies his stranglehold on the
producers In underdeveloped countries by
pursuing a policy which Is wholly
detrimental Io the needs of such countries.
I hope that India will not learn the hard
way. Learning by experience Is proverbially
costly.
Accession to the Convention IsJraught
with grave peril to the Indian manufacturer
and will not serve any public Interest.
Subscribing to the Convention tby India,
apart from Involving prejudicial conse
quences Io Iho Indian economy, In open to
Iho objection that It Is contrary to the
Injunction contained In Art.39(b) nnd Art.
39(c) ol Iho Constitution.
99
99
FINANCIAL EXPRESS. BOMBAY. WEDNESDAY. AUGUST 10, 1988
Paris convention is the
last straw: IDMA
Flnandal Express Bartau
BOMBAY, Aug. 9. - The Indian
Drug Manufacturers Assodxtion ha*
expressed alarm over Qic .'pressures
mounted on'the Go ver? rot at,by the
US Government to oompoT.India to
join the Paris Convention.
In b communication to the Goveminent, IDMA today expressed its
fears that "any amendment to Indian
Patent Act 1970 will mean deathkneU
of the national pharmaceutical indus
try and in future years India will no
longer be a country having low
priced medicine*../’■
In tact, the price* of drugs and
medicine* will go up five to ten times
within a few years a* a result of the
monopoly of import of c**ential and
Life-saving drugs by a single manufac
turer and they emo{'al of all competi
tive force* from the market, IDMA
said". The. convention bestow* exclu
sive right pf importation, manufac
ture and marketing to the patent
holder. •
. A majority of new drug introduc
tions in the last ten years have been
effected by the national sector of the
Industry., and many .of them have
Been manufactured as bulk raw
material, in 'the.. country, IDMA
observed. Some of these are already.)
being exported to the Western
world.
Export of pharmaceutical* ha* in
creased by 63 per cent in 1985-86 and
the trend is likely to be accelerated in
ihc future. Amendment of the patent
.acfwill *Iow down export* on the pne
hand and increase the price of drug*
to the co a* timer on the other hand.
As such, any amendment to the
Indian Patent Act will- cause long
term irreparable damage to the
national interest and national priori-.
tie*.
IDMA invited the Government'*
attention to the fact that India is a
signatory to the Alma Ata declara
tion of Health for All by 2000 AD.
The Government is playing a signifi
cant role in achieving this objective
and there wifi be a substantial out
flow of Government fund* for the
purpose. "The Government can illafford at this point to disturb the
price structure which is operating
within the country in competitive
environment’ and take the risk of
creating a monopoly situation of'
imported patented drugs 6y multina
tionals."
The association pointed out the
foliowins rpeofic fallout* if India
signed the convention: 1. Price* of
. drug* and medicine* would go up and
in a “few year* would match the
western price because of the,
monopoly of import* allowed to mul
tinationals. 2. Indigenous develop
ment of technology by the national
sector will decelerate*. 3. There will
be an increase in the Import* df
costly substitute* and the value of
such Import* would go up to the
extent of 300 to 500 in lea* than five
year*. 4. The export effort mounted
by national companies for bulk drugs
and pbaramaoeuticals will receive a
severe setback and this will be
m at died by, increased imports.
jThe.je’rtet pointed put that the
industry, tpt$iy ha* reached a situa
tion where the gap between export
andimport is minimum and it has not
increased ovex the last tea year*. On
the contrary, it b ibowins a declining
trend. The gap between imports and
exports will widen if India signed the
convention.
Many of the hew diaooverie* of die
world have been introduced in India
in, tfipee;four year* time after the
enactment’;- 0f tbc 1^70 .Act. The
pre-1970 gap for introduction of new
drug* was, on an average, eight to 10
years. The Indian consumer will be
denied the availability of new drup
fast enough after its introduction in
the western world at a reasonable
price if India succumbed. IDMA
said.
The price of pharmaceuticals are
the lowest in the world and compara
tive products in’the rest of the world,
especially In the west, are jO to 12
time* higher where the Patent Act
provides market monopoly to manu
facturer*, it said.
Also, the CSIR and other research
institutes are on record that the
Indian Patent Act has in fact stimu
lated indigenous research and de
velopment and have to fact contri
buted to technological upgradations
and innovation* during the last 18
year*.
Thu has also been recognised in
recent year* by various ministries
and sped al committees appointed to
study the need for joining Paris
Convention.
8 DECCAN HERALD, Saturday, July 30, 1988
DECCAN & HERALD
Bangalore, Saturday, July 30, 1988
Thought for the day
THEY arc (loiiiK things on (lie screen these days that the
French don’t even put on postcards.
— Bob Hope
Turning the screws
THE UNITED STATES estimates that it suffers an
annual loss of $ 50 billion from patent violations across the
world. This is no small amount for a country running an annual
trade deficit of around S 150 billion. So it is not surprising that
the US has been working on a world wide agreement that
would give more protection to US products. Senior US
officials arc currently in India to try to convince the Govern
ment to agree to a more rigorous protection of "intellectual.
property.” The violation of US patents is not very significant in
India; the phenomenon is more common in East Asia and Latin
America. Bui India is one of the developing countries that
until recently has been in the forefront of opposition to the
international convention on patents.
The issue is a difficult one to resolve. The considerable
expenditure that goes into research and development requires
that the inventor of a product or process should be given some
protection so that he can earn a reasonable return. However,
such protection invariably also leads to a higher price which,
especially in an area like drugs and pharmaceuticals, means a
conflict between private gain and public interest. The issue is
even more complicated in developing countries whose past
experience has been that less than 5 per cent of patents granted
to foreign companies have been exploited for domestic pro
duction. Clearly, patents here arc used to pre-empt domestic
production, the patentee preferring to meet demand through
imports.
It is on this issue that developing countries have on the
whole been opposed to the existing Paris Convention on
patents. The convention was first signed in 1893, has been
revised only six times since then, and, while supposedly
according equality to all signatories, in actual practice discri
minates heavily in favour of countries holding the most
patents. It is not that the developing countries do not have any
patent laws. These laws arc, however, less stringent than those
ofthe US and Western Europe and encourage local production
rather than imports.
Under US pressure, intellectual property (along with
services) was put on the agenda of the Uruguay Round of trade
discussions. In the meanwhile, however, the US has continued
to force individual countries to provide stricter protection to
foreign products and processes. Under the threat of trade
retaliation, this has worked to some extent in East Asia. The
pressure is now being put on India. The US strategy appears to
be to’make a'new international agreement a more attainable
pro/xxsitiyn through, pressure on individual countries, rhe
terms of this .new agreement wilt ultimately depend as much
on a common Third World platform as on the intensity of US
pressure. --.
;i
Generic drug market
US firms resent
Indian inroads
By Shyam Kufnar
BOMBAY, Aug. 4. - India's
growing penetration of the United
States’ generic brug market hus
sparked off resentment among
Amencan manufacturers, some of
whom have approached the US
Administration asking for revocation
of duty-free status for Indian ex
ports
The demand, coinciding with US
tvernment's pressure on India to
sign the Paris Convention on patents.
has aroused fears that the most lucra
tive export market may become outof-bounds for the Indian industry.
Ethyl Corporation, a bulk drug
and chemical unit based in Rich
mond, Virginia, has filed a petition
with the US Trade Representative,
Mr. Clayton Yeuttcr, asking for re
vocation of duty-free status for ibup
rofen.
The company justified its demand
with the claim that "the flood of
Indian ibuprofen into the US market
is undercutting the price of US pro
duction." Some other manufacturers
have also complained of dumping by
Indian companies.
Ethyl Corporation in its petition
said: "We believe ibuprofen industry
in India, pcrhnps the whole phar
maceutical industry, is as developed
and us competitive worldwide as is
the industry in tnc US or any other
country where ibuprofen is pro
duced."
This claim may be true, but
charges of dumping by Indian firms
are unfair, according to industry
sources here. They said India was
quoting the same price for ibuprofen
in the US as it did in Europe, and no
European manufacturer has com
plained as yet. If the drug costs more
for American manufacturers, Indian
suppliers ought *not to be blamed,
they said.
Cheminor Drugs Pvt. Ltd., a'
Hyderabad-based company belong
ing to Dr. Reddy's group of com
panies, is the largest producer of
ibuprofen In India, and nas obtained
the approval of the US Food and
Drug /Xdministration (FDA) to the
US. It began its production of the
drug in 1985 and produced 212 ton
nes last year. More than 80 per cent
of the drug is exported to the US,
USSR, Japan, China, UK and other
countries. Exports of ibuprofen has
earned more than Rs. 25 crores for
the company.
Industry sources said that the most
attractive market for the industry is
the generic market in Europe and the
US and a host of Indian companies
have turned to export of those bulk
drugs and formulations whose inter
national patents have cither expired
or are about to expire in the near
future.
India has already earned a name in
the world market as a leader in the
manufacture of a number of bulk
drugs like ethambutol, metranidazolc,
methyldopa.
ibuprofen,
mebendazole ano sulfaxetnaxole.
Drugs whose patents have already
expired in the US and produced in
India
include
chlorpropamide,
lorazepam, mcthyldopa, tolnaftate,
danazol, diazepam, ibuprofen, cionidine, mctaprotercnol, ampicillin,
cephalexin, sulfamethoxazole and
trimethoprim.
This year, patents for nalidixic acid
and piroxicam arc expiring, two
other drugs produced in India. Other
drugs whose patents arc expiring-in
the near future include the following
already made in India: albuterol,
amoxicillin, miconazole, nifedipine,
naproxen,
alprazolam,
atenolol,
metoprolol, cimetidine, terbutaline,
captropril and cisplatin.
Last year, out of the $30 billion US
pharma market, generic drugs consti
tuted $ four billion. It is estimated
that this segment will grow to $11
billion by 1998. More than 40 drug
formulations are also due to come off
patent by 1992. This represents
perhaps
the
biggest
marketing
opportunity lor the Indian industry.
Everyone acknowledges the fact
that the most important factor, which
enabled India to penetrate the US
market was the enactment of the
Indian Patents and Design Act of
1970. Any move to amend the act
will prove detrimental to Indian ex
ports, industry sources said.
Apart from the quality of the drug
concerned, US FDA officials inspect
the production facilities for good
manufacturing
practices
before
approving it for imports. More than
15 Indian companies have already
been approved by the US agency and
applications of many more are pend
ing. Approvals once granted are
valid only for three years, and have
to be renewed.
MS MARKETS
WoH-rMT
fAcSS
CL) P?
Fo«£l<SN pAtfXS
QCcAS io ixz A <- P^?c
° &■
NATIONAL LABORATORIES ATTACK NEW ARGENTINE PATENT PROPOSALS
If current Argentine patent legislation is modified to allow patents for pharmaceutical compounds, national labora
tories will be prevented from utilising 70% of their compounds, since these will become subject to patent protection,
says CILFA, the association representing the national industry, in a press release aimed at increasing public aware
ness of the consequences of the proposed changes for the national drug industry.
At preseni, the legislation stipulates that pharmaceutical compounds cannot be patented, but manufacturing
processes can. Proposed changes in the patent law would permit patents for both pharmaceutical compounds and
manufacturing processes
According to CILFA. the national industry has been "obstructed, checked and many times prevented" from manu
facturing drugs as a result of the co ordinated actions of multinational enterprises. By a massive patenting of manu
facturing processes, multinationals have, it says, been able to protect and monopolise virtually all drug intermediates
on the world market As soon as a national laboratory has started to manufacture a drug using its own or imported
intermediates, multinationals have immediately threatened legal action on the pretext of patent infringement of
manufacturing procedures
The argument that patent protection would encourage multinational companies to invest in local production
facilities is, according to CILFA, a complete fallacy - as witnessed by the fact that 430 drugs are already manu
factured locally by multinational companies. CILFA points to the literature published in recent years on the tech
nological problems experienced in developing countries as evidence that a patent system does not provide an
effective instrument for the development of a national industry. It also cites the case of Brazil where, although
patents are prohibited for both products and manufacturing processes, there has been a substantial increase in the
local production of drugs.
The main objective of any change in the legislation, CILFA maintains, should be a strengthening of the national
industry — in which case the legislation should make it "absolutely and completely clear" that no patents should
be granted for either pharmaceutical compounds or manufacturing processes on the grounds that such products
are indispensable to health. The introduction of patent protection for drugs would, it says, result in a loss of con
trol over public health and a "total dependence on monopolistic interests."
ARGENTINA: NATIONAL COMPANIES CONTROL 50 PER CENT OF THE MARKET
The importance of the local pharmaceutical industry in Argentina has been emphasised by Sr Antonio Arguelles,
president of CILFA (Centro Industrial de Laboratories Argentines), the pharmaceutical manufacturers association
representing the interests of the country's national laboratories.
In an interview with the newspaper "La Nacion," Sr Antonio Arguelles pointed out that although the local pharma
ceutical industry operates in competition with leading multinational companies, it has still managed to control 50
per cent of the market. This compares with Brazil, where national companies account for only 18 per cent of the
market, and Mexico where they control scarcely 12 per cent. Furthermore, the local industry exports finished pro
ducts to Paraguay and Bolivia and has established subsidiaries in Uruguay and Chile.
The general economic recession had a less serious effect on the pharmaceutical industry than on other sectors. Sr
Antonio Arguelles said. The demand for drugs had fallen by only 9 per cent and most companies had been able to
continue operating at full strength. However, he added, in.order for the industry to continue working at its present
rate, it was necessary for price levels to be governed by free market conditions rather than by political criteria.
"Otherwise, chaos would destroy the industry and the general public would be deprived of any progress made with
in the pharmaceutical field."
.. . maintenance of antipatent law essential
Sr Antonio Arguelles also stressed the importance of preserving the country's antipatent ruling which stipulates that
pharmaceutical compounds are not subject to patent protection on the grounds that they are indispensable for the
preservation of health. "It is essential that the government adheres to this principle when drawing up its new legal
instrument on patents," he said. Another important factor was the maintenance of an open drug compendium. Plans
by the PAM I, the health insurance agency for pensioners, to implement a drug formulary containing only 341 pro
ducts would go against the interests of PAM I beneficiaries and would also have a serious effect on the industry's level
of production.
Finally, Sr Antonio Arguelles suggested that adequate credit facilities should be made available to the industry for
the installation of new plant and equipment for the manufacture of drug intermediates as well as finished products.
NO PHARMACEUTICAL PRODUCT PATENTS IN DENM ARK AS NEW LEGISLATION DEFEATED
The bill to amend the Danish patent law (1968) so as to permit ratification of four patent conventions, including the
European patent convention (see Scrip No308, p5), fell unexpectedly at its second reading on May 24th, following a
switch of the 24-seat Progress Party from support to opposition. Since the bill, which would have introduced amongst
other things a pharmaceutical product patent, implied some relinquishment of Danish sovereignty.it required a vote in
favour by five-sixths of the house.
In consequence, the conventions will not now be ratified and the bill’s third reading on June 2nd concentrated on minor
domestic issues, without the ratification clauses, and was passed uneventfully This is not. however, necessarily the end
for Danish pharmaceutical products. Under the 1968 Act tne Secretary for Commerce has the authority to grant blan
ket permission for product patents to be introduced in particular industrial sectors. During the second reading he did
not respond to a challenge from the Progress Party that he should renounce this power for the pharmaceutical industry
The major criterion for use of this authority, that other countries in Scandinavia should have introduced such patents.
has already been met. The government is believed to be embarrassed that Danish patent law has, for the first time in
years, failed to keep in step with Swedish law (which introduced product patents on June 1st), and may thus favour
the exercise of ministerial prerogative.
Some Danish industrial sources have suggested that vigorous lobbying by two companies. Dumex A/S and A/S GEA,
played a part in changing the vote of the Progress Party. Others suggest that the lobby from the Handvoerker-Radet,
the craftsmen's council representing some 40-50 thousand small businesses, was very much more influential. The two
industry associations, the domestic manufacturers MEFA and the importers MEDIF, both supported the bill.
WORLD NEWS IN BRIEF
e "No! to the proposed changes in the patent law,"
is the slogan of CILFA, the Industrial Centre of
Argentine Pharmaceutical Laboratories, in its
efforts to counteract the campaign initiated by
foreign laboratories which is aimed at persuading the
government to introduce modifications to existing
legislation which prevents the patenting of pharma
ceutical products. CILFA is warning that the success
of the multi-nationals' campaign would result in "the
destruction of the national pharmaceutical industry.'’
NO PATENTABILITY OF DRUGS
IN NEW YUGOSLAV BILL
It is expected that a new Yugoslav Patent. Trademark, Model*
& Designs Law will be passed by parliament by the end of the
year to take effect virtually immediately. Earlier reports had
indicated that under the new law patents would give no right*
to their owners to oppose imitation by Yugoslav companies
but would simply entitle the holders to low royalty paymenu.
The latest repons are even more pessimistic: according to
article 19 of the draft bill currently being considered by the
authorities, there would be neither substance nor process pro
tection for pharmaceutical products, agrochemicals (fungicide*,
insecticides & pesticides), synthetic fertilisers and alloys.
It is understood that an earlier version of this bill had been re
jected by parliament, but that chances of passage of the new
version are high. This is yet another blow to foreign pharma
ceutical companies which had until now, co-operated with
Yugoslav pharmaceutical firms, and provides another reason
for them to pull out of Yugoslavia and stop co-operating with
Yugoslav firms.
EU/ope
SPANISH INDUSTRIAL PHARMACISTS SAY NO
TO DRUG SUBSTANCE PATENTS
Tho Spanish association of industrial pharmacist!, AEFI, met
in Barcelona on September 27th to comider the European
patent lystom and its consequence! for the Spanish pharma
ceutical industry. The meeting, which was also attended by the
Director-General of Pharmacy & Drugs, Dr A Lopez Casero,
his deputy. Dr F Ferrandiz Garcia, and the Director-General of
Chemical & Textile Industries, Dr J Angulo, reached a number
of conclusions which confirmed that there is little enthusiasm
among Spanish-owned pharmaceutical companies for patent
protection of drug substances.
The participants, who included representatives of all major
and many medium-size Spanish pharmaceutical companies, ■
and some multinational companies, reached a majority opi
nion that, if Spain were to sign the European Patent Conven
tion and the Community Patent Convention, "the Spanish
balance of royalty income from patents, which is already nega
tive, would deteriorate considerably as a result of the enforce
ment in Spain of many European patents." This would
"seriously damage" Spanish-owned companies, they said.
... attitude to CPC
The participants agreed that, as long as the Community Patent
Convention had not been ratified by all member states, signing
the Convention was not a prerequisite for Spain's entry into
t(ie EEC: as long as Spain could avoid signing it, it should do
so. If signing the CPC became a necessity, then the Spanish
government should negotiate, as part of an overall package for
joining the EEC, provisions that would make Spanish (Castil
ian) the fourth official language for Community Patents.
... and EPC
The participants also agreed that, since there was no obliga
tion for Spain to join the European Patent Convention
(EPC), it should abstain from doing so, since this would
"seriously damage" manufacturers in Spain. If signing the EPC
became unavoidable, care should be taken that this was not
done simultaneously with the CPC, and that the use of
Spanish as an official language should be approved. If Spain
was to Join the EPC, she should make specific reservations as
per article 162.1 j of the EPC regarding any contradiction
between the EPC and Spanish legislation on the protection of
chemical, pharmaceutical and food substances, the participants
said.
Europe
NO DRUG SUBSTANCE PROTECTION IN NEW
FINNISH PATENT BILL
The proposed new Finnish petent logislrtion, which is now
hieing drscoiled by • perhamentery committee end should be
come lew in March, 1980, will provide process but not sub
stance protection for phermeceuticels. This is generally re
gretted by the nonFinnish international companies, although
they welcome the extension of patent life to 20 years.
The new Finnish law. which has been drawn up with the ad
vice of other Nordic countries and follows the principles of the
European Patent Convention, does, however, contain a transi
tion rule which would at some future date allow the authori
ties to change to pharmaceutical substance protection by
ministerial order. According to observers, there is no chance of
the transition rule being used for this purpose in the imme
diate future, but the chances of it happening at some time are
not being ruled out. It is noted that the Finnish national phar
maceutical companies, which have benefited from the pro
cess-only protection, are no longer talking of never having a
substance patent but about when it will come.
Under the bill Finland will be able to join the Patent Cobperation Treaty.
GREEK LAW SAID TO HAVE CANADIAN-TYPE
COMPULSORY LICENCE PROVISIONS
First reports on the new Greek patent law passed by parlia
ment last week indicate that a late amendment provides for
compulsory licences for importing pharmaceutical products,
probably similar to the Canadian system. This is causing
serious concern In International pharmaceutical industry
circles, since: (1) the variety of reasons for granting a com
pulsory licence for importing a drug patented in Greece is be
lieved to be such that virtually all products and all Greek
manufacturers would be eligible; (2) Greek manufacturers
benefiting from a compulsory licence could re-export and
compete with the original manufacturer in foreign markets
where patent protection is lacking.
The situation is viewed as at least as serious as the one in
Yugoslavia, since Greece, although not having the pharmaceu
tical manufacturing capacity and capabilities of Yugoslavia,
is now a member of the EEC, with the membership agreement
coming into force next year. The new Greek Patent Act, in res
pect of its compulsory licensing provision, is seen by inter
national pharmaceutical industry circles as contravening the
European Patent Convention, which should be ratified by
Greece because of its EEC membership.
NEW THAI PATENT ACT PROVOKES OUTCRY
FROM MANUFACTURERS
The recent patting of a Patent Act by the Thai National Legisletive Assembly has provoked an outcry from multinational
pharmaceutical companies because of the absence of a provi
sion in the Act to cover the patentability of pharmaceuticals.
According to Mr Tim Anscomb, director of the Pharmaceutical
Product! Association (PPA), which represents the research
based manufacturers in Thailand, the absence of patent protec
tion for medicines is discouraging the introduction of new
medicines and hindering efforts to improve health care. The
enactment of an effective patent law is the key issue affecting
end-users of pharmaceuticals and the pharmaceutical industry
in Thailand as a whole. Research-based companies are ob
viously reluctant to introduce new medicines when they can
ba legally imitated and marketed at lower, yet profitable,
prices, Mr Anscomb declared.
The emphasis among non-research based companies on low
price rather than quality has tarnished the image of the Thai
pharmaceutical industry, said Mr Anscomb. Furthermore, far
from benefiting consumers, copy products could lead to a
slower return to full health as their formulation and effective
ness was often inferior to the original product.
In an interview with the Thai magazine, WEEK, Mr San
Singhapakdi, acting secretary-general of the Thai Food and
Drug Administration, acknowledged that imitated drugs were
inferior to brandname products, particularly in terms of
weight accuracy, uniformity and bioavailability. Nevertheless,
he added, the number of drugs currently available in Thailand
was sufficient to meet the country's basic needs and the intro
duction of newly developed drugs was not essahtial to the
nation's health.
The acting secretary-general also pointed out that, because of
their low price. Thai-produced drugs could compete effectively
on the world market and were exported regularly to South
America, the Middle East, Malaysia, Singapore, Indonesia,
Hong Kong and Taiwan.
8 The governments of Thailand and the United States have
signed an agreement under which the USAID will provide a
loan of $4 million and a grant of $500,000 to the Thai Ministry
ot Public Health for a campaign to eradicate yellow fever.
Both the loan and the grant will be used by the Health
Ministry to finance the health improvement project during
1990-82, particularly in areas infested by yellow fever.
World
LEAVE PATENT ACT ALONE SAY
CANADIAN GENERIC COMPANIES
In its positipn paper on chinping the pharmaceutical patent
laws, the Canadian Drug Manufacturers Association (CDMA),
which represent) Canadian-owned companies in the Englishspeaking provinces, has recommended that the section of the
Patent Act dealing with pharmaceuticals should not be
changed, but that multinational companies which show a
commitment to engaging in research and development, raw
material synthesis or export activities should be offered special
incentives.
Replying to the suggestion put forward by the Pharmaceutical
Manufacturers Association of Canada (PMAC) that there be a
ten-year period of exclusivity for new drugs, the CDMA points
out that once a compulsory licence is obtained, it takes an
additional three years to obtain HPB approval for a copy/
generic drug — thus the PMAC's concept would place research
based companies "in a virtual monopolistic market position
for a period of 13 years .. . The public would gain little.or
nothing by allowing the multinationals 13 years of virtual
monopoly to set drug prices," the CDMA declares.
The financial impact of generic competition on multinational
companies is exaggerated, the CDMA claims, with the total
sales of drugs under compulsory licences hardly exceeding
CanSlO million ($8.6 million) per year, compared with total
estimated pharmaceutical sales of Can$715 million ($614 mil
lion) in 1978. If the.multinational companies feel they are
suffering financial hardship because of generic competition,
then, the CDMA suggests, they should comeTorward and sub
mit their financial statements of the past five years, together
with those of their parent companies, to the proper govern
ment authorities.
'Copies of the CDMA's position paper on changing the
pharmaceutical patent laws are available through Scrip's
Reader Service, Ref Can. 0 6. Price: £5.00
EFFECTIVE US PATENT LIFE ON NEW DRUGS
AVERAGES ONLY 9% YEARS
The average affective patent life on the 13 new drugs ^proved
by the US FDA during 1979 wu only 9.5 yean, the lowert
since at least 1966, according to private correspondence
between Dr Martin Eisman, of the University of Rochester's
Centre for the Study of Drug Development, and the US PMA
Dr Eisman prepared the following table for the PMA:
Year
1966
1967
1968
1969
1970
1971
1972
Pa ten tod
NCEs
10
16
10
8
14
12
6
Av Effect
Patent
Ufe (Yn)
Year
13.6
14.4
13.5
12.7
14.4
12.2
10.9
1973
1974
1975
1976
1977
1978
1979
AvEHki
Patented
NCEs
12
15
11
15
15
14
13
Extent
Lite lYn)
12.1
136
11.4
113
9£
105
95
The PMA announced Dr Eisman's findings in a press release
which highlighted seven of the 13 new drugs introduced in
1979 (Merrell-National's ritodrine hydrochloride, Yutopar,
Upjohn's 25 hydroxyvitamin D3, Calderol; Parke-Davis' medofenamate sodium, Meclomen; Pfizer's prazosin HCI/polythiazide, Minizide; Abbott's continuous ambulatory peritoneal
dialysis, Inpersol; Ortho's meclocycline sulfosalicylate, Meclan;
and Lilly's fenoprofen calcium, Nalfon 200).
Commenting on Dr Eisman's findings, the PMA president, Mr
Lewis A Engman, said "One doesn't have to be an economist
to see the dampening influence this has on the industry’s in
clination to accept risk . . . Obviously, no firm can afford to
commit itself to such large research costs if competitors are
free to copy the resultant product before those costs can be
recovered."
Scrip's Washington correspondent reports that the PMA's
release and Dr Eisman's study both coincide with a new,
strong wave of Congressional sympathy for the drug industry's
patent-life predicament. This m^kes it all but inevitable that
rapid action will be taken in early 1981 to extend drug patent
lives, our correspondent says.
Unbind States
VARIABLE DRUG PATENT TERMS MAY BE
____________
Orw
AN OPTION, SEMINAR TOLD
facing th* new Congreu In it* •ffort to overhaul US
Cr',» P*t*rrt laws u the possible eiubliihment of variable
,tr'S^-ra °f patam protection, depending upon the coil and
duration of R&D and regulatory approval procedural. This was
su?Zsted to the first 1980-81 Roche Foresight Seminar in
Was-': ngton on November 12th by Dr Henry Grabowski, of
tt-e University of Rochester, New York.
Dr Grabowski pointed out that anti-infectives have about half
the average R&D cost of other pharmaceuticals, and this fact
could argue for their being given half the patent protection.
Sroce the purpose of patents is to encourage innovation, Dr
Grabowski suggested another option may be to grant extended
patent lives to drugs that save the most money in cost of
therapy. In Dr Grabowski's audience at the seminar were many
legislative aides of senators and congressmen who have an in
terest in reforming the drug patent laws. It is generally expec
ted that major legislative efforts will definitely be made in this
direction during 1981.
Dr Grabowski pointed to recent statistics compiled by his
university's Centre for the Study of Drug Development, show
ing that the average effective life of a US drug patent has fallen
from 14.4 years to 9.5 since 1967. This will have a "nontrivial"
adverse effect on the US industry. Dr Grabowski predicted. He
referred his audience to UK data showing that, in terms of
measured impact on R&D, drug patents are far more crucial
than patents on most other products. For example, Dr Grabow
ski said, the UK studies had rated patents as affecting 64% of
drug R&D, 25% of pesticide R&D, and a ''negligible” amount
of electronics R&D. Drugs, once developed, are simply too
easy to copy, he said.
Dr Grabowski was sceptical, however, about the remedial
effects of extending drug patent lives. This would not deter
the flow of drug R&D overseas, nor would it have any impact
on the development of orphan drugs - he recommended that
reform of regulatory procedures in the FDA drug approval pro
cess still be viewed as the first priority in improving incentives
to innovate.
Mr Alan Lourie, senior patent attorney at Smith Kline &
French, told the seminar that if patent terms continue to
diminish at their current rate, "compounds just won t be
developed". He reminded his audience that the current 17-year
patent term was set in the Congress of 1970, when regulatory
premarket approval was not a factor. The US Supreme Court s
recent strengthening of "method of use" patents generally
would be a great help to the pharmaceutical industry, Mr
Lourie predicted.
NATIONAL WORKING GROUP ON PATENT LAWS
OBJECTIVES
To discuss issues relavant and related to the Patent Laws
and Paris Convention ;
To arrange for research and publication of papers relating
to these issues ;
To help create a better understanding of these issues by
organising meetings, seminars and public debates ;
To represent to the Government and those concerned with
the formulation of policy on agreed views of the Group :
Publicise and organise publicity ;
in respect of India's and international patent and related laws
and policies.
To forge a National Alliance of various Organisations/Forum/
Associations, etc.to work towards and campaign for patent
laws and policy best suited for India's interests.
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