‘‘No deviations from the provisions of TRIPS’’

Dr P Murali

Post 2005, Indian patent regime got itself aligned to comply with TRIPS obligation that requires all WTO countries to allow patenting of pharma products and processes. This was instrumental in opening the flood gates for innovation. More than 800 out of 1,000 global companies involved in innovation have some kind of R&D presence in India, as they believe that the system could support an innovative ecosystem. Since life sciences industry is one of the highest R&D spenders of the world and thrives primarily on innovation, the new product patent regime assumes a lot of significance that offers protection and exclusivity to true innovation.

Promoting affordable innovation

With India’s knowledge ecosystem supporting frugal innovation, the patent regime is geared to protect products and processes emerging out of this ecosystem with a view on affordability as well. While Indian patent law is cognizant of true innovation, it also aims to reserve its right in providing critical and life saving innovation to its citizens without being prohibitively expensive. Global extension of pharma patents, which will be the effect of TRIPS when fully implemented, has fuelled concerns about drug prices and, subsequently, access to lifesaving medications. To address this concern, India also introduced a clause designed to restrict the number and type of pharma patents granted: Section 3(d) of the Patent Act prohibits patents on variants of existing compounds that do not show enhanced efficacy. It has been extremely contentious since its introduction in 2005.

Several transnational pharma companies feel this as an unacceptably high barrier to patenting, as do many foreign governments. Some critics also point to the fact that since India has set a high barrier in recognising incremental innovation, more than 50,000 patent applications were being affected and that it could stifle innovation. This is in comparison to other nations such as Germany, Australia and Japan who recognise incremental innovation. Yet another point of view indicates the high cost involved in innovation. For instance, many multi-national pharma companies incur more than $1.2 billion to innovate a single drug and close to $4 billion including the cost of failed ones and hence incremental innovation is key to protecting their future earnings to recover this cost. But many observers, including the United Nations Programme on HIV/AIDS and civil society groups, defend 3(d) and point to India as a model for developing countries attempting to use TRIPS flexibilities to promote public health.

It is also now dawning upon several groups that research and innovation costs could also be brought down considerably. For instance we have proposed a ‘sub-$100 million’ based innovation model wherein a ‘people’s drug’ could be innovated for less than $100 million in India given its cost effective discovery ecosystem. Also UN observers indicate that India should aim to tap into its skill base to encourage competitive and open innovation wherein the entire cost of innovation should not exceed a fraction of what is incurred elsewhere. This is one amongst many reasons for several transnational companies are now actively setting up research base here. The idea is to reach bottom of the pyramid with affordable innovative products that could also improve quality of life. The volumes would eventually drive future earnings.

Compliant and unbiased implementation alongwith thorough scrutiny

The recent developments such as Novartis not being issued patent on Gleevec under Section 3(d), an unfavourable order against Roche on Erlocip, Bayer being issued a compulsory licence on Nexavar, revoking of Pfizer’s patent on Sutent – may all be construed internationally as India not adhering to a strong IP protection, it is worthwhile pointing out that Indian law has not deviated from the provisions of TRIPS in each case – be it preventing ever-greening of patent or recognising a truly inventive step – without ignoring the criticality of their life saving nature and reviewing each and every case by its own merit without any bias. This points to a thriving compliance, unbiased implementation and thorough scrutiny of the IP and also a redressal mechanism via judiciary of the world’s largest democracy.

As per 2010-11, out of the total granted patents of 7,486, foreigners walked away with 6,214 while Indians got 1,272 patents forcing the Prime Minister to push institutions to strive for innovation, while the industries ministry now has a concept of ‘utility models’ in the present Indian patent regime, that could provide a framework for providing limited protection to those innovations, which may not meet the standards of the Patents Act and yet are commercially exploitable and socially relevant.