Why is India On US Priority Watch List

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The Indian constitution enshrines that the welfare of society will not be compromised for the profit of a few. It is in line with this philosophy of a welfare state that Indian patent laws are against evergreening which in turn delays launch of cheaper generic versions of patented drugs...

- Dr. Charanjit Kumar Sehgal


The Constitution of India enshrines the principle of India as a Sovereign Socialist Secular Democratic Republic. Therefore, India is one of the very few nations in the world which has a socialistic outlook.

Many WTO member states have an impression that in the pharmaceutical space, India is a no-holds barred country where generic companies can copy an invention and live-happily-ever. However, the reality may be quite different, with the Indian pharmaceutical market growing at double digit rates and fierce competition between innovator and generic companies. Generally, one major factor of concern to innovators is section 3d and sections 84 and 92 pertaining to non-patenting of specie patents of drug molecule and compulsory licensing respectively. The fundamental principles encompassed in the Constitution of India preach the formation of a welfare state, in which, the welfare of society is always preferred against the profit of a few. Accordingly, the patent law legislations have been enacted complying with the TRIPS agreement conferring due proprietary rights on innovators ensuring that such rights are never misused which is not in the interest of the nation in all aspects.

In recent years, these principles enshrined in the constitution are visible in the Supreme Court decisions pertaining to pharma giants Novartis AG, Roche and Merck under section 3d and Bayer under section 84.

The aforesaid case studies have been contrary to the expectations of the US chamber of commerce as these are not in line with US patent law wherein the patents for specie variants of the genus drug molecules are allowed with priority date later than the priority date of the genus patent, therefore, longer patent term. For example for clopidogrel drug used for heart ailments, the genus patent expired in 2010 whereas the specie patent for polymorphic Form-II is still valid and will expire in 2019. This practice is termed as evergreening of the drug patent which in turn delays the launch of cheaper generic versions of the patented drug. This is responsible for little or no access to some important drugs by the more needy section of society who cannot afford high prices of such drugs. Article 27 of the TRIPS agreement in a vivid manner illustrates that the WTO member states have to protect the patent rights of the inventors of all the member states regardless of where the invention is carried out and whether the product is made in the jurisdiction where the patented product is made or is imported. The bacteria or virus responsible for diseases for which patented drugs are developed are not selective about the target and poor section of society are equally susceptible to be host for such dangerous germs. However, to check evergreening of drug patents and also to give rights to the developing and under developed WTO state members, the TRIPS agreement under Article 31 gives rights to WTO member states to address health-related issues and accordingly consider compulsory licensing of patented drugs for domestic market and also for export to under developed member states who do not have state-of-art infrastructure to manufacture such drugs. Article 5 section A (2) of the Paris convention also states that each country of the Union shall have the right to take legislative measures providing for the grant of compulsory licenses to prevent the abuses which might result from exercise of exclusive rights conferred by the patent. Doha declaration paragraph 5 also states that each member state has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crisis, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a national emergency or other circumstances of extreme urgency.

Each country of the Union shall have the right to take legislative measures providing for the grant of compulsory licenses to prevent the abuses which might result from the exercise of exclusive rights conferred by the patent, for example, non practicing of protected technology and just to bar competitors from using the same which in US is a violation of anti competitive law.

Owing to its obligation to WTO, India amended its patent law in 2005 complying with all the provisions of TRIPS agreement by deleting section 5 which barred the grant of patent to drug molecule as a product and enacting sections 3d, 8, 83, 84 and 92 to avoid evergreening and abuse of proprietary rights in the form of a patent. Had there been violation of any provision of the TRIPS agreement, this could have been taken to the dispute settlement board of WTO which in turn would have forced India to amend the respective section not complying with TRIPS agreement. No member state has till date approached WTO validating the fact that Indian patent law including sections viz. 3d and 84 which are of concern to multinational pharmaceutical companies and US chamber of commerce are in compliance with the TRIPS agreement. The US building pressure on India, by keeping India under priority watch list is a strategy in the business interest of a few corporate companies at the cost of national state health.

The United States notes with concern the continuing challenges involved with enforcement of patent rights in India, including challenges that patent holders face in securing injunctions against firms that manufacture patented inventions without authorization from the patent holder.

US is expecting India to give injunctions against generic companies making specie products of a drug molecule whose patent has been rejected or abandoned and also not to consider issuing compulsory licensing. Instead, the innovator companies should manage their inventions complying with Indian patent laws particularly sections 3d, 8 and 83. The US innovator companies should refrain from submitting patent applications for specie variants based on priority of the specie patent filed in US and instead submit such patent applications as a divisional patent application of the genus patent or under section 54 of Indian patent law as an addition of patent of the genus patent with same priority date as that of the genus patent which does not violate section 3d. This will satisfy the interests of both India as well as foreign innovators as there is no evergreening of invention and at the same time, all the specie variants of the genus drug molecule are protected with same protection term as of genus drug patent. Furthermore, India may also consider an IP policy to allow a single patent application based on multiple priorities of genus and its specie variants which will permit genus as well as specie variants within the scope of the single patent.


Disclaimer – The views expressed in this article are the personal views of the author and are purely informative in nature.

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