DR.

RAM MANOHAR LOHIYA NATIONAL LAW

UNIVERSITY, LUCKNOW

IPRs in Pharma Industry

PROJECT

PHARMACEUTICAL PATENTS & EASY ACCESS TO THE

ESSENTIAL MEDICINES/DRUGS & FOODS

Submitted to: Submitted by:

Ms. Priya Anuragini Sajal Raj Gurjar

Associate Professor (Law) Semester IX

Dr. RML National Law University Enrollment Number-200101166

 ACKNOWLEDGEMENTS

I would like to express my special thanks of gratitude to my teacher Ms. Priya

Anuragini who gave me the golden opportunity to do this wonderful project
on the topic Pharmaceutical Patents & Easy Access To The Essential
Medicines/drugs & Foods, which also helped me in doing a lot of Research
and i came to know about so many new things I am really thankful to them.
Secondly i would also like to thank my parents and friends who helped me a
lot in finalizing this project within the limited time frame.
 Derivation of the Patent Regime
The roots of the modern patent regime can be traced in the Venetian System, the British and the
American System. In India in 1856, the first patent system was introduced. In 1859 special
privilege exclusively for the inventor was established which conferred the sole use and selling of
his/her invention for 14 years. This act was replaced by Invention & Design Act, 1911. In 1930
there were some major amendments in the similar act. In 1948, the government of India appointed
patents enquiry committee under Dr. Tek Chand, the committee submitted its report in 1953 but
this bill lapsed due to dissolution of Lok Sabha.

The patent system in India is governed by the Patents Act, 1970 1 (No. 39 of 1970) as amended by
the Patents (Amendment) Act, 2005 effective from 01-01-2005 and the Patents Rules, 2003 as
amended by the Patents (Amendment) Rules, 2006 effective from 0505-2006. The Patent Office,
under the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry,
performs the statutory duties in connection with the grant of patent for new inventions and
registration of industrial designs. Patent Offices are located at Kolkata, Mumbai, Chennai and
Delhi to deal with the applications for patents originating within their respective territorial
jurisdictions. PIS located at Nagpur maintains a comprehensive and provides technological
information contained in patent or patent related literature, on a worldwide basis and provides
technological information contained in a patent or patent related literature through search services
and patent document supply services. IPTI located at Nagpur provides training to the officials of
IP offices and other users of the system who are working in the field of Intellectual Property Rights.

India is a member-State of WIPO, an International Organisation, responsible for the promotion of

the protection of intellectual property throughout the world. India is a member of the following
International Organisation and Treaties in respect of Patents:

• WTO with effect from 1-1-1995.

• Convection establishing WIPO.
• Paris Convection for the protection of Industrial Property with effect from 7-12-1998.
• PCT with effect from 17-12-1998.

Kinds of Patent Applications

Ordinary Application Application for patent of Addiction (granted for improvement of
Modification of the already patented invention, for an unexpired term of the main patent).

1
 Kishan Arora, The Patent Act, 1970 (39 of 1970) 1-4 (New Delhi: Professional Book Publishers, 2007)

• Divisional Application (in case of plurality of invention disclosed in the main application).
• Convention application, claiming priority date on the basis of filing in Convention
Countries.
• National Phase Application under PCT

History of Indian Patent Regime

• 1856: The Act 6 of 1856 on protection of inventions based on the British Patent Law of
1852. Certain exclusive privileges granted to inventors of new manufacturers for a period
of 14 years.
• 1859: The Act modifies as Act 15; Patent Monopolies called exclusive privileges (making,
selling and using inventions in India and authorizing others to do so far 14 years from date
of filing specification).
• 1872: The Patents and Design Protection Act 1883: The Protection of Invention Act.
• 1888: Consolidated as the Invention and Design Act.
• 1911: The Indian Patents and Design Act.
• 1972: The Patent Act (Act 39 of 1970) came in to force on 20-04-1 972.
• 1999: The Patents (Amendment) Act, 1999 came in to force from 01-01-1995.
• 2002: The Patents (Amendment) Act, 2002 came in to force from 20-05-2003.
• 2005: The Patents (Amendment) Act, 2005 came in to force from 01-01-2005.

Early Patents Act & Indian Pharmaceutical Industry

In late 50s when political and economic set up was being enhanced the Indian pharmaceutical
industry was being dominated by the foreign multinational companies. The prices of the drugs
with special mention to life saving drugs were too high. These prices were non affordable by
common people in India. The previous acts were not being able to meet needs. After observation
such chaos in the pharmaceutical sector, the Indian government in 1957 appointed a committee
under the chairmanship of justice Raja Gopal Ayyangar 2. The committee started its work keeping
in mind the changing scenario. The report was inspired by the Indian constitution which ensures
social economic justice. Article 21 of constitution which ensures the right health to citizen was the
guiding philosophy behind Ayyangar.

2
Ayyangar Rajagopala, Report on the Revision of the Patents Law, Government of India, 1959.

List of Amending Acts

• Repealing and Amending Act, 1974 (56 of 1974)
• Delegated Legislation Provisions (Amendment) Act, 1985 (4 of 1986).
• Patents (Amendment) Act, 1999 (17 of 1999)
• Patents (Amendment) Act, 2002 (38 of 2002) Patents (Amendment) Act, 2005 (15 of
2005)

The Present Scenario

The patent Act (Act 39 of 1970) came into force on 20th April 1972. The Patents act of 1970 was
designed perfectly in tune with our then national ideology of planned development. This was the
time when there was socialistic planning. Since then India has underwent an absolute economic
enhancement. India has taken up the strands of globalization and liberalization. Today the country
is gaining momentum ahead of the global economy3. This process will not be complete unless the
research and development is also integrated with global research and development. Also India has
entered into an international framework after being the member of WTO. Thus it is in the legal
obligation to fulfill all the statuary norms of the WTO. After signing the TRIPs agreement India is
continuously updating its patent regime.

Amendment Act 15 of 2005

Statement of Objects and Reasons- The law relating to patents is contained in the Patents Act,
1970 (39 of 1970) which came into force on the 20th April, 1972. This Act was amended in March,
1999 and June, 2002 to meet India's obligations under the Agreement on TRIPS, which forms part
of the agreement establishing the WTO. The amendments primarily focused on the obligations
which came into force from 1st January, 1995 (in respect of amendments made in March, 1999)
and obligations which came into force from 1st January, 2000 (in respect of amendments notified
in June, 2002). The first amendment to the Patents Act introduced a transitional facility ("mail
box") from January 01, 1995 to receive and hold product patent applications in the fields of
pharmaceuticals and agricultural chemicals till January 01, 2005 and also for grant of EMRs for a
period of 5 years or till the product patent is granted or patent application is rejected, whichever is
earlier. Before making the latter amendment, a Joint Committee of both the Houses of Parliament
examined all aspects and recommended various provisions in order to provide necessary and
adequate safeguards for protection of public interest, national security, biodiversity and traditional
knowledge, including effective flexibilities

3
 S. R. Chaganti, Pharmaceutical Marketing in India 1-36 (Hyderabad, Pharma Book Syndicate, 2005)

4
to enable appropriate and timely response to national and public interest concerns, especially those
relating to public health and nutrition. These were included in the second amendment.

The earlier amendments had provided for the modalities for a ten-year transition facility (which
India had negotiated at the time of its accession to the WTO), commencing from the 1st January,
1995. As a consequence, the law was required to be amended further in respect of India's
obligations under the TRIPs Agreement, due from 1st January, 2005.

Given the importance of the issues, the Government undertook broad-based and extensive
consultations involving different interest groups on aspects critical to the changes which were
necessary in the Patents Act, 1970. These included country-wide interactive sessions with various
interest groups, including scientists, academicians, economists, representatives of various industry
sectors (such as pharmaceutical, biotech and software), chamber of commerce, private and public
sector units, journalists, non-governmental organizations, representatives of State Governments,
lawyers and attorneys and other interest groups and extensive inter-Ministerial consultations.

The time-frame for this set of amendments was most crucial as any slippage in meeting the January
01, 2005 deadline had the potential of inviting retaliatory action under the WTO disputes
mechanism. Having availed of the entire ten-year transition period provided under the TRIPs
Agreement, India had no legal basis to defend its default on the deadline. The past record of
delayed implementation would also not have helped the Indian case. 7:15 default would also have
created a legal vacuum for the "mailbox" applications, as there would not be any mechanism to
deal with them from January 01, 2005. This would have amounted to a specific default on the
international commitment to examine and dispose of these cases, and might have again provided
an opportunity to WTO member countries to raise a dispute against India in the WTO. There would
also have been a legal vacuum in respect of fresh applications after January 01, 2005, as the law
was salient on whether the “mailbox" provision would subsist or whether it would have ceased.
Finally, there would have been an erosion of India's credibility in the international field. In the
circumstances it was considered necessary to bring in the required amendments in time and as
Parliament was not in session, the President promulgated the Patents (Amendment) Ordinance,
2005 (Ord. 7 of 2004) on the 26th December, 2004.

While considering the third set of amendments to the Act, efforts have been made not only to fulfill
our final obligation under the TRIPs Agreement, but also to simplify and rationalize the procedure
governing grant of patents so as to make the system more efficient and user-friendly.

Doha Declaration
The Declaration neither amends the TRIPS Agreement nor provides a basis for developing
Countries to link their patent and health legislations. The Patents (Amendment) Act, 2002 closely
follows TRIPS and in the process does away with provisions of the 1970 Act that constituted
India’s own response to the challenge of providing exclusive commercial rights in a field
concerned with the fulfillment of basic health needs.

The provisions of the 1970 act and similar legal regimes in other developing countries have been
the source of significant complaints by the private sector pharmaceuticals industry in developed
countries. The US pharmaceuticals lobby estimates that it currently loses more $1.7 billion
annually because of India’s insufficient intellectual property protection1.

The Doha Declaration is a direct consequence of the multiple controversies concerning patents in
the health sector, particularly in the context of the HIV/AIDS epidemics. Its importance is linked
to the recognition that the existence of patent rights in the health sector does not stop from taking
measures to protect public health. More specifically, it affirms that TRIPS should be “interpreted
and implemented in a manner supportive of WTO members right to protect public health and, in
particular, to promote access to medicines for all” . This strengthens the position of countries that
want to take advantage of the existing flexibility within TRIPS. In other words, the declaration
does not open new avenues within TRIPS but confirms the legitimacy of measures seeking to use
to the largest extent possible the in-built flexibility found in TRIPS.

The declaration focuses mainly on questions related to the implementation of patents, such as
compulsory licensing. Compulsory licensing has long been used as a tool to regulate the exclusive
rights conferred by patents. In the case of health, the rationale is to make sure that the existence of
a patent does not create a situation where a protected medicine is not available to the public because
of non-health related factors. The Patents Act, 1970 provided an elaborate regime that included
both compulsory licences and licences of right . The TRIPS Agreement has not done away with
the notion of compulsory licences but provides a more restrictive framework than the current
regime in force in India. The recognition in the Doha Declaration that TRIPS member-states can
use the flexibility provided in the agreement and can, for instance, determine the grounds on which
compulsory licences are granted must thus be understood in the context of a generally increasingly
restrictive international patent regime. The declaration has been hailed as a major step forward in
the quest for making the TRIPS Agreement more responsive to the needs of developing countries
and more specifically to individuals who are unable to afford the cost of patented drugs. In fact, it
addresses a number of important issues related to the implementation of medical patents. However,
it fails to take up the much more fundamental questions of the scope of patentability and the
duration of patents in the health sector. The Doha Declaration remains an important instrument in
India for two main reasons. Firstly, at a political level, India was amongst the most vocal
developing countries at the ministerial conference in putting forward developing Countries’
interests . Secondly, the declaration was adopted while the joint committee of Parliament was
finalizing its report.

1 H. Brennan, R. Distler, M. Hinman, and A. Rogers, “A human rights approach to intellectual property and access to
medicines,” Global Health Justice Partnership Policy Paper 1, Yale Law School and Yale School of Public Health
(September 2013)
The Hatch-Waxman Act (1984)
It is the popular name for Drug Price Competition and Patent Term Restoration Act, 1984. It is
considered as the landmark legislation which established the modern system of generic drugs in
USA. Hatch-Waxman amendment of the federal food, drug and cosmetics act established the
process by which, would be marketers of generic drugs can file Abbreviated New Drug Application
(ANDA) to seek FDA approval of generic drugs. Paragraph IV of the act, allows 180 day
exclusivity to companies that are the "first-to-file" an ANDA against holders of patents for branded
counterparts.

In simple words “Hatch-Waxman act is the amendment to Federal, Food, Drug and Cosmetics act
which established the modern system of approval of generics through Abbreviated New Drug
Applications (ANDAs)”

Significant results due to Hatch-Waxman act-

• Prior to the Hatch and Waxman act the generic drug manufacturer had to do the entire
clinical trials. After the passage of Hatch and Waxman act the generic drug manufacturer
had to only prove bioequivalence of generic drug to the innovator drug by showing that the
generic drug is 80-125% bioequivalent to the innovator drug.
• The time and cost involved for getting the generic drug into the market was significantly
reduced.
• Low cost quality, safe and effective generic drugs were available to the patients.
• Since 1984, over 10,000 generic drugs have entered the market, and generics accounted
for close to 50 percent of prescriptions filled (as on august 1, 2003).
• Billions of dollars in health care costs are being saved annually.

Access to the patented drugs under TRIPS

In April 1994, with the conclusion of the seven-year long Uruguay Round of multilateral trade
negotiations, a wide-ranging international agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS) was finalized. The agreement entered into force with the formation of the
World Trade Organization (WTO) in January 1951. India became a party to the TRIPS Agreement
in April 1994. At that time, India’s current enactment of the Patent Act of 1970 directly
contravened Article 27 of the TRIPS Agreement. Upon coming into effect on January 1, 1995,
TRIPS set out transitional periods for WTO members to introduce legislation complying with the
obligations under TRIPS. After a three-stage amendment process since entry to WTO in 1995,
India entered into TRIPS compliant new patents regime with effect from 1 January 2005. As the
Patents Act, 1970 underwent these amendments and product patent regime re-emerged, a
discontent Indian pharmaceutical industry faced the impact.
Patent Laws and Pharmaceutical Industry
Protection of intellectual property rights in India continues to be strengthened further. The year
1999 witnessed the consideration and passage of major legislation with regard to protection of
intellectual property rights in harmony with international practices and in compliance with India's
obligations under TRIPS. The Government of India has taken several measures to streamline and
strengthen the intellectual property administration system in the country. Projects relating to the
modernization of patent information services and trademarks registry have been implemented with
help from WIPO. The Government of India is implementing a project for modernization of patent
offices at a cost of Rs.756 million incorporating several components such as human resource
development, recruiting additional examiners, infrastructure support and strengthening by way of
computerization and re-engineering work practices, and elimination of backlog of patent
applications. An amendment to the Patent Rules was notified on June 2, 1999 to simplify the
procedural aspects.

The Trade Marks Registry is also proposed to be further strengthened and modernized. A project
for modernization was earlier implemented during 199396. Further strengthening of the Registry
is being taken up at a cost of Rs.86 million. The main thrust now is to strengthen the infrastructure
of the Trade Marks Registry and the early removal of backlog of pending applications, transfer of
records to CD- ROM’s, re-engineering of work processes, appointment of additional examiners,
etc.

As regards the aspect enforcement, Indian enforcement agencies are now working very effectively
and there has been a notable decline in the levels of piracy in India. In addition to intensifying
raids against copyright infringers, the Government has taken a number of measures to strengthen
the enforcement of copyright law. Special cells for copyright enforcement have been set up in 23
States and Union Territories. In addition, for collective administration of copyright, copyright
societies have been set up for different classes of works.

Product Patents and Prices of Drugs

The debate on impact of product patents on the pharmaceutical industry in India 2 has centered on
the issues of price of the patented product and their accessibility. The positive association is
observed between stronger protection and prices of the drugs, also the prices declined with the
expiry of patent. The adoption of process patents along with the domestic regulations that restricted
the role of Pharmaceutical Industry of India has reached a position of near self sufficiency in
formulations. After long experience of having a negative balance of trade in pharmaceutical

2 Bioinformatics Institute of India, Biomedical Intellectual Property Management 116-36 (Noida, Bioinformatics
Institute of India)
products, India started enjoying positive balance of trade from the late 1980s. In production volume
India accounts for 8% of world’s pharmaceutical production and is the fifth largest in the world.

Irrespective of the competition, because of the socio welfare implication of the pharmaceutical
prices, all over the world other than US, the prices of medicines are subject to government
regulations. In some counties the government meets the part of bill. Most of the governments list
the drugs, which qualify for reimbursement and the extent to which they do so. In absence of such
health security schemes and with the very low purchasing power of the people in India, the
government of India has brought certain essential drugs under the price control. The price control
along with the amendment of patent laws in early 1970s resulted in a declining impact on prices.
In India three factors have contributed to the lower cost of production: 1) the process development
capacity of the units; 2) severe competition among the firms and 3) relatively lower cost of
production. The comparison of patented drugs introduced elsewhere in the world shows that prices
of the drugs had increased manifold after the protection. In the other side, developing countries
may not be affected by the increase in the price of the drug due to low participation of patented
drugs, because dynamic domestic players in India have managed to introduce substitutes of the
patented products within four or five years after their appearance in the world market.

Impact of Weak Protection System

One of the major advantages of the universal system is that, it would facilitate access to new
medical products. While welfare loss due to possible price increase in the post WTO regime is
high lightened in the most of the studies, the welfare loss due non introduction of new patented
drugs in India due to the weak protection regime is not discussed adequately. In this context, one
of the advantages of the product patents is that the stronger patents will provide access to the latest
inventions in the drugs, which the developed world will not shy away from introducing in India.

The drug prices in India were brought under control based on recommendations of Hathi
Committee, which observed that since the drugs industry has a social responsibility, it should
operate much above the principles of trade for profit. However due to repeated plea of the industry
that the drug production was becoming unprofitable, in 1986, government reduced the number of
drugs under control from 347 and 166. Yet in spite of the price reduction in India, over a period of
15 years from 1980, there has been a general rising trend in the prices especially of essential life
saving drugs recently, where as the finance ministry under which DPCO is monitored has
announced the decision to reduce the number of drug under price control.

The pharmaceutical policy 2002 indicated a drastic reduction in number of drugs under price
control. According to the industry sources, the new DPCO would cover about 34 bulk drugs and
their formulations under control. Despite the price controls, monitoring and enforcing such prices
has been very poor in India where, significant differences persisted between the prices charged by
different manufactures for the same formulation.
Global Status of Indian Pharmaceutical Industry
The media giants like the New York Times coming out with misguiding editorials 3, possibly aimed
at stifling India's strength and powers in science and technology. It is important yet to analyze
threadbare whether the new Patent Act is a sell-out or a well planned game plan to isolate India at
the WTO. Without reforms, India would not have reached such dizzy heights. It yet does not select
Indian companies to seek extra protection on their home turf. Ironically, these pharma majors are
also filing patents abroad and are doing roaring business in the very countries where patent laws
are strictly in force. It also demeans the well-established strength of the Indian intellect that is
headed for the destination 2020.

There is a concerted move to crush India's science and technology skills. The well-known British
think-tank Chatham House ran a seminar entitled, "Can Indian research changes the paradigm of
the global pharmaceutical industry?" After the conference many Indian companies showcased their
research. Consequently, streams of foreign R&D heads have been arriving in India to seek
partnerships with Indian companies across the whole pharma supply chain including clinical,
discovery, herbal research and manufacturing.

Robert Blackwill, former Dean of Harvard University and Ambassador to India said, "There has
been a sea change in attitude by the people of India towards patents as they reap the benefits of the
knowledge economy. The science and technology prowess of India is cutting edge and she must
take her rightful place, along with China at the head of developed economies."

Similarly, in the 229th meeting of the American Chemical Society, the policy makers noted that
scientists from India would soon be able to have the most innovative products outclassing the
Americans. While a new drug development costs touch $1.5 billion overseas, it is an established
fact that India can produce state-of-the-art drugs at a fraction of that amount leveraging on low
cost, high quality, speed and large patient profile.

Together with the presence of largest number of US FDA approved plants outside 4 the USA,
producing high quality drugs at lowest cost, India is in an enviable position to take on the best in
the world. It is this reality that is causing worries for the policy makers in the West.

The Patent Act, 2005 can in no way influence cost of drugs. The government has taken care that
drugs patented before 1995 are not covered by the patents. These include the drugs in the WHO
essential list. With over 20,000 competitors, market forces will keep the prices under control. Rise
in prices, if at all, would be more due to illogical policies of the finance ministry and rising duties
and taxes than the patent law. In India, 97 per cent of drugs are off patent and are manufactured by

3Sarah Hiddleston, “Patent Trouble”, Frontline, February 23, 2007 at 131.

4M. D. Nair, “From Local to Global- The Growth Path for Indian Pharmaceutical Industry”, The Pharma Review,
December, 2006 at 37.
a vast number of companies. Besides, physicians will always have the alternative of using older,
cheaper but equally effective molecules to treat patients.

The new Patent Act Ordinance, introducing the long awaited product patents. The Ordinance
includes several provisions aimed at rationalizing timelines, allowing flexibility and reducing
processing time for patent applications. The new Act will boost R&D and will help to bring in
foreign direct investment in the industry and contribute to improved healthcare. There are three
areas where India will continue to lag behind in ushering in World Class IPR standards. The first
is that India should join other leading countries and progressive nations in moving away from pre-
grant opposition. The Ordinance as announced will provide representation by third parties and
lengthen time for grant of Patent. The second area of concern for the Industry are the existing CL
provisions that go much beyond national emergency and extreme urgent situations, public health
crises and anti-trust situations. Broadening the scope of CL can lead to unfair commercial gains to
favored companies. The third area of concern for the research based manufacturers is that a new
provision has been added in the Ordinance that treats patent holders in respect of mailbox
applications on a discriminatory footing in so far as them being denied the rights and privileges
from the date of publication retrospectively.

The Patent Amendment opens up vast opportunities for the Indian pharmaceutical firms. Large
companies like Ranbaxy, Nicholas Piramal, Dr Reddy's, Wockhardt, Lupin etc, are investing
heavily in R&D and in a few years should be able to launch their own patented molecules all over
the world. We also have the largest number of US FDA approved manufacturing facilities outside
USA. Therefore, India is poised to emerge as a significant player in the area of generics. There is
an apprehension that medicine prices are going to go through the roof in the product patent regime.
This is a myth propagated by some sections of the industry. Over 97% of the drugs in the WHO
list of essential drugs are already out of patent, and will continue to be available at current prices.
And there are several therapeutic equivalents available for the rest. The NPPA will keep on
monitoring medicine prices. As such, medicines contribute to only about 15% of healthcare
expenditure. The bulk of the expenditure (85%) comes from diagnostic tests, hospitalization,
doctor's consultation fees etc. Therefore, this obsession with medicine prices in India is not
warranted.

Big pharma companies may enter India, not just to set up their own facilities but also to actively
partner with Indian scientists, academic institutions and hospitals. Kerala, Maharashtra and Gujarat
are already leading in clinical trials and work done there is accepted even by the foreign regulatory
agencies, where quality requirements are most stringent. India, by not reneging on its commitment,
will now be part of the global knowledge economy. This, in turn, would increase manifold cross
border research, alliances, outsourcing, contract manufacturing, clinical research and in-
licensing/out-licensing of products and services. Consequently, this would also bring in a paradigm
shift in the pharma industry worldwide, enabling India to take rightful place at the head of the table
among the developed nations. This would also mean that Indian drugs would move up the value
chain.
The opportunity for the MNC pharma is improving their growth by launching patented new
products. However, just having the Patent Law on paper will not be enough inducement to launch
patented products. Once the TRIPS compliant law is in place the MNC's will monitor its
implementation and if they find that it is being done in a transparent and fair manner only then
they will launch their products. MNC's are also requesting the government to provide data
protection to the safety and efficacy data developed by them through costly and time consuming
clinical trials. All over the world in countries such as USA, Europe, China, Korea, Singapore etc,
data protection is in force. We have recommended to the government that at least 5-year of data
protection is granted from the time of marketing approval. It is necessary for the government to
provide an environment of IPR protection that fosters innovation and stimulates launch of patented
molecules, which will result in better healthcare for all. Another opportunity for MNC's is to enter
into alliances with domestic companies for generic drugs sourcing for use by their overseas
formulations plants. Again the local manufacturing units of MNC's can be utilised to manufacture
bulk drugs and formulations for global supply to other affiliates.

The global pharmaceutical industry is under tremendous pressure to reduce costs. While the drug
discovery cost has ballooned to a reportedly US $ 1 billion per NCE the R&D productivity is
continuously declining. The global industry, therefore, is looking for cost containment through
outsourcing and India offers tremendous opportunity in the area of contract R&D, manufacturing,
clinical trials, bio-informatics, custom synthesis, technical services etc.

India will emerge as a leading country in the world pharmaceutical market. Many Indian
companies like Ranbaxy, Dr Reddy's, Wockhardt etc, have begun international operations which
will make a significant contribution to their turnover. Exports will be the major thrust of the
industry, in the Post Product Patent Era. Also, the manufacturing costs for formulations would be
half of what it is in the developed world due to lower costs of inputs. MNC's may make their Indian
manufacturing facilities "centers of excellence" for supplying to other countries. Partnering for
developing NCE's by outsourcing to India offers tremendous cost advantage without sacrificing
on quality. The biopharmaceuticals market is also evolving very fast and the Indian market is
flooded with biogenerics like erythropoietin, filgrastim, tPA, Interferon, human insulin, vaccines,
etc. In fact India is likely to emerge as one of the largest producers of vaccines in the world in few
years time.

China brought world-class patent act and data protection laws years before it was required to for
similar reasons. Although it is behind India in research and development, it seems to be catching
up quickly and is pouring billions of dollars in life sciences and biotechnology. Singapore,
Thailand and Korea, too, are leaving no stone unturned to be on the forefront in the area of
knowledge economy.

IP is a journey and will evolve over time as has happened in cases of telecom, insurance sectors.
These sectors, due to new legislations, not only have witnessed steep fall in costs, the quality has
also improved manifold. It is not by accident that CSIR5-6-10 has filed largest number of patents
abroad. It only shows that the Indian intellect is capable of creating its own space given the freedom
to spread the wings of its intellect to its full potential. The patent law is a step that would help in
opening of knowledge centers in the Indian villages and lead us to be a developed economy in the
coming decades.

In the case of-

Big Pharma vs. Nelson Mandela (1998)

This is a case from South Africa of February,1998. In February 1998, the South African
Pharmaceutical Manufacturers Association and 39 mostly multinational pharmaceutical
companies took the Government of South Africa to court, saying that its attempts to increase the
availability of affordable medicines violated both the South African constitution and the TRIPS
Agreement.
The Amendment Act introduces a legal framework to increase the availability of affordable
medicines in South Africa. Provisions included in the Amendment Act are generic substitution of
off-patent medicines, transparent pricing for all medicines, and the parallel importation of patented
medicines.
U.S govt. & European govt. pressurized the South African govt. to repeal the amendment in there
legislation.
AIDS activists effectively highlighted these policies , profoundly embarrassing then-presidential
candidate Al Gore. As a result of increasing public pressure, the United States changed its policies
at the end of 1999.
The widely publicized South African court case brought two key issues out into the international
arena. First, the interpretation of the flexibilities of TRIPS and their use for public health purposes
needed clarification to ensure that developing countries could use its provisions without the threat
of legal or political challenge. Second, it became clear that industrialized countries that exercised
trade pressures to defend the interest of their multinational industries could no longer exert pressure
without repercussions at home.
E Hoffmann La Roche Ltd. v. Cipla Ltd (2012)
A patent application was filled for Tarceva a medication got from Erlotnib for treatment of lung
tumor in 1996. The Drug Controller General of India offered endorsement to Roche for showcasing
Tarceva in India offered endorsement to Roche for advertising Tarceva in India in 2005. The Cipla

5 Aarthi Ramchandran, “Govt set to change Patents Act”, Money, December 09, 2004 at 73.
6 Nithya Subramanian, US pharma lobby seeks changes in Patents Act,
http://www.thehindubusinessline.com/2005/07 /29/stories/2005072900281400 (January 23, 2008).
10Harinder S. Sikka, Patent Act- Beginning of a New Era, http://www.ipfrontline.com/depts/article.asp?i

d=2518&deptid=6 (January 21, 2008).

brought its nonexclusive form by the name Erlocip in 2008. The once every day tablet cost of
Roche is about Rs. 4800, while Cipla's bland variant expenses about Rs.1600. In this the rule was
set around the court that public welfare will be given priority over patent right because it’s a need
of a developing country and ‘step ahead of ladder to become a developed country’and Delhi High
court declined to give brief directive and enabled Cipla to advertise its non exclusive /generic
medications.

Conclusion of this project :

Access to essential medicines can be affirmed as a human right on the basis, not only of the right
to health under Article 12 of the ICESCR, but also on two other rights set out in the ICESCR,
namely, the rights "to the protection of the moral and material interests resulting from any
scientific, literary or artistic production" (as enshrined under Article 15(1)(c)) and "to share in
scientific advancement and its benefits” (as per Article 15(1)(b)). The former is the human rights
basis for intellectual property protection, according to which creative ideas and expressions of the
human mind that possess commercial value receive the legal protection of property rights called
"intellectual property rights". There is an apparent contradiction between these two rights when
applied to access to medicines: Article 15(1)(c) seems to protect the "right" of pharmaceutical
companies to earn a profit from the drugs they develop, by setting prices that render medicines
inaccessible to the destitute sick, while Article 15(1)(b) seems to protect the "right" of those
destitute sick to benefit from the development of new drugs. The authors suggest that the way out
of this dilemma is to distinguish intellectual property rights from human rights and consider them
a temporary monopoly established for the valid social purpose of encouraging scientific invention
and artistic creation. In other words, an IPR is a legally protected interest of a lower order than a
human right, which implies a superior moral and legal claim. This distinction should not be
interpreted to imply that IPRs do not have social value for, indeed, they have a very high value,
justifying limiting Article 15 rights reasonably to promote innovation and creativity.

It also needs to be emphasized that there is a looming need to make the system more responsive to
the needs of developing countries and the least-developed countries (LDCs) so that they may take
steps for the realization of human rights, including the rights to health and food, without any threat
of economic sanction and litigation before the WTO dispute settlement mechanisms. At the WIPO
Conference on ‘Intellectual Property and Public Policy’ in July 2009, the Director General of
WTO, Pascal Lamy, while re-affirming the objective of Doha Declaration to be the accessibility
to ‘cheaper drugs for the poor’, said that ‘the international IP system cannot operate in isolation
from broader public policy questions such as how to meet basic human needs for health, food and
a clean environment.’ However, attaining such standards can be possible only and only if the
developed countries are willing to cut down the profit margins of their pharmaceutical industry
and ensure that proper measures are being taken in order to fight fatal global diseases such as
AIDS, TB, etc.
Analyzing this subject from the Indian point of view; the changes to the Patents Act, 1970 could
enable it to continue playing the pioneer role that it played in the pre-TRIPS period, making drugs
available at cheap prices to consumers both domestically, and around the world. The Act has some
clear provisions to protect the interests of the domestic generic manufacturers. The amended
Patents Act has an effective opposition system for challenging frivolous patents, limited
patentability exceptions, elaborate provisions pertaining to compulsory licensing, and parallel
importation. In addition, the National Pharmaceutical Pricing Authority (NPPA) and India’s price
regulatory policy, the Drug Price Control Order (DPCO), could play a key role in keeping a check
on prices.

While addressing the issue of access to medicines, and the right to health, this new global patent
regime could herald the beginning of a new chapter, provided the provisions in the new laws are
utilized effectively and with global harmony.

Annotated Bibliography

1. Kishan Arora, The Patent Act, 1970 (39 of 1970) 1-4 (New Delhi: Professional Book
Publishers, 2007)

An authentic book by an outstanding author, update with all topical issues on patent law in a
globalized world including trade secrets, patenting of biotechnological products, DNA Sequences,
plants & animals, computer related inventions, methods of business, rights of publicity of
celebrities, presentation of information and the like. The Latest amendments with major changes
adequately reflected upon.

2. Ayyangar Rajagopala, Report on the Revision of the Patents Law, Government of India,
1959.

After the chaos regarding non-affordability of drugs the Indian government in 1957 appointed a
committee under the chairmanship of justice Raja Gopal Ayyangar to find some solution to the
problem. The report was inspired by the Indian constitution which ensures social economic justice.
Article 21 of constitution which ensures the right health to citizen was the guiding philosophy
behind Ayyangar.

3. S. R. Chaganti, Pharmaceutical Marketing in India 1-36 (Hyderabad, Pharma Book

Syndicate, 2005)

This note talks about the continuous success of India in the field of pharmaceutical industries.
Today India is considered as one of the most leading sector of Generic drugs/medicines in the
world.

4. H. Brennan, R. Distler, M. Hinman, and A. Rogers, “A human rights approach to

intellectual property and access to medicines,” Global Health Justice Partnership Policy
Paper 1, Yale Law School and Yale School of Public Health (September 2013)

This research paper of Yale Law School says that, the US pharmaceuticals lobby estimates that it
currently loses more $1.7 billion annually because of India’s insufficient intellectual property
protection.

5. Bioinformatics Institute of India, Biomedical Intellectual Property Management 116-36

(Noida, Bioinformatics Institute of India)

In this Institute the debate was held on the price of drugs which was raised due to Patentability of
drugs.

6. Sarah Hiddleston, “Patent Trouble”, Frontline, February 23, 2007 at 131.

This footnote talks about that, how the Indian Pharmaceutical Industries reaches the hike in the
world. It was basically due to the changes in WTO reforms. On the other side the media giants like
the New York Times coming out with misguiding editorials, possibly aimed at stifling India's
strength and powers in science and technology.

7. M. D. Nair, “From Local to Global- The Growth Path for Indian Pharmaceutical
Industry”, The Pharma Review, December, 2006 at 37.

This footnote talks about that very soon India is going to lead the pharmaceutical industries in the
world. Together with the presence of largest number of US FDA approved plants outside the USA,
producing high quality drugs at lowest cost, India is in an enviable position to take on the best in
the world. It is this reality that is causing worries for the policy makers in the West.

8. Aarthi Ramchandran, “Govt set to change Patents Act”, Money, December 09, 2004 at 73.
9. Nithya Subramanian, US pharma lobby seeks changes in Patents Act,
http://www.thehindubusinessline.com/2005/07 /29/stories/2005072900281400 (January
23, 2008).
 10. Harinder S. Sikka, Patent Act- Beginning of a New Era,
http://www.ipfrontline.com/depts/article.asp?i d=2518&deptid=6 (January 21, 2008)

These footnote talks about the Global Status of Indian Pharmaceutical Industry. IP is a journey and
will evolve over time as has happened in cases of telecom, insurance sectors. These sectors, due
to new legislations, not only have witnessed steep fall in costs, the quality has also improved
manifold. It is not by accident that CSIR has filed largest number of patents abroad. It only shows
that the Indian intellect is capable of creating its own space given the freedom to spread the wings
of its intellect to its full potential. The patent law is a step that would help in opening of knowledge
centers in the Indian villages and lead us to be a developed economy in the coming decades.