INTRODUCTION

India has been one of the leading countries in manufacturing affordable generic drug and selling them in India and in other developing nations. China and India have been supplying essential drugs to low income as well as the middle-income nations. “India supplies 20% of the world’s generic drugs. India is also a producer of 65% of the World Health Organization’s requirement of DPT (diphtheria, pertussis and tetanus) and tuberculosis, as well as 90% of its measles vaccines. ”

Evergreening patents do not effectively contribute to the technological advancement and they limit the market entry of generic drugs which can be a serious issue as it would not help during a national emergency or a public health crisis. Hence, the patents act, section 84 (1) states that after expiry of 3 years from the grant of patent, anyone can apply for compulsory licensing and manufacture generic version of the patented drug. There are three conditions for the same- one is that the reasonable requirements of the public haven’t been fulfilled, second is that the patented medicine isn’t available at affordable price, or that the patented medicine isn’t available in India.

Bayer Corporation v. UOI , decided on decided on 15th July 2014, is the first case in India which dealt with compulsory licensing. The Bayer case is a landmark case as it considers the socio-economic needs of the society as one of the important aspects in delivering the judgment. To give a brief idea of the case- Anodyne Corporation Ltd, hereinafter referred to as the petitioner, developed a drug called Nexavar for treating kidney and liver cancer. This drug was granted patent in 45 countries including India, in the year 2008 and therefore as per section 48, the petitioner got exclusive rights over the drug. Nacto, an Indian drug manufacturing company reached out to the petitioner for grant of voluntary license for manufacturing and selling the drug in India and the same was rejected. On completion of 3 years from the grant of patent to the petitioner in India, Nacto applied for compulsory licensing for manufacturing and sale of the drug for cancer at Rs 8,800/- per therapy and it was granted the same. As per section 87, any person who has an issue regarding grant of patent can file objection, consequently, the petitioner raised its objection before the Controller & the controller granted compulsory license to Nacto while directing it to pay 6% of its net sales as royalty to the petitioner. This petition arose out of this act of granting of compulsory license to Nacto. The petitioner challenged the grant of license as well as the way in which section 94 was applied. On 13th of March 2013, the tribunal upheld the decision of the Controller, however it increased the royalty payable by Nacto from 6% to 7%.

To deny compulsory licensing to Nacto, the petitioner has to establish two things- one is that scope of public interest isn’t a priority in this case, which they failed to establish and secondly, that there will be irreparable harm to them. However, the cost incurred for manufacturing of the drug was recovered in full by the petitioner within a year and therefore after 3 years this argument of not considering the mandate in section 90 1 (i) does not carry weight before the court. “While public interest may seem less important in other cases, cases involving pharmaceutical patent requires a closer look into public interest as the inventions being produced are directly for the health of the public. ”

Bayer contended that their patented drug is required only during the last stage of kidney/liver cancer and therefore not everyone suffering from this type of cancer requires the drug. Hence there is no need for compulsory licensing of the medication. The court rejected this claim, and this can never be carried out in a mathematical basis and instead should be seen on a broad basis. The high court states that “Section 84(7) (a) (ii) of the Act states reasonable requirement of the public is not satisfied, in case the demand for the patented article is not met to an adequate extent.” What constitutes the term “adequate extent” differs from case-to-case basis. It is to be noted that the Doha declaration on TRIPS, 2001 states that there should be flexibility among nations when it comes to ensuring access to medication for the needy.

Public interest has emerged as an important factor in dealing with cases relating to pharmaceutical patents. In the case of Johnson & Johnson Vision Care Inc. v. Ciba Vision Corp. the court considered public interest in denying Cuba Vision a motion of permanent injunction. Ciba Vision has argued than an injunction on Johnson’s contact lenses does not concern public health and it only affect comfort, however the court observed that it is both health and comfort of the public and these two do fall within public interest. India is of the view that any essential patented invention should be accessible by the public and the people cannot be deprived of this to uphold rights of the patent holder and this view is taken in several judgments relating to pharmaceutical patents including the Bayer-Nacto case.

Author: Anna Mariam Koshy,  A Student of Jindal Global Law School, in case of any query, contact us at Global Patent Filing or write back us via email at support@globalpatentfiling.com.

REFERENCES

ACTS/ GUIDELEINES

1. The Patents Act, 1970.

2. UNDP Guidelines for examination of patent applications relating to pharmaceuticals.

3. Office of the Controller General of Patents, Designs and Trademarks- Guidelines for examination of patents application in field of pharmaceuticals.

4. Doha declaration on the TRIPS Agreement and Public Health 2001

ARTICLES

1. Jay Dratler Junior, eBay’s practical effect: two differing visions (2008), Akron Intellectual Property Journal: Vol. 2: Issue.1, Article 2.

2. Rory Horner- Why the world needs vaccines form China and India to beat Coronavirus.

3. Feroz Ali- The Access Regime: Patent Law Reforms for Affordable Medicines.