No patent is granted in India for the
end product in the case of food, medicinal items or chemical substances.
Legal protection of such items only cover the method or process of manufacture.
This means an imitator can escape the charge of infringement by producing
a product already patented with minor variations in the process of production.
A patent may be viewed as contract between
a nation and the inventor giving the inventor exclusive right to manufacture,
use or licence his invention for a specific period and in exchange the
inventor describes the details of his invention to permit those skilled
in the art to employ it and it rewards the patentee a legal monopoly to
make use of his invention to his economic benefit.
Some examples include New Chemical entities,
new process of manufacture, new composition of matter new fermentation
process.
Some examples are methods of detection/diagnosis
or treatment of disease, analytical methods, methods of agricultural cultivation,
set of cards or games.
Indians were very good in Process Technology
and Indian Scientists could develop their own process once any new molecule
was introduced overseas and the molecules were introduced in Indian Market
within a span of 3 to 5 years. This is because India was not a signatory
to the Paris Convention and was not member of GATT at that time. New molecule
introduction with minor variations in process technology by Indian companies
was called as PIRACY by original Researchers.
However, with the policy of Industrial
Liberalisation and to bring a global discipline, a number of issues connected
with International agreement on trade related Aspects of Intellectual Property
rights have been discussed and the negotiations concluded in 1993. The
outcome of the final Uruguay round of discussion is the GATT Agreements,
1994, the final text signed by 115 countries who are members of WTO.
The GATT agreements cover every aspect
of international movements of goods and services alongwith protection and
enforcement for technological innovation. The Salient features of GATT
are :-
-
Trade related intellectual property
rights (TRIPS)
-
Trade related investment measures
(TRIMS)
-
Trade in services<196>agreement
(GATS)
The objective of the TRIPS agreement
is protection and enforcement of intellectual property rights to promote
technological innovation and to the transfer and dissemination of technology
for the mutual advantages of producers and users of technological knowledge.
It contains specific provisions and scope of Patentability of Drugs and
agrochemicals. The TRIPS agreement also provides that patents shall be
available and patent-right enjoyable without discrimination as to the place
of invention, field of technology and whether products are imported or
locally produced. On fulfilment of certain conditions Exclusive Marketing
Rights (EMR) will be allowed to the patentee to protect the innovations
or product patent and prevents other from making, selling or distributing
such products even if manufactured by alternate process.
Since Patentability extends to products
or process the terms of the patent would be applied for twenty years for
Product patent and then twenty years for process patent, particularly in
the chemical field including drugs and pesticides. In the case of drugs
and medicines, patents will be available for its usage forms. dosage forms
and their combinations. New process would be patented and new dosage forms
etc. would also be patented and this kind of monopoly protection in some
forms or the other, would in a period of 10 to 15 years, cover almost 70/80%
of turnover in the pharmaceutical industry.
-
TRANSITIONAL ARRANGEMENTS
Under TRIPS agreement, developing countries
including India are entitled to delay the enforcement by ten years for
amending their Patent rules and regulations. Indian Drug industry shall
have access to manufacture the drugs which are currently under Patent as
a result of filing application before 01.01.1995 in any country in the
world and the off-patent drugs in the generic forms, provided that the
processing technology is developed in India.
-
IMPACT OF PATENT REGIME ON PHARMACEUTICAL
INDUSTRY
The specific fall out of the changes
that would be made in the patent laws on the basis of the provisions in
the TRIPS agreement would be manifold. The consumer will be hit by high
prices and erratic availability of pharmaceuticals, medicines etc. and
the domestic industry would face the question of survival.
It is accepted that pricing includes
developmental expenses. Beginning with R&D expenses to the stage of
plant and machinery, all expenses go to the costing of finished product.
But the amount recoverable on an annualised basis is related to both the
market forces and the laws of the land. The main impact of the proposed
globalisation of patents would be on the prices of medicines which would
go up several times higher making it extremely difficult for the poor people
of India to afford them.
The availability of new drugs from indigenous
sources of the domestic companies would be totally out of question. Dependence
upon imports would go up.
-
IMPACT ON MEDIUM & SMALL SCALE
SECTOR
The existing industry, particularly
in the medium and small scale sectors will over a period of a decade or
so after the introduction of new patent regime, face serious degrowth as
they will have no possibility of taking up new products. Even for the existing
products or process, new patents will be taken, creating difficulties for
companies to market their existing products.
With the acceptance of TRIPS, transfer
of technology is likely to accelerate. Most of the leading drug multinational
companies are present in India having substantial equity participation
in their Indian counterparts. With the policy permitting them to increase
the share-holding, they have already expressed interest in bringing their
latest technologies to manufacture additional bulk drugs to improve present
facilities.
Indian indigenous sector have better
opportunities to enter into technical collaboration with the firms underrepresented
in India.
Most of the new drugs permitted during
the last five years are still covered by the patent and their formulations
in India are manufactured from imported bulk drugs. The sources of such
imports are mostly other than the original manufactures and are likely
to dry out as a result of GATT. Their continued availability will depend
upon the development of alternate technologies or on technical collaboration
agreement.
-
IMPACT ON RESEARCH & DEVELOPMENT
To establish an identity in the International
market, Research and Development activities have to be strengthened with
substantial investment by Indian firms. As a result of the availability
of the patents in drugs and medicines, Multinational companies will not
be interested to establish separate R&D centres in India. If fact,
it will be difficult for domestic companies to be able to match multinational
companies potential in R&D sector, sales turnover and world-wide infrastructure
for patenting and promotion of their products. Further to achieve significant
performance on the basic R & D front in India, Government will have
to come forward in a big way to support public and private efforts on a
long term basis.
-
FUTURE STRATEGIES TO FACE NEW CHALLENGES
Now that the GATT is a reality and will
come into force within agreed time-frame, the Indian companies are visualising
the best possible means to encounter the situation.
The more forward looking and internationally
minded among them have evolved a two-fold strategy :
-
To strengthen R&D capabilities
during the 10 year transitional period.
-
To enter into strategic alliance
with research-based companies abroad for setting up joint ventures in India
or licensing in patented new Drugs.
Both the Government policy of granting
automatic approval for joint ventures in which foreign investment is up
to 51 percent (which is applicable to the Drug industry) and the new incentives
being considered for total R&D should go a long way to encourage indigenous
companies to adopt the future strategy. |