General Awareness

April 04, 2017 @ 01:15 PM

April 04, 2017 @ 01:15 PM

K. J. Somaiya Institute of Management Studies and Research, Mumbai

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Patents in India

Positively General Awareness helps CAT aspirants to gain confidence so with this view we at MBA Rendezvous have started series of articles on General Awareness. 

Today you will read article on : Patents in India

Patent is a form of intellectual property rights (IPR) which apart from patents also includes trademarks, copyrights, geographical indicators etc. A patent is an exclusive right granted for an innovation, which is a product or a process that provides, in general, a new way of doing something, or offers a new technical solution to a problem.
Objective of patent is to grant the innovator of the product or process some benefits where invention/innovation cannot be commercially made, used, distributed or sold without the patent owner's consent. These patent rights are usually enforced in a court, which, in most systems, holds the authority to stop patent infringement. 
In India, patents are governed by Indian Patents Act 1970 which initially provided for the process patents only and not for product patents for food, chemicals and drugs.
Suppose if product has been developed by an inventor, then he can file patent for the process through which that product has been developed and not for that product itself. In the case of inventions being claimed relating to food, medicine, drugs or chemical substances, only patents relating to the methods or processes of manufacturer of such substances were provided. Thus patent act of 1970 emphasized public interest over monopoly rights. 
However, under World Trade Organization (WTO), Trade Related Intellectual Property Rights (TRIPS) agreement provides for product patent for 20 years. After the expiry of 20 years, anyone can manufacture that product. 
All WTO members had to comply with TRIPS agreement before 2005 because of which Indian parliament passed Patent Amendment Act 2005 which brought product patent regime in India. Important features of 2005 Amendment Act and extension of product patent protection to all fields of technology including drugs, foods and chemicals were granted. 
Exemptions under 2005 Act are –
• Frivolous claims contrary to natural laws
• Anything contrary to law or morality or injurious to public health
• Mere arrangement or rearrangement of duplication of known devices.
• A method of agriculture or horticulture
• Inventions related to atomic energy
Further, act also empowers the government to import, make or use for its own purpose. It also empowers import of drugs for public health distribution. It also empowers the government to revoke the patent which is found mischievous to state or prejudices to public. State can also acquire a patent to meet national requirements. 
Patents act is supposed to have most important bearing on the pharmaceutical industry. Drug manufacturing MNCs incur huge cost in the form of R&D for development of new drugs. In order to recover that cost, they sought patent and sell these drugs at exorbitant prices.
After the term of patent (20years) is over, every company is free to manufacture those drugs and price of these drugs reduces drastically as new companies don’t engage in the R&D and its cost is reduced. Such drugs whose patent is expired are called as Generic medicines and Indian pharmaceutical companies produce these generic medicines at mush less cost than their western counterparts.
Under the 1997 patent act, Indian companies could produce these drugs even before expiry of 20 years through different process but after 2005 amendment; they have to comply with the product patent. Therefore, it may have an adverse impact on price of medicines in India as they have to comply with TRIPS.
Bolar Provision
Bolar provision facilitates production and marketing of patented product immediately after the expiry of term of patent by permitting preparatory action by non patent companies during the term of the patent. According to this provision, despite the patent rights, research and tests for regulatory approval does not constitute infringement of patent.
There have been few apprehensions in various quarters particularly for health sector regarding its impact on drug prices as it may rule out the availability of low cost drugs. However, it is said that 97 percent drugs manufactured in India are off patents and will remain unaffected.
Further, legislation has strong provision for the outright acquisition of patents to meet national requirements. Besides, there is also Drug Price Control Order administered by National Pharmaceutical Price Authority. There are also adequate safeguards to protect the interest of domestic industry and common man from any increase in the prices of drugs. 
Although there are adequate safeguards are assured by the government, but some impact on prices cannot be ruled out which will further alienate the poor from the health due to rising cost of medicines.
Since it is also nor immoral on part of the companies conducting extensive research on the development of life saving drugs, treatment can be assured to all the persons through universalization of Health Insurance which may be partially public funded. 
Just like government had imposed cess on petrol and diesel to recover the cost of High development, some cess can also be imposed to recover the cost of universal health programme.  
In 2009-10, as many as 34287 patents were filed out which only 6168 patents were granted. Moreover, only 17 percent of these patents were granted to Indian while rests were granted to the foreigners. In 2010-11, of the total 7,486 patents granted, Indians could claim only 1,272. On the other hand, foreigners walked away with 6,214 patents. In the world, Japan is credited with maximum number of patents.
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