Once wedded to patent, the government should take all steps to ensure that holder’s rights are fully protected
In recent times, MNC pharmaceutical companies have approached Indian courts seeking to prevent regulatory authorities from granting market approval to generic companies for drugs they hold patent.
Thus far, the courts have acted in a denial mode. In the 2010 Bayer-Cipla case, a division bench of the Delhi High Court had refused to ask the government to link the patent status of a drug to grant of market approval for generic version.
Recently, US drug giant Merck Sharp & Dohme petitioned the court to restrain an Indian firm Glenmark from making and selling anti-diabetes drugs which violated its patents in India. Like in Bayer-Cipla case, a single-judge bench of the Delhi High Court rejected stance taken by Merck.
The grant of a patent confers ‘exclusive rights’ on the patent holder for manufacturing and marketing of a product. Thus, during the term of patent, any person keen to make and/or sell cannot do so without seeking prior consent of the patent holder.
In the case of drugs and crop protection products (CPPs), any person/entity wishing to import/make and sell a product has to take approval of the concerned regulator—the Drug Controller General of India (DCGI) and the Central Insecticides Board & Registration Committee (CIB&RC), respectively.
The DCGI grants registration for drugs under the relevant provisions of the Drugs & Cosmetics Act (1944) whereas the CIB&RC does so for CPPs under the relevant section of the Insecticides Act (1968). Under extant arrangements, DCGI/CIB&RC while considering applications for registration do not take cognisance of the existence of patent—suo motu or even when the patent holder brings it to their attention. After a thorough scrutiny and satisfaction about the claims in particular, ‘efficacy’ and ‘safety’ of the product and compliance with various conditions laid down in provisions of the act and rules, these regulators grant market approvals.
Thus, two actions (by different wings of the government)—the grant of market approval by DCGI/CIB&RC and grant of patent (by the Controller General of Patents & Trademarks)—are totally independent and governed by their respective acts and rules. The stance of MNCs is that an ‘inherent’ link between these two actions should be recognised. Given far-reaching ramifications and substantive questions of law, the matter is now before the court.
For ‘other’ products where approval by the government is not involved, the matter is not so much complicated. It is a straight interface between an entity wishing to make and sell a patented product and patent holder.
In drugs and CPPs, however, the risk of patent infringement may get tempered/circumscribed by an action of government (read regulatory authority) in approving the product. Having set up facilities for making and selling the product ‘upon authorisation given by the government’, how could patent holder/company dare undermine his act! Legally though there is no bar on patent holder to go to the court and seek compensation/damages (regulator can’t stop him), the infringer does get emboldened and perceives registration as a shield. Ideally, where a patent exists, a generic company must not venture into that territory and submit an application—unless it has prior consent of the patent holder. That indeed is the raison d’être of a patent and should be honoured by all stakeholders.
Alas, such scenarios do not exist in the real world! Submission of applications despite full knowledge about existence of patents is a matter of routine. The generic players are also emboldened by protracted delays by courts in pronouncing decisions. The Patent Act and the rules there under allow for the possibility of post-grant opposition. A patent challenger (generic player) has only to gain by this act as he can run his business unhindered with full regulatory backing. Third-party interests, especially employment, consumer protection, etc, too get a tinge of permanency. That does not bode well for the innovator to get a fair deal as then the courts are prompted to take into account other considerations as well.
In medicines, these have a profound appeal. Indeed, TRIPS flexibilities allowed to member governments are built around the edifice of making uninterrupted supplies at prices ‘affordable’ to millions of patients.
In view of the above, expressed concerns of MNCs that regulatory authorities are facilitating infringement of the patent (albeit indirectly) are not without basis. As it is, an innovator passes through tough terrains to get a patent. And when he gets—after a long wait—effective protection period or residual patent term (clock starts ticking from the date of application filing) is too little. Now, if a generic company gets into manufacturing and marketing of the product from the day one, that would tantamount to adding salt to the injury of innovator! While the latter makes all the efforts, the former enjoys the fruits.
Clearly, innovators are sandwiched between regulatory actions enabling prompt entry of generic companies on one hand and protracted delays and uncertainties of getting a fair deal through judicial interventions on the other.
MNCs are justified in seeking remedial action. And, since the regulator provides a platform to generic companies to ride piggy back, a natural course of action lies at that level. Therefore the plea for patent linkage.
An argument that regulator does not have expertise in patent-related matters is untenable. All that it needs to know is ‘whether a patent exists’ (it does not have to get in to the process of patent grant, a job done by patent controller).
The suggested linkage should apply only to cases where patent exists and is duly notified. It must not cover instances of mere filing of patents or patent application published, etc, as these may or may not result in patent grant. The only flip-side could be a scenario where a patent gets revoked at some point of time. But, such instances are rare and that should not deter the lawmakers from taking a decision that provides a well-deserved comfort to innovators. The government must not allow its actions to be clogged by pre-patent (amendment) mindset. Once wedded to patent, it should take all steps to ensure that holder’s rights are fully protected. The concept of ‘patent linkage’ needs to be viewed in this spirit.
Published at http://www.financialexpress.com/news/column-a-logical-step-to-honour-patents/1102900/0