People's Democracy

PATENT ACT

Third Amendment to Have Disastrous Impact on People

Shyamal Chakraborty 

THE patent act has been revised for the third time and an ordinance issued to that effect.  It is like hastening the death of a dying patient by withdrawing the life support system.

In 1981, Mrs Indira Gandhi said that the concept of an ordered and developed world was bound up with the fact that discoveries of medical science would remain free from the burden of patents and no profiteering would be allowed in matters of life and death.  The Congress of Mrs Gandhi has now issued an ordinance just opposite of what she had said. India would now be burdened with the weighty chains of the patent act.

CONGRESS & BJP IN SAME BOAT

Much water has flown down the Mississippi and the Ganges since Mrs Gandhi’s time.  In 1994, the then defence minister Pranab Mukherjee signed the multilateral trade negotiations. The Trade Related Intellectual property Rights (TRIPS) was put in place.  It was decided at the WTO that no nation could have patent rights of its own except those fashioned after the TRIPS model.

The Patent Act formulated by India in 1970 served as a model for the third world. To make it compatible with TRIPS, three amendments were found to be necessary. Of these, two amendments were effected earlier in 1999 and 2002. The third amendment was put in motion on and from January 1, 2005. The applications for patents, indigenous and foreign, were being received from 1999. The ‘mail box’ will now be opened.

In 1995 the BJP organised protest when the patent bill was placed in Rajya Sabha. On coming to office, however, the BJP rushed through two of the amendments and tried to effect the third one back in 2003. At that time, 44 intellectuals had vehemently protested against these steps being taken about the patent act. On coming to office in 2004, the Congress-led UPA government has no qualms about stepping into the BJP’s shoes and is keen to have the bill passed.

ASPECTS OF THE 1970 ACT

The following were the important aspects of the patent act of 1970:

1. Not to give patents for medicines, and in agriculture and chemicals etc.

2. To shorten the time period of patents to 5/7 years for processes and 14 years for commodities.

3. To demarcate between imports and indigenous production of patented goods.

4. To use compulsory licensing for implementing patents and to spread technology.

5. To fix the upper limits of royalty before the transfer of patents.

The positive sides of this act were as below:

1. Despite the lag-behind in several sectors, progress was made in the production of medicines.

2. Within two to six years of introduction of new medicines abroad, India could produce them through alternative methods.

3. We had quite a success in heavy engineering, aluminium, space and nuclear research, and in the agricultural sector where superior quality seeds have been produced.

4. Invention of more than one hundred basic medicines.

5. Some 40 per cent of antibiotics, 18 per cent of antibacterial, 70 per cent of anti-leprosy, 89 per cent of birth control, and 40 per cent of heart medicines were sold at the cheapest rates in India.

6. Some 90 per cent of the medicines needed nationwide is produced in India whereas the figure stood at only 38 per cent back in 1975.

7. Instead of dependence on imports, more than half of the pesticides and bactericides are now manufactured here.

8. The export of Indian medicines, especially to third world countries, has increased by 25 times or more.

9. The number of drugs producing units have grown by six times.

10. In rupee terms, the total manufacture of drugs has increased by 50 times.

11. India is among the countries where drugs are the cheapest.

MAIN CHANGES

In the earlier two amendments the following principal changes were incorporated:

Granting of patents for monopoly rights to sell commodities in India

1. When the applicant desires to exclusively manufacture and sell the products in India.

2. When the applicant has received patent rights in any other country on or after January 1, 1995.

3. When the applicant, even before receiving the patent for the product concerned, had applied for patent for such articles on January 1 or later.

Even if there is no patent received, the concerned person(s) shall have monopoly rights over the marketing of the product if he had documented and formulated the production process and the product.

The following were omitted by the two amendments:

1. In the event of a famine, epidemic, natural disaster, and the occurrence of or the threat of a particular disease, the union government can give the right of selling and marketing to some other person(s).

2. The union government reserves the right to fix the price cap on any product of public interest.

The NDA and the Congress ignored the suggestions and advice of the Law Commission on the amendments after the passage of the first amendment in Rajya Sabha.

RELIEFS NOT UTILISED

Quoting the former director of the National Bureau of Plant Genetic Resources (ICAR), K L Mehra writes that the non-formal producers of economic assets organised free exchange of knowledge across groups and along the lines to advance and develop agriculture and to improve the standard of living, but without documentation since that was improbable during those earlier times.

Mehra also writes that botanists gathered knowledge from peasants and traditional herbal doctors for free, and that knowledge acquired by generations could not have any property rights attached. Making patents out of these knowledge bases is some kind of a theft.

Mehra cites neem and says patents have been taken out for neem products of various kinds. They include pesticides, bactericides and sweeteners. Indians have been using neem products for centuries. But a recent survey reveals that such herbal products as have been patented represent a value of 48 billion US dollars. Why should not the 250-odd concerns that have organised these patents for themselves provide royalties to the people who own the true intellectual property rights to these products?

Article 27 of the TRIPS agreement clearly states speaks of some amount of relief for the member countries, but the union government has not taken advantage of the provisions.

The Law Commission has stated that patents should not be instituted in (1) symptomatic, investigative, and surgical treatment of humans and animals, and (2) in products and plants directly related to the overall development of a country, its standard of living, conservation, public health, and environment.

The products to be exempted from patents are: (1) the products included in the system of medicine incorporated in the Indian Medicine Central Council Act, which are used by the Indian people, and (2) the products and systems of treatment used for generations by local anthropological groups.

The second amendment to the patent act incorporates in full article 5 of the TRIPS.  The exceptions in this regard, i.e., chemicals, medicines, food articles, and agricultural chemicals, have been duly incorporated in the third amendment as the ‘deadline’ had been set for January 1, 2005.

ANTI-NATIONAL PROVISIONS

There were two aspects of the 2003 amendments. The first was a concern to implement the TRIPS conditionality. Secondly, they were based on certain acts that are anti-national. The promise and political assurance of social security, that was given in the second amendment, has been given a go-by in the third amendment. 

Earlier there was a system where the process could be patented. Now a product itself is to be given a patent. Even similar products produced through alternative processes must have to give a royalty to the patent holders of the original product. As a result, the prices of patented seeds, fertilisers and medicines are bound to go sky-high.

Earlier, a patent could be opposed and appealed against within four months of its grant.  The grounds that could be cited were:

1. The invention being patented is common knowledge and is used in the country publicly.

2. The patented product is not an invention.

3. Geographical facts and material sources have been wrongly quoted to substantiate the patent.

4. The product patented is part of the traditional system of India or of any other country.

But the third amendment stipulates that, other than a representation, no opposition to the patent could be lodged before the patent is implemented. This is clearly a sop because, once its marketing starts, there would be no point in opposing a patent. The representation part does not say anything about the length of the hearing on the protest and the ultimate result.

Argentina and Thailand have protested against this procedure, but not India. Such an act cannot be justified, especially because, at least seven per cent of the patent applications, that is close to 6,000 applications, had been turned down between 1972 and 1987.

POSSIBLE STEPS

By signing the TRIPS agreement, India has become enmeshed in the vortices of the world trade agreement, from which it cannot escape. Until such time when the third world countries unitedly oppose the agreement, some steps could conceivably be taken:

1. Following the example set by China, it could be decided that if the price of a patented product is not fixed even after the passage of a stipulated time, another producer might be compulsorily given a license.

2. The example of some other countries may be emulated and royalty to be given may be limited to four per cent.

3. Medicines patented for internal consumption may be exported to such third world countries as do not produce them. 

4. The applications for patents in the ‘mail box’ must be considered and rampant grant of patents checked.

Disputes are still going on the issue of patenting. Discussions are going on, for example, on micro-organisms. The union government has to desist from haste in implementing the patent act. Compulsory licensing exists in scores of developed countries and these countries have never employed any such indiscretion in the implementation of patenting as does India. As India is in a position to export medicines, at a cheap rate, to other countries needing these products, multinational corporations (MNCs) would close down the import and export of generic medicines to such countries if India desists from such exports.

The Doha declaration on TRIPS agreement and public health clearly states that all agreements on patenting must have people’s interests in mind, and that medicines must not be excluded from the process in this regard.

POSSIBLE IMPACT

The possible impact of patenting will be made clear if one cites certain examples. For one, the cost of a medicine will jump tenfold or more. In case of anti-retroviral drugs used for AIDS cases, the cost would increase from Rs 7,000 per year to Rs two lakh per year. As it is, only 10 per cent of AIDS patients receive treatment of any kind. The cost of Glivek, an anti-cancer drug, will stand at Rs 22,000 per ampoule --- 20 times the present Rs 1,100. No less than 39 life saving medicines will be withdrawn from the Indian market. The country will be at the mercy of the MNCs.

While declaring that the TRIPS agreement must not compromise public interest, the World Health Organisation (WHO) has said that every country must take equal care of the people’s interests along with those of patent owners. A policy must be adopted for the poor and less developed countries whom medicines may be supplied cheap.

Over and above phthisis, malaria and diabetes, the incidence of AIDS is dangerously increasingly in India. Tropical diseases are starting to spread. As per the Doha declaration, medicines must be produced on an emergency basis and compulsory licensing implemented. Compulsory licensing can be used in instances of popular interests, epidemics, natural disasters, and for the conservation of life forms. The TRIPS agreement has the relevant provisions in the various sub-clauses under clause 27.

In the circumstances, why is the union government bowing down and needlessly capitulating before the WTO? Cannot it realise that its job is to safeguard the interests of more than 100 crore people? In many countries of Asia and Africa, demonstrations have started to take place against the changes in India’s patent act, as the people of these countries will be grievously hurt by the increase in the cost of medicines. The reason is that the MNCs will control the markets and supply medicines at prohibitive costs. On December 6, demonstrations were organised before the Indian embassy in Paris. The demonstrators argued that AIDS patients of many African and Asian nations would die as medicines at cheap rates would no longer be available from India. The struggle to pressurise the union government into not putting in place the third amendment to the patent act, indeed to preserve the patent act 1970 itself, must be based on a wide footing, involving every section of the people. The task brooks no delay.