1. Intellectual property rights: Patent grants jump by nearly half

Intellectual property rights: Patent grants jump by nearly half

The easing of the procedures for appraisal/grant of intellectual property rights (IPRs), announced in May 2016, has resulted in far quicker disposal of applications and reduced the backlog substantially.

Published: March 3, 2017 7:12 AM
Intellectual property rights, IPRs, IPR filings, TRIPS, DIPP, PWL, MNCs, Adheesh Nargolkar, Khaitan & Co The easing of the procedures for appraisal/grant of intellectual property rights (IPRs), announced in May 2016, has resulted in far quicker disposal of applications and reduced the backlog substantially. (Reuters)

Surbhi Prasad

The easing of the procedures for appraisal/grant of intellectual property rights (IPRs), announced in May 2016, has resulted in far quicker disposal of applications and reduced the backlog substantially, reports Surbhi Prasad in New Delhi. Grant of patents saw an increase of 48.5% in April-January 2016-17 compared with the year-ago period, while that of trademarks surged 182%. This was even as IPR filings generally saw a flat year-on-year growth.

In the first 10 months of this fiscal, up to 18,923 patent applications have been disposed of, up 52% from the corresponding period last year, while the disposal of trademark filings witnessed a whopping 248% jump. The big increase in the manpower with the patent department also contributed to the drive. The trend, according to analysts, signifies the government’s bid to address concerns over the allegedly tight patenting rules in the country by way of simplified procedures and efficient disposal of applications. However, New Delhi continues to be firm on retaining the substantive provisions in its IPR laws, including the Section 3(d) of the Patents Act that is meant to ensure that incremental drug inventions are patented only if they brought about significant increase in the product’s therapeutic efficacy.

The government has been under tremendous pressure from research-oriented multinational pharma companies based in the US — touted as the Big Pharma — for dilution of Section 3(d). While a drying up of new potentially blockbuster drugs in the Big Pharma’s R&D pipeline is seen to be the reason for the demand, India is clear that its patent laws are fully TRIPS-compliant.

Last year, the government had unveiled the national IPR policy to focus on issues like expediting approval processes involving patents or trademarks and consolidating institutional mechanisms to create a robust IPR ecosystem. The system is also aimed at encouraging Indian innovators to file more patent applications.

“We needed manpower to clear the backlog… With the recruitment of 458 patent examiners last year, which resulted in a fourfold increase in such manpower, we did bring it down,” an official from the department of industrial policy and promotion (DIPP) said. The department is looking at amending the trademark rules next month which would further simplify the process and speed up disposal of applications, the official said. “There would be a major simplification in the process, major reduction in the number of rules,” he added.

However, these steps are unlikely to pacify the US. It is unlikely that the US trade representative will exclude India from its priority watch list (PWL) of countries with weak/ineffective IPR regimes anytime soon. The Indian Pharmaceutical Alliance (IPA), which comprises top-notch domestic drug companies, has recently dispatched a letter to the USTR, making a strong case for removal of India from the PWL in its 2017 edition. The previous edition included India for allegedly failing to adequately protect IPR in its pharmaceutical sector and expressed concern about the lack of clarity on standards for sections 85 and 92 of the Patents Act pertaining to compulsory licence (CL).

While under Section 85 only a single issue of grant of compulsory licence by India and a solitary refusal had been reported prior to 2016, no case was reported in 2016, IPA noted. CL is a TRIPS-compliant mechanism under which the signatory nation can allow a local firm/s to manufacture a patented drug under certain defined circumstances, namely, “extreme urgency”, “national emergency” or “public non-commercial use”. “There are attempts by Big Pharma of the US to push India to undertake commitments that are beyond what the WTO’s TRIPS agreement prescribe,”IPA secretary general DG Shah said.

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“The MNCs are not liking the fact that because of Section 3(d), patents which are being granted in other jurisdictions are not being granted to them in India,” said Adheesh Nargolkar, partner at Khaitan & Co. He added that Indian courts have granted exemptions, restraining generic players from infringing MNCs’ patents. “There have been many cases where in patent (held by MNCs) have been enforced by courts,” he said.

Recently there have been questions on existence of Section 3(d) and the defining of term efficacy in that section.
“Indian courts have granted and are granting exemptions restraining the generic players from infringing the MNCs’ patent. There have been many cases wherein patent have been enforced by the MNCs,” Nargolkar said.

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