The issue of ?evergreening? of drugs, or obtaining new patents for minor improvements on a product towards its patent expiry, has been a subject of debate in India ever since 2005, when India allowed patenting of products in pharmaceuticals, as opposed to the earlier process patent regime. The latest discussion has risen from the publication of a study Patent Protection and Innovation prepared by TC James, director of the National Intellectual Property Organisation, an NGO recognised by the World Intellectual Property Organisation. The study was commissioned by the Indian Pharmaceutical Alliance, a lobby group for domestic pharma companies and was presented at a roundtable discussion organised by Ficci on March 29. The study was in response to another report by the US-India Business Council, titled The value of incremental innovations: Benefits for Indian patients and Indian business, which had come out last year.

In James? study, he attempts to establish that what is required are more ?genuine innovations leading to development of drugs for diseases, which still pose a challenge to humanity and not minor cosmetic modifications on existing drugs.? He argues that there is no clinching evidence to show that innovations can only occur in a strong protection regime, turning the argument of many MNCs, that the Indian patent regime still does not foster innovation, on its head. For this, he uses an earlier IPA study, in which the industry body came out with a list of 86 patents granted for pharmaceutical products by India after 2005, where the products are not breakthrough drugs, but ?minor variations of existing pharmaceutical products?.

The bone of contention in the Indian Patent Act, despite it allowing product patents, is Section 3(d), which prevents incremental innovations. As per Section 3(d), something is not an invention if ?the mere discovery of a new form of a known substance, which does not result in the enhancement of the known efficacy of that substance, or the mere use of a known process.? While this clause has been built in to guard against ?evergreening?, it has been challenged by MNCs. According to MNCs, incremental innovations lead to the availability of more and better drugs that suit local conditions and can be procured at more affordable prices, and Section 3(d) is a dampener. However, facts speak otherwise. Despite the safeguards, incremental inventions, which meet the criteria of patentability, have got patented in India. There was a steep rise in the number of patents that were granted between 2004-05, when product patent regime was introduced, to 1,911. This has kept on rising ever since?to 4,320 in 2005-06, 7,539 in 2006-07, and 15,261 in 2007-08. All these years, the number of non-resident (foreign) applicants has grown. The argument is brought out clearly?Section 3(d) has not come in the way of incremental innovations and has not deterred MNCs from applying for patents here.

Yet another myth professed by multinationals is that the ?loopholes? in India?s patent regime will cripple the industry and the health care system. This argument does not hold much water, going by some of the points put forward by James. According to figures compiled by IPA, the total revenue of pharma companies grew from Rs 43,986 crore in 2004-05 to Rs 80,336 in 2008-09. So, one can assume that the Indian pharma sector has not suffered any major setback because of Section 3(d).

While MNC lobby groups will still feel the need to pressurise the Indian government on the need to plug the so-called ?holes? in the Indian intellectual property regime, it will also be worthwhile to listen to some of the different voices that are emerging from the West. For instance, Andrew Witty, CEO of GlaxoSmithKline, reportedly expressed confidence in the Indian patent system. He also assured there would not be any major increase in drug prices in India in future, just because the products are patent-protected. This is contrary to the views of PhRMA, the US drug lobby group for ?innovator? companies, which feels that the current Indian law does not recognise the benefits of innovations and only reduces incentives for companies to do research and make progress in medical technology.

In essence, it may not be a good idea to harp on the issue of Section 3(d) coming in the way of incremental innovations, or the slackness of India?s patent regime. Patent laws differ from country to country and companies need to strive to tap opportunities in that country by adhering to the market rules there. While it can be understood that global pharma giants face the issue of drying up product pipelines, owing to ever-tighter regulations, it cannot be used as a reason to demand the scrapping of Section 3(d). Rather, new means to tap opportunities in unmet health care needs can be continuously developed, to the advantage of these companies as well as for the larger public good.

?mg.arun@expressindia.com