An anti-disclosure amendment that hits public health
Paper:
Mains: General Studies-III: Technology, Economic Development, Bio diversity, Environment, Security and Disaster Management
Crux: The recent amendment to the Patent Rules, 2020.
Key Details:
- The Central Government, in exercise of the powers conferred upon it under the Patents Act, 1970 has passed the Patents (Amendment) Rules of 2020.
- The Rules amend Form 27 of the Act through which statements regarding the working of the patented invention on a commercial scale in India have to be filed by Patentees or Licensees.
What are the amendments?
- The amendment to Rule 131(2) means that the statement with respect to the workings of the Patent has to be filed every financial year, within six months from the expiry of such financial year.
- A single Form 27 can now be filed for multiple patents, but this provision is applicable only when all the patents are inter-related and all such patents are under the same patentee or licensee.
- The amendment has eliminated the need to publicly disclose under Form 27 the nature of commercial usage of the patented inventions in the country.
Disclosure of information
- India’s patent legislation grants an exclusive privilege of a 20-year patent monopoly to an inventor.
- India’s patent law imposes an obligation on the patentee to commercially work the invention in India to ensure that its benefits reach the public.
- The central idea behind granting patents itself is to ensure innovation and public interests are well balanced.
- In an event of failing to comply by the patent rules, a compulsory licensing is issued or revocation of the patent under the Patents Act, 1970 is possible.
- Further, courts have routinely rebuffed interim injunction in cases alleging infringement of a patent which has not been worked in India.
- The information about the extent of the working of the invention in India is important for checking abuse of patent monopoly (e.g. excessive pricing or scare supply of the invention) and to serve the public interest.
- Section 146(2), a provision not common among patent legislations of other countries, requires every patentee and licensee to submit to the Patent Office an annual statement explaining the extent to which they have worked the invention in India.
- The disclosure is to be made in the Form 27 format as per the Patent Rules, 2003. This statement will help the Patent Office, potential competitors, etc. to determine whether the patentee has worked the invention in India and made it sufficiently available to the public at reasonable prices.
- However, the patentees and licensees along with the Patent Office have overtly ignored this statutory requirement and to add to this, there has been considerable persuasion from the multinational corporations and the United States government to quash the requirement.
The PIL
- The recent amendment to the form was made in pursuance to a PIL filed in the Delhi High Court in 2015.
- The PIL revealed the rampant non-filing and defective filing of Form 27 by patentees/licensees and sought a direction to the government to strictly enforce the patent working disclosure rules and take action against the violators.
- The PIL also called for a reform of Form 27, arguing that the information it sought was not adequate to examine the extent of the working of the patent.
Dilution of disclosure
- The inadequacies of Form 27 as pointed out by the PIL was acknowledged by the government and the government was directed to bring about necessary changes in Form 27.
- However, the government not only took longer to come up with a new Form 27 format but instead chose to water down the disclosure format, thereby disregarding the Delhi High Court directions and the public interest.
- The government’s stance of choosing to weaken Form 27 by removing the requirement of submitting important information, thus damaging the essence of the patent working requirement defies logic.
- The form now requires the patentees and licensees to provide only the following information:
- whether the patent has been worked or not;
- if the invention has been worked,
- the revenue or value accrued in India from manufacturing and importing the invention into India; and
- if it has not been worked, reasons for the same and the steps being taken towards working.
- They are no longer required to provide any information in respect of the quantum of the invention manufactured/imported into India, the licenses and sub-licenses granted during the year and the meeting of public requirement at a reasonable price.
Inadequate criteria
- The data on merely the revenue/value accrued from manufacturing/importing the invention is not sufficient to ascertain the extent to which the patent has been worked and to verify if the all-important public interest is being served.
- The key data that is required for assessing the working of the invention in the country is the total units of the invention manufactured/imported in India. It is the disclosure of this data by Bayer in Form 27 that played a pivotal role in the grant of India’s first compulsory license to Natco for the anti-cancer drug Sorafenib/Nexavar.
- The doing away with the disclosure requirement overrides the very purpose of this Form.
- The removal of the requirement of submitting any licensing information, including the disclosure of even the existence of licenses (instead of seeking further details such as names of licensees/sub-licensees and the broad terms of the licenses as suggested in the PIL), means that the patentees/licensees can just self-certify that they’ve worked the patent without having to support the claim with the data on how they’ve done so, including through licensing/sub-licensing the patent.
- The exclusion of data regarding the disclosure of details such as the price of the invention, its estimated demand, the extent to which the demand has been met, details of any special schemes or steps undertaken by the patentee to satisfy the demand, etc., as recommended in the PIL, makes it extremely difficult to ascertain whether the invention has been made available to the public in sufficient quantity and at an affordable price.
Way ahead:
- The amendment to patent rules has considerably weakened the intellectual property regime in India.
- The patent law obligated the patentees/licensees to disclose patent working information, to ensure that patents serve public interests and not serve the sole interests of the inventor.
- The provision of compulsory licensing will be a casualty in the absence of disclosure information.
- The amendment rules pave the way for patent abuse, monopoly of usage and make innovations inaccessible to people.
- The lack of accessibility of patented medicines, life-saving drugs could result in undesirable consequences for public health of the country.
- The government must reconsider its amendments and use the PIL recommendations as its guiding spirit