THE BIOLOGICAL DIVERSITY ACT, 2002 AND THE...

South Asian Journal of Multidisciplinary Studies (SAJMS) ISSN:2349-7858 Volume 1 Issue 4

Published By : Universal Multidisciplinary Research Institute Pvt Ltd

THE BIOLOGICAL DIVERSITY ACT, 2002 AND THE RELATED PROBLEMS IN PATENTING

Shambhawi Sinha*

ABSTRACT

The article begins with a general overview of Environmental Legislation in India but mainly seeks to highlight the relatively new yet unknown law – The Biological Diversity Act, 2002. Its critical appraisal and relation with the Intellectual Property Rights have also been stated. It also draws attention to the lacunae in the patenting process in India. It stresses on the ambiguity and hurdles in patenting of the genetic resources and biotechnology. The subsequent losses, lack of enough provisions and need of revamping the scenario have been dwelled upon.

A Biological diversity conservation legislation should, by virtue of its content and purpose be suffice to convince people about its intent. Regrettably, despite dealing with the subject of conservation of biodiversity, it fails to do so. The thrust of the implementation so far clearly shows that the neoliberal paradigm of “growth” leaves little room for concerns related to community sovereignty or even biodiversity conservation.

Invention in biotechnology are synthesised through recombinant DNA and a lot of investment in involved in such invention, so it has triggered the need to protect these inventions through the grant of patents. The article aims to bring to the foreground all of the above mentioned issues and provide with suitable suggestions as and where possible.

KEYWORDS – The Biological Diversity Act, 2002; The Indian Patents Act 1970; TRIPS; Biotechnology; Biodiversity

__________________________

* The author is a student of Government Law College, Mumbai and is currently studying in the Third year of the Five year Law course. She can be contacted at [email protected]



I. INTRODUCTION

Environmental law, post-independence, started growing its roots in India in the early 70’s.

Inspired by the Stockholm conference and the world scenario various laws were passed.

The Wildlife (Protection) Act 1972 was the first such statute to be promulgated. In the

following years the Water (Prevention and Control of Pollution) Act of 1974, The Forest

(Conservation) Act 1980, The Air (Prevention and Control of Pollution) Act 1981, and The

Environment (Protection) Act 1986 collectively gave the country a bundle of strong laws.

The Wildlife (Protection) Act 1972 sought to protect species of animals and birds which were

under threat of extinction. There are 410 species of mammals in India which account for

8.86% of the world's mammals1. Nearly 89 species are listed as threatened in the

International Union for Conservation of Nature and Natural Resources (IUCN) Red List of

Threatened Animals (IUCN 2006)2

The Water (Prevention and Control of Pollution) Act, 1974 was an effort to reduce and stop

pollution in rivers. The Air (Prevention and Control of Pollution) Act, 1981 is made on

similar lines as the Water Act but it goes a few steps forward in terms of details. It was made

to take appropriate steps for the preservation of the natural resources of the earth which,

among other things, includes the preservation of the quality of air and control of air pollution.

The Public Liability Insurance Act, 1991 came on the heels of the Bhopal Gas tragedy. Its

main aim was to provide relief to victims of industrial disaster victims. It became obligatory

for industrial set-ups to obtain insurance which was equivalent to the capital needed to

establish the industry.

In June 2010 the National Green Tribunal (NGT) Bill was passed. It heralded a new dawn in

environmental protection. The court has been set in New Delhi and four benches spread

around the country with the sole mission to quickly dispose off environmental protection

cases.

1 Endangered Species of India-http://moef.nic.in/downloads/publicinformation/criticallyendangered_booklet.pdf 2 List of Endangered Species, IUCN- http://www.iucnredlist.org/apps/redlist/search



The Environment (Protection) Act (EPA), 1986, was the first one to deal with environment

protection and its components in a holistic way. The EPA was purportedly framed to give

effect to the decisions taken at the UN conference on the human environment held in 1972;

however, many say that it was the Bhopal tragedy that precipitated the enactment of the

legislation. The EPA provided a framework for management of hazardous substances, prior

assessment of the environmental impact of major developmental projects, discharge of

industrial pollutants and effluents into the environment, guidance for industrial setups, and

management of chemical accidents.

II. PRINCIPLES EVOLVED AS PART OF ENVIRONMENTAL LEGISLATION

The Indian judiciary, as a part of its activism, has for long used established international

environmental principles while adjudicating a host of landmark environmental cases in India.

These cases reflect the high standards of awareness of the Indian judiciary which not only

took judicial activism to unseen heights in the country but also provided strong precedents in

environmental actions.

A. THE POLLUTERS PAYS PRINCIPLE

Indian Council for Enviro-legal Action v. Union of India3

AP Pollution Control Board v. Nayudu4

Vellore Citizens Welfare Forum v. Union of India5

In the case brought by the Indian Council for Enviro-legal Action, the world saw the Indian

apex court use the Polluters Pays principle inspired by the Principle 16 of the Rio

Declaration on Environment and Development which supports Polluter Pays Principle6. The

court held that if an enterprise is engaged in an inherently dangerous activity, which might

cause harm to another in course of the actions, will have to bear the financial burden of

preventing or remedying the damages that might been caused by the pollution being created

3 1996(3) SCC 212 4 [2000]Supp5SCR249 5 1996(5) SCC 647, (at 659) 6 Principle 16 of Rio Declaration on Environment and Development: National authorities should endeavour to promote the internalization of environmental costs and the use of economic instruments, taking into account the approach that the polluter should, in principle, bear the cost of pollution, with due regard to the public interest and without distorting international trade and investment.



by the manufacturing process. The enterprise would also be strictly and absolutely liable for

the damages caused by his actions.

In AP Pollution Control Board v. Nayudu the Indian Supreme Court applied the

precautionary principle in considering a petition against the development of certain hazardous

industries.

The Court held that : "It is necessary that the party attempting to preserve the status quo by

maintaining a less-polluted state should not carry the burden of proof and the party who

wants to alter it, must bear this burden.”

In the Vellore Citizens Welfare Forum case, tanneries in the South Indian state of Tamil

Nadu were discharging effluents without treating them which caused huge tracts of

agricultural land to become infertile and groundwater to be severely polluted. The Court held

that Polluters Pays principle, in this case, must extend to paying damages for the

environmental degradation caused by the pollutants discharged by them. The Court also

observed that sustainable development, polluters pay and precautionary principles were part

of international customary law and as such, it had to apply to Indian cases as well.

The Court held :"We have no hesitation in holding that the precautionary principle and

polluter pays principle are part of the environmental law of India. Remediation of the

damaged environment is part of the process of 'Sustainable Development' and as such

polluter is liable to pay the cost to the individual sufferers as well as the cost of reversing the

damaged ecology."

B. ABSOLUTE LIABILITY

M.C. Mehta v. Union of India (Oleum Gas case)7

The Supreme Court of India laid down in this case that any industry engaged in a hazardous

or inherently dangerous activity owes an absolute and non-delegable duty to the immediate

community to ensure no harm is done to them. The Court also observed that the larger

physical and economic structure of the enterprise, the heftier would be the compensation. The

Court in its award modified the rule in Rylands v. Fletcher8 and the way it applied to the

Indian cases.

7 AIR 1987 SC 965 8 [1868] LR 3 HL 330



Enterprises could not escape by proving that they could not foresee the injury that was

caused and that the activity on their land and premise was not an unnatural use to begin with.

C. SUSTAINABLE DEVELOPMENT AND INTER-GENERATIONAL EQUITY

Narmada Bachao Andolan v. Union of India9

M.C. Mehta v. Union of India10

State of Himachal Pradesh v. Ganesh Wood Products11

The Supreme Court first ruled in favour of the petitioners and stayed the construction till the

entire rehabilitation work was done as envisaged. Though the courts have led the

environmental protection brigade with extreme enthusiasm which has allowed concerned

citizens to raise their voices effectively, it has had a particularly controversial position in the

Narmada Bachao Andolan v. Union of India wherein it was observed that “Sustainable

development means what type or extent of development can take place, which can be

sustained by nature/ecology with or without mitigation.”

This was also seen in the M.C. Mehta v. Union of India (Taj Trapezium) case.

Inter-generational equity is held in high regard as well and is seen as an important component

of conservation of nature and sustainable development, with the Supreme Court invalidating

forest based industry in the State of Himachal Pradesh v. Ganesh Wood Products. In the case

Indian Council for Enviro-Legal Action v. Union of India, too the Court noted that the

principle would be violated if there were a substantial adverse ecological effect caused by

industry.

9 2000 (10) SCC 664 at p.727 10 AIR 1997 SC 734 11 AIR 1996 SC 149



III. THE BIOLOGICAL DIVERSITY ACT, 2002

The dependence of human beings on biological diversity is beyond challenge, as evident in

everyday life. The food, fibre, fuel, fodder, shelter, health and other needs of the growing

world population are dependent on various components of biodiversity. Plant genetic

resources for food and agriculture are a common concern of all countries and many depend

largely on plant genetic resources that have originated elsewhere. Therefore the sustainable

use of biological diversity at the national as well as international level is of critical

importance.

A legally binding agreement Convention on Biological diversity was adopted by the United

Nations Conference on Environment and Development held at Rio de Janeiro in June 1992.

The main objectives of the CBD were the conservation of biological diversity, the sustainable

use of its components and the fair and equitable sharing of benefits arising out of the

utilization of genetic resources, including proper access to resources and proper transfer of

technologies, taking into account all rights over those resources and technologies and by

appropriate funding. The convention affirmed that countries have sovereign rights over their

biological resources and that the countries are responsible for conserving these resources and

using them in a sustainable manner.

A. The Law

India is a party to the Convention of Biological Diversity, 199212 which gives every nation,

which has ratified the Convention, the right of sovereignty over its natural resources. In

pursuance of the same India created an umbrella act which is the Biological Diversity Act,

2002.

B. Purpose of the Act

The Act fulfills its obligations under the Convention of Biological Diversity; harness India’s

natural resources in a sustainable, conserve natural resources, facilitate access to the

resources in a just manner, sharing benefits arising out of such access and use, use of natural

resources for commercial and research purposes of bio-survey and bio-utilisation, and

transfer of research results and application for intellectual property rights relating to Indian

bioresources.

12 Convention on Biological Diversity, Rio De Janeiro ( www.cbd.int )



C. Passed on

This Act was passed by the Lok Sabha (the lower house of Parliament) on December 2, 2002

and by Rajya Sabha (the upper house of Parliament) on December 11, 2002. India ratified the

Convention of Biological Diversity in February, 1994.

D. Reason behind the Act

The chief reason behind the passage of the Act was to conserve 91,000 species of animals

and 45,500 species of plants in its ten bio-geographic regions, 6,500 native plants are still

used prominently in indigenous healthcare systems, thousands of locally-adapted crop

varieties, grown traditionally since ancient times and 140 native breeds of farm livestock,

continue to thrive in India’s diversified farming systems13.

E. Exclusions

The Act excludes Indian biological resources that are normally traded as commodities and

traditional uses of Indian biological resources and associated knowledge and when they are

used in collaborative research projects between Indian and foreign institutions with the

approval of the central government.

IV. CRITICAL APPRAISAL

The process of formulating BD Act started only after India becoming a signatory to the

Convention on Biological Diversity in 1993. Even then it took a good 10 years for the Act to

be notified. There is no denying that the efforts of government officials, NGOs and

academicians have also contributed, however, according to many experts, the gaps in the Act

and subsequently in the Rules indicate that the real push was an international treaty

obligation. When the Act was notified, it threw up mixed responses.

On 15th April 2004, the Union Ministry of Environment and Forests (MOEF) notified the

Biological Diversity Rules14 under the BD Act. The Act mandated the establishment of

13 The Biological Diversity Act, 2002 No. 18 of The Gazette of India, Ministry of Law and Justice 14 The Biological Diversity Rules, 2004 ( www.nbaindia.org/rules.htm)



BIODIVERSITY MANAGEMENT COMMITEES (BMC) which could have enabled local

communities to have some voice in the conservation, sustainable use and equitable benefit

sharing of biological resources. But the new set of rules which came in 2004 completely

diluted the effect of the act as far as local representation is concerned. It limited the role of

BMCs to preparing People’s Biodiversity Registers that documents local knowledge and bio

resources. This immensely undermines the right of local communities who are the most

important stakeholders. Documentation without legal protection is a sure way of exploitation.

There is an apparent lack of faith in the competence of local groups in taking decisions, as

well as an attempt to centralize the natural resource management system all over again. This

step (even after the 73rd and 74th Amendments to the Constitution of India which have upheld

the need for decision making at the village level) seems retrograde and in complete contrast

to spirit of country’s legal system.

The Act requires all inventors to obtain the consent of NATIONAL BIODIVERSITY

AUTHORITY (NBA) before applying for intellectual property rights where the invention is

based on biological resource obtained from India, and grants the authority the power to

‘impose benefit sharing fee or royalty or both or impose conditions including the sharing of

economical benefits arising out of the commercial utilization of such rights.’ Given the lack

of extra-territorial jurisdiction of the NBA and its inability to monitor applications overseas,

the efficacy of such a provision will be extremely doubtful. The Act introduces intellectual

property rights in the management of biological resources as provided in TRIPS15 agreement

but does not directly address the subordination of intellectual property rights to the goals of

the biodiversity convention as mandated by Article 16 of the convention.

A major issue of the CBD and the resultant Biological Diversity Act is a shift in focus from

the ecological and scientific value of biodiversity to its mere commercial value. Under the

Act, all foreigners are treated in the same way, regardless of whether they are from developed

countries or from less developed countries. It differentiates between domestic companies and

the MNCs, although the provisions of TRIPS demand that MNCs be treated at par with

domestic companies. The Act does not seem to have an overall riding effect on the existing

laws on wildlife and forests, and it is not clear which law will prevail in case of a dispute.

One of the striking features of the regime is that it completely obliterates common property

15 Trade-Related Aspects of Intellectual Property Rights (TRIPS) is an international agreement administered by the World Trade Organization (WTO)



arrangements whose importance and extent in the context of the management of biological

resources is still immense.

The Act centralizes property rights either in the hands of the state through sovereign

appropriation or in the hands of private inventors through monopoly intellectual property

rights. It does not, however, provide a framework for the rights of all other holders of

biological resources and related knowledge. The Act does not give current rights-holders the

capacity to defend their rights in the same way that it seeks to equip the country with tools to

ward-off biopiracy or even with rights equivalent provided to patent holders or applicants.

Further, the Act is conspicuously shy in its treatment of traditional and local knowledge,

merely requiring the central government to “endeavour to respect and protect” such

knowledge, whereas the question, especially in the Indian context is important enough to not

be left to the discretion of the executive and to require a definitive statement of law.

‘Biopiracy' practically refers to the ways that usually corporations, claim ownership of, free

ride on, or otherwise take unfair advantage of, the genetic resources and traditional

knowledge (TK) and technologies of developing countries. Biopirates are those responsible

for one or both of the following acts: (i) the theft, misappropriation of, or unfair free-riding

on, genetic resources and/or TK through the patent system; and (ii) the unauthorised and

uncompensated collection for commercial ends of genetic resources and/or TK.

Unlike the US law, the Indian law does not discriminate between the home country and

foreign country while determining the 'novelty' of an 'invention'. The aforesaid provision of

the US law implies that a patent conferred by the US Patent Office, which involves, say, an

act of biopiracy of an Indian TK, can be challenged by India only if some written proof of

that knowledge can be produced, for want of which such biopiracy would continue. Although

patents are supposed to be granted for new inventions, this denial or non-recognition of non-

written 'prior art' elsewhere (in the US law) allows patients to be granted for existing

knowledge and use in other countries. It is this glaring loophole of the US law, which opens

the door for bio-piracy of the non-written TK of India and other developing countries by the

MNCs. Provisions included in the Indian Patents Act in conjunction with the prior informed

consent (PIC) and benefit sharing requirements incorporated in the Biological Diversity Act

2002 create sufficient room for combating the biopiracy threats at the national level in India.

Nevertheless, the problem remains that existence of a similar protective shield for Indian bio

resources and TK cannot be guaranteed under the national patent laws of other countries.



Because, notwithstanding the leeways available under TRIPS for such provisions (as have

been introduced in Indian Patents Act), the Agreement does not make it obligatory for the

member countries to include in their respective patent laws provisions aimed at protecting the

bioresources and Traditional Knowledge of the country of origin against biopiracy.

Unfortunately, the Indian government does not seem to be sincere & focused enough to

secure the intellectual property rights of its citizens because the process of applying for and

getting a patent is a lengthy one and not citizen-friendly.

V. A DIFFERENT PERSPECTIVE – What the other school of thought says?

The Act conveniently overlooks the benefits that India has gained through free access and

utilization of exotic germ plasm of plants and animals. In fact all revolutions (green, white

and blue) that salvaged India from hunger and starvation and led us to self-sufficiency and

food security would have been impossible without foreign biological material. The green

revolution started with the cultivation of dwarf japonica rice varieties which later led to the

development of HYV seeds. White revolution was achieved through massive cross breeding

programmes with exotic seeds of cattle like Brown Swiss, Jersey, Holstein-Friesian etc.

Indian farmers cultivate a large number of exotic crops and even today continue to introduce

and domesticate foreign plants and animals for commercial utilization. Cocoa, Rubber,

vanilla, anthurium, stevia, numerous varieties of orchids and other commercial floricultural

crops and many species and breeds of livestock and poultry (Japanese quail, Yorkshire pig,

white leghorn chicken, White Chinchilla rabbit, Italian honey bee etc) have become popular

among Indian Farmers. All of the above examples would clearly illustrate that India has

gained much more through free access and exchange of Biological materials from other

countries and we will have to continue our dependence to sustain increment in productivity to

meet the basic demands of the ever-growing population.

The role of traditional knowledge in Pharmaceutical discovery too has been relatively small

in recent decades and income from biodiversity prospecting for pharmaceutical products

could be modest. Most multinational seed corporations together deal with no more than nine

species and are self-sufficient with breeding material for most of these commercial crops. The

high hopes and promises of equitable sharing of benefits arising out of the commercial use of

traditional knowledge associated with biodiversity is turning out to be unrealistic16.

16 Laird and Wynberg 2005, Simpson et al. 1996



Kloppenberg and Kleinmann17 selected 20 food crops and 20 industrial crops that lead global

production and estimated the magnitude of regional contributions and debts of geopolitical

regions to global plant genetic estate. They proved that there is no such thing as genetic

independence; instead nations of the world are linked in a complex network of plant genetic

interdependence. No region can afford to isolate itself, or to be isolated from access to plant

germplasm of other regions of diversity. The general global rule is dependence on important

imported genetic materials.

We can easily deduce the importance of knowledge sharing and joint scientific developments.

Intellectual Property Rights and Patents are vital instruments for securing economic benefits,

which can lead to the sustainable development of the local community and also towards the

sustainability of the bio-resource. BD Act 2002, is counter productive to India’s position on

IPR and Patents Bill. Perhaps the lure for benefit sharing blinkered us to overlook our own

high dependency on import of exotic gene plasms. We must realize that the commercial

benefits are insignificant compared to vital issues such as food security and sustenance.

Benefit sharing professed as a shortcut to economic development, can neither be a substitute

for innovation, invention or industrialization nor a sustainable source of supplementary

income for rural communities.

With our population, extreme climate, vulnerable ecology, compliance ratio of monitored

industries being less than 50%, and the economy resting heavily on extinguishable natural

resources, sustainability is the next big challenge for the country. Wide ranging changes from

institutional reorganisation to paradigm shift amongst the people and finally turning the

lopsided industrial approach to the environment are required at this point of time. This

change will require commitment, planning, and effective execution of national programs.

Consultation with the public and regulated community control is vital.

The Act can prove to be a big game changer in area of Biodiversity conservation and

receiving appropriate revenue for use of indigenous bioresources by outside bodies. Once,

effective guidelines, lucid definitions, clarity of jurisdiction and proper authority distribution

takes place, the Biological Diversity Act 2002 can be a much better success.

17 Kloppenberg.J and Kleinmann D.L (1987) BioScience



VI. BIOTECHNOLOGY

Biotechnology is not new but exists since ancient times and its progress has been witnessed

through many centuries. The term ―biotechnology is defined broadly to include not only the

old biotechnology such as the traditional method of manufacturing fermented products but

also the new biotechnology represented by genetic engineering and recombinant technology.

So, biotechnology can be defined as, direct application of science and engineering in the use

of living organism or parts or product of living organism in their natural or modified form18.

In general parlance, biotechnology comprises any technology that uses living organism in

particulars plants, animal or micro-organism. Regarding economic corporation and

development biotechnology includes any technique that uses living organism or part of

organism to make or modify product to improve plants or animal or to develop

microorganism for specific use19. Broadly biotechnology can be classified into two: industrial

biotechnology and agricultural biotechnology. Industrial biotechnology refers to chemical

and pharmaceutical substance derived from or process pertains to the plant and animal

kingdom. Agricultural biotechnology involves use of genetic engineering to develop new

plants and animal20.

The biotechnology invention can be classified into three categories: (a) invention relating to

an organism or martial such as living entities of natural or artificial origin (animal, plant

microorganism) biological material( plasmids, viruses and replicas and part of organs, tissues,

cells and organelles) and naturally occurring substance from living entities, biological

material or part thereof, (b) invention relating to process for the creation of living organism or

production of other biological material and (c) invention relating to use of this microorganism

or biological material21.

18 Canada Environment protection Act ,Section 3(1) 19 Patent and Innovation: Trends and Policy challenges. OECD, Paris, 2004 20 Feroz Ali Khader, The law of patents, with special focus on pharmaceuticals in India, , Lexix Nexis, Butterworths, 1st edition 21 Sujith Bhattacharya, patenting in biotechnology, DESiDOC bulletin of information technology Vol.27 No.6 November 2007 PP 31-39



Biotechnology invention raise peculiar challenges as it imports issue relating to ethics, morality an access to technology into patent law. Some of the issues like exclusion of plants and animal from patenting and the permissibility of patenting gene sequence have impact on the patentability of this invention.

VII. SUBJECT MATTER IN BIOTECHNOLOGY FOR PATENTING

Biotechnology is concerned with the use of living organism or biological system in the manufacture of drug or any other product. It is concerned with the change in genetic make-up of an organism called as genetic- engineering. There are three types of subject matter-:

1. The bio-matter itself which includes product of biotechnology

2. The method and process of making bio-matter and/or the product

3. The use of bio-materials.

According to section 2(1)(m)22 patent means a patent for any invention granted under the act. Invention means a new product or process involving an inventive step and capable of industrial application23. The grant of patents for biotechnology invention is a matter of policy. The patent authorities have made a detailed expression of the policy it would follow in its Manual of patent practice and procedure.

The following things include certain biological invention but do not constitute patentable subject matter-

1. Discoveries

2. Invention against public order or morality

a. Human body and discovery of its element and gene in natural form (isolation of human gene and gene sequence are patentable if isolated from by technical process), cloning

b. Process for modifying the gene line identity of human being

Use of human embryos for industrial or commercial purpose and process for modifying the genetic identity of animal which is likely to cause them suffering without substantial medical benefit to man or animal and also resulting animal resulting from such process.

3. Plants, animal and essentially biological process.

22 Indian Patent Act, 1970 23 Sec2(1)(J), Indian Patent Act, 1970



A. PATENTABLE SUBJECT-MATTER

The foremost condition before granting patent to any invention is that it should not fall in exclusion category for which patent is not granted. In other words it should fall within the ambit of patentable subject-matter. In India inventions are patentable not the discovery unlike U.S. law. Section 3 of The Patent Act, 1970, provides the list of subject-matter which are not patentable. Any subject-matter which does not fall within this list can be claimed for patenting. The Indian patent Act states that following are not inventions and therefore do not constitute patentable subject matter-:

1. Invention against natural laws

2. Invention contrary to public order or morality.

3. Discovery of a living thing occurring in the nature.

4. Method for treatment of animal or human being

5. Plants and animal in whole or nay part thereof other than microorganism but including seeds, varieties and species and essentially biological processes for production or propagation of plants and animals.

B. NOVELTY

Novelty is most essential requirement for patenting of any product. An invention is patentable if it is novel or new in the light of prior art. Prior art comprises of all the matter made available to the public before the priority date of invention by written or oral description, by use or in any other way. In the case of Bishwanath Prasad Radhey Shyam vs. Hindustan Metal Industries24 the Supreme Court held that the fundamental principal of patent law is that a patent is granted only for inventions which are new and useful. That is to say, it must novelty and utility. It is essential for the validity of a patent that it must be the inventor‘s own discovery as opposed to mere verification of what has already known before the date of patent.

C. INVENTIVE STEP

Inventive step means any invention that involves technical advances as compared to the existing knowledge or having economic significance and it is non-obvious to skilled person.

Inventive step has three requisites-

1. It involves technical advances or has economic significance or both

2. Non-obvious to person skilled in the art.

3. Non-obviousness 24 (1979)2 SCC 511



In order to be patented, an invention needs to be non-obvious. The essential element of novelty and inventive step would depend on the given facts of each case. If the particular manner of manufacture is the same, then there cannot be any novelty in the subject matter. If there is no inventive step, it implies that it is obvious25. The term obvious has not been defined under the Patent Act; it can be safely stated to be a circumstance where a skilled person in the particular field, on going through the specification would complete the product. Therefore, even if any of two ingredients i.e. technical advances or economic significance or both are available, if such invention enables a person skilled in the field to complete the product on going through the specification, such invention can never be treated as inventive step and consequently no patent can be validly issued26. Same was observed in the Bajaj Auto Service vs. TVS Motor Company Ltd.27 by the Madras High Court.

D. INDUSTRIAL APPLICATION

An invention must be capable of being used in the industry28. The patent protection is not available to purely abstract or intellectual creation. The use may not be for profit and hence it includes agricultural use also. Capable of industrial application doesn‘t require proof of actual use. The potential to be used or made in industry is sufficient evidence for proof of industrial application. The inventions which are not so useful are protected in some countries as utility model but this concept is not recognized in India29.

All the biotechnology material have one or the other use in the industry. Such as DNA sequence like gene, EST and many others have lot of industrial application. In many cases DNA is used for like producing protein or diagnostics or in forensic science etc.

VIII. PATENTING OF GENETIC RESOURCES

The relationship between genetic resources, traditional knowledge and intellectual property rights is among the most controversial issue. Genetic manipulation has raised the issue as to whether the alleged innovation is merely a discovery or an invention. The method of isolating a substance is patentable and characterisation of the structure of a substance and applying a use to the substance is also patentable. However merely finding something occurring in the nature is not patentable30. A leading judgement on patenting of life forms was passed by Hon‘ble Calcutta high court in Dimminaco AG v. Controller of Patents31 the patent was for laboratory preparation(a process) of bursitis vaccine. A biological entity may be 25 Bilcare Ltd. Vs. Amartara Pvt. Ltd., 2007(34) PTC 419(del) at p.434 26 Section 3 of The Indian Patent Act, 1970 27 2008(36) PTC 417(Mad.) at P.463 28 Sec.2(1)(ac), Patent Act, 1970 29 Dr. M.K.Bhandari, Law relating to Intellectual Property Rights, Central Law publication, 3rd edition 30 Rodney D. Ryder: concept of commercialization, Macmillan Publication 31 1 PLR 2002 July 255



patentable if the technical intervention of man had resulted in an artificial state of affairs which does not occur in nature. The isolation and cultivation of naturally occurring micro-organism which have some new use satisfy the requirement of technical intervention.

IX. CLONING

Clones are organisms that are exact genetic copies. Every single bit of their DNA is identical32. Cloning is the process of transforming nucleus of an multi cellular organism‘s cell to an unfertilized egg of the same species while transgenic cloning is when a particular gene is added to the nucleolus of an adult organism cell before it is transferred to an unfertilized cell of the same species. Dolly was the first mammal (sheep) that was created by cloning in 199733.

Cloning is neither patentable in India nor in any other country due to the ethical concept involved in it. Moreover, the patent office is unlikely to grant patent for process for cloning human being or animals, process for modifying the germ line, genetic identity of human being or animals, use of human or animal embryos for any purpose on the ground that they are against public order and morality34.

X. THE ISSUES INVOLVED

Biotechnology invention raises peculiar challenges such as its imports, issue relating to ethics, morality, access to technology related to patent law. Some of the issues like exclusion of plants and animal from patenting and the permissibility of patenting gene sequence have impact on the patentability of an invention.

For an invention to be novel, it need not be a major breakthrough. No invention is small or big. Modifications to the existing state of the art, process or product or both, can also be candidates for patents provided these were not earlier known. In a chemical process, for example, use of new reactants, use of a catalyst, new process conditions can lead to a patentable invention.

'State of the art' has not been defined under the Patents Act, the following general principles are applied by the Patent Office to determine the novelty of an invention during the examination procedure by applying provisions of section 13, read with the provisions of sections 29 to 34 :

An invention is not considered to be novel-

(a) If it has been anticipated by publication before the date of filing of the application in any of the specifications filed in pursuance of application for patent in India on or after 1st January, 1912. 32 what is cloning, http://learn.genetics.utah.edu/content/cloning/whatiscloning/ 33 H S Chawla, Patenting of biological material and biotechnology, Journal of Intellectual property rights, vol 10, January 2005, pp. 44-51 34 Sec 3(b), patent act, 1970



(b) If it has been anticipated by publication made before the date of filing or the date of priority of the application in any of the documents in any country; or

(c) If it has been claimed in any claim of any other complete specification filed in India, which was filed before the date of application though published after the date of that application

Although no absolute test has been laid down which can be applied in every circumstance, certain broad criteria could be indicated. Whether the manner of manufacture patented was publicly known, used and practised in the country before or at date of the patent? If answer to question is yes, it would negative regarding novelty and subject matter.

Lord Davey in the case of Rickmann vs. Thierry35 stated that it was not enough that the purpose was new or that there was novelty in the application that the article produced was new in that sense but there must be novelty in the mode of application. In adopting the old contrivance to the purpose, there must be difficulties to overcome, requiring what was called invention, or there must be some ingenuity in the mode of making the adoption.

Anti-Ever greening

Section 3(d) of patent act, prohibit ever greening, it is designed to discourage patents of ever greening by prohibiting grant of patent on derivative form of known substance unless derivative form has significantly enhanced efficacy36.

This section may prove problematic for Indian biotechnology industry which is developing new combination vaccine. Although, such vaccine may be novel but section 3(d) prohibit such patenting unless efficacy is increased. The term 'efficacy' has not been defined under patent act, so what degree of efficacy is required to get a patent is matter of discretion on patent office. The same point has been upheld by the Court in the Novartis case. The burden of proof will be on the biotechnology applicant, to prove the efficacy of the vaccine has been increased.

The patenting of new use of known process is not patentable. But if a new process is developed for production of the known product it can be claimed for patent. In such case only process will be granted patent not the final product. This prohibition function of section 3(d) tends to be more problematic for patent applicants.

35 (1896-14 RPC 105) 36 Ahibhusan De & Uma Baskaran, What the New Patent Regime Means In Practice, Managing Intellectual Property. Jul./Aug. 2005, at 63-64



XI. BIOTECHNOLOGY PATENT PROSECUTION - GUIDELINES & BASIC CONSIDERATIONS

There is no formal bio-guidance as of yet with regard to biotechnological patent application. Some reference in Manual of Patent Practice and Procedure (MPPP) is there and guidelines with regard biotechnological inventions are inconsistent and inadequate. Pertinently there is no mention of word gene or DNA in Patents Act, 1970, nonetheless, MPPP serves as an informal written guidance for the examiners/Practitioners and is not a binding document. The biological material such as recombinant DNA, Plasmids and processes of manufacturing thereof are patentable provided they are produced by substantive human intervention. Gene sequences, DNA sequences without having disclosed their functions are not patentable for lack of inventive step and industrial application.

Further, MPPP provides that the processes for cloning human beings or animals, processes for modifying the germ line, genetic identity of human beings or animals, uses of human or animal embryos for any purpose are not patentable as they are against public order and morality.

During prosecution, the establishment of the biological function of a biotech invention, it is preferable to include biological experimental data / efficacy data – both in vitro as well as in vivo to support the efficacy of a claimed invention over the prior art. Furthermore, an isolated but not modified living entity is not substantially different from the form in which it existed in the nature are non-patentable under sec 3(c). However, mere isolation of a living thing or a part thereof from its natural environment without a modification by genetic engineering or otherwise that improves properties or increases efficacy of the claimed invention over the existing form or a biological material or a part thereof is isolated in the desired form from its natural environment, such material is no longer a living thing occurring in nature as envisaged in s. 3(c) of the Patents Act. Additionally, quite often the material obtained by the process of isolation is in a raw state and thus needs to be processed further e.g. purified by physical or chemical treatment to render it industrially applicable. It can therefore be argued that the isolated material is not necessarily a “merely discovered living thing”. First time isolation of a component from biological material is patentable.

If sequences of biologics included with claims, to obtain broadest possible protection, it might not be prudent to include such specific references to SEQ IDs in the main claim. However, in the event that compliance with such a requirement is mandatory during the final stage of the prosecution of an application, such a reference could then be merged in the main claim, as broadly as possible in order to secure the eventual acceptance of such an application. The specific sequence IDs of the genetic material being claimed must have been described sufficiently in the accompanying description so as to enable a person skilled in the art to identify and work upon such material (submission of SEQ ID in electronic as well as in form is also mandatory). Otherwise, insufficient disclosure as well as enablement objections could be raised. Additionally, the reference to more than one SEQ IDs requires establishing unequivocally that more than one sequence of IDs is so correlated with another that they constitute a single inventive concept.



XII. PATENT LAW AND CONSERVATION OF BIOLOGICAL DIVERSITY (CBD)

India enacted the Biological Diversity Act to address the issues of prior informed consent, disclosure and access and benefit sharing. This Act primarily aims at regulating access to biological resources and associated traditional knowledge so as to ensure equitable sharing of benefits arising out of their use.

All matters relating to requests for access by foreign individuals, a non-resident Indian, institutions or companies ( that are not incorporated or registered in India; or incorporated or registered in India with foreign participation in its share capital or management), and all matters relating to transfer of results of research to any foreigner is dealt with by the NBA. Section 3 provides that all foreign national require approval from NBA for obtaining Biological Resources or knowledge associated with it and Section 4 provides that Indian individuals/entities to seek approval before transferring knowledge / research and material relating to any biological resources (occurring in or obtained from India) to foreign individuals, non-resident Indians, institutions or companies ( that are not incorporated or registered in India; or incorporated or registered in India with foreign participation in its share capital or management). NBA, may consult the Biodiversity Management Committees (BMC) or any other expert committee constituted for this purpose and thereafter grant approval under Section 19 subject to such terms and conditions it may deem fit.

In case of Collaborative projects (covered by Section 5 of Biological Diversity Act) that are either approved by the Government or conforms to the policy guidelines formulated by the Government, no further approval is required from NBA.

For flora such as bacterial or fungal strains habitant from reserved and protected forests, notified sanctuaries and national parks are regulated by Indian Forest Act, 1927 and Wildlife Protection Act, 1972. The Indian Forest Act and Forest (Conservation) Act deal with management of forests and conservation of forest land respectively. Wildlife (Protection) Act is for the protection of wild animals, birds and plants, and basically aims at protecting, propagating or developing wildlife or its environs through national parks, sanctuaries etc. In addition, the Act has a provision to prohibit picking and uprooting etc. of specified plants.

In the Biological Diversity Act, ‘Biological resources’ mean plants, animals and micro-organisms, their genetic material and by-products with actual or potential use or value. Human genetic material is outside the purview. However, extracts of bacterial and fungal strains and all value added products are not encompassed in the definition of ‘biological resources’ and thus do not require approval of the NBA. The Indian collaborating company of a foreign entity is only required to give prior intimation to the concerned State Biodiversity Board about obtaining such material for commercial purposes.

Under The Biological Diversity Act, Section 6(1) provides that prior approval of NBA is necessary before applying for any kind of IPRs (in or outside India) based on any research or information on a biological resource obtained from India.



Such approval, however, is not required where IPR rights relating to protection of plant varieties are applied for (Section 6(3)). This is because in such cases, it is the Plant Varieties and Farmers' Rights Authority, established under the Protection of Plant Varieties and Farmers' Rights Act, 2001, which grants the right and determines the benefit sharing. This Authority, in turn, endorses the grant of right to NBA;

In case of Patents, one can procure such approval after the publication of the patent application and before the grant of patent.

In case of assignment of IP rights to third persons, the persons who have been granted approval for access to biological resource and associated knowledge may transfer the same by taking approval from NBA.

While granting such permission, the NBA is most likely to impose benefit sharing conditions such as monetary benefit like royalty, joint ventures, technology transfer product development. The parameters involved for payment of such compensation are extent of use, sustainability aspect, impact and expected outcome levels, short term and long term benefits etc.

XIII. CONCLUSION

The issues that relate to the patenting of biological material are relatively new to India. Standardized practice is yet to be satisfactorily established with respect to patenting or non-patenting of biological inventions. However, if a claim of an invention is related to a novel and inventive and modified genetic material, wherein such genetic material is identified by its protein or amino acid sequences at least in the description and in the claims, such genetic material is capable of industrial application, then the Patent Office generally accepts such invention as patentable. Therefore, the inventions are subject to the fulfillment of the relatively broad criteria. It is noteworthy to mention that the patenting of biological material in India is still decided more often on a case-by-case basis.

The BD Act, 2002 relegates the role of communities to that of secondary stakeholders, choosing instead to rely on scientists or bureaucrats, who would only have a partial picture of the ground reality. Biodiversity regulation is critically linked to the idea of community sovereignty. Unless local decision-making and control over biological resources and their knowledge becomes a reality, the latter will be continued to be treated as the property of the nation state which is intent on commercialising these resources.

Biological resources and the knowledge associated with it have the potential to generate wealth, where the term extends beyond its mere monetary value. If granting access to biodiversity creates an ecological or livelihood crisis then, the law and its implementers need to be scrutinised.

India’s post-TRIPS patent laws include several provisions that make biotechnology patenting more attractive as a basis for competitive advantage. The Dimminaco decision likewise signifies greater judicial and administrative appreciation of the importance of biotechnology patenting. It is apparent from the allowable claims disclosed hereinbefore, that the biotech



patents can be obtained in diverse areas provided the description/enablement requirements be complied with and prosecuted articulately. The never ending debate of discovery and invention is one of the hindrances before granting patent to any genetic resources. Further, basic requirement of novelty, disclosure, non-obvious and utility have to be full filled for protecting genetic or biotechnology invention under patent law. There is need for amending the Indian Patent Act, 1970 which is another obstacle in granting patent, as most of terms mentioned therein are vague.

Big companies like Mahyco Ltd., Monsanto Ltd., Coal India Ltd., Dabur India Ltd., South Eastern Coalfields Limited, Northern Coalfields Limited, Western Coalfields Limited etc and many other such mineral based industries have already been affected by the Act.

The present Intellectual Property Rights of India do not have a sure shot answer to the vague provisions of the said Act.

Small Companies like Som Distilleries Pvt. Ltd., Associated Alcohol & Breweries Ltd., Regent Beers & wines Ltd., Agro Solvent, Lilasons Breweries Ltd., Ruchi Soya Industries Ltd., etc. have cases pending in various National Green Tribunals37.

The applicability of 2% Biodiversity cess can have overwhelming effects. Over 30% in royalties need to be paid by bio-pirates like Nestle, Monsanto, DuPont, Dow Chemicals, Syngenta, Roch, Eli Lilly, Palmolive, Unilever, Proctor and Gamble and other such Multinationals38.

India being one of the bio-diversity rich countries, it would, thus, be prudent to protect biotechnological inventions as that would help Indian biotechnology research to compete globally. India needs to reap the due benefits from its rich bio-resources with an enabling provision for patent protection in biotechnological innovations and inventions.

37 See http://www.indiaenvironmentportal.org.in/category/34615/thesaurus/national-green-tribunal-ngt 38 The Business Line

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