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TRIPS Agreement – Impact on Indian Patent Act 1970

- Himatej Reddy


International Patent Regime PARIS CONVENTION for the protection of

industrial property PCT (Patent Cooperation Treaty) BUDAPEST TREATY on the International

recognition of the Deposit of Microorganisms for the purposes of patent procedure

TRIPS AGREEMENT (Agreement on Trade-Related Aspects of Intellectual Property Rights)


TRIPS Agreement To strengthen protection mechanisms for patent

holders’ rights Came into effect on 1st Jan, 1995 Deals with various intellectual properties

including patents, trademarks, copyright and related rights, geographical indications and layout designs

Incorporates 2 major principles– Principle of National Treatment and– Most Favored Nation


TRIPS Agreement (Cont.)

Principle of National Treatment:It signifies that each member nation shall treat the nationals of other member nations in the same way it treats its own nationals with respect to intellectual property (Art. 3)


TRIPS Agreement (Cont.) Most Favored Nation (MFN):

It states that if a member nation accords a special privilege, advantage or immunity with respect to the protection of intellectual property to nationals of any particular member country then such privilege, advantage or immunity shall be automatically and unconditionally extended to nationals of all the other member countries as well (Art. 4)


TRIPS Agreement (Cont.)

TRIPS Agreement

Minimum Standards

Enforcement of IP Standards

Dispute Settlement


Impact on Indian Patent Act, 1970

First patent statute passed in 1856 Indian Patent Act 1970 came into force on 20th

April, 1972 Modification of Patent Act in response to the

report submitted by Ayyangar committee in 1959 is of more significant – opposed to grant product patents


Impact on IPA, 1970 (Cont.)

Domination of Indian drug industry by foreign multinationals

Import drugs into Indian market and set the prices of life saving drugs high making them unaffordable to a common man

Only process patents were granted to drug, chemical, food and certain other inventions under the 1970 Act


Impact on IPA, 1970 (Cont.)Sec.5 of Art.39 in IPA, 1970, states that

“ In the case of inventions –– Claiming substances intended for use, or capable

of being used, as food or as medicine or drug, or– Relating to substances prepared or produced by

chemical process (including alloys, optical glass, semi-conductors and inter-metallic compounds), no patent shall be granted in respect of claims for the substances themselves, but claims for the methods or processes of manufacture shall be patentable.”


Impact on IPA, 1970 (Cont.) Basic standard of TRIPS Agreement – Principle

of non-discrimination– Inventions must not be discriminated based on the

field of science & technology to which they belong Post 1995 amendment – Transition period of 10 years – mailbox– Exclusive marketing rights (EMR)- subject to certain

conditions, to market the product for a period up to 5 years from the date of grant


Impact on IPA, 1970 (Cont.) The Patents (Amendment) Act 2002:– Extension of the patent term to 20 years from the date

of filing– New definitions of invention and inventive step– New exclusions from patentable subject matter like

business methods, algorithms and traditional knowledge

– Reversed burden of proof provision – patent infringement

– Streamlined the compulsory licensing framework– Paved the way for patentability of microorganisms


Impact on IPA, 1970 (Cont.) Art.39, Sec.53 of Patents Act 1970 states that

“The term of every patent granted under Patents Act, 1970 shall– In respect of an invention claiming the method or

process of manufacture of a substance, where the substance is intended for use, or is capable of being used, as food or as medicine or drug, be 5 years from the date of sealing of the patent, or 7 years from the date of publication whichever period is shorter; and

– In respect, of any other invention, be 14 years from the date of the patent”



2002 Amendment of Sec.53(1)– “Subject to the provisions of this Act, the term of

every patent granted, after the commencement of the Patents (Amendment) Act, 2002, and the term of every patent which has not expired and has not ceased to have effect, on the date of such commencement, under this Act, shall be 20 years from the date of filing of the application for the patent”



According to Section 2 (j) of Indian Patent Act, 1970,– “INVENTION means any new and useful-• Art, process, method or manner of manufacture;• Machine, apparatus or other article;• Substance produced by manufacture, and includes any

new and useful improvement of any of them, and an alleged invention”



2002 Amendment of Sec. 2 (j)– Sec 2(j):

“INVENTION means a new product or process involving an inventive step and capable of industrial application”;

– Sec 2(ja):“INVENTIVE STEP means a feature that makes the invention not obvious to a person skilled in the art”


Impact on IPA, 1970 (Cont.) 2002 Amendment of Sec. 3– Sec. 3(b):

“an invention the primary or intended use or commercial exploitation of which would be contrary to public order or morality or which causes serious prejudice to human, animal or plant life or health or to the environment”

– Sec 3(j):“plants and animals in whole or any part thereof other than microorganisms but including seeds, varieties and species and essentially biological process for production or propagation of plants and animals”

– Sec 3(k):“a mathematical or business method or a computer programme per se or algorithms”


Impact on IPA, 1970 (Cont.)– Sec 3(l):

“a literary, dramatic, musical or artistic work or any other aesthetic creation whatsoever including cinematographic works and television productions”

– Sec 3(m):“a mere scheme or rule or method of performing mental act or method of playing game”

– Sec 3(n): “a presentation of information”– Sec 3(o): “topology of integrated circuits”– Sec 3(p):

“an invention which, in effect, is traditional knowledge or which is an aggregation or duplication of known properties of traditionally known component or components”


Impact on IPA, 1970 (Cont.)Filing of patent

application (PS/CS)

Publication

Request for Examination

Examination – Issue of FER

Grant of PatentPost-grant Opposition

Promptly after 18 months from filing date

Within 48 months from filing date


Impact on IPA, 1970 (Cont.)Filing of patent

application (PS/CS)

Publication

Request for Examination

Examination – Issue of FER

Grant of Patent

Pre-grant Opposition

Post-grant Opposition

Promptly after 18 months from filing date

Within 48 months from filing date



• In case of alleged infringement of a patented product the “onus of proof” rests on the plaintiff

• 2002 amendment has resulted in “reversal of burden of proof” in case of infringement of patented process


Impact on IPA, 1970 (Cont.)• Sec 104(A) of 2002 Amendment Act:

“In any suit for infringement of a patent, where the subject-matter of patent is a process for obtaining a product, the court may direct the defendant to prove that the process used by him to obtain the product, identical to the product of the patented process, is different from the patented process if, -• the process results in ‘new’ product; or• There is a substantial likelihood that the identical

product is made by the process, and the plaintiff has made reasonable efforts to determine the process but has failed”


Impact on IPA, 1970 (Cont.)• Compulsory licensing - to strike a balance

between promoting access to existing drugs and promoting R&D into new drugs

• 2002 amendment provides three grounds for seeking a compulsory patent license– Firstly, provides the broadest grounds for seeking

a compulsory patent license in the case of non-working of patented inventions. Such license can be sought only 3 years after the sealing of the concerned patent



– Secondly, on notification of the Indian government in circumstances of national emergency or extreme urgency like the breakout of epidemics

– Thirdly, in case of certain patents that are essential to the efficient working of other patented inventions



• The Patents (Amendment) Act, 2005:– For the first time since 1970, Indian patent law

allowed patent protection to substances capable of being used as pharmaceuticals, food , and agro-chemicals

– Many controversial features that caused many disputes and debates



• Though India signed the TRIPS Agreement, prices of drugs are remain quite low and are not expected to shoot up considerably in near future due to proper checks

• However, drugs which are used for the treatment of diseases like AIDS, Cancer, etc. are of high cost because their patents are held by the MNCs


Impact on IPA, 1970 (Cont.)• High prices resulting from product patents can

be tackled by:– Resorting to parallel imports or granting compulsory

licenses during the patent term and– Ensuring that the entry of generics is not delayed

after the expiry of patents• India has incorporated the Bolar provision– Permits the generic producers to use the patents

even before the expiry to get regulatory permission and hence to enter the market as soon as the patent expires


Conclusion• Significant changes in Indian Patent Act after

TRIPS Agreement:– Both process and product patents– Almost all fields of technology patentable– Term of patents: 20 years from date of filing– Very limited scope of governments

• Since India’s pharmaceutical industry today is completely different than what it was in 1970, stronger IPRs may help them by supporting path-breaking research and development

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