The patent challenge

The patent challenge

After becoming a signatory to the TRIPS agreement last year and enactment of Patents (Amendment) Act in 2005, India has become the flavour of the season. But India’s patent infrastructure is still in its infancy with inadequate manpower and an ill-equipped patent office. There’s a need for a quick action, discerns Sapna Dogra

The government’s adherence to the TRIPS agreement with the enactment of Patents (Amendment) Act 2005 by the process of amending the Indian Patent Act 1970, has opened up new vistas for the Indian pharma industry. This move has enabled global firms to take a renewed interest in the Indian pharma industry.

In the meanwhile, Indian pharma companies have already woken up to the importance of IPR, both as an asset and as a marketing tool. Now, some companies even have patent cells attached to their R&D departments as their customers from regulated markets insist on receiving non-infringement statements. “There has been a four-fold increase in patent filings by all the major companies involved in R&D,” says D G Shah, Secretary General, IPA. At USV, the IPR activities of the company both in terms of patenting R&D’s efforts, as well as providing support to the marketing divisions for infringement issues, are all a part of the responsibilities of the Knowledge Cell, which is the strategic planning unit of the company. This cell examines the development process for each product for patent status in advance and prepares the market entry strategy before R&D can take up the project.

In spite of the evolution of the pharma industry in the light of the new patent regime, many global players are still sceptical due to certain uncertainties in the law. Some of the areas of concern include narrowing the definition of patentability to NCEs; broadening the scope of compulsory licensing to include affordability; and the lack of data protection. Another concern with respect to MNCs is that the new patent law extends to products that are in the R&D pipeline and does not cover most products already on the market, leaving many products exposed.

Some complaints

It might be a little too early to judge the new law as India’s patent infrastructure is still in its infancy. There is also a large backlog of patent applications. Though the government is introducing measures to increase resources, train staff and clear the backlog by digitisation of the process, the progress is still tardy.

This slow paced work progress is inviting a lot of criticism from the industry. “The functioning of the patent office is totally unprofessional and bureaucratic that it is almost non-workable,” says Chan Park, Advocacy Officer, Lawyers Collective. Other countries have websites with all the information available online and available through search. But in India, it is yet a far-fetched idea, he laments. For instance, if one needs a copy of a US patent or a European patent, it can be simply downloaded from the Internet for free. On the other hand, to get a copy of an Indian patent, it is an uphill task. One has to make a personal visit to the patent office, where it was filed and one must make an advance payment based on the number of pages.

Hard to search

The gazette has been online only for about a year now (the past issues were manual). However, this has not made the search any easier and there is no indexing, either, for single issue or for multiple issues. One has to search each issue manually from cover-to-cover if one needs to check on a patent application. “I must examine the gazette and ascertain the number of pages, the other option being a letter to the patent office providing the details based on which they send a response quoting the amount that we need to pay,” says an exasperated Dr K G Rajendran, Head, Knowledge Cell, USV. Even after paying the amount, there’s a waiting period before obtaining a copy of the required application!

To add to the woes, the patent knowledge and interpretations vary from office to office, making a search for the right patent, a wild goose chase. “The need of the hour is to have all the approved patents and published applications digitised so that they can be accessed as easily as people access the US or EU patents,” says Park. The database should also be a form that can be searched easily. As of now, the data is in the form of scanned pdf files, which contains abstracts instead of full literature. The data available through TIFAC also has a number of errors, like lack of uniformity in corporate names, lack of systematic indexing, cross-linking common parameters and spelling errors. “A spelling mistake in a searchable database makes the database totally useless,” he rues.

What makes matters worse is the typical government office syndrome, where people are forced to make umpteen visits to the patent office because the person concerned is, more often on leave. “Recently, Mumbai patent office was not functional for three full months because they were shifting from one building to another,” says Rajendran.

The shortage of patent examiners is also increasing the internal inefficiency of the patent office manifold. “Lack of manpower is a grave issue. There are about 3,500 patent examiners in the US, whereas the number in China is about 4,000. But India has just 275,” says B K Keayla, Convenor, National Working Group on Patent Laws.

Legal system to address IPR?

There is also manpower inadequacy, in terms of IPR attorneys with strong background in the respective sciences. In an ideal situation, all judges handling IPR-related cases should be experts in chemistry, pharmaceutics and biotechnology. However, in practice, this is not possible,” observes Rajendran. To be a patent attorney, a candidate needs to have a degree in science, technology or engineering stream along with a degree in law. These unique requirements add to the issue of scarcity of adequately qualified professionals. An easy remedy to this problem is court calling expert witnesses in respective fields to testify.

Rishi Bhatnagar

IPR lawyer

There are trainers coming from the US and Europe to educate the Indian judiciary on the intricacies of IPR, which is still a new concept. This is not a healthy trend, says Park because the version of patent laws in such cases would be pro-West. There are some institutions like George Washington University Law School, which established the India Project in 2004. The project uses legal education to help build bridges between the United States and India. According to Park, every year IP law experts, who are CEOs of big pharma, general council of companies, partners of big law firms tour India and meet Indian Government, judiciary and corporates to talk about the IP protection. However, he cautions that the interpretation is as per their convenience, which is not suitable in Indian conditions. There has also been a substantially increased interest in the field. India, with its vast talent pool of technically qualified professionals, is well positioned to suit the demand. Numerous institutes, law schools and science faculties have introduced patent courses and training for suitably qualified persons. This will soon add to the resources already available.

There have been suggestions to establish special courts to handle IPR cases. “Special courts may have their logic. But, it has been noticed that they tend to consciously or unconsciously assume a bias in favour of the intellectual property right holders,” says Rishi Bhatnagar, an IPR lawyer based in the UK. According to him, this may be an issue with a nascent and developing patent regime in India. “As of now, there is a requirement to sensitise and train the existing judges to new aspects of the law, including inter alia the patent regime. This will help reduce the need to set up special courts,” he says. One also has to bear in mind that intellectual property issues are interwoven with several other issues and a judicious mind is all one needs to resolve the case.

Need of the hour

Sanjiv Kaul

Chrys Capital

A patent system has many advantages to the industry, and the industry should also chip in for the same instead of choosing to play the blame game. “MNCs and big Indian companies should bring in resources to train, station and retain the people on BOT (build, own and transfer) basis,” says Sanjiv Kaul, MD, Chrys Capital. The approvals and disapprovals should not be sensationalised, but the process should be facilitated without influencing the outcome.

There should be more patent offices in the country in the major cities like Ahmedabad, Hyderabad and Lucknow and they should be digitised and connected. Speedy online access of the data in public domain, is yet another demand of the industry. Patent examiners must have access to subscribed databases to make the search more meaningful, which will in turn, result in ‘good’ patents being granted.

The patent office must provide online access to the entire Indian patent database (granted patents and published applications) with an efficient indexing system. Such a database should be searchable, error-free and should have the entire text. The industry’s grouse is that the present system, besides being inefficient and not user-friendly, gives room to complaint of favouritism, which should be overcome.

Clearance and backlog
  • Over 10,000 patent cases received clearance in 2002-2003 compared with 2,800 patent applications in 1999-2000
  • Out of the pending 45,000 patent applications, preliminary scrutiny reports have been issued for over 42,000 applications
Proposal to Recruit Additional Personnel
  • 62 new patent examiners have been recruited
  • 181 patent examiners will be recruited
Operation Sunrise
  • The patent office reviewed (by the January 30, 2004 deadline) 2,000 applications received as of December 30, 2003
  • Over 70,000 patent records and 20,000 design records have been digitised
  • A searchable database has been proposed for the website
Source: Ernst & Young Analysis, 2005

More manpower

There are three important factors, which will help revamp the patent office- manpower, resources and training. It is pertinent to scale up the salary structure of patent examiners, Keayla advises. There is severe paucity of trained personnel, the only solution being recruiting fresh graduates and training them on the job. Such a situation leads to rampant poaching of trained people from other companies. Another side-effect of this situation is the mushrooming of “academies” offering training courses in IPR. These courses neither have any standard syllabus nor any quality control. To address this, Rajendran says that Technology Information, Forecasting & Assessment Council (TIFAC) should introduce a proper curriculum that these training programmes must follow. The final examination must be conducted by TIFAC. The certificates and diplomas must be given by TIFAC too. Implementation of such a programme could ensure minimum standard for all the certificate holders, he avers.

To qualify as a patent agent, one needs to pass a qualifying exam under section 126 of the Patents (Amendment) Act 2005. Such a certificate does not guarantee experience in various aspects like patents drafting, filing and infringement analysis. The patent office could provide a mechanism for imparting such practical training.

Remedial steps

The impending Technical Expert Group (TEG) final report’s recommendations would help end the uncertainty and prepare the drug industry to face the rules by bringing in a uniform interpretation and implementation of patent laws.

Though the Patent Act, while addressing almost all the TRIPS flexibilities, provides sufficient safeguards to address public health concerns, the challenge lies in the implementation of these safeguards in a prudent manner.

To allay the concerns of the global pharmaceutical majors and to gain greater confidence that India’s Patent Act will administer justice efficiently, the government has proposed several measures to address procedural delays, existing backlogs, and a paucity of trained human resources. These range from proposals to set up specialised IP courts to comprehensive modernisation of patent offices in the country (ref table).