By, Shubhank Suman

INTRODUCTION

In developing countries, millions of people still have little or no access to lifesaving drugs, and the main reason for it is patent. A patent that confers certain legal rights on inventors and gives them absolute monopoly regarding the use of the invention to prevent competition also has an enormous impact on the drugs’ accessibility and reachability. Millions of people, mostly in developing countries, lack access to lifesaving drugs. Patents can have a dramatic impact on access to drugs when they are used to prevent competition.[i] A patent gives certain exclusive rights to the manufacturer over the use of the drugs; these rights enable the manufacturers to prevent others from manufacturing the same drugs and make them the sole authority to decide the quantity of supply and the price of the drugs. Consequently, they charge heavy prices as per their whims and fancies. On account of these exorbitant prices, the treatment of most of the curable diseases like T.B. becomes incurably out of reach for the poor. [ii] Hence the high price of medicinal products becomes a question for life and death in developing countries where people pay for medicine from their own pockets and very rarely have health insurance.

Today, about 14 million people die from infectious diseases every year. Many of these diseases are curable and preventable, such as acute respiratory infection, diarrhea, malaria, etc.

The death toll from these diseases is particularly high in developing countries due to the lack of access to lifesaving medicines. A lack of research into specific diseases is a major source of such an access gap. Pharmaceutical patenting in developing countries is another major obstacle, which increases drug prices by restricting generic competition to hinder the accessibility of drugs. For example, the cost of a patented drug that is used in the treatment of AIDS costs around 95000 for one tablet making it highly unaffordable for the middle and lower-middle class. The inaccessibility of lifesaving drugs in the developing countries also raises a few questions, what would happen if a country produces a vaccine for corona? Will they be patented too?

 

CONCERNS OF PATENTABILITY OF LIFE-SAVING MEDICINES

The patentability of drugs not only impacts the price of the medicines, but it also has a huge impact on the supply and quality of the medicines, which raised numerous concerns for society.

  • Evergreening – A patent is granted for a period of 20 years and cannot be renewed. Hence in order to extend the life of the patent and to maintain a monopoly, pharmaceutical companies use the process of evergreening where companies make minor changes in the patented drugs, which may or may not increase its efficacy and then apply for a new patent.[iii] This evergreening process prevents new entrants from entering into the drugs market which in result has a direct impact on the quality and quantity of the medicines.

 

  • Cartel –  Patentabiity of drugs leads to the emergence of patent sharing where companies share patents with each other. This concept of patent sharing results in the formation of various pharmaceutical cartels where companies share patents with each other to prevent other competitors from entering into the competition. Sometimes companies use this patent sharing to kill their own existing product in lieu of the introduction of a more sophisticated product to increase prices. These cartels seriously affecting the innovations in the field of medicine.[iv]

  • Diplomacy –  patentability of drugs also make medicines a weapon of diplomacy. As even though a patent is in the hands of private entities, the state may still have the right to use them for its own purposes. There are many instances where developed countries stopped the supply of patented life-saving drugs to blackmail developing countries.

POSITION IN INDIA

Following the colonial era, Indian intellectual property laws had inherited U.K. patent law, Consequently, Indian citizens were unable to afford pharmaceutical medicines on average. Therefore, in 1970 India adopted the Patent Act, under which drugs and agrochemicals are specifically excluded for patenting and only their development processes can be patented. This exclusion was introduced to break India’s reliability on imports of bulk medicinal products and to develop a self-indigenous pharmaceutical sector.[v] The lack of protection for patented products in drugs and agrochemical products has greatly affected India’s pharmaceutical industry and led to the growth of considerable expertise in the reverse-engineering of drugs that are patentable in the other countries but not protectable in India.

It enabled Indian companies to make cheaper copies of drugs (or other inventions) of another company as long as the process of production was slightly different.

However, many changes occurred in the Indian market with the introduction of the GATT which India signed it in 1994. GATT and the TRIPS Agreement were now required to comply. Not complying with these standards meant that the defaulting party would no longer be a member of the WTO (World Trade Organization). The pharmaceutical industry now had to meet the minimum standards which were provided under TRIPS. Hence, not only process patent, but product patent was also introduced, and the period of patents was increased from 7 years to 20 years.[vi]

EFFECT OF PRODUCT PATENT

Previously in the Indian patent system, the only process of the medicine is patentable and not the medicines itself. However, after the introduction of the “product patent regime” under the TRIPS, even the medicine could be patented. Now Other companies cannot produce the same drug once it has been patented. Section 5 (1) of the Indian Patents Act that deals with the patentability of the process of medicines was deleted.

Following the changes introduced by the India Patent Act, the need arose to make a balance between patent protection and to maintain competition among drug companies. The new “product patent regime” had created a situation of monopoly in the market of lifesaving drugs. Foreign generic companies had started regulating prices of lifesaving drugs and started giving tough competition to Indian pharmaceutical companies which resulted in the closure of more than 30% small and large pharmaceutical companies.[vii]

Consequently, in order to tackle high prices of patented drugs in the Indian medicine market, a compulsory licensing system is introduced under patent law. Section 84[viii] of the Patent Act stipulates that compulsory licensing can only be granted after three years from the time of the grant of a patent and in the following cases only.

  1. “The invention which has been patented is not available to the public at an affordable price.
  2. “The reasonable requirement of the public with respect to the patented invention has not been satisfied.”

This system forces the pharmaceutical companies to not to indulge in high price competition and also lower down the prices of patented medicines if they want to get a compulsory license in India.

SHOULD WE REMOVE PATENTABILITY OF LIFESAVING DRUGS?

An inventor who used his/ her ability to invent something new is awarded a patent as a monopoly in order to acknowledge their efforts and encourage them for further inventions. The grant of the patent confers certain legal rights on inventors to protect their devices against the unauthorized sale, use, production or sharing for a period, not more than 20 years. Hence it is wrong to say that the patentability of lifesaving drugs has an only negative impact on society. A patent is not absolute and can be subjected to a number of checks and balances to curb its abuse. If we completely remove licenses from the area of lifesaving drugs, then it will demotivate the inventors who invest years behind such innovations, which results in the reduction of innovation and competition in the market of lifesaving drugs. Reduction in the race would turn out to be a reduction in the quality and quantity of lifesaving drugs.[ix]

  • Patentability of medicines also results in the generation and circulation of technical information as patent acts as an encouragement to disclose information which otherwise may remain secret by individuals or organizations. This information makes people aware of the complex problems and ensures the continuation of scientific progress as each invention builds on the base of previous ones.
  • Patents provide certain monopolistic rights to the inventor for the period of 20 years; these monopolistic rights make inventors more willing to fund research and development, which contributes significantly to the innovation in the field of medicines.
  • Patents of lifesaving drugs ensure a high profit and help recoup investments incurred during the research and development stage. High gain attracts new entrants into the market, which results in broader accessibility and reachability of lifesaving machines.

Therefore, we have to look for a balanced approach to deal with the shortcomings of drug patents.

 

WHAT GOVERNMENT CAN DO?

Governments can play an essential role in monitoring disequilibrium in accessing lifesaving medicines. States should support comprehensive and intensive research in developing lifesaving medicines by providing publicly available research infrastructure and directly stimulating researchers and scientists rather than rewarding risk capitalists and companies for real researchers’ work. One solution is to create a worldwide patent pool which should be based on a system of free research and testing without the conventional patent restrictions. This would facilitate public access to science and technology that can be used to develop medicines and treatments.[x] An excellent example of this is the International Genome project. A “Centralized innovation fund” to integrate research and development therapies, including antibiotics and vaccines to support vulnerable communities, was another research model introduced by Bangladesh, Barbados, Bolivia, and Suriname in 2009.[xi]

Even though the patent is in the hands of private entities, the state may still have the right to use them for its purposes. Hence countries should enact specific laws to facilitate these arrangements. E.g., in the USA, the Bayh-Dole Act 1980 ensures that the government maintains sufficient rights to use publicly funded research patents. This act also confers “march-in” rights on the government If the patent holder refuses to license the invention to third parties. It means that a forced license may be issued on reasonable terms to a third party. When ‘action is necessary to alleviate health or safety needs’ or when the patented invention to be produced in proper time[xii] This means that for the COVID 19 vaccines, the U.S. government can order a vaccine corporation or university to license a patent to others with federal funding. Similarly, like the USA, In Australia, the government can also exploit other people’s patented inventions under the ‘crown’ right to use for the health and welfare of people. In these cases, the patent proprietor has the right to a government’s financial compensation. Countries that offer pharmaceutical products patenting may also issue compulsory licenses for domestic and export production of pharmaceutical products, invoking the conditions laid down in the Paris Convention.

CONCLUSION

In light of the above discussion, we can say that lifesaving drugs’ patentability cannot be eliminated as it has both advantages and disadvantages. Moreover, the concept of patentability of lifesaving drugs is a creation of the needs of the modern business that protects the pharmaceutical inventions’ ideas. However, we cannot ignore the difficulties associated with the patent of lifesaving drugs like high prices, unfair competitions, etc., and those that are unavoidable. It must be appropriately analyzed and resolved. Therefore, the need for the hour is to come up with balanced laws that provide a broader scope for the patentability of medicines and maintain its viability in the current scenario.

[i] Akansha Mehta, Patenting of lifesaving drugs, has created a global health crisis where human life has become a commercial commodity, (Aug 6, 2014), https://blogs.lse.ac.uk/impactofsocialsciences/2014/08/06/the-morality-of-patenting-life-saving-drugs/.

[ii] Robert Downson, Impact Of Patent On The Access And Price Of Life Saving Drugs, (2016), Https://Www.Pharmatutor.Org/Articles/Impact-Of-Patent-On-The-Access-And-Price-Of-Life-Saving-Drugs.

[iii] Rupali Mukherjee, Changes to India’s patent law will impact prices of lifesaving drugs, Times of India, (Mar 23, 2016).

[iv] Id.

[v]  Nilesh Zacharias,  Patents And The Indian Pharmaceutical Industry, (Nov 20, 2019), https://www.mondaq.com/india/patent/865888/patents-and-the-indian-pharmaceutical-industry.

[vi] Pradeep S. Mehta, TRIPS and Pharmaceuticals: Implications for India, (1998), http://journals.openedition.org/sjep/718.

[vii]  Tushita Dogra, Pharmaceutical Patents A Threat To India’s Drug Industry?, (Mar 14, 2018), https://www.mondaq.com/india/food-and-drugs-law/682550/pharmaceutical-patents-a-threat-to-india39s-drug-industry.

[viii] Indian Patent Act 1970, Sec 84.

[ix] Justify the Patenting of Life Saving Drugs (2018), https://www.lawteacher.net/free-law-essays/commercial-law/justify-the-patenting-of-life-saving-drugs-commercial-law-essay.php.

[x] Patenting of lifesaving drugs has created a global health crisis where human life has become a commercial commodity, supra note 1.

[xi] Lyrissa Lidsky, Patent reform is needed to protect lifesaving drugs, (2019), https://www.statnews.com/2019/07/23/patent-reform-protect-access-lifesaving-drugs/.

[xii], Natalie Stoianoff, Whoever invents a coronavirus vaccine, will control the patent – and, importantly, who gets to use it (May 29, 2020), http://theconversation.com/whoever-invents-a-coronavirus-vaccine-will-control-the-patent-and-importantly-who-gets-to-use-it-138121.

Image source: Photo by Adam Nieścioruk on Unsplash