THE ANTI-MONOPOLISTIC ROLLER, INDIA’S PATENT BOLAR

A. INTRODUCTION

“A patent is a grant but inventorship is a right”, quotes Kalyan C. Kankanala in his highly revered book “FUN IP: Fundamentals of Intellectual Property”. While for times immemorial, patents have been categorized as rights granting “intellectual monopoly privilege”, Section 107A of the Indian Patents Act is often termed as an “inevitable equipoise” in this ownership syndicate. The fundamental objective of Section 107A is to promote research and development as well as delineate certain acts which are not to be considered as infringement.

The earliest origins of Bolar exception can be traced to the US Federal Circuit decision in Roche Products Inc v Bolar Pharmaceutical Co Inc. 1The Federal Circuit, while examining the nature of infringement in a pharmaceutical patent held that the experimental use exemption to patent infringement narrowly provided under US law did not allow for testing undertaken by Bolar Pharmaceutical to obtain marketing approval of a generic product. The said decision attracted immense criticism from the pharmaceutical industry which termed the judgement as an “undisputed deterrence in curative research”. The said judgement was eventually overturned by the introduction of the US Drug Price Competition and Patent Term Restoration Act 1984 (commonly known as the ‘Hatch-Waxman Act’), which intended to strike a balance between the innovator and generic pharmaceutical producers by allowing the innovators to manufacture, use, offer to sell, or sell a patented invention (other than a new animal drug or veterinary biological product) for uses reasonably related to the research and development of drugs and other biological products. The said provision was subsequently incorporated in the IP laws of several countries, including India which introduced the Bolar exception into the Indian Patents Act, 1970 by way of an amendment (Act 38, 2002, which was subsequently amended by Act 15, 2005). While the said provision was introduced in the year 2003, it only gained significance in the year 2005, when India embraced the product patent regime, leading to an explosion in pharmaceutical patents. While several stakeholders often possess varied opinions on the insertion of the said provision in the Indian Patents regime, the legislative intent behind the same was to ensure maximum availability of the drugs in the Indian market. Another significant reason behind the incorporation of the “Bolar exemption” was to protect the Indian generic drugs industry, which possess 71% of the market share and form the largest segment of the pharmaceutical industry in India.

B. THE INDIAN PATENT LINKAGE SCENARIO AND THE RELEVANCE OF THE BOLAR PROVISION

The existence of patent linkage in India has been an issue of contention ever since the Indian generic drugs industry subsumed the position of being the largest in the global drugs scenario. Patent linkage refers to the link between the marketing approval of the generic product and the patent status of the innovator product. While marketing approvals are aimed at ensuring the efficacy of a drug, it has been long debated that these ancillary approvals cannot supersede the patent rights accrued over the invention. While the concept of patent linkage in India has remained uncertain for a large period of time, the decision of the Delhi High Court in the case of Bayer Corporation vs. Union of India & Anr2 is regarded as the first case to decide on the aforementioned concept wherein an apparently liberal and flexible interpretation of the Bolar exemption was provided.

The case, revolving around the kidney cancer drug Sorafenib tosylate , dealt with two appeals filed by Bayer against the decision of the single judge in the writ petitions filed by Bayer against Natco and Alembic Chemicals to injunct the aforesaid pharmaceutical companiesfrom making, selling, distributing, advertising, exporting and offering for sale any product that infringed Bayer’s patents with regard to the drugs Sorafenib and Rivaroxaban respectively. Natco had earlier secured a compulsory licence from Bayer with respect to Sorafenib through the Indian Patent Office and subsequently sought permission from Bayer to export 1 kilogram (kg) of the active pharmaceutical ingredient Sorafenib to China to conduct a clinic trial and research the development of the drug for regulatory purposes. Bayer, aggrieved by the attempt of Natco to export its patented drug, filed a writ petition, arguing that the grant of such permission to Natco would be contrary to the provisions of Section 107A, as the said transaction falls under the ambit of a commercial activity and hence infringes Bayer’s rights. The court, owing to the factors elucidated above, rejected Bayer’s plea and held that Section 107(A) covers any sale of a patented invention which is required for the development and submission of information under any law in a country other than India that regulates the manufacture or sale of any product. It was held that the sale of the aforesaid drug to the Chinese company can be reasonably stated to be related to studies that are required to be conducted by the said company for obtaining the regulatory approvals, and hence fall within the exception under Section 107A. The court, while recognizing the challenges faced by nations to ensure a strengthened future of curative study, stated that it was unfair to dictate the behavioural and legal requirements of other nations by confining a research exception within the territory of India.

C. COVID’19 AND BOLAR PROVISION

Dr. William Bill Foege, Director Centre for Disease Control and Prevention, once quoted that “there is no human endeavour that is outside the provision of public health”. The said quote holds unprecedented relevance in today’s time, when health of the public has become an issue of prime significance for any nation. On April 22nd, 2020, the nation woke up to a hopeful publication by the Print recently, titled “Indian drugmakers begin developing Remdisivir, ‘world’s best shot’ against COVID-19”. 3The article dealt with several prominent Indian drug giants conducting research on the drug Remdisivir, which served as a potential cure for the novel coronavirus. Owing to the existence of the Bolar provision, the companies conducted detailed study on Remdisivir (IN 332280) , which was granted a patent as recently as February 18, 2020 and is valid till the year 2035. With the novel coronavirus becoming a global emergency, save a national one, member states of the WTO may be able to invoke the rights guaranteed to them as per the Doha Declaration., i.e., they may be able to issue compulsory licensing. While owing to the prevalence of the Bolar provision, Indian generic companies are protected in terms of research and experimentation for a potential COVID’19 cure, any drug or vaccine that proves to be useful for treatment of COVID-19 is likely to be subject of a patent dispute in India as it moves out of the ambit of “study” into the realm of “commercialization”.

D. CONCLUSION

With research and innovation in health growing at an unprecedented rate, states are often faced with the dilemma of “rights” over the “province of all mankind”. Companies spend huge into developing drugs which meet the extensive standards of efficacy and safety and expect maximum ownership over their overly expensive innovations. However, Article 21 of the Constitution of India guarantees a fundamental right to life and personal liberty. The expression “life” in this article encompasses the earlier notions of “survival” to include within its ambit the “right to live with dignity”. The right to health is inherent to a life with dignity, and inaccessibility of drugs often serves as a deterrent for nations to ensure effective realisation of the said right. While the inclusion of Bolar provision is aimed at making the Indian Patents Regime more aligned with the fundamental sensibilities of the nation, unregulated use by companies can result in the exploitation of the Bolar exemption beyond what can be considered “reasonable”. Moreover, the inclusion of the term “reasonable” allows the Courts to judge each case owing to its unique circumstances, rather than forming watertight guidelines, which may prove contrary to the objectives of the said provision.

The article was originally published on www.lexology.com and can be accessed here.