P.K. Ghosh President - Biotechnology, Cadila Pharmaceuticals Ltd., Bhat Corporate Campus

1. Presentation Coverage “Flexibilities available under TRIPS agreement, cases of countries utilizing flexibilities, implications for Indian Industry for domestic and export market with special focus on biotech based pharmaceuticals” P.K. GhoshPresident - Biotechnology, Cadila Pharmaceuticals Ltd., Bhat Corporate Campus Sarkhej Dholka Road, Bhat, Ahmedabad – 382 210 TRIPS AGREEMENT, CURRENT INDIAN PATENTS ACT & INDIAN BIOTECH INDUSTRY IPR Seminar at Intas Biotech, Moraiya, Ahmedabad September 26th 2005

2. TRIPS compliant Indian Patents Act, 2005 Patents Act of Developed Countries Indian Patents Act, 1970

3. EMERGING SCENARIO AFTER 31-12-2004 • Product Patenting will have to be respected by Member Countries. • This will not apply to products already in manufacture and use, with some exceptions . • New Products’ entry into Member States will be expensive till patents are in force on them. • Production technologies will be difficulty to be accessed. Alliances with developed countries are expected to be expensive to developing countries. • Only inventive countries will reap substantial benefits. • Developing countries will concentrate on patent expired products and services and there will be the birth of Biogenerics • As the New Products Entry per year is not very large in number, developing countries would have to manage by using patent expired products.

4. MAIN CONCERNS IN BIOTECH PATENTING IN DEVELOPING COUNTRIES • Food Security Concern • Livelihood security • Biotech Medicines at unaffordable prices REASONS FOR CONCERN • Lack of Adequate Inventive Infrastructure for R&D • Lack of Adequate Scientific Skill • Lack of Adequate Resources. Developing Countries have therefore favoured lower levels of IPR Protection

5. Article 27 of TRIPS of WTO Patentable Subject Matter1.         Subject to the provisions of paragraphs 2 and 3, patents shall be available for any inventions whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial applications. Subject to paragraph 4 of Article 65, paragraph 8 of Article 70 and paragraph 3 of this Article, patents shall be available and patent rights enjoyable without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced. 2.         Members may exclude from patentability inventions, the prevention within their territory of the commercial exploitation of which is necessary to protect order public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment, provided that such exclusion is not made merely because the exploitation is prohibited by their law.3.        Members may also exclude from patentability:(a)     Diagnostic, therapeutic and surgical methods for the treatment of human or animals;(b)     Plants and animals other than microorganisms, and essentially biological processes for the production of plants or animals other than non-biological and microbiological processes.  However, Members shall provide for the protection of plant varieties either by patents or by an effective sui-generis system or by any combination thereof.  The provisions of this subparagraph shall be reviewed four years after the date of entry into force of the WTO Agreement.

6. WHAT ARE PATENTABLE SUBJECT MATTER UNDER WTO? • Patent shall be available for any invention in all fields of technology, provided that these are new, involve an inventive steps and are capable of industrial applications. • Members may exclude • Inventions which are contrary to public interest or morality. • Diagnostic, Therapeutic and Surgical Methods for the treatment of human or animals or plants. • Plants and animals other than microorganisms • Essentially biological processes.

7. MAIN ISSUES IN BIOTECH INVENTIONS • Protection of Microorganisms. • Plant Variety protection. • Patenting of Animals. • Discovery and Invention. • Ethical Issues. • Traditional Knowledge. • Essentially biological Processes. • Deposit and Access • Sharing of Genetic Biodiversity.

8. To be TRIPS complaint what India has done? • Sec. 3 of Indian Patent’s Act 1970 has been amended to include • Section 3 (j) which reads as under, • “Plants and animals in whole or any part thereof other than micro-organisms but including seeds, varieties and species and essentially biological process for production or propagation of plants and animals” (25th June 2002 Amendment) • Cont…….

9. To be TRIPS complaint what India has done? • Sec. 5 & 39 of Indian Patent’s Act 1970 deleted • India signed Paris convention and became a part of Budapest Treaty, all before 31.12.2004 • Definition of inventive step in the Patents (Amendment) Act, 2005 was changed as a new section 2(1)(ja) to read as under :- • “ a feature of an invention that involves technical advances as compared to the existing knowledge or having economic significance or both and that make the invention not obvious to a person skilled in the art” • The definition of Patent was changed to mean “ a patent for any invention granted under this Act”. • Cont………….

10. To be TRIPS complaint what India has done? • Sec 3(d) in the amended act defines what is non patentable through the statement : • a) the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance • b) the mere discovery of any new property or new use for a known substance • c) the mere use of a known process, machine or apparatus – unless such process results in a new product or employs at least one new reactant • Sec 92 A (1) of the new act has expanded the scope of compulsory licencing ground

11. How flexibility has been created in the Patents (Amendment) Act, 2005?

12. PROTECTION OF MICROORGANISMS • Microorganisms need not be defined. But States could interpret microorganisms for the applicability of their National laws on Patentable microorganisms. • Microorganisms include viruses, sub viral agents, plasmids, bacteria including cyanobacteria, fungi, actinomycetes, yeast and protozoa. • Cell lines of vertebral origin or other cell lines originating from higher life forms are not microorganisms. • Monoclonals derived from vertebrates are also not microorganisms. • Patentable microorganisms would be those which have been produced by human intervention and where the interventions are non obvious and they do not involve an essentially biological process.

13. PLANT VARIETY PROTECTION • A Plant variety is a genotype within a genera and within a species. It is developed by breeding process. It can also be developed by genetic engineering. • All germplasms in a country are owned by the States. • A plant variety can be owned by a public or a private entity under the Plant Variety Protection Act (PVPA). In order to own a variety for a limited period, the inventor / breeder has to prove that the variety is Distinct(New), Uniform( with regard to features of its vegetative propagation or sexual reproduction) and the variety is Stable in its essential characteristics. • Indian PVPA allows farmers to grow and retain the cultivated propagules including seeds under farmers’ rights. • All protected plant varieties in India must be registered with the authority.

14. PATENTING OF ANIMALS • WTO has provided exemptions to countries to the protection of animals, including animal varieties. • This opportunity can be availed of by all countries and animals including animal parts like organs, tissues and cells of animals modified to patentable inventions can be kept out of patenting, if the States so desire. • Though there is yet no protection of animal varieties, the scientific progress in the development of animal varieties have not remained behind.

15. DISCOVERY AND INVENTION • All findings in biology where a biological substance or its properties already existed in nature but was noticed for the first time individually or collectively by human should be termed as discoveries. • Naturally occurring microbes, plants and animals, naturally occurring biochemicals, genes, nucleic acids stretches, proteins, carbohydrates, lipids or combinations thereof which are naturally occurring should be treated as products of nature. • Patentable microbes or plant varieties that can be protected through PVPA should be products of human intervention and distinct from the naturally occurring ones. • Inventions as opposed to discovery, should have elements of human intervention, the product should be new and there should be uses of the product including industrial applications.

16. ETHICAL ISSUES • Ethics come from love for life. • Love for Life is related to cultural practices. Cultural practices vary. • Creation, interpretation and operation of IPR laws cannot delink societal standards of cultural practices and issues of morale. • IPR laws touch societal issues: so they cannot be ethically neutral. • Ethics and Law are complexly interconnected. • Complexities are resolved by interpretive legal community. Media and vocal public has a role to play to bring in proactive public into the debate. • Exploitation of Inventions contrary to ordre public or morale should be out of IPR Maintenance of activities of animal welfare, human dignity and preservation of natural living biological wealth are considered as natural to human beings. Therefore, inventions and activities which are contrary to these would trade upon ethical issues. Inventions in areas which do not conform to animal welfare or which bring down human dignity should not be considered to be inventions that are patentable.

17. SHARING OF GENETIC DIVERSITY • The convention of Biological Diversity encourages equitable sharing of genetic biodiversity among Member States. • It is required that inventions emanating from genetic materials should mandatory mention the origin of the material. This would ease sharing of benefits from inventions emanating from different genetic materials received from different States by different inventors.

18. Where developing countries can concentrate? • For Exports & Domestic Sales: To produce Patent Expired Drugs by innovative technologies • To intensify efforts on well planned research keeping available resources in view • To concentrate on Pharmaceuticals from Genetic bio diversity & Traditional knowledge • To intensify infra structures for quality assessment & improvement

19. Global sale of recombinant therapeutics (All figures in USD Million) ,  & 

21. CONCLUDING REMARKS • IPR laws of Member Countries would have to conform to WTO. There are provisions to create elbow rooms from within the WTO. • All countries will try to upgrade their research capabilities. • Patented biotech products would generally be very expensive to the consumers. First innovators would take heavy premium. • Free availability of genetic materials will be retarded unless friendly policies of sharing are in sight. • Public will be more literate on IPR issues. • The Centers of Education, Research & Training will increasingly become the generators & possessors of IPR.

22. Patents Act of Developed Countries Indian Patents Act, 1970 TRIPS compliant Indian Patents Act, 2005 The Survival instinct shall manifest differently in different countries………..

23. THANK YOU