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Extending Provision of Compulsory Licensing
Compulsory Licensing is intended not to deprive the innovator companies from earning due income but only discourage them from enjoying monopolistic profits

Government is considering extending provision of compulsory licensing beyond cancer to diabetes & hepatitis. In an exclusive interview, Saurabh Chandra, Secretary, Department of Industrial Policy and Promotion Board, talks about issues related to Compulsory Licensing and its implications on the international Pharma companies in India. Excerpts from the interview.

What are the issues in pursuing Compulsory Licensing (CL) in India? Can you elaborate the law details in granting compulsory license & the correponsding regulatory norms?
Compulsory Licensing is enabled under four sections of Indian patent act. These are section 84 (general CL to be issued by the Controller on application), Section 91 (issue of CL by the Controller for a related patent on application), Section 92 (issue of CL by the Controller based upon a notification by the Central Government of circumstances of national emergency or in circumstances of extreme urgency or in case of public non-commercial use) and Section 92 A (issue of CL by the Controller on application for manufacture and export of patented pharmaceutical product to any country having insufficient or no manufacturing capacity in the pharmaceutical sector for the concerned product to address public health problems).
In addition, Chapter XVII, Section 100 provides for use of inventions for the purpose of government and acquisition of inventions by Central Government.

How will CL address the underlying issues of access to medicines and healthcare?
Compulsory Licensing will address the issues of access to medicines and healthcare by making drugs available to public at reasonably affordable prices.

CL deprives the innovator companies from making money, which they would have invested in discovering successful drug and many unsuccessful trials. What do you have to say?
As per the provisions of the Patents Act 1970, in the situation of grant of CL against a patented invention, the innovator company will be entitled to get the reasonable royalty from the Company which gets the CL.
As such CL is intended not to deprive the innovator companies from earning due income but only discourage them from enjoying monopolistic profits.

Will CL hamper the process of innovation in drug development? Does it discourage Multinational Pharma Companies from investing in innovation and encouraging Indian companies to develop new molecules?
The provisions for CL are not meant to hamper the process of innovation but to ensure a fair balance between the interests of innovators and urgent need of public health.
As explained, issue of CL under the Patents Act does not hamper growth of pharmaceutical industry. It only ensures a balance between private interest and public health needs.
Any issue of CL will follow due process of law and will be in accordance with the Patents Act and consistent with TRIPS and Doha Declaration.

Will the CL ruling and litigations make MNCs rethink their investments in India and what can be the implications on the international Pharma companies in India as they have expressed their concern after the Bayer Natco case ruling?
The Indian IPR regime is fully compliant with TRIPS. Moreover, the issual of a Compulsory License will follow the due processes of law. An order for CL can be challenged in IPAB, which is an independent judicial authority.
Further a person aggrieved from an order of IPAB can make an appeal before the Supreme Court of India. In this backdrop there is no reason for any MNC to apprehensive about protection of IPRs in India.

Please comment on Compulsory Licensing of patents according to the TRIPS agreement?
The provision for Compulsory Licensing have been incorporated in the Patents Act 1970 in accordance with the flexibilities provided under Section 31 read with Section 8 in TRIPS agreement.
These flexibilities have been stipulated i n t h e TRIPS Agreement to enable the member States to deal with the anti-competitive practices and also the emergent national circumstances.