{"id":250896,"date":"2021-07-08T15:00:24","date_gmt":"2021-07-08T09:30:24","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=250896"},"modified":"2023-10-03T14:12:03","modified_gmt":"2023-10-03T08:42:03","slug":"spreading-strains-of-sars-cov-2","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2021\/07\/08\/spreading-strains-of-sars-cov-2\/","title":{"rendered":"Spreading strains of SARS-CoV-2: The need to rethink utility patents"},"content":{"rendered":"

Introduction: The pertinence of rethinking utility patents<\/span><\/h2>\n

The vaccines against COVID-19 possess a limited degree of efficacy against newer strains of SARS-CoV-2. Even so, in some cases, minor changes in composition may be required.[1]<\/a> Yet, the adaptability to each strain may not receive patent protection that is enjoyed by the vaccine against the COVID-19 strain. This is so particularly in India, where a patent for a new use, is granted only in exceptional circumstances.[2]<\/a> It is not as simple as waiving patent rights because the skills, experience and expertise cannot just be learnt, it needs to be inculcated through proper training.[3]<\/a> The better way to proceed is to incentivise pharmaceutical companies to voluntarily licence not only the original vaccine but also any modified versions of a vaccine if need be. The first step towards the latter is to offer patent protection to incremental inventions.<\/p>\n

The author builds a case for the relaxation of Section 3(d<\/em>) of the Patents Act, 1970. In doing so, the article will explore the scope of the Articles 7 and 1 of the Trade-Related Aspects of Intellectual Property Rights Agreement (the Agreement), the socio-economic context in which the Indian IP regime is based and the stakes that it seeks to balance by analysing Indian judicial pronouncements. The judicial approach will be tested against the aims that it tries to further, in order to demonstrate the inefficiency of the current approach.<\/p>\n

Mapping the Scope of discretion under the Trips Agreement<\/span><\/h2>\n

Indian courts[4]<\/a> have sourced the discretion to mould provisions of the Agreement from Articles 1 and 7 of the Agreement itself. Article 27 i.e. patentable subject-matter needs to be read considering Articles 1 and 7 which lay down the nature and scope of obligations of member countries and the objectives of the Agreement, respectively.<\/p>\n

The Agreement under Article 1, limits the freedom of the member States only to determine the appropriate method of implementation of its provisions. Additionally, Article 7, in delineating the objectives of the Agreement makes promotion of technological innovation and transfer and dissemination of technology, the guiding factors in the protection and enforcement of IPR. Further, it identifies the users as well as the manufacturers as stakeholders, and provides for a balance of rights and obligations, conducive to social and economic welfare. Therefore, the room to manoeuvre is only within the substantive provision, here i.e. Article 27 of the Agreement in a manner that furthers equilibrium between stakeholders.<\/p>\n

Article 27, in outlining in clear terms the subject-matter of patentability, seeks to exhaust the categorisation of inventions that cannot be commercialised and patented. The line is drawn at those inventions that bear the potential to affect public order or morality. All other inventions, whether products and processes, in all fields of technology, as long as they are new, involve an inventive step and are capable of industrial application, demand patent protection. Hence, the discretion which is to be kept within the boundaries of the Agreement is limited to maintaining balance with respect to matters affecting public order and morality.<\/p>\n

Understanding the norm on utility patents: Indian judicial pronouncements<\/span><\/h2>\n

In India, the norm is for the new use of a known substance, to not be granted a patent, while the exception is that it be granted a patent if it meets the threshold of enhanced efficacy.[5]<\/a> Hence, it is pertinent to understand through what it is that guides the application of the aforesaid threshold.<\/p>\n

\u00a0The Novartis case[6]<\/strong><\/a>: The enhanced efficacy test<\/em><\/h3>\n

The Supreme Court defined efficacy as \u201cthe ability to produce a desired or intended result\u201d.[7]<\/a> Hence, it is the purpose and utility of a drug in terms of the result that it is \u201cdesired or intended to produce\u201d[8]<\/a>, that would be the deciding factor when it comes to testing the efficacy of a drug. In other words, it is the therapeutic efficacy that is tested. Although the Court based its decision on the \u201cenhanced therapeutic efficacy\u201d[9]<\/a>test, it did not provide a standard for the same. Even though the ruling on Section 3(d<\/em>) was directed at prohibiting \u2018incremental invention\u201d,[10]<\/a> the Supreme Court said that the decision should not be \u201cread as a general prohibition\u201d[11]<\/a> on applying for patents for an incremental invention in the \u201cchemical and pharmaceutical\u201d[12]<\/a> sector.<\/p>\n

F. Hoffman La-Roche Ltd. <\/em>v. Cipla Ltd<\/em>.[13]<\/strong><\/a>: The \u201cnew form of an old substance\u201d test<\/em><\/h3>\n

The test laid down in this case was that of a \u201cnew form of an old substance\u201d.[14]<\/a> The burden to prove that IN\u2019774 was a new form of an old substance i.e. EP\u2019226, was on Cipla. Cipla however, failed to discharge the burden. As a result, Roche\u2019s evidence of difference in efficacy was considered sufficient for it to be granted a patent under Section 3(d<\/em>). Notably, for Cipla to have met its burden, the Court considered it sufficient for it to prove that EP\u2019226 on further reaction can result in the formation of IN\u2019774.<\/p>\n

The question that remained can be viewed twofold: (1) whether there is \u201ca product which may not strictly covered within the patent claim\u201d[15]<\/a>; and (2) whether the product \u201csubstantially contain the patented product but also contain some other variants or some other parts in addition to the patented article or product\u201d.[16]<\/a> The Court, relying on the multiple cases[17]<\/a> including Kirin-Amgen\u00a0<\/em>v.\u00a0Hoechst Marion Roussel Ltd.<\/em>,[18]<\/a> advocates for the claims to be interpreted purposively, in that, the real purpose for the invention of the vaccine should guide the decision-making. It must be noted that \u201ca fortiori\u00a0determination of whether a variant can be subsumed within a broad patent claim is bound to be substantively different (and presumably lower) when compared with the obviousness standard in assessing the question of further working on an invention that could revoke it in the future\u201d.[19]<\/a><\/p>\n

The abovementioned guidelines, carved out from judicial decisions, are within the scope of discretion granted by the Agreement. This to the extent that they comply with the subject-matter patentability requirements under Article 27 of the Agreement in prescribing a method of implementation of the Agreement that balances the stakeholders\u2019 interests. Despite these guidelines that have been laid down in the landmark cases discussed above, the courts have allowed their judgments to be guided solely by the factor of \u201caccess to life saving medicines\u201d.[20]<\/a> They have justified this factor trumping the other considerations on the ground that it promotes social and economic welfare, an aspect that the Agreement permits a member State to accommodate for. In an effort to facilitate such access and accommodation, they have identified evergreening as a cause that needs to be addressed.[21]<\/a> Evergreening is a practice that pharmaceutical companies employ, by\u00a0incorporating minor changes either in the composition of the drug or in the instructions for its administration<\/a>. In order to remedy this cause, they have stood by the legislative remedy i.e. Section 3(d<\/em>).[22]<\/a> Resultantly, for incremental inventions, to surpass the roadblock of Section 3(d<\/em>), they have to demonstrate \u201cenhancement of known efficacy\u201d \u2013 a standard that remains undefined. This approach however, reflects a selective understanding of the Agreement and disregards its overall scheme as decoded above. Such disregard has caused India to overstep its discretion under the Agreement thereby adversely affecting the balance it proposes to create.<\/p>\n

Bending the norm: Arguing in favour of utility patents<\/span><\/h2>\n

The key stakeholders in this debate over utility patents, as identified by the Agreement as well as the courts,[23]<\/a>are the end users and the manufacturers. Therefore, it is the effect on these stakeholders that must be examined to arrive at a stand on the granting of utility patents.<\/p>\n

In stark contrast to the aim of Parliament in curating Section 3(d<\/em>), the current threshold fails to see the cause-and-effect relationship between the granting of patents and access to the public to life-saving medicine.[24]<\/a> The very theories that form the foundation to intellectual property law identify this integral relationship.<\/p>\n

The utilitarian theory,[25]<\/a> in justifying IPR, posits that technological invention and artistic creation benefit the society and humankind. Hence, to further the utilitarian belief of greatest good to the greatest number of people, monetary incentives are offered to creators in the form of rights to profit from their work. The social planning theory[26]<\/a>concretises the reflection of the utilitarian belief in the intellectual property regime by advocating for a system that fosters the achievement of a just and attractive culture. It also fortifies the view that intellectual property not only leads to social welfare but also serves the society. This is evidenced by the fact that a prerequisite for the granting of a patent is a complete description of the invention including the methods by which it is to be operated.[27]<\/a> Consequently, the Government after the expiry of the patent term will have at its disposal, the entire information on the manufacture, operation and use of the patented invention for it to be put out in the public domain. This makes the grant of a patent, an incentive for the inventor to offer complete disclosure. Such disclosure is important in its absence; the society will have to invest a considerable amount of time and money in reinventing the invention from scratch.<\/p>\n

This is pertinent when considered in context of the COVID-19 vaccine which can be made to undergo minor changes for it to be more effective against differing strains of SARS-CoV-2.[28]<\/a> It is important for undivided knowledge to alter the vaccine for a new use, to be available to the public, particularly when the world is aware that the pandemic did not halt at one wave. While this might prima facie seem to be furthering evergreening, when analysed in the context of compulsory licensing, it does in fact strike a balance between the rights and obligations of the producers and users. A compulsory licence is the licence to generically manufacture a patented invention after three years of the patent term.[29]<\/a> The Delhi High Court in F. Hoffmann-LA Roche Ltd.<\/em>v. Cipla Ltd.<\/em>,[30]<\/a> spells out in clear terms the very objective of compulsory licensing which is to ensure the availability of the drug at affordable prices. The Court\u2019s interpretation of the purpose of compulsory licensing was aided by the legislative intent which was to reasonably ensure that the patentee recovers the enormous cost of research and development.[31]<\/a> Accordingly, the patent-holder should be accorded monopoly which could be taken away post a minimum period of which in India\u2019s case is three years.[32]<\/a> This is not to say that the minimum period of three years should not be reduced in light of the current pandemic.[33]<\/a> Instead, such a change should be guided by uniform considerations and must ideally emanate from the legislature in response to the worsening situation. The most important reason to ensure certainty is that it attracts patent applications for life-saving drugs in the absence of which, even a complete shift toward public welfare will lose its very purpose.[34]<\/a> The urgency of the matter is resonated in the current context with Adar Poonawalla, CEO of Serum Institute of India, the largest manufacturer of COVID-19 vaccines in the world, indicating his intention to commence COVID-19 vaccine production abroad.[35]<\/a><\/p>\n

Concluding and mapping the road ahead<\/span><\/h2>\n

The projection of estimated cost of developing a COVID-19 vaccine is $250 million per project with a mere 32% success rate through phase 2 trials.[36]<\/a> In light of the heavy costs and the possibility of the current vaccines being capable of being modified to suit newer strains, courts should allow the interpretation of their discretion to be guided by the Agreement and the legislative intention In doing so, the equipoise between the rights and obligations of the patentee and the end user as postulated in F. Hoffmann-LA Roche Ltd.<\/em>v. Cipla Ltd.<\/em>[37]<\/a>should be considered the best practice. This is because it embodies the legislative intention in using compulsory licensing as the tool to maintain equilibrium. The only unaddressed question is regarding the standard to test the new use against. While the Novartis <\/em>case[38]<\/a> endorses the standard of \u201cenhancement of known efficacy\u201d, F. Hoffmann-LA Roche Ltd.<\/em>v. Cipla Ltd.<\/em>[39]<\/a>, brings it down to a two-fold question of whether the new product contains a variant, and whether it differs in purpose from the older version. Notably, it clarifies that such threshold of enhancement for granting a patent for an incremental invention must be lower than that of inventive step and non-obviousness, as employed integrating the initial patent. Ergo, the considerations involved in the rejection of the patent by the IPO in Novartis <\/em>case[40]<\/a>, should ideally have been rooted in efficacy exclusively in comparison with the initial drug rather than all prior knowledge.<\/p>\n

\n

*<\/a> 3rd-year\u00a0student, BA, LLB (Hons.) Maharashtra National Law University, Mumbai. Author can be reached at shrutidhonde@mnlumumbai.edu.<\/span><\/p>\n

[1]<\/a> Michael Greshko, Existing vaccines should work against new coronavirus variants \u2014 for now (National Geographic, 15-1-2021)<\/a><\/p>\n

[2]<\/a> The Patents Act, 1970, Section 3(d<\/em>)<\/a>.<\/p>\n

[3]<\/a>Interview with Dr Prabuddha Kundu, Co-founder and Managing Director, Premas Biotech (The Wire, <\/em>11-5-2021).<\/p>\n

[4]<\/a>Novartis AG <\/em>v. Union of India<\/em>, (2013) 6 SCC 1<\/a>.<\/p>\n

[5]<\/a> Patents Act, 1970, Section 3(d<\/em>).<\/p>\n

[6]<\/a>Supra <\/em>Note 4.<\/em><\/p>\n

[7]<\/a>Ibid<\/em>.<\/p>\n

[8]<\/a>Sanjay Kumar and Arpita Sawhney, \u2018The Patent Litigation Environment in India\u2019 (IAM Magazine 22 May 2020) <https:\/\/www.iam-media.com\/patent-litigation-environment-india<\/a>>accessed 29 May 2020.<\/p>\n

[9]<\/a> Novartis, supra<\/em> Note 4.<\/p>\n

[10]<\/a>Ibid.<\/em><\/p>\n

[11]<\/a>William Bennett, Indian Pharmaceutical Patent Law and the Effects of Novartis AG<\/em> v. Union of India, <\/em>(2014) Wash. U. Global Stud. L. Rev. 535<\/p>\n

[12]<\/a>Novartis<\/em>, supra <\/em>Note 4.<\/p>\n

[13]<\/a> 2015 SCC OnLine Del 13619<\/a>.<\/p>\n

[14]<\/a>Ibid.<\/em><\/p>\n

[15]<\/a>Ibid.<\/em><\/p>\n

[16]<\/a> Ibid<\/em>.<\/p>\n

[17]<\/a>Catnic Components Ltd.<\/em>\u00a0v.\u00a0Hill & Smith Ltd<\/em>., 1982 RPC 183; Merck & Co. Inc<\/em>.\u00a0v.\u00a0Generic (UK) Ltd<\/em>., 2004 RPC 31; Improver Corpn<\/em>.\u00a0v.\u00a0Remington Consumer Products Ltd.<\/em>, 1990 FSR 181.<\/p>\n

[18]<\/a>2004 UKHL 46: 2005 RPC 9 (HL).<\/p>\n

[19]<\/a>Merck & Co. Inc<\/em>.\u00a0v.\u00a0Generic (UK) Ltd<\/em>., 2004 RPC 31.<\/p>\n

[20]<\/a>Novartis<\/em>, supra Note 4.<\/p>\n

[21]<\/a>Ibid.<\/p>\n

[22]<\/a> Linda L. Lee, Trials and TRIPS-ulations: Indian Patent Law and Novartis AG<\/em> v. Union of India<\/em> (2008) Berkeley Technology Law Journal 281.<\/p>\n

[23]<\/a>Novartis<\/em>, supra Note 4.<\/p>\n

[24]<\/a>Shruti Dhonde & Yashaswi Pande, Balancing IPR and the Right to Health: An Abiding and ad rem <\/em>Puzzle for a Welfare State (NLUJ CIPS Blog, <\/em>30-1-2021) <https:\/\/nlujcipsblog.wordpress.com\/2021\/01\/30\/balancing-ipr-and-the-right-to-health-an-abiding-and-ad-rem-puzzle-for-a-welfare-state\/<\/a>> accessed 11-4-2021.<\/p>\n

[25]<\/a> V.K. Ahuja, Law Relating to Intellectual Property Rights <\/em>(3rd<\/sup> Edn., LexisNexis 2017).<\/p>\n

[26]<\/a>Ibid<\/em>.<\/p>\n

[27]<\/a> The Patents Act, 1970, Section 9<\/a>.<\/p>\n

[28]<\/a> Greshko, supra<\/em> Note 1.<\/p>\n

[29]<\/a> The Patents Act, 1970, Sections 91-94<\/a>.<\/p>\n

[30]<\/a> 2009 SCC OnLine Del 1074<\/a>.<\/p>\n

[31]<\/a> Ibid<\/em>; Telefonaktiebolaget LM Ericsson (PUBL)<\/em> v. Competition Commission of India<\/em>, 2016 SCC OnLine Del 1951<\/a>.<\/p>\n


\n[32]<\/a>Telefonaktiebolaget<\/em>, supra Note 31.<\/span><\/p>\n

[33]<\/a> Greshko, supra Note 1.<\/p>\n

[34]<\/a>Dhonde and Pande, supra Note 24.<\/p>\n

[35]<\/a> Serum Institute Chief Says He\u2019s Left India, Planning to Start Covid Vaccine Production Abroad (Scroll.in, 1-3-2021) < https:\/\/scroll.in\/latest\/993820\/coronavirus-serum-institute-chief-says-he-is-planning-to-start-vaccine-production-outside-india<\/a>> accessed 1-5-2021.<\/p>\n

[36]<\/a>Andrew Lo, The Challenging Economics of Vaccine Development in the Age of COVID-19, and What can be Done about it? (DIA Global Forum, May 2020) <https:\/\/globalforum.diaglobal.org\/issue\/may-2020\/the-challenging-economics-of-vaccine-development-in-the-age-of-covid19-and-what-can-be-done-about-it\/<\/a>> accessed 11-4-2021.<\/p>\n

[37]<\/a>Supra Note 30.<\/p>\n

[38]<\/a>Supra Note 4.<\/p>\n

[39]<\/a>Supra <\/em>Note 30.<\/p>\n

[40]<\/a>Supra<\/em> Note 4.<\/p>\n","protected":false},"excerpt":{"rendered":"

by Shruti Prasad Dhonde<\/p>\n","protected":false},"author":67011,"featured_media":250970,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[42503,1191],"tags":[39924,29944,46462],"class_list":["post-250896","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal-analysis","category-op-ed","tag-covid-19","tag-patents","tag-sars-cov-2"],"yoast_head":"\nSpreading strains of SARS-CoV-2: The need to rethink utility patents | SCC Times<\/title>\n<meta name=\"description\" content=\"Spreading strains of SARS-CoV-2\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2021\/07\/08\/spreading-strains-of-sars-cov-2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta 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