• The single most important feature of the Bill is the introduction of product patents for drugs and chemicals with a patent term of 20 years. This is a departure from at least three decades of process patents for a term of 7 years in these areas. With this, the interim provision of “exclusive marketing rights” is no longer relevant and pending applications on the basis of which these rights were granted are to be examined immediately. Included in the product patents are “mail box” product applications for drugs and chemicals filed from 1995 onwards which the Indian Patent Office will now examine.
• A new use of a known substance still remains unpatentable. The relevant Section has been amended to include a further explanation indicating that salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of a known substance would also be considered to be the same substance, unless they differed significantly in efficacious properties. The ramifications of this amended definition are not clear at this stage.
• Patent protection has not been extended to any software including embedded software.
• The novelty requirement has now been made absolute.
• The definition of “inventive step” has been modified and now specifies “a feature of an invention that involves technical advances as compared to the existing knowledge or having economic significance or both and that makes the invention not obvious to a person skilled in the art”. This replaces the earlier definition of “not obvious to the person skilled in the art” which was in line with definitions in most patent offices. Again, the precise implications of the new definition are not clear at this stage.
• A new definition has been introduced for "pharmaceutical substances" which are defined as “a new entity involving one or more inventive steps”.
Patent Publication / Prosecution / Opposition
• Under the new provisions, applicants can request early publication of an application.
• With the ordinance, the acceptance stage was removed. A successful applicant will now proceed directly to grant.
• Opposition proceedings can be initiated pre-grant or post-grant. The grounds of opposition are now similar for both stages. Pre-grant opposition is possible within three months from the date of publication or before the grant of a patent, whichever is earlier, and will be an inter-partes proceeding.
• It is now possible to appeal to the Intellectual Property Appellate Board in addition to the normal judicial recourse available. The Appellate Board, however, is yet to be constituted.
• Several office procedures and time frames have now been streamlined. The most significant change is that the time period for placing an application in order for acceptance which is now six months, is extendible by a period of three months. A number of fees have also been revised.
Provisions for damages
• In infringement suits, damages can be claimed from the date of publication. However, patents granted for “mail box” applications will only be effective from the date of grant of the patent (though the term of the patent will start from the date of filing of the application). Significantly, the patentee cannot bring an infringement action against a party who was using the invention prior to 1 January 2005 and continued using it thereafter. The applicant may, however, seek a “reasonable royalty”, although what constitutes “reasonable” has not been spelt out at this stage.
Compulsory licensing
• India already had several compulsory licensing provisions and these provisions have been expanded by the Bill. Compulsory licenses can now be issued to manufacture and export patented drugs to countries that do not have manufacturing facilities for the relevant products – provided the country allows such importation. However, compulsory licences can only be issued three years after the grant of a patent.
Parallel Importation
• Under previous provisions for parallel importation it was possible to import a patented product from a person duly authorised by the patentee to sell and distribute the product. This has now been broadened and the person need only be ‘duly authorised under the law’. The provision has been introduced to ensure that the patented product is available at the lowest international price.
Conclusion
The Patent (Amendment) Bill 2005 has now been passed by both Houses of Parliament and has received Presidential assent. However, the rules are yet to be published and the Bill has therefore not yet come into force. The Bill is the final chapter in a long and contentious journey since India joined the World Trade Organisation (WTO) and made a commitment to be TRIPS compliant by January of 2005. The most significant changes are in the area of pharmaceuticals. India has the largest pharmaceutical manufacturing and R&D base outside the United States and India’s pharmaceutical exports have been growing steadily since 1995. India is also slowly being recognised as a globally competitive pharmaceutical manufacturing location. How the new law will impact on the industry cannot be definitely predicted at this stage though most major companies appear to have welcomed it.
