IMPLICATIONS OF GRANT OF COMPULSORY LICENSING OF PATENT IN INDIA

World Intellectual Property Organization (WIPO) states patent as an absolute right accorded for any innovation, which is a product or a procedure that gives, generally a new method of performing something, or provides a new practical solution for any issue. The inventor to whom a patent is provided will have absolute right over his invention for a period of 20 years, and he can prohibit others from utilizing his patented product. But under certain conditions, a patented product may be provided to the third party for utilizing of a compulsory license. The concept of compulsory licensing has been specified in the chapter XVI of the Indian Patents Act, 1970.

Patent May 21, 2021 0 Add to Reading List

IMPLICATIONS OF GRANT OF COMPULSORY LICENSING OF PATENT IN INDIA

MEANING OF PATENT –

World Intellectual Property Organization (WIPO) states patent as an absolute right accorded for any innovation, which is a product or a procedure that gives, generally a new method of performing something or provides a new practical solution for any issue. The inventor to whom a patent is provided will have absolute right over his invention for a period of 20 years, and he can prohibit others from utilizing his patented product. But under certain conditions, a patented product may be provided to the third party for utilizing of a compulsory license. The concept of compulsory licensing has been specified in chapter XVI of the Indian Patents Act, 1970.

COMPULSORY LICENSES -

Compulsory licenses are sovereign state authorizations that do not give the authority to a third party to produce, utilize, or sell a patented product without the permission of the patent owner. Under the Indian Patent Act, 1970 and under the international legal agreement, provisions related to compulsory licensing are given. In India, under the Indian Patent Act, 1970, Chapter XVI deals with compulsory licensing, and the requirements which need to be satisfied for the accord of a compulsory license are set down under Section 84 and Section 92 of the Act.

Section 84(1) of the Indian Patent Act, 1970, states that any person having a concern may make an application for a compulsory license, after three years from the accord of a patent on the basis of the patented invention -

That the reasonable need of the public is not being fulfilled.
That it is not accessible at a reasonably economical price to the public.
That is the territory of India it has not functioned.

SECTION 84(7) - PROCESS FOR FILING THE APPLICATION OF COMPULSORY LICENSE

When an application is filed for an accord of compulsory license in front of the controller, it should hold all the relevant facts and proof holding up the same. Then the controller have the freedom to decide what should be done in that particular situation, after inspecting the case and scrutinizing the prima facie things in an application made up against the patentee. The controller will scrutinize several elements and on the base of that he will conclude whether to accord the compulsory license or to refuse the application of according the license. Such elements are –

Nature of the Invention –

The creation of a specific thing or procedure should be new and functional.

The capacity of applicant –

An applicant should be competent to work for invention.

Attempt of the applicant –

Applicants should make several attempts to acquire the license from the patentee on sensible terms and satisfy the controller of his attempts.

If the controller is well pleased after considering all the elements, then he may accord a compulsory license and if he not well satisfied with the application then he may refuse the accord of compulsory license by providing a notice which holds the facts about the same. In that case, the applicant can have several issues concerning the rejection. If yes, then he may appeal for a hearing with the controller within one month from the date of issuance of such refusal notice. But the controller will choose whether the hearing with the applicant will be held or not on the grounds of the earlier refusal.

After the end of three years from the date of the accord of a patent, anybody concerned can make an application to the controller for accord of compulsory license on patent as per Section 84 of Patents Act, 1970 on any of the following basis, which are -

The sensible needs of the common people have not been fulfilled with reference to the patented invention.
The patented invention is not accessible to the common public at an equitably economical price.
Within the territory of India the patented invention is not functioned.

As per the Patent Act, under Section 84, anybody who is fascinated or already the holder of the license may request the controller for accord of compulsory license on end of the three years period, when the conditions are satisfied which are declared above in the section.

TERMINATION OF COMPULSORY LICENSE -

On an application (via Form 21) along with proof, made by the patentee or any other person obtaining title or patent’s interest, under Section 84 the compulsory licence accorded can be terminated by the controller, when the situations contemplated for accord of the compulsory licence cease to exist. Afterwards the applicant needs to give a copy of the application and proofs to the holder of the compulsory licence and to notify the controller of the date on which it was made effectual.

Compulsory licence’s holder can file his or her disapproval along with proof to the application for termination, within one month from the date of the controller’s receipt of the application (and proof). A copy of disapproval and proofs need to be given to the applicant by the licence holder.

After that, the controller will appoint a hearing for examining the facts and for giving a verdict. If the controller chooses to terminate the compulsory licence, a command setting out terms and conditions (if any) of such termination will be given to both the parties.

CASE LAWS -

BAYER CORPORATION VS ASSOCIATION OF INDIA

In this landmark case the government allowed the third party for compulsory licensing under Section 84 by granting or allowing to sell or use a licensed specific cycle, without the patent owner’s permission.

CONCLUSION -

Particularly India faces a challenge, owing to the economic circumstances of the mass population. On one hand, it has to adapt strictly with the international level of patent protection and on the other hand, it has to protect public health.

In underdeveloped countries we can say that compulsory licensing has now begin to be the hope for financially challenged patients and compulsory licensing is now one of the major controversial topics in International Property matters.

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