DR. RAM MANOHAR LOHIYA NATIONAL

LAW UNIVERSITY, LUCKNOW

2014-15

Intellectual property rights-II

(FINAL PROJECT)

TITLE OF THE PROJECT

PATENTS AND HUMAN RIGHTS

Submitted to: Submitted by:Mr. Vikas Bhati Aviral Umrao Asstt. Prof. in Law Roll No. – 31

TABLE OF CONTENTS

1. Introduction

2. Right to Health

3. Health and Patents

4. Human Rights and Patents

5. Harmonization of Interests

6. Conclusion

7. Bibliography

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INTRODUCTION

Today inventions of new products or new processes particularly in the field of medicine,

in general, involves the collective effort of many highly skilled professionals and

expenditure of considerable amount of money and time which only big corporations and

institutions can afford. Besides, the manufacture of the article or product on a commercial

scale requires further effort and money.

Accordingly, under modern conditions only big corporations or institutions can afford to

engage in research and development of new products or processes, which truly passes on

to the product price. Health is one of the fundamental basic needs of all human need. The

right to life includes the right to health.1In legal term as well the fundamental human

right treaties recognize that the right to health would encompass a number of elements

from prevention to cure to access to drugs.

India has amended the Patents Act in 1999 and 2002 to comply with the obligations of

Trade-related Aspects of Intellectual Property Rights (TRIPS). The only pending

obligation with regard to TRIPS is the introduction of product patents to medicines and

agro-chemicals. The product patent prohibits others from making, using, offering for sale,

selling or importing the patented product.

As a result, the product patent gives a monopoly to the patent owner for the production of

patented article during the term of the patent (20 years). Therefore, product patent

protection for medicines and agro-chemicals creates monopoly and eliminates

competition in the pharmaceutical market. Drug companies often abuse the patent

monopoly and fix exorbitant prices for the patented medicines. The introduction of

product patent thus reduces accessibility and affordability of drugs.

The net result of the TRIPS accord has been high cost of medicines and the consequent

denial of access to medicines to the poor across the globe . Further, it has also led to a

situation where medicines required to treat diseases that predominantly occur among the

poor are not researched at all. Instead drugs that are being researched are drugs used for

"lifestyle" diseases like impotence, baldness, obesity, etc .

1 State of Punjab v. Makinder Singh Chawla, AIR 1997 SC 1225

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This was reiterated in unequivocal terms by the WTO Doha Declaration on TRIPS

Agreement and Public Health (2001), which, inter alia, commented that countries have

the sovereign right to enact laws that safeguard domestic interests. It recognised the

gravity of public health problems in developing countries and clearly provided that the

member countries had the right to protect public health and to promote access to

medicines for all.

RIGHT TO HEALTH

A healthy body is the very foundation of all human activities. The right to health has

been recognised in the national constitutional and statutory laws as well as in

International law.

 Right to Health in the Indian Scenario:

With 260 million Indian citizens still below the poverty line and without the

fundamental assurance of healthcare, the right to health clearly acquires great

importance in Indian scene. The World Health Organization (WHO) rankings place

India as 112th on the list of 199 member countries with regard to the health care

systems.

In India, the government’s concern for health and safety of its people is indicated by the

legislations enacted for health care. Recently Article 21 of the Indian Constitution has

been interpreted to incorporate the right to health in right to life and hence this right

having now acquired a constitutional status through judicial activism, can be judicially

enforced. The Directive Principles of State Policy provide against the exploitation of

weaker sections of society, including children, and mandate the state to raise the levels

of nutrition, the standard of living and improve public health. Protection and

improvement of environment and safeguarding forests and wildlife is also an obligation

of the state. These are contained in articles 39, 47 and 48A in Part IV of the

Constitution.

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Access to medicines is a fundamental element of the right to health

Health is a fundamental human right, indispensable for the exercise of many other rights

in particular the right to development, and necessary for living a life in dignity. The

realization of the right to health is also a fundamental goal of State’s policies and

programmes, regardless of their economic, social, cultural, religious or political

background.

 From a human rights perspective, access to medicines is intrinsically linked with the

principles of equality and non-discrimination, transparency, participation, and

accountability. States are obliged to develop national health legislation and policies and

to strengthen their national health systems. For this purpose, key issues related to access

to medicines must be taken into account such as: sustainable financing, availability and

affordability of essential medicines; price and quality control; dosage and efficacy of

medicines; procurement practices and procedures, supply chains, etc.2

in Human Rights Council resolution 12/24, the Office of the United Nations High

Commissioner for Human Rights (OHCHR)3 convened an expert consultation on 11

October 2010 in Geneva, Switzerland, “for an exchange of views on human rights

considerations relating to the realization of access to medicines as one of the fundamental

elements in achieving progressively the full realization of the right of everyone to the

enjoyment of the highest attainable standard of physical and mental health” 4

Government has a constitutional obligation to provide health facilities.

The hon’ble supreme court has interpreted the right to health in many ways. Through

public interest litigation as well as litigation arising out of claims that individuals have

made on the State, with respect to health services etc. As a result there is substantial case

law in India, which shows the gamut of issues that are related to health. The recognition

that the right to health is essential for human existence and is, therefore, an integral part

2 Access to medicines - a fundamental element of the right to health http://www.ohchr.org/EN/Issues/Development/Pages/AccessToMedicines.aspx accessed on 22-10-20143 para. 7, HRC res. 12/244 HUMAN RIGHTS COUNCIL, Twelfth session , Agenda item 3 “Access to medicine in the context of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health” (A/HRC/12/50), chap. I, 12 October 2009

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of the Right to Life, is laid out clearly in Consumer Education and Resource Centre Vs

Union of India5. It also held in the same judgment that humane working conditions and

health services and medical care are an essential part of Article 21. Further in, State of

Punjab and Others v. Mohinder Sing6“It is now a settled law that right to health is integral

to right to life. Government has a constitutional obligation to provide health facilities.”

The issue of adequacy of medical helath services and affordable medicines was also

addressed in Paschim Baga Khet Mazoor Samiti Vs State of West Bengal7 It was held

that that Article 21 imposes an obligation on the State to safeguard the right to life and

health comes with in ambit of life.

Apart from recognizing the fundamental right to health as an integral part of the Right to

Life, there is sufficient case law both from the Supreme and High Courts that lays down

the obligation of the State to provide medical health services.8

HEALTH AND PATENTS

Health is one of the fundamental basic needs of all human beings. In legal terms,

fundamental human rights treaties recognize the right to the 'enjoyment of the highest

attainable standard of physical and mental health’. Health policies encompass a number

of elements, from prevention to cure and access to drugs. While all elements are

important, the question of access to drugs stands out in the context of the TRIPs

Agreement.

Access to drugs generally requires their availability and affordability. There is thus a

strong link between economic poverty and access to drugs. A group of international

organisations recently estimated that less than 10 per cent of people living with

HIV/AIDS in developing countries have access to antiretroviral therapy.

The human rights treaties have not devoted significant attention to the impact of

intellectual property on the realization of specific rights such as right to health. Human

right laws does not provide for any guidance concerning its link with any general field of

5 1995 AIR 9226  SLP (C) Nos.12945 and 18828 of 1996) O R D E R In CA No.16979/96 @ SLP (C) No.12472/967 1996 SCC (4) 378 Parmanand Katara Vs Union of India, 1989 AIR 2039

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law. It is rather apt to mention that the relationship has been termed and recognized in

general terms.

However, it is also true that there are certain adjustments have to be made in laws

relating to intellectual property rights including their application so as to bring them in

consonance with the spirit of right to health. This is precisely the scope of the paper

which accepts the existence of IPR regime but at the same time suggest the ways and

means to ensure that the interest of the public at large especially in terms of health is

looked after.

HUMAN RIGHTS AND PATENTS

The relationship between human rights and intellectual property requires elaboration. On

the one hand, intellectual property does not provide much guidance concerning its links

with other fields of law. On the other hand, human rights treaties show that the interests

of the patent holder are recognised but not as fundamental rights and that the interests of

the community at large come first.

TRIPs was adopted as a stand-alone agreement which makes no mention of the impacts it

can have, for instance, in the field of health. Nevertheless, WTO member-states that are

also parties to human rights treaties cannot draft legislation to implement WTO

obligations without considering its compatibility with other international obligations,

such as human rights commitments.

In fact, the UN Committee on Economic, Social and Cultural Rights has specifically

indicated in the case of the right to health that states should not agree to measures that are

manifestly incompatible with their previous international legal obligations. Even though

the formulation of the right to health at the international level is vague, it gives at least a

broad framework within which health policies should fall. Thus, it imposes on

governments to progressively facilitate access to drugs. Since patents on drugs tend to

push prices up, governments have a duty to ensure that the introduction of product

patents does not jeopardize access to drugs.

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Indeed, not only should states refrain from taking any steps that limit access to drugs but

also they should also actively pursue better access over time. In this sense, it is doubtful

whether the amendment to the Patents Act of 1970 can stand scrutiny under human rights

treaties. The 1970 Act introduced a number of limitations on the scope of the rights

granted to patent holders with specific public health goals in mind. As widely

acknowledged, the provisions of the 1970 Act may not have solved the problem of access

to drugs, but they contributed to improving access. Dismantling the whole regime

amounts to taking several steps back in terms of access to drugs. This seems even truer in

the context of the HIV/AIDS crisis, where some of the existing drugs are often available

only at prices that are prohibitive for the general public.

India has a number of other international obligations, particularly in the field of human

rights. As interpreted by UN human rights organs, the right to health requires that

countries progressively take positive steps towards facilitating access. Dismantling the

1970 regime may constitute a violation of India's obligations under the Covenant on

economic, social and cultural rights. There are thus compelling reasons for redrafting the

patents bill in a way which neither threatens the country's interests nor constitutes a

potential violation of human rights.

HARMONIZATION OF INTERESTS

Harmonization is the best possible way to ensure the interest of two parties. Need of the

hour is to harmonise the interests of both the patent holder and public at large. The

interest of the patent holder is looked after by granting him the product patent on his

invention. Also, ensuring that the patented drugs are ensured at affordable rates looks

after the interest of the public. Thus imbalance would not be created thereby ensuring

conducive environment for the pharmaceutical firms to operate without hassles on one

hand and access to affordable life saving drugs to the common populace on the other.

The project tends to suggest a cushion mechanism so that the effect of this new patent

regime in terms of high cost is not passed on to the masses. For this purpose, the

government has to play an active role. This is more so in cases of Heath Care Welfare

States including India. Few of the suggestions are as follows:

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Compulsory licensing: This refers to use of the patent without authorization of the

Patent Holder .By this, the government or any third party authorized by the

government can market the product. In this case, the general belief that the

compulsory licenses can be granted only in cases of national emergencies is incorrect.

It can also be granted in cases where the proposed user had made efforts to obtain

authorization from the Right Holder on reasonable terms and conditions and that such

efforts have not been successful within the reasonable period of time.

In India the Patent Act 1970 recently was amended to include provisions or

compulsory licensing. Further, the Act9 provides for compulsory licenses on

notification by the Central government “in cases of national emergencies or in cases

of extreme urgency or in cases of pubic non-commercial use”. This should not be

read in the strict manner even an apprehension of a public health emergency in future

should be sufficient to evoke this provision.

Drug Subsidies: This can be a major step, which the government can take so as to

keep the prices of drugs within the reach of the pockets of the general public.

Subsidies can be granted in cases of drugs, in the same manner as they are granted in

LPG, petrol, Kerosene oil, sugar and other essential commodities.

For instance, post 2005 the price of the particular drug is Rs 10. Then in that case the

government can pay Rs 4. Thus, in this case, public pays only Rs 6. The idea behind

this proposition is to mention certain life saving and important health drugs in the

‘Essential Drug List’, just like the Essential Commodities List; we have for the above

stated commodities.

It is also to be mentioned that the List should be reviewed periodically so as to

include any important drug in the list or exclude any other drug from the list, which

has become less important.

Price Control Mechanism: The government should also introduce a price control

system for stringent monitoring of prices of drugs not mentioned in the ‘Essential

Drugs List’. This is to ensure that the prices of ‘other drugs’ do not increase which

would drill a hole in public pocket. Nearly 75% of the retail pharma market is

9 Section 92 of Indian Patent Act, 1970

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currently outside price control and the government should constitute a panel that

would monitor changes in price of unscheduled drug (control free).

If the panel is convinced that rate at which the price of a particular unscheduled drug

has risen without a valid reason or due to unfair trade then it can ask the government

to control and bring the price within the reasonable limits.

Price Ceilings: The National Pharmaceutical Pricing Authority can also perform an

additional task of putting a ceiling on the maximum price of a particular product.

These should also include fixing a higher ceiling for the generic drugs and a lower

one for branded drugs.

This will also put pressure on the large companies to exit from generic business. The

ceiling on the prices will ensure that the maximum price of a particular drug is well

within the reach of the masses. Few things, which can be taken into account while

fixing the ceiling would be the amount spent in research and development, the cost

involved in production of the invention plus the subsequent marketing of the product.

The idea is to balance the interests of both the inventor and the public. The inventor

should get the reasonable returns on the product as well as the public should be able

to avail the product at a reasonable rate.

Importing Drugs: A country can import the generic version of a patented product and

the government has the freedom to determine the grounds upon which importing of

such drug can take place. The imported drug can be from a country in which the drug

is not patented. It can also be in case of patented drug, the case in which the exporting

country also has to issue a compulsory license.

India could import on-patent drug from another country if the drug is available there

at a lower price. However, this is not a real option for India, which can produce, drugs

at a cheap cost.

Global Health Fund: Another option available to India would be to rely on funds

released by the global health fund. India could use these funds to fight epidemics

HIV/AIDS, TB, and Malaria. However, this option has to be exercised guardedly

mainly because of two factors. Firstly, India has never been a potential recipient of

these funds and secondly, this will raise the issue of increasing north-south economic

dependency which can have serious implications in terms of national sovereignty.

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Manufacture of a drug at a local level: If a particular drug is patented in India,

option should also be available to the government to locally manufacture drugs if a

case of acute shortage of the availability of the drug arises. This is to ensure that the

patent protection does not take toll of the national health. India can also take example

from the policies of other developing countries such as South Africa and Brazil which

have a health policy in place that makes sure during national health emergencies

drugs are easily available and that too at a reasonable cost.

Health Insurance: This can be another scheme initiated by the government in order

to ensure that whatever cost are incurred by the patients during treatments are

subsequently reimbursed, if they have a medical insurance. One of the ways to

harmonise this issue is to aggressively privatise health insurance so that due to

competition in health insurance sector, the prices of health insurance itself is well

within the reach of the masses.

Taxes and duties on medicine: The government should ensure that the taxes and

duties on medicines are not exceedingly high so as to affect and increase in the price

of the drug normally the taxes and duties on medicines are quite steep and an amount

to about 30% to 40% of their total price. These taxes need to be cut drastically so as

to make sure that the drugs are available at affordable rates.

CONCLUSION

The originators of inventions should get just reward/compensation in the form of suitable

royalty and there should be no grudge in providing for the same. Simultaneously, the

doors should be opened for obligatory licensing to involve the domestic enterprises in the

production of patented drugs.

India can play an effective role about the availability of generic drugs at reasonable prices

by the pharmaceutical industry only after the ignored issues are provided through further

suitable amendments to the Patents Act 1970. If the damage to the amending process of

the Patents Act is not undone, public sufferings will soar to an unimaginable extent and

we would be heading for a high cost economy. Poor will suffer and middle class will

suffer.

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The problem with the studies under taken on behalf of the industry is that nobody knows

the real cost of the drug research and development, and the study relies only on industry

inputs, with no real scrutiny of the same. We must find a standard mechanism to find out

the approximate cost of drugs and R & D.

BIBLIOGRAPHY

Books

1. Halsbury’s Laws of India, lexisnexis, butterworth, Delhi, 2004

2. Rodney D. Ryder, Intelleltaul Property and the Internet, Lexisnexis,

Butterworths, New Delhi, 2004

3. Narayanan, P., Intellectual Property Law, 3rd edn., Eastern Law House, Delhi,

2004

4. Cornish, W.R., Cases and Materials on Intellectaul property, 2nd edn.,

Universal Law Publishing Co. ltd. Delhi, 2004

Websites:

1. http://www.expresspharmaonline.com/20070815/management04.shtml

2. http://www.legalservicesindia.com/articles/pg.htm

3. http://news.indlaw.com/publicdata/articles/article67.pdf

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