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The West Bengal National University of Juridical Sciences- NUJS- (NUJS IPR Chair with IPTLS and Share) organised a conference on “Publicly Funded Patents and Technology Transfer: A Review of the Indian Bayh Dole” on the 12th of September 2009 at the NUJS Auditorium, Salt Lake, Kolkata. In January 2009, the government introduced the Protection and Utilisation of Public Funded Intellectual Property Bill, 2008 in the Rajya Sabha. The bill is currently undergoing scrutiny by a Parliamentary select committee, after which it will be placed before the Parliament. This conference aimed to generate more awareness and a nuanced discussion around the Bill and what is stands for.
Speaking at the concluding panel discussion, Yogesh Pai, Associate Fellow at the Centre for Trade and Development (Centad), New Delhi brought out some of the major flaws in the current version of the Bill. He scoped them as issues that involve a broader policy dimension and those that relate specifically to the language and scope of the Bill, which might led to unintended consequences. He noted that there were inherent problems with the way in which the Bill came to be drafted. He emphasized that the bill was shrouded in secrecy right since its inception and there ought be have been greater transparency in the drafting process of the Bill. Noting that there was no background study conducted- except on the recommendation by the National Knowledge Commission (NKC), which directly works under the leadership of the Hon’ble Prime Minister- he vehemently argued for the need to conduct a rigorous and evidence based study on issues around this bill before its endorsement by the Indian Parliament. The recommendations of the NKC, he noted, was shoddy and highly misleading since it was based on an outdated, flawed and orthodox understanding of the importance of IPRs and its links with the innovation ecosystem and commercialization in an university or public funded institutional environment. He emphasized on the need to promote a holistic view about how the innovation ecosystem performs in a publicly funded research environment and its relationship with commercialization for better and affordable products reaching the Indian consumers- especially affordability of medicines by the larger section of the Indian public. It was indeed unfortunate that when the whole IP system in under tremendous stress and challenge, this bill would add to worsening of the situation by fully endorsing the idea that more patents meant more innovation. And this is even while there is concrete evidence quite to the contrary formulated by experts in evidentiary IP research , also confirmed by reports from the EPO, special UN expert commissions and the Competition Commissions across the globe. He noted that while there is a strong ongoing global attempt to propose a compensatory liability regime in case of patents and copyrights, it was disturbing to note a reverse trend of IP fundamentalism in India. He noted that wider diffusion of technologies was the need of the hour, which could only be possible if the IP holders did not possess any legal backing to unilaterally refuse the license and to unilaterally fix royalties that lead to possible royalty staking situations.
He specifically emphasized that since IPRs were private rights to be protected under international agreements- more specifically under the TRIPS agreement- there is an opportunity to carve out a indigenous regime for promoting innovation in cases of public funded research environment as there are no private rights involved in the first place. Publicly funded patents may have their own set of standards for patent eligibility, patentability, acquisition and enforcement and no international commitment would act as deterrent to it. In this context, the speaker emphasized on the need to understand that in case of publicly funded IPRs, India could broadly interpret limitations and exceptions, notwithstanding her current commitment under any international IP agreements. He also cautioned on the need to consider the changing norms of science which would fundamentally be altered if the IP culture overrides the scientific culture of sharing and growing. In fact, the whole direction of research may take a different course, more so in case of neglected diseases where even with adequate IP protection, private R&D fails due to produce new drugs due to the enduring phenomenon of “missing markets”. He hypothesized that the promise of needs driven scientific research and development by publicly funded research institutions may be successfully trumped by greed driven scientific research.
Another important lacuna in the Bill relates to the issue of tracking commercialization. While the bill was aimed at commercialization, it did no attempts in provisioning the same except for a local working clause. This, the speaker noted, might not in all cases ensure commercialization. The assignees of patents may for obvious competitiveness factors sit on the research outcomes without taking active measures to commercialize the invention, even while keeping the patents alive and royalties flowing to the inventor and the institution. Hence there is a need to carve out a regulatory model to ensure commercialization where genuine non-feasibility issue is not involved. Further, he emphasized on the need to cast some liability on the IP Management Committees (IPMC) for irresponsible decision making behavior. While the bill stipulates strict penalties for all actors, interestingly one of the major beneficiaries – the IPMC- was left with no liability! Next, in cases where the recipient (the university or publicly funded institution) does not opt for title, is there any need for establishing the IPMC?- the bill does no attempt to provide any clarity. Further, the speaker noted that there might be situations where students (specifically masters and PhD students) are engaged by the university/inventors to conduct research. Such students may not be employed or engaged by the institution for conducting the specific research and might be working on educational grants. Since inventions arising out of educational grants are excluded from the purview of the bill, some inventions created by students in public funded institutions may not be recognized at all.
On some of the more specific points concerning the Bill and its language, he pointed that there were visible gaps which might lead to litigious waste and have long term negative impacts. He noted that scientific innovation demands sharing (material sharing and knowledge sharing) and that the bill failed to promote inter-university/public funded institute technology transfer and licensing arrangements. He pointed that the bill makes no fundamental distinction between the use of publicly funded IP by the industry versus another public funded university. Noting that the research exemption in India, though broadly worded, might be narrowly construed under the influence of jurisprudence that has emerged in comparative developed country jurisdictions. Hence it might not resolve the issue of promoting inter-university knowledge flows and technology transfer, especially when the research outcome is commercialized. Another provision relating to licensing of related patents under section 91 under the Patents Act is also of limited help since the basic condition for such a licensing arrangement works only in case of patents holders holding cross portfolios, including other additional stipulations attached. The speaker then stressed on the need to internalize the concepts of competition law to create an overarching framework for knowledge dissemination. Wider and broader use of essential facilities doctrine under the abuse of dominance prong of the modern competition law, he noted, could be of useful help. He stressed on the need to internalize provisions in the bill relating to competition law on ex ante basis without resorting to ex post treatment under competition law, which could potentially mitigate the negative impacts of the bill- more specifically with reference to inter- inter-university/public funded institute technology transfer and licensing arrangements. Emphasizing that specific and legally sophisticated regime for Patent pledges (covenants not to sue) could also be carved within the scope of this bill, he noted that it could in some instances lead to voluntary upfront commitments by IP owners/ inventors.
He concluded with a general remark that the bill in its current version was fundamentally flawed and urged upon the need to reconsider altering its fundamentals before it’s too late to recall!
The Panel Discussion (L to R): Dr. V K Unni, IIM Kolkata; Prof. Madhukar Sinha, IIFT- New Delhi; C H Unnikrishnan, LiveMint; Yogesh Pai, Centad- New Delhi;
Pranesh Prakash, CIS- Bangalore; Prof. (Dr.) N S. Gopalakrishnan, HRD IPR Chair
CUSAT-Cochin; Prof. Shamnad Basheer, HRD IPR Chair- NUJS Kolkata.
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