THIS PROJECT HAS BEEN SUBMITTED BY

MR. RAHUL.V.CHANDRAMOULI

ID NO: 213004

ON

BIOTECHNOLOGY LAW

DURING THE WINTER SEMESTER 2018

ON

PATENTABILITY OF BIOTECHNOLOGY
INNOVATIONS
Table of Contents
Introduction........................................................................................................................ 3
History of granting patent to biotechnology innovations....................................3
Position in India................................................................................................................. 4
Pre-TRIPS.................................................................................................................................... 4
TRIPS and India......................................................................................................................... 5
Judicial push for patenting biotechnology innovation........................................................5
Changes post TRIPs................................................................................................................... 6
1999 Amendment.................................................................................................................................... 6
2002 Amendment.................................................................................................................................... 6
2005 amendment...................................................................................................................................... 7
Biotechnology through the requirements of any patent application...............7
Subject Matter............................................................................................................................ 7
Industrial Application............................................................................................................... 8
Novelty.......................................................................................................................................... 8
Inventive Step.............................................................................................................................. 9
Gene isolation.............................................................................................................................. 9
Guidelines for Examination of Biotechnology Application for Patent..........10
Relevant issues................................................................................................................ 11
Ever-greening of Patents and the life saving drugs...........................................................11
Compulsory licensing In India.............................................................................................. 12
Bayer v Natco........................................................................................................................................ 12
Current progress in the patenting Biotechnology...............................................13
Conclusion......................................................................................................................... 14
Introduction

Through this project, we will first look at how patenting of biotechnological

innovations started in the United States and how the TRIPs led to changes in the
Indian Law and judicial pronouncement accelerating the process.

Next we will see how the current framework for patenting of biotechnology is
working including the thresholds to be met under patent laws, the guidelines of the
IPO.

Next we will look at some issues in this field including areas where considerable
controversy has arisen and have had major cases.

Finally we will look at the current progress in Biotechnology Patents in India and the
status of their patent applications

History of granting patent to biotechnology innovations

Probably the most well known case on granting of a patent to a biotechnology

innovation is the US Supreme Court case of Diamond v Chakrabarty1. This case is the
considered to be the first one in the world to give a patent to a living organism and
was the trendsetter, which led to various jurisdictions considering allowing certain
living organisms to be patented. In many ways we can say without this case, it is
questionable if Trade-Related Aspects of Intellectual Property Rights (TRIPS) would
have covered Biotechnology Innovations.
The brief facts of the case are that, General Electric had in its employ, a genetic
engineer called Ananda Mohan Chakrabarty. Mr. Chakrabarty while working
separating oil from water in oil spills ended up creating a bacteria, which had the
ability to break down crude oil. General Electric filed a patent for it, naming Mr.
Chakrabarty as the inventor. Mr. Diamond was the patent examiner who rejected the

1
447 U.S. 303 (1980)
application on the ground that Patent Act of 1952 by practice, living organisms were
not given patents. The Circuit Court had held that it was patentable and the Patent
Examiner decided to go before the US Supreme Court. The court held that “Living,
man-made micro-organism is patentable subject matter as a "manufacture" or
"composition of matter" within the meaning of the Patent Act of 1952. The fact that
the organism sought to be patented is alive is no bar to patentability”.2

Position in India

Pre-TRIPS

Patents in India are covered by the Indian Patents Act of 1970. The act gives the
definition of invention as “any new and useful art, process, method or manner of
manufacture, machine, apparatus or other article, substance produced by
manufacture and any new and useful improvement of any of them”.3 The general
principles of industrial application, requirement of an inventive step and presence of
novelty are also needed for the grant of a patent.

The Act leaves what can be patented open by only giving a list of things of non-
patentable items.4 One of the non-patentable items mentioned originally were those,
which are meant to be used as or could possibly used in drugs, medicines, food items
and chemical processes. Further there was a clear bar on patenting living organisms.
Reading all this together, we can imply that innovation in biotechnology would fall
mostly fall within these categories and thus is not patentable. Since the Biotechnology
industry in India was not really in a developed stage at the time of coming into effect
of this Act, it was not too much of a problem not allowing patenting of biotechnology
innovations.

2
Diamond v Chakrabarty 447 U.S. 303 (1980)
3
2(j) § The Patents Act 1970
4
3 § The Patents Act 1970
TRIPS and India

India signed TRIPS in 19945 and the TRIPS was to come into effect from January 1,
1995. India needed to bring into consonance all of its domestic IP laws with the
provisions of the TRIPs by January 1 st 2005.6 TRIPS is well regarded as the possibly
the most important document influencing IP across the globe, especially in bringing
uniformity between the IP laws in its signatories and also in recognizing a variety of
upcoming intellectual properties which would have not have been protected by
conventional IP Laws. TRIPs extensively spoke about patents being expanded beyond
the traditional notion of it by both recognizing biotechnology and also products and
not just processes.7

Judicial push for patenting biotechnology innovation

While India was undertaking radical changes to its patent law in order to recognize
biotechnology innovations as patents, India had the first patent of a biotechnology not
by legislation but by the judiciary. This happened in the case of Dimminaco AG v
Controller of Patents and Designs & Others.8 The petitioners were a Swiss
pharmaceutical company who had developed a specific process for preparing a
vaccine for bursitis (a condition which causes inflammation of the liquid sacs between
tissues). They applied a patent for the same; the Patent Office denied a patent for it as
it consisted of living material. On appeal to the HC of Calcutta, it was held that
irrespective of the fact the end product was one, which was living, the process
satisfied the requirements of a valid patent and thus should be given a patent. This
was the landmark case as it opened the doors for patenting various biotechnology
innovations, which were earlier prevented, as the end product was a living organism.

5
http://www.forbesindia.com/printcontent/29302
6
Sudip Chaudhuri, 'TRIPS Agreement and Amendment of Patents Act in India'
[2002] 37(32) Economic and Political Weekly 3354-3360
7
27.3 § Trade-Related Aspects of Intellectual Property Rights
8
(2002) I.P.L.R. 255 (Cal)
Changes post TRIPs

The Indian Patent Act was amended thrice in order to accommodate the various
provisions of TRIPs, which India had to be compliant with regard to biotech.

The Department of Biotechnology, which falls under the ministry of Science and
Technology set up the “Biotechnology Patent Facilitation Cell (BPFC)” in July of
1999 to facilitate anyone wishing to get a biotechnology innovation patented. 9

1999 Amendment

This amendment having retrospective action from 1995 brought about two main
changes, First it allowed patenting of chemical substances meant to be used in drugs
and food. Second, applications for patent in the subject matter of agricultural and
pharmaceutical inventions were allowed; however only as mailbox applications as in
they can be filed, but the consideration of the same will happen only from the date
when India needs to be compliant with TRIPs.10

2002 Amendment
The next amendment was in 2002. This amendment first and foremost expanded the
definition of “chemical process” to include "bio-chemical", "biotechnological" and
"microbiological" processes. This can be marked at the point when biotechnology
started getting express recognition as something patentable. The amendment further
allowed patenting of products and not just processes which helps biotechnology
because as much many biotechnology inventions are products. Another sweeping
change was made in the list of non-patentable items. The essence of changes were that
while benefiting biotechnology, the only preclusions were for natural discoveries,
treatment of animals and humans.11

9
http://www.dbtindia.nic.in/patents/#
10
Patents (Amendment) Act, 1999
11
Patents (Amendment) Act, 2002
2005 amendment
The last amendment was made in 2005, which concerned the recognition of the
Budapest Treaty. This amendment set up a proper product patent system in line with
the treaty. Biotechnology inventions now required the invention to be submitted to a
depository recognized by the treaty. This was done to substitute the ‘written
submission’, which is usually supposed to accompany a patent submission. 12

Biotechnology through the requirements of any patent application

Subject Matter13

To have a dynamic of patentable subject matter, the act only gives a list of non-
patentable material. As we saw earlier this list was also amended to accommodate
biotech. Some of the specific exclusions do concern Biotech. For example a discovery
cannot be patented, as in there has to be some form of human change to the naturally
occurring substances in order for patent application to be considered. This prevents
scientists who discover new species to try patenting them. While microorganisms are
patentable, plants and animals in part or whole cannot be patented, this includes those
genetically modified also. Seed and plant variety cannot afford to be patented due to
the high dependence on agriculture in India, however protection is given under
Protection of Plant Varieties and Farmers' Rights Act, 200114. While stem cell is not
patentable, DNA and Gene sequences are not excluded. Lastly treatment of humans or
animals is excluded.15

12
Patents (Amendment) Act, 2005
13
NS Sreenivasulu , Biotechnology and patent law : patenting living beings (1 edn,
Manupatra 2008)
14
Protection of Plant Varieties and Farmers' Rights Act, 2001
15
3 § The Patents Act 1970
Industrial Application16

The act defines industrial application as“ in relation to an invention, means that the
invention is capable of being made or used in an industry;”17

A key requirement of patents is the ability to use it industrially. Since the Act does not
provide a definition, we need to look at what is generally accepted as the tests which
are used to test application industrially which that it should be capable of production,
the usage has to be found in some industry and finally the reproduction of it must be
possible as and when required. These are not tough to satisfy in a Biotechnology
innovation and thus hold good.

Novelty18

While novelty is a key requirement of any invention to be given a patent, in the case
of biotechnological innovations, it faces a major hitch. This is because it can always
be argued that most of the biotechnological innovations are either already present in
nature or is a derivative of what exists in nature. However if we refer to the Manual of
Patent Practice and Procedure19, we will see that it allows for patenting of various
forms of biological innovation, including DNA etc. This combined with the fact that
several patents have been given to biological innovations, which have analogous
items in nature, suggests a relaxation of the novelty requirement.

16
NS Sreenivasulu , Biotechnology and patent law : patenting living beings (1 edn,
Manupatra 2008)
17
2(ac) § The Patents Act 1970
18
NS Sreenivasulu , Biotechnology and patent law : patenting living beings (1 edn,
Manupatra 2008)
19
08.03.07 § Manual of Patent Practice and Procedure
Inventive Step20

The act defines inventive step as “ means a feature of an invention that involves
technical advance 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;”21

Similar to the part on novelty, inventive step will also hit a roadblock when it comes
to biotechnological innovations. For example sometimes the innovation itself is doing
what nature does in the human body or an animals body artificially. Or it could be
figuring how a certain biological component came into existence. With a lack of case
law or direct legislative provisions on the requirement of inventive step, we need to
look at the Manual of Patent Practice and Procedure 22, which clearly allows for the
patenting of various forms of biological innovation, including DNA etc.

Gene isolation23

A major portion of the work on Biotechnology revolves around genes, which form a
part of our DNA. Using our Genes, it helps understanding living beings, how they
function and also help attack several diseases. Now since gene, naturally exists, if we
were to take a strict interpretation of Section 3(c) 24, since isolating the gene from the
other DNA matter is but a discovery, it should not be given patent protection on
account of it not being an invention. However if were to look at it more broadly, we
will understand, that the Gene is not present naturally as a free standing component of
the DNA, it is a part of the sequence and thus enjoined with several other components
of the DNA, and thus actually isolating the gene is a very delicate process and is as

20
NS Sreenivasulu , Biotechnology and patent law : patenting living beings (1 edn,
Manupatra 2008)
21
2(ja) § The Patents Act 1970
22
03.04.06 § Manual of Patent Practice and Procedure
23
http://www.ebtc.eu/pdf/130924_REP_A-guideline-to-patentability-assessment-
standards-for-biotech-inventions-in-India_Web.pdf
24
3(c) § The Patents Act 1970
complex as an innovation. Thus the general norm world over has been to give patent
to a sequence of DNA only if the sequence is new and the process of isolation of the
sequence is one which is even one skilled in the field doesn’t seem as obvious. The
function of the sequence is also very important in granting the patent.

The Manual of Patent Practice and Procedure has recognized the patentability of a
method of presenting the sequence; an antibody, which works against the sequence.
These too apply only to genetically modified gene sequence/amino acid sequence and
they need to novel, have industrial application and have an inventive step.25

Guidelines for Examination of Biotechnology Application for Patent26

This is possibly the most comprehensive document, which India has come out with
relations to the patentability of biotechnological innovation. The document first gives
a history of both legislative and court made law relating to the patenting of
biotechnology in India. The Guidelines clearly states its scope as being “Therefore,
there is an urgent need to put in place Guidelines to establish uniform and consistent
practices in the examination of patent applications in the field of biotechnology and
allied subjects under the Patents Act, 1970. Thus the guidelines are intended to help
the examiners and controllers of the Patent Office so as to achieve uniformity and
consistency.”27
The guidelines later go on to examine the sections relevant to examination of a patent
in light of biotech. The sections it analyses in depth are 2(1)(j), 3(b), 3(c), 3(d), 3(e),
3(h), 3(i), 3(j), 3(k), 3(p), 10(4) and 10(5). The reason the Guidelines are extremely
helpful as they provide very relevant illustrations while discussing each of the
sections and these being highly technical in the field of the biotechnology go beyond
the scope of just aiding patent examiners, but also help both innovators and patent
25
08.03.07 § Manual of Patent Practice and Procedure
26
Guidelines for Examination of Biotechnology Application for Patent (Office of
Controller General of Patents, Designs and Trademarks) – March 2013
27
Guidelines for Examination of Biotechnology Application for Patent (Office of
Controller General of Patents, Designs and Trademarks) – March 2013
attorneys from clearly using these guidelines to test the patentability of the work in
question.

Relevant issues

Ever-greening of Patents and the life saving drugs

Ever-greening a patent is a tactic used by several patent holders to obtain separate

patents on what to a layman would be essentially the same thing but technically has
different attributes. In the specific case of pharmaceutical products, where this is most
problematic, it could vary from difference in colour, to manufacturing process, to
adding an ingredient, which doesn’t change the effect or the reaction of the body on
ingesting the product including the chemical produced while metabolizing it etc.

Due to the presence to Section 3(d)28, ever greening has by and large been prevented.
Section 3(d) in essence disallows the patenting of a product, which is a new form of
an already existing substance, or if a new effect of an existing substance has been
found. The second part has especially vexed global pharmaceutical companies as
earlier all they needed to do was not report all the properties of the drug in the first
patent, and get a renewal on the patent by disclosing the different properties one by
one. Also, Section 3(d) has an efficacy clause, which classifies several naturally
occurring substances such as isomers, esters, salts etc as a single substance unless the
efficacy of them is significantly different.

While being on the gray line with regard to complying with our TRIPs obligations,
Section 3(d) has helped a lot of life saving drugs from being monopolized by big
pharmaceutical companies and thus have kept prices fairly low than to generic drug
makers.

Even post the 2005 amendment to the Patent Act, which brought our Patent Law in
consonance with our TRIPs obligations, Indian law still prevented the patenting of
28
3(d) § The Patents Act 1970
incremental advances on the same unless the test of efficacy is satisfies which quite
different form the positions in UK and US where Incremental advances are
patentable.

The most famous case on this matter is the Novartis Case29

The brief facts of the case are as follows, Novartis had a patent granted to it in 1993
through the Chennai office for leukemia treatment. Later in 1997, they filed to obtain
a patent for beta crystalline version of the same drug. In 2003, an Exclusive
Marketing Right was granted to them. The price between the generic manufacturing
of the same drug and Novartis was about 10 times or over by Novartis. Novartis also
obtained an order to stop generic manufacturing of the drug. This was contested by
several Indian Generic manufacturers including Ranbaxy, Natco etc. And an order
was passed in their favour. Novartis then filed a writ contesting the constitutionality
of Section 3(d). The court clearly held that Section 3(d) is valid and further under it, a
beta version of a drug cannot be held to be new substance and thus will not qualify as
an invention. This is a landmark judgment with regard to generic manufacturing and
has allowed India to keep the price of essential life-saving drugs low.

Compulsory licensing In India

Bayer v Natco30

This case was the first case on Compulsory Licensing in India and has had wide
ranging ramification.

The brief facts are that Bayer, an MNC had a drug by the name Naxaver which was to
help patients in late stage Kidney cancer which was patented. It was priced at very
steep price. Natco requested Bayer for a voluntary license which was rejected. Natco
29
Novartis AG v. Union of India (UOI) and Ors.; Natco Pharma Ltd. v. UoI & Ors.;
M/S Cancer Patients Aid Association v. UoI & Ors. (2013) 6 SCC 1
30
Bayer Corporation v. Natco Pharma Ltd., Order No. 45/2013 (Intellectual Property
Appellate Board, Chennai)
then went to the Indian Patent office and obtained a compulsory license as it satisfied
the requirements given in Section 84 as it was life saving.

This sent shockwaves to most foreign manufactorers of pharmaceutical products as

this was a clear message that if you have a life saving drug, make your profits, price it
reasonably otherwise the government can compulsorily license it out for the greater
good of people. This judgment is in line with the Novartis case that the patent law is
subservient to the benefit of the population at large.

Current progress in the patenting Biotechnology

As per the Annual Report published by the Indian Patent Office for the year 2014-
2015, there was around 1035 biotechnology patents filed which is a considerable
increase over the few years preceding it.31 If you look at the top filers for patent, you
have CSIR clearly on the top with 315 followed by DRDO with 98. The top private
biotechnology patent filer was Jubilant Life Sciences, a company investing heavily in
Pharmaceutical R&D. They had 17 applications32. Most of our Biotechnology patents
have been directly or indirectly related to the Pharmaceutical industry and some of the
latest ones concern itself with RNA effects to combat HPV.33

Conclusion

http://www.ipindia.nic.in/writereaddata/Portal/IPOAnnualReport/1_71_1_Annual_R
31

eport_2014-15_English__2_.pdf
http://www.ipindia.nic.in/writereaddata/Portal/IPOAnnualReport/1_71_1_Annual_R
32

eport_2014-15_English__2_.pdf
33
http://www.dbtindia.nic.in/patents-granted-year-2012-2013/#
In the present day and age, advances in human sciences are moving rapidly with cures
for what were earlier thought to be deadly or chronic illness being found everyday. It
is not going to be too long before we find a cure Cancer and AIDs. In order to keep in
tune with the dissolving wall between technology and biology, it is very important to
keep our laws dynamic in order to give legal protection to those bringing about
innovation. Several times, the innovations happen only due to the legal protection,
which could protect it. As seen through this project, India has made great strides in
bringing our laws to the global standards of protection without preventing its citizens
access to life saving drugs. But it is now time for India to lead and set an example
rather than just be a mute follower.