INTELLECTUAL PROPERTY RIGHTS - PATENTS

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Intellectual Property Rights, “IPR are intangible

in nature and are given to a person for the
intellectual property created by them using their
minds. It allows the creator to have sole ownership on the creation of their mind for a
specific period.

Intellectual Property is produced using human intelligence and includes innovative

concepts, inventions, trademarks, industrial models, literature, brands, names etc., In
today’s scenario, IPR plays an important role in encouraging innovative ideas and
techniques by providing economic benefits to the inventor or the creator. On the
Global front IPR has risen to importance since the last two decades, when global
business houses and large corporations started generating huge economic benefits
from IPR.

The Concept of Intellectual property is not new in this world, it was first noticed in
1474, in Renaissance northern Italy, when Venetian Law made its first attempt to
protect inventions of the creators by granting patents to them for having exclusive
ownership of their intellectual property. In the year 1450, the invention of printing press
and movable type by Johannes Gutenberg, played an important role in introducing
copyrighting system in the world, as it is said to be the origin of the first” copyright.

The Intellectual Property “laws started taking shape after the “Paris Convention for the
Protection of Industrial property” in 1883 and the “Berne Convention for the protection
of Literary and Artistic Works” in 1886. The Legislators proposed giving global
protection for intellectual property rights in the early 1800s. The Paris Convention,
signed in 1883, aims to promote international collaboration and transparency. The
Berne Convention of 1886 extended the same protection to written assertions three
years later. Along with this large-scale industrialization, growth in investment capital,
development of infrastructure and expansion of railways networks by the end of 19th
century aided in boosting the importance of Intellectual Property Laws” globally.

According to the convention signed in Stockholm in 1967, an organization called World

Intellectual Property Organization was established, “whose main aim was to protect
both Industrial property i.e., inventions, trademarks and designs and copyrighted
materials like literary, musical and other artistic works. The organization gives the
following list of items which are protected under Intellectual Property Laws:

 Inventions
 Trademarks
 Service marks
 Commercial names
 Designations
 Industrial designs
 Protection against unfair competition
 Literary, artistic and scientific works
 Scientific discoveries”
 “All other rights resulting from intellectual activity in the industrial, scientific,
literary or artistic fields”
TRIPS “negotiated as a part of Uruguay round of General Agreement on Tariffs and
Trade (GATT) treaty in 1994 acted as a catalyst in the development of International
Property Law. TRIPS agreement takes into account all the forms of Intellectual
Property and aims at providing supportive and firm standards of protections and
enforcements of its principles at international as well as national level. It confirms that
the GATT principles and provisions are observed and followed. Thus, due to this
comprehensive approach of TRIPS agreement, it is by far considered as the
furthermost comprehensive multilateral agreement on Intellectual Property”. TRIPS
covers the following areas:

 Industrial Designs
 Copyrights
 Trademarks
 Geographical Indications of origin
 Lay-out designs of assimilated circuits
 Patents

Copyright, “patent, trademark, and trade-secret law were all thought to be related but
distinct until the middle of the twentieth century. They were governed by various
statutes and administered by different agencies in most nations, and there were few
issues that included more than one of these disciplines. Each field was also thought to
advance particular social and economic objectives. The boundaries between these
fields started to blur out in the second half of the twentieth century. They became
increasingly intertwined, and the term "intellectual-property law" was coined to
encompass them” all.

Perceptions “evolved in part as a result of the fields' inevitable expansion, which

frequently resulted in overlap in operation. Copyright law, for example, was modified in
the 1970s to include protection for computer software. Later, in the late 1980s and
early 1990s, several countries' courts ruled that software may be protected under
patent law as well. As a result, software developers might rely on one or both fields of
law to prevent customers from duplicating programmes and competitors from selling
identical or nearly identical” programmes.

All these developments in Intellectual Property Rights have given this field a
concrete shape which is now being used across the globe and encourages creative
minds to innovate and derive economic benefits out of it.

Intellectual “property refers to almost anything created by the human mind, including
ideas, innovations, industrial models, trademarks, compositions, writings, symbols,
names, brands, and so on. Intellectual property rights are similar to other types of
property rights. They empower its owner to fully benefit from his or her product, which
originated as a concept and ultimately materialized. They also provide him the authority
to restrict others from exploiting, engaging with, or manipulating with his or her product
without his or her authorization. He or she has the legal right to sue them and demand
that they cease and recompense” for any harm.

There are seven forms of Intellectual Property Rights:

Patents: New “species of plants or strains, as well as revolutionary concepts or
techniques, are very often protected by patents. Patents are intellectual property rights
which provide the owner an exclusive right to restrict others from producing, selling,
using, or importing an invention for a particular amount of time, usually twenty years.
The US Patent and Trademark Office issues patents in the United States. An
innovator does not have exclusive rights to his or her creation until a patent is”
awarded.

In order “to be patented, an invention must be recognized unique and beneficial in the
vast majority of instances. It must also represent a massive advancement in the state
of the art; it cannot just be a logical extension of what is already known. If the
requirements for patentability are satisfied, patents are frequently granted for
improvements to previously patented products or” methods.

Trademark: Any “title, phrase, symbol, design, or combination of these things that
identifies your goods or services can be used as a trademark. It's how clients know
you and tell you apart from your competition in the marketplace. Both trademarks and
service marks are alluded to as "trademarks." For commodities, a trademark is used,
whereas for services, a service mark is used. A trademark is a word or phrase that”
identifies

 Where “your goods or services originated from.

 Guarantees that your brand is protected under the law.
 Aids in the avoidance of forgery and” counterfeiting.

In “the case of trademarks, a widespread misperception is that having a trademark

entitles you to legal ownership of a certain term or phrase and the ability to restrict
others from using it. You do not, however, have rights to the term or phrase in
general; only to how that word or phrase is” used.

Copyright: refers “to the legal rights of the intellectual property owner. Simply put,
copyright is the right to copy. This means that only the original creator of the product
and the person who gave it permission have the exclusive right to reproduce the
work. Copyright law gives the creator of the original material the exclusive right to
reuse and
reproduce the material for a specified period of time. The “copyrighted object is then in
the public” domain.
When someone makes a product that is considered unique and requires substantial
mental effort to create, it becomes intellectual property that must be safeguarded from
unlawful copying. Computer software, art, poetry, graphic designs, musical lyrics and
compositions, books, films, innovative architectural designs, website content, and so
on are examples of unique works. Copyright is a legal protection that may be utilised
to legally protect an original production. A work is deemed original under copyright law
if the creator developed it from scratch, with no duplication. An Original Work of
Authorship is a term used to describe this sort of work (OWA). Anyone who owns the
copyright to an original piece of writing immediately owns it, barring others from
exploiting or copying it. The copyright can be voluntarily registered by the original
owner if they want to gain an advantage in the legal system if the necessity arises.

Trade secrets : Trade secrets can include anything from a proprietary process,
instrument, pattern, design, formula, recipe, technique, or practise that is not widely
known and can be utilised to develop a business that has an edge over rivals or
gives value to consumers.

Trade secrets are defined differently in different jurisdictions, yet they all share the
same characteristics:

 They aren't available to the general public.

 Their possessor benefits financially from their concealment.
 Their privacy is rigorously” guarded.

Trade secrets are the "classified papers" of the corporate sector, just as top-secret
documents are tightly guarded by government organisations, as private” information
(as trade secrets are known in certain countries).

There are several tangible and intangible instances of trade secrets. Google's
search algorithm, for example, is intellectual property in code that is modified on a
regular basis to improve and protect its operations.

Industrial Design: Industrial design “is a purposeful problem-solving process that uses
new products, systems, services, and experiences to promote innovation, increase
corporate success, and improve quality of life. Industrial design is concerned with
bridging the gap between what is and what is feasible. It's a multidisciplinary field that
uses creativity to solve issues and co-create solutions with the goal of improving a
product, system, service, experience, or company. Industrial design, at its core,
reframes difficulties as possibilities, resulting in a more hopeful outlook on the future. It
brings
together innovation, technology, research, business, and customers to create new
value and a competitive edge in the economic, social, and environmental” realms.

Data bases: Database rights, “which were first implemented in 1996, were designed to
protect databases. The rights exist if a sufficient amount of time and effort was put into
gathering, distributing, or authenticating the contents of a database. Financial, human,
and technical resources are all part of the investment. The developer of the database
is
the original owner, and he or she is responsible for compiling, validating,
and presenting” the database's contents.
Unfair competition: Any dishonest “business practice that is unlawful by statute,
regulation, or common law is characterized as unfair competition. It encompasses
similar concepts that provide for a range of legal claims, including trademark or
copyright infringement, improper appropriation of trade secrets, and defamatory false
publications claims, among others. The legislation protects enterprises' financial,
intellectual, and inventive investments in order to differentiate themselves and their
goods. It also intends to promote competition by motivating firms to produce other
goods and services that are superior to those” delivered by rivals.

Patents

A patent is a “type of intellectual property right that is legally awarded and safeguarded.
It ensures that creative labour is protected for a set amount of time. A exclusive right
over an innovation is referred to as a patent. A patent is a legal document that
establishes a person's claim, privilege, or authority over an invention. In some ways, it's
a restricted monopoly provided by the state under legislation in exchange for technical
knowledge disclosure. The Patents Act of 1970 governs patent law in India.

Innovation is the most important stage in the advancement of science and technology.
As a result, everything that promotes innovation promotes scientific progress. The
ownership of any intellectual discoveries in the world of design, literature, industry, and
science is referred to as intellectual property rights. Inventors are given exclusive rights
to their innovations under such systems, which encourages continued innovation and
growth in these sectors. Such systems encourage progressive activity by allowing
innovators to be fairly compensated for their efforts. Patents offer financial incentives
as well as acknowledgement for their work. It is a commercial instrument that may
provide inventors a strong market position while also generating additional cash
through” licencing.
Patents provide scientists, researchers, and businesses with Intellectual Property rights
that provide them with a short monopoly. They can increase their returns and earnings
by obtaining exclusive rights to their innovation. As a result, they are more motivated to
do more research and contribute to the growth of science and technology. Historians
and economists agree that patents have resulted in an increase in the number of
inventions during the previous fifty years. People are motivated to labour more, create
more, and encourage research when they have the opportunity to earn bigger returns.

Patents allow “businesses and researchers to earn 50% more money from their
products. High-tech companies, such as medicine and software, see a 60% boost in
earnings, while the electronics industry sees a 40% increase in sales. Because patents
result in considerable financial rewards, more companies and researchers are ready to
invest in research and development. Patents, according to the Australian Intellectual
Property Research Institute, stimulate individuals to develop and innovate
considerably. People's desire to develop would reduce by 13% if they couldn't acquire
a patent on their invention, according to a study that looked at a list of licences.
Patents guaranteed a 40–50% increase in wages for these individuals. Patents also
make technology accessible to scientists all across the world, encouraging new
discoveries and partnerships.

To be patented, an invention must be regarded original and advantageous in the

majority of instances. It must also represent a major advancement in the state of the
art; it cannot just be a logical extension of previously acquired information. If the
requirements for patentability are satisfied, patents are frequently given for
improvements to previously patented items or methods. A patent is a type of property
that has several characteristics in common with personal property. It can be sold
(assigned), mortgaged, or passed down to an inventor's heirs. Because the patent
owner has the exclusive right to prevent anyone from creating, using, or selling the
invention, he can grant licences to others to do any of these things in exchange for
royalties or other remuneration”. The right of a patentee to prevent others from making
"equivalents" of copyrighted technology is also included in his or her rights. If any of
these rights are infringed, a court can order the violator to pay damages and desist
from infringing in the future at the patentee's request.

Patent Law in India

The “Indian Patents and Designs Act, 1911, was adopted in 1911, marking the
beginning of the country's patent legislation. The current Patents Act, 1970, came into
effect in 1972, updating and combining the old patent law in India. The Patents Act of
1970 was changed again in 2005 by the Patents (Amendment) Act, which expanded
the scope of product patents to include food, pharmaceuticals, chemicals, and
microorganisms. The clauses pertaining to Exclusive Marketing Rights (EMRs) have
been deleted as a result
of the modification, and a provision allowing for the issue of a compulsory licence” has
been added. Pre-grant and post-grant opposition measures have also been added to
the law.

The Patents Act is a component of the Intellectual Property Laws that deals with
new patents. There are two sorts of patents: product patents and process patents.

Requirement for Inventions to be patented:

 Invention must be new

 Invention must have a significance change when compared to its previous
version
 Invention must be useful to the world in bonafide manner
 Invention must be applicable of Industrial applicability
 Invention should not come under Inventions that are non-patentable under
section 3 and 4 of Patents Act of 1970.
Patent Holder or Patentee:

A patent holder “invents a methodology or product wherein the Patentee's exclusive

Rights and Obligations are awarded to the Patent holder as an incentive for investment
in creative or inventive activities and for the transmission of such activities to the public
at large for learning. These exclusive rights and obligations of the Patentee, however,
are not unlimited, and they can be terminated in exceptional circumstances when the
interests of the Patent holders and others must be” balanced.

Benefits to Patentee:

 Patent law in” India outlines the Patentee's exclusive rights and obligations to get
specific commercial benefits from the innovation he or she produced. Such
Patentee Rights and Obligations are offered to encourage inventors to invest in
new inventive offices, as well as to recognise that the improvements they
produce will be guaranteed and protected by the law, and that no one else will
be able to copy their discoveries or creations.
 According to the Patent Act of 1970, such protection is granted for a specific time
period (usually 20 years), during which the inventor will enjoy certain selected
Rights and Obligations of Patentee. When a patent is issued, specific
exploitative Rights and Obligations of the Patentee are offered as an incentive
for the public disclosure of the Patentee's creativity or innovation.
 These governing Rights and Obligations of the Patentee are usually for a term
of 20 years and are also assignable, allowing the Patentee to get a licence for
the innovation and maximise the profit connected” with it.

Rights of Patentee:

In India, “a patent award grants the Patentee has an exclusive right to use or
manufacture the patented invention or to use the patented procedure connected with
the invention. The Patent Act of 1970 provides some rights and obligations for
patentees. The following are the numerous types of patentee rights:

 When a patent is granted for a product, the exclusive right to restrict any third
party who does not have his/her consent from providing, using, manufacturing
for sale, importing, or exporting such items in India is granted.
 Whenever the patent's subject matter is a process, the exclusive right to restrict
any third party who does not have his or her agreement from offering, using,
manufacturing for sale, importing, or exporting for such things that are directly
produced from the method in India”
 Moreover, the Patentee's product should not be such that it cannot be patented
in India under Section 48 of the Patent Act, 1970.

Term of Patent:
Every patent awarded “has a 20-year duration starting from the date of application. The
term of a patent for an application filed in the national phase of the Patent Cooperation
Treaty (PCT) will be 20 years from the international filing date granted under the” PCT.

Patent Infringement

A “patent granted under the Indian Patents Act 1970 gives the patentee exclusive rights
to prevent anyone else from making, using, offering for sale, selling, or trying to import
the patented invention for the intent of using, selling, or offering for sale in India without
the patentee's consent until the patent expires. This prohibits third parties from
monetizing the patented idea while the patent is still valid. Any use of a patented
invention without the patentee's express permission is considered” an act of
infringement. Infringement can land the infringer in legal difficulties, since the patentee
can sue the infringer for infringement and demand monetary compensation.

Activities considered as Infringement:

The “Patents Act of 1970 does not specifically define acts that would be considered
infringing on the patentee's patent rights. Section 48 of the Act, on the other hand,
grants the patentee exclusive rights to prevent third parties from creating, using,
offering for sale, selling, or importing the patented invention for the purpose of using,
selling, or offering for sale in India without the patentee's approval. As a result, every
conduct by a third party that infringes on the patentee's rights is presumed to be an
act of infringement.

Third parties, on the other hand, can profit from patented innovations by obtaining a
licence from the patentee or obtaining his or her necessary approval for a specific
usage. Any commercial use of a patented invention without the patentee's
authorization is considered an act of” infringement.

Activities considered as non-infringement:

Sections “47, 49, and 107A of the Patents Act of 1970 identify some acts linked to
a patent invention that are not considered infringing. The legislative exemptions to
infringement it is what they're called. The following are the legislative exclusions to
infringement:

 Use by the Government: Section 47 of the Patents Act of 1970 establishes

specific requirements for the issuance of patents. The government's use of
patents is one of the statutory exclusions to infringement. The government can
utilise an innovation at any time after submitting a patent application or after
granting patent rights to the patentee under Section 47. The government can
also provide written permission to any individual to utilise an innovation for the
government's own purposes. A patentable innovation can also be made or
imported by the government for its own purpose.
  Exemptions for Research and Development: The Patents Act of 1970, Section
47(3), provides for the use of a patented invention by anyone for the primary
intention of experiment or research, including the transmission of information to
pupils. This clause lays the groundwork for future study and development in the
field of art where the patent is issued. The patented innovation can be used by
scientific researchers to conduct study for the advancement of science and the
better welfare of society. The clause also permits the use of the patented
invention for educational purposes, such as informing pupils about the current
state of the art. Selling patented items for experimental purposes, on the other
hand, is not covered by this legislative exemption and is deemed an act of
infringement, with the individual selling the product for monetary benefit being
considered an offender. Furthermore, using a pirated material for the purpose of
an experiment or giving directions to a student is deemed an infringement.
 Governmental Distribution of Medicinal Drugs to Medical Institutions : Section
47(4) of the Patents Act of 1970 allows the government to import patented
medicines or drugs for its own use or to distribute them through dispensaries,
hospitals, or other medical facilities that have been notified in the government's
official gazette. This clause allows the government to strike a balance between
the public interest in healthcare access and the patentee's exclusive rights.
However, using patented drugs for monetary advantage without the patentee's
authorization is considered infringement.

 Foreign vessel using patented Innovation : If a foreign vessel employing a

patented innovation arrives to India, temporarily or accidently, it is not deemed
an act of infringement, according to Section 49 of the Patents Act, 1970. This
eliminates the risk of a foreign vessel with a patented innovation on board
inadvertently infringing on patent rights. However, no business ambitions for the
use of a patented innovation in India will be” pursued.

Case of Patent Infringement

Pfizer “Versus Teva Pharmaceutical Industries and Sun Pharma

Teva Pharmaceutical Industries

Teva was founded in 1901. Israel is where the company's headquarters are located.
They now have over 3,000 drugs in their portfolio and generate 85 billion pills and
capsules every year. More than 55 production sites in more than 30 countries are
part of the organisation.

Operating in 60 markets and ranked among the world's top pharmaceutical businesses.
The firm boasts the largest medicine cabinet in the world, with a wide range of items
ranging from generics, APIs, and over-the-counter medications to specialist and
biologic therapies.
Pfizer

Pfizer, based in New York City, is an American multinational pharmaceutical and

biotechnology firm. In 1849, two German immigrants, Charles Pfizer and his
relative Charles F. Erhart, founded the corporation. Pfizer is a pharmaceutical
company that specialises in immunology, cancer, cardiology, endocrinology, and
neurology. The corporation has numerous bestselling medicines or products that
produce yearly revenues of more than $1 billion each.
Sun Pharma

Sun Pharmaceutical Industries Limited is a global pharmaceutical firm based in

Mumbai, Maharashtra, that develops and sells pharmaceutical formulations and
active pharmaceutical ingredients (APIs) in over 100 countries. It is India's largest
pharmaceutical firm and the world's fourth largest speciality generic pharmaceutical
company. Psychiatry, anti-infectives, neurology, cardiology, orthopaedics,
diabetology, gastroenterology, ophthalmology, nephrology, urology, dermatology,
gynaecology, respiratory, oncology, dentistry, and nutritionals are among the
therapeutic categories covered by the products.

The case history goes back to 1900s and is considered as one of the most
complicated cases of Patent infringement with acquisitions increasing the
complexity of the case.

In the early 1990s, Altana Pharma a US based pharmaceutical company licenced the
original Protonix (acid influx drug) patent to Wyeth pharma (another local pharma
company) . Later Altana Pharma was purchased by Nycomed Pharma in 2006, and
later on Nycomed Pharma was purchased by Takeda in 2011. In 2009, Pfizer
acquired Wyeth. Thus all this acquisition part gave rise to split ownership of the patent
between the two parent companies. Pfizer and Takeda eventually inherited the
Protonix patent.

By early 2007 Pfizer was using Protonix in its specialized acid influx drug which us
used to reduce stomach inflammation in patients. In the year 2007 the company
booked revenues of more than $1.9 Billion , but in 2008 the company’s revenue fell
down to $395 Million, six months later, Wyeth announced that Protonix sales in the
first half of 2009 were $179 million, which was less than the $284 million generated by
generic versions of the medicine, and the reason given by Pfizer was the launch of
generic versions of Protonix drug by Teva Pharmaceuticals in late 2007 and by Sun
Pharma in early 2008. Weyth pharma on the behalf of Pfizer, its parent company
launched a litigation against Teva Pharma and Sun Pharma for the infringement of
Protonix patent which was said to get expired in 2011.

Looking at the revenue of Pfizer , Teva opted to introduce its generic version of
Protonix,, rather than waiting for the Protonix patent to expire in 2011. In January of
2008, Sun Pharma followed suit. Both generic companies planned to reach an
agreement with the branded company, Wyeth, or have the patent declared invalid by a
court. Thus went through with the launch despite the patent being invalid, claiming that
it was a near-duplicate of an older .Such product releases are referred to be "at-risk,"
implying that the firms might face significant fines if the patent is subsequently found to
be genuine.
This was the first time in the history of generic drug making when generic drug making
companies manufactured “at risk” drug.

Later in 2013 the final judgement came on the infringement case, stating the patent
to have valid legal existence and fining both the companies, Teva Pharmaceuticals
Industries and Sun Pharma a sum of $2.15 billion to be paid as compensation for
infringing the patent by releasing generic version of specialized drug when its patent
was still active.

Pfizer in the United States and Takeda (who purchased Protonix creator Nycomed
in 2011) divided the settlement money, with the former receiving 64 %.

Teva agreed to pay $1.6 billion to Pfizer and Takeda, while Sun Pharma agreed to pay
$550 million. Teva and Sun both confessed that their sales of generic pantoprazole
infringed on the patent that was found to be valid by the court as part of the settlement.

“We are pleased with today’s settlement, which recognizes the validity and value of the
innovation that led to Protonix,” said Amy W. Schulman, evp and general counsel of
Pfizer. “Protecting intellectual property is vital as we develop new medicines that save
and enhance patients’ lives.”

New and improved pharmaceuticals are being launched onto the market as a result of
rapid technological advancements in the globalised era. Many developments in the
pharmaceutical industry have resulted in the launch of blockbuster pharmaceuticals,
saving the lives of millions of people. The majority of the profits from these
commercially successful pharmaceuticals are used to fund R&D and the development
of new drugs.

Pharmaceuticals are one of the industries where innovation has a significant influence
on drug makers' bottom lines, thus these firms are putting greater emphasis on R&D
to stay competitive and win market share. The pharmaceutical industry's success is
defined by innovation, yet the risk connected with the launch of new treatments might
jeopardise its existence in the marketplace. Furthermore, innovation aids pharma
companies in differentiating themselves from generic manufacturing firms to research
based firms. The majority of pharma businesses use innovation to drive growth and
provide significant returns on investment. The cost of developing and releasing a new
medication on the market is substantial, and its success or failure is greatly reliant on
the industry's need for innovation. Because the stakes in the sector are so high,
pharma companies must devote a considerable portion of their profits to research and
development
Thus, patents are required to encourage economic development and innovation.
They assist in getting a competitive advantage in the industry as well as increasing
revenue and market share. Patent protection that is adequate can provide pharma
businesses
with a foundation for future expansion and the development of new treatments.
Protecting innovative discoveries also aids pharma businesses in recouping increasing
R&D expenses and maximising the commercial product lifetime. As a result,
developing an effective IP strategy is crucial in order to optimise profits and realise the
actual value of intellectual” property.