India’s IPR Policy on

Biotechnology
Intellectual Property of Biotech
Processes : Main Regulatory and
Legal Aspects
Presented by
Vidya B. Mehrish
Dua Associates, India
([email protected])
on February 16, 2006
Forum: AIDIC, BIOTECH GROUP
BIOTECH PROCESSES OVERVIEW WORKSHOP,
MILANO, ITALY
Dua Associates, India
 Overview of Presentation

 What is Biotechnology?

 Why is Biotechnology Important for India?

 Indian Government Initiatives

 Potential Areas for Investment in the Indian Biotechnology Sector

 Intellectual Property Rights of Biotechnology (Legal Frame Work)

Dua Associates, India February 16, 2006 2

 What is Biotechnology?
Biotechnology includes:

 Recombinant DNA and Genetic Engineering

 Cell Cultures
 Waste Treatment and Utilization
 Enzymes and Biocatalysts
 Fuels
 Nitrogen Fixation
 Fermentation and Pharmaceuticals

Dua Associates, India February 16, 2006 3

 Why is Biotechnology
Important for India?
 For a country like India, biotechnology is a powerful enabling technology
that can revolutionize agriculture, healthcare, industrial processing and
environmental sustainability .

 Biotechnology as a business segment for India has the potential of

generating revenues to the tune of US$ 5 million and creating one million
jobs by 2010 through products and services.

 Clinical development services can generate in excess of US$ 1.5 billion while
bio-services or outsourced research services can garner a market of US$ 1
billion over this time scale.

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 Why is Biotechnology
Important for India?
 With approximately 200 industries, the growth of the biotech sector in India has
been rapid. Current estimates indicate that the industry grew by 39% annually
to reach a value of US$ 705 million in 2003-2004.

 Currently, the bio-pharma sector occupies the largest market share of 76%
followed by bio-agri 8.42%, bio-services 7.70%, industrial products 5.50% and
bio-informatics 2.45%.

 The current policy review envisages an annual turnover of US$ 5 billion by 2010.

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 Indian Government Initiatives
 Import Duty Exemption (Promotion of Import Duties on key R&D, contract
manufacturing / clinical trial equipment and duty credit)
 Tax Deduction on R&D Expenditure (Extending the 150% weighted average
tax deduction on R&D expenditure under section 35 (2AB) of the Indian
Income Tax Act until 2010).
 Priority Sector Lending (Enable lending by Indian banks to biotech
companies as priority sector lending).
 Customs Duty Removal (Remove customs duty on raw materials imported
into India, that go into making the finished product is imported duty free).
 Simplification of Procedures (Simplification and streamlining of procedures
for import, clearance and storage of biological, land acquisition, obtaining
environmental and pollution control approvals would be simplified and
streamlined within shorter time frame lines through consultations with
various central and state government departments).
 Fostering Inter-Company Relationships (The Indian Government further
intends to make efforts to remove hurdles for contract research especially for
input output norms and tax on revenue generated through contract research /
R&D).
 Developing Communication Systems (One significant feature of the biotech
industry is the fluidity and variety of its inter-company relationships,
traditionally much greater than in other industries).

Dua Associates, India February 16, 2006 6

 Potential Areas for Investment in
the Indian Biotechnology Sector
 Agriculture and Food Biotechnology

 Industrial Biotechnology

 Preventive and Therapeutic Medical Biotechnology

 Regenerative and Genomic Medicine

 Pharmaco-genomics

 Bio-engineering and Nano-biotechnology

 Bio-informatics and IT Enabled Biotechnology

 Clinical Biotechnology and Research Services

Dua Associates, India

February 16, 2006 7
Intellectual Property Rights of
Biotechnology : Legal Aspects
 In India, a patent can be obtained only for an invention which means a new
product or process involving an inventive step and capable of industrial
application.

 In order to be patentable, an invention must concern a new and useful

manner of manufacture. The word “manufacture” applies not only to
things made but to the practice of making, to principles carried into
practice. Essentially, if the starting material remains unaltered by the
process, and the end product also remains the same as the starting
material, the process is understood as “no manufacture” from the
patentability perspective.

 To be patentable an invention must have (i) technical advancement over

existing knowledge, (ii) economic significance, (iii) or both which makes
the invention not obvious to a person skilled in the art. If the subject
matter of the invention is novel, non-obvious and the invention has
industrial applicability, it can be patented in India. Indian Patents Act,
1970 § 2(j).

Dua Associates, India February 16, 2006 8

 Intellectual Property Rights of
Biotechnology : Legal Aspects
Changes to Indian legislation in keeping with international legislative framework

Subsequent to the enactment of TRIPS, Indian Patent law has changed in the
following ways :

 A uniform twenty (20) years for all patents granted after May 20, 2003;

 A reciprocal arrangement with all convention countries, union of countries and

inter-governmental organizations;

 Products made patentable in all fields of technology from January 1, 2005;

 The extension of the rights of the patentee;

 For product patent applications on pharmaceuticals and agro-chemicals filed

before January 1, 2005, under the mail box system, request for examination is to
be filed within thirty six months from the date of priority.

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 Intellectual Property Rights of
Biotechnology: Legal Aspects

 Rights of patentee for mail box applications extend from the date of
grant of patent.

 For patents granted on mail box applications which include

Biotechnology inventions, patent holder is entitled to receive
reasonable royalty from such enterprise which has made
significant investment and has been producing and marketing the
concerned product prior to January 1, 2005 and which continues to
manufacture the product covered by the patent on the date of grant of
patent and no infringement proceedings can be instituted against such
enterprise.

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 Intellectual Property Rights of
Biotechnology: Legal Aspects
 Compulsory licenses are available for manufacture and export of patented
pharmaceutical products to any country which has insufficient or no
manufacturing capacity in the pharmaceutical sector for the concerned
product to address public health problems subject to the condition that
compulsory license has been granted by such country or such country by
notification allows importation of patented pharmaceutical product from
India.

 A major concern of pharmaceutical industries concerning amendments in

the compulsory license procedure is that it can be granted to any interested
person if the patented invention is not available to the public at a reasonable
affordable price. The term ‘Affordable’ is a relative term which however, has
not been defined.

Dua Associates, India February 16, 2006 11

 Intellectual Property Rights of
Biotechnology: Legal Aspects

 Yet another concern is that amended act allows generic manufacturers who
were producing and marketing products of a mail box patentee before
January 1, 2005 to continue doing so on payment of a reasonable royalty.

 Bolar provision included making, using or selling patented product before

expiry of the term of patent for obtaining regulatory approvals. Bolar
provision now includes “Importing”. Thus, while considerable period of the
patent holder is wasted in obtaining regulatory approvals, the generic
producer has advantage that immediately on expiry of the term of patent, he
can commence production.

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 Intellectual Property Rights of
Biotechnology : Its Regulatory Framework
 Legislative framework : The Drugs and Cosmetics Act, 1940 and the Drugs and
Cosmetics Rules, 1945 as amended from time to time, regulate recombinant pharma
products.
 Authorities : The Drugs Controller General of India (DCGI), the State Drugs Controller
and the Recombinant Drugs Advisory Committee (RDAC) constituted by the Ministry
of Health and Family Welfare regulate the recombinant pharma products.

Steps involved in the approval process of a biotechnology product -

 Proposal (examination of proposal in light of the bio-safety regulation and
guidelines)
 Approval of Review Committee on Genetic Manipulation (RCGM)
(Examination of information for R&D work, approval of pre-clinical trial based on
evaluation of data physico-chemical and biochemicals characterization of the process
and the final product
 Genetic Engineering Approval Committee Drugs Controller of India
(Approves Clinical Trials and Containment Facilities and Evaluates Clinical Trials)

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Dua Associates, India
 Intellectual Property Rights of
Biotechnology : Its Regulatory Framework
 Approval for Manufacture and Marketing (Currently, there are multiple regulators,
multiple ministries, lack of coordination, lack of a linear progression in the responsibilities
of a regulator and lack of a linear progression in the approval process and committees
working outside their areas of expertise).

Proposals to streamline the process :

 The Institutional Bio-Safety Committee will monitor all development work (up to 20 litres)
and recommend to RCGM for Animal Toxicity Tests (ATT) & Scale Up.
 RCGM will evaluate the recombinant technology and grant permission for scale up – R&D,
review and approve for pre-clinical animal toxicity tests and evaluate ATT data and
recommend to DCGI for Human Clinical Trial (HCT).
 DCGI will permit Human Clinical Trials, review Human Clinical Trial Data, grant
permission for Manufacture and Marketing of the product and inspect the facility where
the product is manufactured.
 GEAC will review the manufacturing process to ensure that the LMO (Living Modified
Organism) is “inactivated” during the process and send its recommendations to the Drugs
Controller General of India within the specified time.

Dua Associates, India February 16, 2006 14

 Future Proposals by the Indian Government to
further steam-line the Regulatory Aspect of the
Indian Biotechnology sector

 National Biotechnology Regulatory Authority

 In-service Center for Training of Professionals

 Guidelines for Transgenic Research

 Special Regulatory Cell

 Review Committee on Genetic Manipulation (RCGM) Evaluation of

Recombinant Technology

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