A question of adjudication came up before the High Court of Delhi, whether Patents Act, 1970 permits export of a patented invention from India. The petitioner, Bayer Corporation (Bayer) filed a writ petition in the High

CS Professional · Intellectual Property Rights - Law and Practice · PYQS · December 2024
A question of adjudication came up before the High Court of Delhi, whether Patents Act, 1970 permits export of a patented invention from India. The petitioner, Bayer Corporation (Bayer) filed a writ petition in the High Court of Delhi contending that Natco was granted a Compulsory Licence by the Controller of Patents for the drug 'Sorafenib Tosylate' under section 84 of the Patents Act, subject to certain terms and conditions contained therein, wherein one of the terms was that the Compulsory Licence was solely for the purposes of making, using, offering to sell and selling the drug covered by the patent for the purpose of treating HCC and RCC in humans within the territory of India. However Natco was manufacturing the product covered by the Compulsory Licence for export outside India and that the export by Natco was contrary to the terms of Compulsory Licence and amounted to infringement of the patent within the meaning of Section 48 of the Patents Act. Natco filed a counter affidavit in the writ petition inter alia pleading (a) that Natco had not exported any product (subject matter of Compulsory Licence); (b) that under the scheme of the Drugs and Cosmetics Act, 1940 (Drugs Act) permission was routinely granted for export to various countries upon compliance of certain conditions and that there were similar provisions in the western countries including Europe; (c) that the Patents Act also provided that export of a patented product for generation or submission of regulatory permission was not an act of infringement. Bayer contended that, the acts of a non-patentee (Natco) of making, using offering for sale, selling patented products would be infringement of patent and that the patentee was entitled to approach the Courts to prevent the non-patentee from doing the said acts. Natco argued (i) that the exports intended by Natco were only for research and development purposes and for obtaining the drugs regulatory approvals in the countries to which exports were intended (ii) that Natco was not intending export of the product covered by the Compulsory Licence for commercial purposes and that research and development activity with respect to patented drugs, for which submission of data to the Drug Regulatory Authority. In furtherance to this an issue was raised during the proceedings in the Court related to the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS Agreement). India as a party to the TRIPS agreement has agreed to give effect to the provisions thereof without being obliged to implement in its law more extensive protection than is required by it, provided that such protection does not contravene the provisions of the TRIPS Agreement. Else, India is free to determine the appropriate method of implementing the provisions of the TRIPS Agreement within its own legal system and practice. The objective of the TRIPS Agreement, as per Article 31 of the TRIPS Agreement, member countries may allow use of patented product/process for certain purpose, vide Clause (f) which provides that such use should be predominantly for the supply of the domestic market of the member country authorizing such use. The submissions of both the parties traverse the contours of the Patents Act and TRIPS Agreement. Answer the following questions. Is Natco liable for infringement. Decide.

Answer & Explanation:

Section 107A of the Patents Act, 1970 lays down that any act of making, constructing, using, selling or importing a patented invention solely for uses reasonably related to development and submission of information required under any law for the time being in force, in India, or in a country other than India, that regulates the manufacture, construction, use, sale or import of any product shall not be considered as an infringement of the patent right of somebody else. The pertinent question that arises in the present set of facts however is, 'whether a non-patentee thereunder can export a patented invention for such purposes. The answer to this question has to be sought from the language of section 107A itself. In the recent case, this question was answered by the Hon'ble High Court of Delhi wherein it has held that a 'Sale by a non-patentee of a pharmaceutical product solely for the purposes prescribed in Section 107A would also not be infringement and cannot be prevented.' Section 107A(a) of the Act, commonly referred to as the "Bolar" provision exempts certain acts related to the development and submission of information required under Indian law or the law of any other country from being considered as infringement of the patent. However, the further question to be answered is whether the word 'selling' in Section 107A is confined to within the territory of India and thus selling of patented invention outside India, even if for purposes specified in Section 107A, would constitute an infringement which can be prevented by patentee. To answer the question and to interpret the word 'selling', the Court proceeded to dissect the language of section 107A and came to a finding that the meaning and ambit of the term 'selling' cannot be confined to 'selling within India only'. It further held that the 'presence of the word import' and absence of the word export' in Section 107A does not lead to any inference of the word selling' therein being exclusive of in the course of export. While the need for exporting was not felt due to presence of the word 'selling', the need for the word 'importing' in Section 48 was necessary to preserve exclusive right of patentee and in Section 107A to allow import for purposes prescribed therein'. Therefore, based on the interpretation of Section 107A, Natco would likely not be liable for infringement if the export is solely for the purposes prescribed under Section 107A, i.e., for development and submission of information required under any law for regulatory approvals.

Topics: Patent Law

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