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GE, Boeing, Honeywell back India on patents

March 26, 2016 16:00 IST

India’s IPR framework and enforcement were comparable to those in developed countries

Large multinationals like General Electric (GE), Boeing and Honeywell have endorsed India’s intellectual property rights (IPR) environment even as US drug and software companies lobby against the country’s patents regime ahead of the Special 301 Report of the US Trade Representative (USTR).

Most representations have, however, acknowledged an improvement in India’s IPR regime under Prime Minister Narendra Modi. The USTR will issue the Report in April. It had conducted an out-of-cycle review for India in 2014 but did not downgrade it. India has always maintained that US Special 301 is a unilateral measure and the government does not agree to be party to any such investigation.

GE says Indian innovations have been used the world over. “GE’s Lullaby baby warmer was originally developed at our research centre in Bangalore and is now sold in over 80 countries. The design enables caregivers to focus on the baby and not switches. The unit is particularly popular in Western Europe,” it said, in its representation to the USTR. GE employs 5,300 technologists in its research centres in Mumbai, Chennai, Hyderabad and Bengaluru.

Honeywell has pointed out that India’s IPR framework and enforcement were comparable to those in developed countries.

“Honeywell has committed time and financial resources to patenting its technologies in India, and confidence in India’s IPR framework was one of the key enablers in the establishment of Honeywell’s engineering and technology presence, including Honeywell Technology Solutions and the Honeywell India Technology Centre,” it said, in its representation.

Boeing said it had seen greater openness to IPR concerns under the Modi government. “There is new momentum suggesting that India is preparing to take steps to improve its IPR regime. As the preeminent US exporter to India, as well as an investment partner in India, Boeing continues to have a positive experience with Indian customers, partners, and suppliers on IPR protection,” it said.

US drug firms, however, continue to lobby with their administration to press India to change some of its patent policies.

The Biotechnology Innovation Organization said India had not addressed key concerns in the draft IPR policy due in 2016.  “The authors do not address some of the more controversial policy issues, notably compulsory licences (CLs). This is a missed opportunity to articulate the government’s position on this and other critical issues,” it said.

India denied patent protection for inventions that would otherwise meet internationally accepted criteria, said the National Association of Manufacturers. “Since 2012, patents for at least 25 products have been undermined through rejection, invalidation, or other revocation,” it said.

The Pharmaceutical Research and Manufacturers of America, a grouping of leading drug innovators, said, “Though the basic import duties for pharmaceutical products average about 10 per cent, additional duties and assessments are imposed that bring the effective import duty total to approximately 20 per cent. In fact, India collects more in taxes on pharmaceuticals than it spends on medicines,” it said.

The US India Business Council has recommended that India remain on the less damaging Priority Watch List, pointing out that legacy issues remained a concern. India has maintained that US Special 301 is a unilateral measure and the government of India does not agree to be party to any such investigation.

In a first for India, the department of industrial policy and promotion (DIPP) is finalising an IPR policy to strengthen patents regime that encourages innovation and R&D. Besides, the government has also constituted a think tank on IPR to advise government on a range of patents-related issues.

India has been holding talks with US for over a year under a bilateral working group for IPR. Earlier this week, India defended its right to grant compulsory licence and to determine the grounds upon which such licences are granted. India has always maintained that its IPR laws are WTO Trade-Related Aspects of Intellectual Property Rights compliant. India has been put under the USTR “priority watch” list for two years in a row, arguing that India’s patent laws favoured domestic companies.

India and the US have been at loggerheads over the contentious issue of compulsory licencing and section 3(d) of Indian Patents Act, which does not approve patents for evergreening.  India granted first CL in 2012, allowing local firm Natco to sell a generic version of German company Bayer’s cancer medicine Nexavar at a lower price. However, DIPP, in the last two years, has put down CL requests made by the ministry of health.

What is the Special 301 report?

  • The Special 301 Report is prepared annually by the Office of the United States Trade Representative (USTR) under Section 301 as amended in their Trade Act of 1974
  • The reports identify trade barriers to US companies and products due to the intellectual property laws, such as copyright, patents and trademarks, in other countries
  • Each year, the USTR must identify countries which do not provide “adequate and effective” protection of intellectual property rights or “fair and equitable market access to United States persons that rely upon intellectual property rights”
Dilasha Seth in New Delhi