Why the Indian Inventors Are Preferring Foreign Filing More Than Patent Filing In India
Though India is witnessing a sharp growth in the number of patent filings by individuals and organisations at a praiseworthy speed, still it is way behind the developed nations. Even the neighbouring country, China has left India much behind.
In 2018, India granted over 3 lakhs patents, and by 2020, it increased only to 3.5 lakhs. The experts informed the Committee that Indians, specifically in the manufacturing industry are preferring to obtain patents in foreign countries rather than in India, and the reason behind that is the lack of confidence in the patent protection provided by the Indian Patents Act 1972.
Before raising any finger and critically analysing the patent protection in India, let’s have a look at the year-wise data of patent filing by Indian inventors.
What Could Be The Reasons For Such Disparity?
Though India has sound and well-developed patent regulations, the lack in its execution and delay in the process between Indian patent search and patent granting, was the need of the moment for the formulation of the new law. Starting from responding to the examination requests to listing the application for scheduling the hearing before the examiner, almost every step encounters delays and backlogs, which are still unrepairable even with technological advancement.
One of the major issues faced by the Intellectual Property ecosystem in India is an inadequate workforce in the patent office, despite the fact that a patent is a form of protection for the unique and novel innovations in a country, that can be made used to aid the economical development of the country.
As per the EAC-PM report, at the end of March 2022, 860, 13704 and 8132 people are employed in the patent offices of India, China and the US. On the other hand, till the end of the last financial year, 2021-22, 1.64 lakh applications were pending from the controller’s end.
It also raised the issue that the bureaucrats create hurdles, and the officers claim that each submission is read through properly, but every second patent report suggests similar objections. However, Gupta also said that the officers are not the only persons to blame, the lack of enough manpower is another reason.
Let’s have a glance at the problems faced by the Indian patent system and solutions to those:
| Problems | Solutions |
|---|---|
| Lack of Tie-ups with MNCs dealing in drugs | The MNCs dealing in drugs conquer a weak presence and their presence in the Indian market is often limited, as their drug basket is quite small. Multinational companies may tie up with Indian companies for broader marketing. This is likely to have greater affordability for Indian buyers. Also, the drug company is getting the opportunity to avail a broad market. |
| High-expense drugs | The Indian government grants the right of manufacturing a drug before the expiry of the patent held for that drug. Compulsory licensing does not follow a straight jacket formula, rather they are dependent on two conditions - the cost of the patented product is too high for the common citizen and the patent holder does not make the drug available in the market at all. The compulsory license for export will be reported on similar grounds as mentioned before, only under a condition. It was decided in the Doha Declaration of Public Health that the drug should be exported only to poor countries to meet acute health issues. |
| Price Control | Applying the drugs/pharmaceutical products for the protection of patent meaning making them subject to price control and the purpose of doing so is to protect the citizen from being the victim of exorbitant pricing. |
| Too much delay in granting the patent | The lack of clarity in the provisions under the Patents Act results in filing unnecessary opposition to the pharmaceutical patent filing, though through an Indian patent search the chances of opposition is reduced. As per the reports by the Annual Intellectual Property Office Report, in 2018-19, the number of pre-grant opposition filed was 426, which nearly doubled in 2019-20 to 800 pre-grant opposition filed. Relevant to that, it is critical to note that the number of filings has not increased much. It is also reported that, in some cases, there are six pre-grant oppositions to a single pharmaceutical patent filed. Moreover, an adequate number of oppositions are Benami which means, anonymous opposition. This unnecessarily delays the actual procedure. To curb this practice, The Intellectual Property Appellate Board made it compulsory to submit valid identity proof - Aadhar card/voter ID/ passport/driving license for filing an opposition. Though the Board ceased to exist in April 2021, the rule still exists. |
The lack of a fixed timeline is also another hindrance that is resulted in delays. Further, some cumbersome compliances are raised due to certain provisions under Patents Act 1970.
Why has the Indian patent regime faced challenges raised by USTR?
The Indian Patent Act of 1970 governs Indian patents, which are a set of exclusive rights granted for inventions that might be either products or processes. The following requirements must be met for innovation to qualify for a patent under the act:
- It needs to be original.
- It must be non-obvious or include a creative step or steps.
- It should be able to be used in industrial settings.
- A unique way of doing something or a novel technical solution for a problem shouldn’t be subject to the provisions of sections 3 and 4 of the Patents Act of 1970.
In terms of intellectual property rights, India has steadily allied with foreign systems. The Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement was ratified on January 1, 1995, when it joined the World Trade Organization. Following this, it modified its domestic patent laws to be in compliance with TRIPS, most notably in 2005 when it added patents for pharmaceutical products to the statute.
Before proceeding to discuss the hindrances Indian patent applicants face and the solutions to those, let’s have an idea about the difference in the number of patent filings in India and foreign as follows:
| Year | India | Foreign filing |
| 2017 | 2348 | 2058 |
| 2018 | 3656 | 2361 |
| 2019 | 6258 | 2852 |
| 2020 | 6979 | 3872 |
| 2021 | 6656 | 9189 |
It’s interesting to note that the original Indian Patents Act excluded pharmaceutical products from patent protection in order to provide affordable access to medical care for all. According to a 1959 commission headed by the jurist Rajagopala Ayyangar, laws should be drafted “with special reference to the economic conditions of the country, the state of its scientific and technological advance, it’s future needs, and other relevant factors…in order to minimise, if not eliminate, the abuses to which a patent monopoly system is capable being put.”
Following the 2005 modification to comply with TRIPS, patent protection for pharmaceuticals was reinstated.
How does patent registration affect the commercial market in India?
The five main products used for commercial purposes – mechanical engineering, computer science, pharmaceutical, agriculture, and biotechnology showed the trend in this manner.
The USTR also issued a study in 2021 that addressed many of the same issues.
The Parliamentary Standing Committee’s “Review of the Intellectual Property Rights Regime in India” thoroughly examined these concerns and more general IPR-related ones. In July of last year, the Committee presented the Rajya and Lok Sabha with its conclusions.
This gave insight into how Indian intellectual property law operates and showed where it differs from American patent law and is generally in line with it.
The Indian Patent Act’s Article 3(d) has been one of the critical areas of disagreement between India and the U.S.
As the Indian pharmaceutical and software industry controls a lion’s share of money flow in the domestic market and the international market, it is crucial that utmost care and protection is provided to the industrial controller, i.e. inventor’s interest.
