Public Money: Health groups fear the new bill will facilitate private property with public funds (Pic By Subhabrata Das)

“This Bill can make a few people very rich,” says Leena Menghaney, an access-to-medicines campaigner at Geneva’s Médecins Sans Frontières’ New Delhi office, which has in the recent past called for alternatives to patents for incentivising innovation. “It will create more patent monopolies and not the incentives that you need for innovation on neglected disease that India desperately needs.” Menghaney fears that the law will only divert public resources towards areas that maximise profit for scientists and the companies to whom they license out patents. “The legislation will simply facilitate private property with public funds,” agrees K.M. Gopakumar of Centad who plans to write to the ministry, and rally other concerned individuals and groups. “There can be many incentives other than patents to promote creativity and innovation, which includes open source, prizes, tax exemption, and network research.”

The Bill is modelled on America’s Bayh-Dole Act enacted in 1980 to encourage universities to licence out patents generated from government-funded research to industry for commercialisation. An earlier BW article (‘Patently not Obvious’, BW, 4 April 2008) had quoted K.K. Tripathi, advisor to the department of biotechnology in the Ministry as saying that the Indian law’s purpose “is to get (government-funded) research commercialised for public use and for the benefit of society”.

But the Bayh-Dole Act has attracted criticism in its own country where universities are behind several blockbuster drugs and diagnostics owned by the biopharmaceutical industry. “Public funds go to universities so that they can conduct research on potential new medicines,” says Amy Kapczynski, assistant professor of law at the University of California in Berkeley. “The university then turns the results over to private companies, typically under an exclusive licence that has no safeguards to guarantee that people in the US or elsewhere can access the resulting medicine for a reasonable price.”

While the US law does give the government ‘march-in’ rights in certain situations, “it has basically been a paper tiger, largely because the language is vague, the bar appears to be quite high, and it wasn’t really thought through”, says Bhaven Sampat, assistant professor at New York’s Columbia University who has studied the Bayh-Dole’s impact in great detail and is preparing a white paper on the Indian Bill. “If India does pass such legislation it should be very explicit about conditions under which the government can march-in to compel broader licensure and wherein the government march-in rights reside.” But both Menghaney and Gopakumar say the Indian law has no specific safeguards and relies entirely on ‘compulsory licensing’ provisions of the Indian Patents Act (administered by the commerce ministry through patent offices). “It is the responsibility of this new law to ensure that licences will not block access to developing countries while they are being handed out,” says Menghaney. “But it puts the onus of preventing patent monopolies entirely on the patent offices.”

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(Businessworld issue 20-26 May 2008)