The controversy between India and USA related to patent protection has raised many question and concerns on patent laws. The USA criticized India's patent law and ridiculed India by listing it as a "priority country" which means that the country has done minimum to protect patent laws on global level.
What were the reasons that prompted USA to take such adverse decision? Were they legitimate? Was India's stand aftermath of this controversy legal? To answer these questions we need to analyze patent laws, flexibilities in these laws and conditions where those flexibilities can be used.
On January 1 1995 India became a member of WTO by signing three major agreements- GATT, GATS and TRIPS. Trade related intellectual property rights (TRIPS) was designed to implement and administer intellectual property rights on global scale.
Intellectual property rights are given to individual or organization that have created something novel and of commercial value and these rights exclude others to manufacture, sell or use products based on their novel idea.
India amended its Patent act 1970 to meet the requirements set in TRIPS agreement. Few important amendments that were made were; the patent term was increased from 7 years to 20 years, product patents were applicable in pharmaceutical sector, and patents could be applied in HYV seed and genetically modifies plants.
The TRIPS agreement was designed for the welfare of the individuals or community who holds the patent and to promote research and developments in society.
However TRIPS provided use of safeguard measures like compulsory licensing and sui generis (native) system.
Compulsory license is when government allows manufacture of patented product without the prior permission of patent holder. This can be issued when a government thinks that the product is beyond purchasing power of general public.
Any Government can use these safeguard measures in special circumstances for the benefit of its people, for example in issues related to health care.
India also issued compulsory license to an Indian company Natco pharma in 2012 to manufacture cancer drug nexavar and sell it at a very low price.
The use of compulsory license by India was done to make a drug accessible to its population which could save many lives.
The step taken by government considering the importance of public health was fully compatible with TRIPs and well within the boundaries of its patent laws.
The big pharmaceutical companies in USA were not happy with India's decision. The government of US in retaliation ranked India lowest in US chamber of commerce's IP survey 2014.
The USA even listed India as "priority country" which is the worst classification given to countries.
This issue raises many questions mainly on the principles and goals of WTO.
WTO was formed with a basic principle of creating a healthy environment for trade and raising the standard of living of people in developing and underdeveloped countries by providing them access to markets and technology of developed countries.
Thus retaliatory measures taken by USA to protect its corporates are a clear violation of the WTO's principles.
India has sent a strong message by rejecting all accusation and challenged the USA to justify its measures in WTO.
India is a representative of many developing countries who in the past have used these flexibilities in patent laws for welfare of its people.
All eyes are set on WTO, it will decide whether WTO is a guarantor of public welfare or it is a threat for millions of underprivileged people on this planet.