1.

THE PATENTS (AMENDMENT) ACT OF 2012 AND THE COMPULSORY

LICENSING NOTIFICATION ISSUED BY THE GOVERNMENT ARE
CONSTITUTIONALLY VALID
1.1 The Amendment Act of 2012 is not violative of Art 14 of the Constitution of
India
Art 14 of the Constitution lays down Equality before law and equal protection for all.
Arbitrary action is described as one that is irrational and not based on sound reason or as one
that is unreasonable. Any decision, be it a simple administrative decision or a policy decision,
if taken without considering the relevant facts, can only be termed as an arbitrary decision
and violative of the mandate of Art 14 of the Constitution. However in the present case, the
relevant facts to be considered is whether it satisfies the basic requirements, object and
purpose of the 1970 Act and whether it complies with TRIPS.
1
Only the Action of the State
or its instrumentality, uninformed by reason, may amount to being arbitrary and
discriminatory are liable to be questioned. However in the present case, the Amendment is
both backed by reason as well as non-discriminatory since it imposes an uniform notification
over all the cancer drug due to the emergency prevailing in the country.
2
The Government
policy unless shown manifestly arbitrary or wholly unreasonable cannot be held violative of
Art 14 or unless contrary to law and if honestly taken. An act of the legislature cannot be
struck down merely by saying that it is arbitrary. For deciding whether a particular decision
was arbitrary or reasonable, the existing circumstance at the time of taking the decision had to
be examined and not those prior to the decision.
3
Policy decision of the government to grant
payment of arrears of employees from certain date was held to be constitutionally valid.
4

1.1.1 The Doctrine of parens patriaeapplies in the present case
This means that the state is the parent of the country and it has a legal obligation to protect
the citizen especially when there a threat to the health and security of the nation. The subject
matter of parens patriae power can be adjudged on two counts (i) In terms of necessity (ii)
assessment of any trade-off or adverse impact, if any.
5


1
Om Kumar v. Union of India (2001) 2 SCC 386.
2
M.J Sivani v. State of Karnataka (1995) 5 SCC 289 (para 19)
3
Balco Employees Union (Regd) v. Union of India (2002) 2 SCC 333; State of Bihar v. Bihar Distillery Ltd
(1997) 2 SCC 453; Patna Regional Development Authority v. Rashtriya Pariyojna Nirma Nigam- AIR 1996 SC
2074.
4
State of Haryana v. Rai Chand Jain (1997) 5 SCC 167.
5
Anuj Garg v. Hotel Association of India (2008) 3 SCC 1.
1.1.2 Clause ii of the Amendment Act, 2012 barring interim injunction is
constitutionally valid.
Sec 41 of the Specific Relief act says what are the situation under which an injunction be
barred by law. One such situation being to avoid multiplicity of the proceeding and one other
relevant ground being where there is an efficacious other relief available for the pertinent. In
this instance the reason behind the amendment being that pharmaceutical patents being life
saving drugs cannot be granted an interim injunction because the public will be affected at
large. Thus this amendment is made in light of the public interest. The Court could grant the
mandatory injunction only when there was no effective alternative remedy. This is the
general principle of law. Thus when there is a better alternative remedy, the legislation does
not violate the fundamental rights.
6
The Decision of the State of M.P to abolish the State
Administrative Tribunal in view of the fact that its continuation would be one more tier in
the administrative Justice in as much the decision was rendered by it, an aggrieved party
could approach the High Court under Art 226/ 227. The court held that one remedy under the
law can be barred if there is efficacious other remedy available to the petitioner in public
interest or to avoid multiplicity of proceeding.
7
Merely because an appeal is not provided in
the statute, that by itself would not render a statute constitutionally invalid being violative of
Art 14 of the Constitution.
8

This is a case of protective discrimination given to the Pharmaceutical Patents alone
in the interest of Public at Large.
9
And the government is not entirely barring the right to seek
the royalty under the Amendment Act, therefore it is a policy decision to protect the public
interest. However the Amendment does not leave the patent holder without any reasonable
remuneration or royalty. Therefore it is completely valid and a rationale criteria. Thus
Individual hardship must subserve the larger social interest.
10
Where a persons legitimate
expectation was not fulfilled by taking a particular decision then the decision-maker should
justify the denial of such expectation by showing some overriding public interest.
11
In
Profulla kumar Das v. State of Orissa,
12
the Supreme Court held the grounds for striking

6
Seth Chand Ratan v. Pandit Durga Prasad (2003) 5 SCC 399 (para 13) ; The Choice School v. MP Salim,
Kerala High Court; Sukhdeo Narayan and Ors v. Mahadevanand Giri, Patna High Court.
7
M.P High Court Bar Association v. Union of India (2004) 11 SCC 766.
8
Jamshed N Guzdar v. State of Maharastra (2005) 2 SCC 591
9
D T C v. Mazdoor Union D T C AIR 1991 SC 101.
10
M.P Oil Extraction v. State of M.P (1997) 7 SCC 592 (para 44). Maharastra Rajya Sahkari Sakkar Karkhan
Sangh Ltd v. State of Maharastra 1995 Supp (3) Sccc 475 para 18 and 19,
11
MRF Ltd Kottayam v. Asst Commissioner (Assessment) Sales Tax (2006) 8 SCC 702
12
(2003) 11 SCC 614, 631 (para 45)
down a valid legislation, where in the Court held that it would not be permissible of it to
declare a valid legislation ultra vires only because it may cause some hardship to the
petitioner. A mere hardship cannot be a ground for striking down unless it is held to be a
suffering from the vice of discrimination and unreasonableness. It is a usual presumption
which may be drawn that the statutory authority would not exercise the power arbitrarily.
13

1.2 The Amendment is not in violation to Art 21 of the Constitution
This Article mandates that no person shall be deprived of his life and personal liberty except
according to the procedure established by law. Maneka Gandhis case
14
opened a new
dimension and laid down that it imposed a limitation upon law making as well, prescribing a
procedure that is just, fair and not arbitrary, whimsical and fanciful. Thus as held in
Gopalans Case
15
, Art 21 will only be attracted in case where deprivation in the sense of
total loss. Therefore in the present case, there is no complete deprivation, as any patent
over which compulsory licence is given, the patent gets reasonable and sufficient royalty for
the same.
Thus it is the duty of the state to protect the citizens at large and give them healthy
environment as held in M.C. Mehta v. Union of I ndia.
16
Ensuring good health by improving
the quality of life will also include a major part of Art 21. Thus Right to Life will include
right to food, water, decent environment , education, medical care and shelter.
17

One of the substantive rights recognized by the Covenant is the right of everyone to the
enjoyment of the highest attainable standard of physical and mental health. In particular,
parties are obliged to take steps necessary for the prevention, treatment and control of
epidemic, endemic, occupational and other diseases, and the creation of conditions which
would assure to all medical service and medical attention in the event of sickness.
18
Resource scarcity does not relieve a state of its core minimum obligation - to ensure the
satisfaction of, at the very least, minimum essential levels of each of the rights.
19
Such core
minimum obligation is lifted only when the state can show that its resources are

13
PUCL v. Union of India (2004) 2 SCC 476 (para 43)
14
AIR 1978 SC 597
15
1950 SCR 88,
16
(1999) 6 SCC 9 (para 1).
17
Chameli Singh v. State of UP (1996) 2 SCC 549.
18
ICESCR, Art. 12(1); ICESCR, Art. 12(2)(c), ICESCR, Art. 12(2)(d).
19
UN Committee on Economic, Social and Cultural Rights, General Comment 3 (1990), The Nature of States
Parties Obligations UN Doc HR1/Gen 1/Rev 1, para.10.
demonstrably inadequate to allow it to fulfil its duties. Personal liberty essential means
freedom from any physical restrain of persons by incarceration or otherwise. By merely
issuing compulsory licence for the pharmaceutical patent in the interest of public does not
impose any physical restraint to the patent owners because they are entitled to lawful royalty.
The concept of right to health is so wide under Art 21 that the Supreme Court has the right to
ban use of chemicals and pesticides which are causing health hazards.
20

The scope of protecting public health is so wide that the residents in a state have a
constitutional as well as statutory right to live in a clean and healthy city. This Amendment
Act of 2012, was made in furtherance of ensuring the statutory right of every individual in
Germ-many to have a healthy disease free society.
21

The concept of Compensation/ making good the loss comes only when the actions of the state
are unlawful and that they have to provide effective remedy to the aggrieved person.
However in the present case, the Amendment Act was brought by the Parliament with a
lawful intent to protect public at large, but still there is no arbitrary provision which exempts
royalty to the patent owner.
The expression procedure established by law in the same Article means the procedure
prescribed by the law of the state. Thus it means the power of the legislature to change the
procedure by enacting a law by amending it and when a procedure is so changed, it becomes
a procedure established by law.
22
In the present case, the Amendment Act is valid because
i) The legislature is competent to make such amendment in interest of the public
ii) It does not contravene Part III of the Constitution and only provide a reasonable classification
in interest of the public.
23

Citizen has no fundamental right to carry on business of liquor and the government policy
imposing strict regulations was held to be valid, in interest of the public though there was no
emergency for banning liquor in the country.
24

Maintenance of public order is a constitutional power and responsibility of the state in Entry
I, List II. This includes protection of public health by the Union which is contemplated under

20
Ashok (Dr.) v. Union of India (1997) 5 SCC10; Anukul Chandra v. Union of India (1997) 6 SCC 1.
21
B L Wadehra( Dr.) v. Union of India (1992) 2 SCC 594.
22
AK Gopalan v. State of Madras; Dadu v. State of Maharastra (2000) 8 SCC 437
23
Malkani R M v. State of Maharashtra AIR 1973 SC 157 (para 30)
24
Kuldeep Singh v. Govt of NCT of Delhi (2006) 5 SCC 702
Entry 6, List II. Thus these are legitimate grounds of intervention of the Union and the
Parliament has the power to make such laws and the amendment to the Acts on this regard.
25

1.3 The Amendment Act 2012 is in compliance with the object and purpose of the
Patent Act, 1970.
According to sec. 83 of the Patent Act, 1970 (hereinafter the 1970 Act) patents are granted to
encourage the invention worked in India to the fullest extent that is reasonably practicable
without any undue delay. The section further makes it clear that they are not granted merely
to enable patentee to enjoy monopoly but with dissemination and use of technology to the
mutual advantage of producers and users of technological knowledge in a manner conducive
to the social and economic welfare and to a balance of rights and obligations. This
amendment is further in consonance with S. 83(d) which says that patents so granted should
not impede protection of public health and nutrition and should act as an instrument to
promote public health specially in vital sectors of socio-economic importance. Further with
regard to the third amendment of 2012, sec 83(e) has to be specifically referred because the
1970 Act makes it very clear that any patent granted do not in any way prohibit the Central
Government taking measures to protect the public health. The main of section 83 is to ensure
that the patent granted is worked for the benefit of the public at large. And this is based on the
principle the health of the people is the supreme law,(Salus populi suprema lex esto)
And one other main requirement u/s 83 is that patented inventions are available at reasonably
affordable prices. The 1
st
January 2005 amendment was brought mainly for pharmaceuticals
and agricultural chemicals, the present impugned amendment has almost the same reasons
behind it, which would be in consonance with object and purpose of the Act. The object of
the Act makes it clear that the Patent Laws should include effective flexibilities to enable
appropriate and timely response to the national and public interest concerns, especially
relating to public health and nutrition. Therefore this amendment is in consonance with the
salient features of the Act under clause 7(c) which enables the grant of compulsory licence to
meet emergent public health situations which is permissible under para 6 of the Doha
Declaration on TRIPS and Public health. This will include the power of the government to
bring amendments to strengthen the provisions relating to the national security to guard
against patenting abroad. The Supreme Court ruling the Novartis case in 2013, where the
court coated the opinion of IPAB which said that the intention of Section 3(d) was to prevent

25
Rameshar Prasad (VI) v. Union of India (2006) 2 SCC 1.
evergreening as well as to provide equitable access to life saving drugs in the discharge of
constitutional obligation of providing good health care to the citizens. The Supreme Court
also upheld the constitutional validity of the Indian Patent Law and observed that the same is
in conformity with the international obligations under TRIPS Agreement. India, a developing
country, has a substantial portion of its population below the poverty line, their per capita
income not being sufficient to attain the basic amenities of food, clothing, shelter and
medication. The patents in India, under the Act, are granted for genuine and innovative drugs
only. Though this decision would discourage the foreign drug manufacturers for further
investments in research & development and likely to have repercussions on attracting foreign
investments, it will put the Indian indigenous industry in an advantageous position in the
Indian life-saving drugs market and would be an encouragement for the Indian companies to
produce generic version of drugs that have received patent in the developed countries.
In Pfizer Corp v. Ministry of the Health,
26
the House of Lords, upheld the Common Law
Principle Rex non potest peccare (the King can do no wrong) and that the use of the patented
drugs for the benefit of in-and-out patients of National Health Service Hospitals was a use of
the invention for the service of the Crown and that importation of the patented goods was a
use of the invention which be authorized by the ministry. Doctrine of Sovereign Immunity
would apply to present case and the state has the right of making such amendments in interest
of the public at large though sometime individuals interest might get affected. This
amendment will also stand valid because u/s 102 of the 1970 Act because the powers given to
the government are so wide that they can even acquire a patent for public purpose.
In Associated Provincial Pictures Houses v. Wednesbury Corporation
27
certain grounds
of reasonableness were laid down to evaluate an administrative decision which finds
reflection in Maneka Gandhi v. Union of I ndia. Even in M/s Bee J ay Contractors v.
Hindustan Petroleum Corp
28
stated the court would interfere with the administrative policy
decision only if it is arbitrary, discriminatory, mala-fide or actuated by bias. Likewise, in the
case of I ndian Oil Corporation Ltd v. Mahendra Prasad & Ors,
29
it was held that fairness
and reasonableness doctrine speaks that in all activities of the Government and its
instrumentality should pass the test of such fairness and reasonableness principle. Thus only
if the Government gives no royalty to the patentee while using his/her technology or acquires

26
2012 SCC 60
27
1947 1 KB 223.
28
2010 4 ALL MR 120
29
APO No 442/2003 with WP No. 2561/1987 CHC
it without any sound justification, that is arbitrary and unreasonable under normal
circumstances and can be struck down by the judiciary. Further the Amendment act is in
conformity with Art 31(b) of the TRIPS which states that the general requirements may be
waived by a Member in the case of national emergency or other circumstance of extreme
urgency or in cases of public non-commercial use. This power to make amendment in
accordance with the object and purpose of the Patent Act is the power vested with the
Parliament under Art 246 of the Indian Constitution and it finds its place in Subject 49 of the
Union List in the Seventh Schedule.
In Gabhardts Patent
30
compulsory licence was granted as the product was imported from
another member state. This was granted based on under sec 48 of the UK patent Act similar
to sec 84 of the 1970. This case in turn proves i(b) of the Amendment Act, Constitutionally
valid.
Further the notification issued is not discriminatory because
1) It does not bar the royalty and other remuneration to be given to the patentee as per sec 90(1)
of the 1970 Act.
2) The notification does not grant any exclusive licence as it lays down that all patented cancer
drug would automatically be subject to a compulsory license which is because of prevailing
emergency conditions.
Further sec 92 of the 1970 Act makes it very that the Central Government has the power to
make declaration allowing the grant of compulsory licence in circumstances of national
emergency or of extreme urgency or in case of public non-commercial use. Therefore the
2012 Amendment is very much consonance with the 1970 Act. Further sec 87 makes it clear
that where the national emergency, urgency or public non commercial ise includes public
health crises relating to acquired Immuno deficiency Syndrome, human immune deficiency
virus, tuberculosis, malaria or the epidemics, then the Controller need not apply the procedure
under sec 87.
The Heydons Rule of Interpretation will apply in the present case. The concept of
compulsory licence was brought to avoid to

30
(1992) RPC 1
1) meeting the demand for the patented articles solely by importation from abroad and not by
manufacturing
2) refusing to grant licensees to work the patent locally
3) Imposing unreasonable terms thereby discouraging voluntary licensing
4) imposing restrictive conditions on the use, sale or lease of the patented article thereby
prolonging the patent monopoly rights even after the patent has expired.
31
The mischief
which s. 27 and s.24 of the UK Patent Act were intended to meet are well known. It was felt
intolerable that Letter Patent for inventions which create monopolies and are therefore in
themselves contrary to the spirit of the common laws as being restraint of trade, for the
encouragement of trade and the inventions useful in trade and in consideration of the
disclosure of such invention to the public should be used as they had in fact used to prevent
the development of new industries and to fetter existing in this country. Sec 24 deals
primarily with cases where the trade of this country has been injured by an abuse of the
monopoly conferred by the patent, irrespective of anything which is being done abroad. The
standard to be applied is what a reasonable man or a reasonable business man should do in
the circumstance. It is not enough for the efforts to be sufficient in the patentees own
estimation; they must conform to the standard which an intelligent businessman would place
before himself and adopt. Otherwise a foreigner might excuse himself for doing little or
nothing by urging that he has done his best according to the standard of his own country or
his own particular notions of business requirements.
32

1.4 The Amendment is in consonance with TRIPS and Doha Declaration and it is
constitutionally valid
In Novartis v. Union of I ndia,
33
it was reaffirmed by the Doha Declaration (in paragraphs 4
to 6), to enable the member States to control the patent rights in a manner as to avoid any
adverse impact on public-health. Doha Declaration leaves it open to the member States to
adjust their respective patent systems by regulating the grant of patents and to set up higher
standards for patent protection for pharmaceutical and agricultural chemical products. When
the right to grant and reject the patent itself rest in the hands of the state, here it is only

31
Hateschek Patent (1909) 26 RPC 228 at 239. See Brownie Wireless Co. lTd Appln., (1929) 46 RPC 457 at
469, 470 for a historical account of patent legislation in UK.
32
Boults Patent (1909) 26 RPC 383 at 387.
33
2013 6 SCC 1
issuing a compulsory licence in the interest of the public and it is constitutionally valid. The
TRIPS Agreement also provides for a built-in mechanism for review through the biennial
Ministerial Conference (vide Article 71). The Ministerial Conference is the highest decision-
making body of the WTO and it can make decisions on all matters under any of the WTO
agreements, including the TRIPS Agreement. The fourth WTO Ministerial Conference in
Doha on November 14, 2001, adopted the Doha Declaration on the TRIPS and Public Health.
The Doha Declaration is as follows:
1. Recognize the gravity of the public health problems afflicting many developing and least-
developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria and
other epidemics.
2. Stress the need for the WTO Agreement on Trade-Related Aspects of Intellectual Property
Rights (TRIPS Agreement) to be part of the wider national and international action to address
these problems
3. Intellectual property protection is important for the development of new medicines. We
also recognize the concerns about its effects on prices.
4. TRIPS Agreement does not and should not prevent members from taking measures to
protect public health. Accordingly, the TRIPS Agreement, we affirm that the Agreement can
and should be interpreted and implemented in a manner supportive of WTO members' right
to protect public health and, in particular, to promote access to medicines for all.
5. Accordingly and in the light of paragraph 4 above, while maintaining our commitments in
the TRIPS these flexibilities include:
a. In applying the customary rules of interpretation of public international law, each provision
of the TRIPS Agreement shall be read in the light of the object and purpose of the Agreement
as expressed, in particular, in its objectives and principles.
b. Each member has the right to grant compulsory licences and the freedom to determine the
grounds upon which such licences are granted.
c. Each member has the right to determine what constitutes a national emergency or other
circumstances of extreme urgency, it being understood that public health crises, including
those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a
national emergency or other circumstances of extreme urgency.
d. The effect of the provisions in the TRIPS Agreement that are relevant to the exhaustion of
intellectual property rights is to leave each member free to establish its own regime for such
exhaustion without challenge, subject to the MFN and national treatment provisions of
Articles 3 and 4.
6. The WTO members with insufficient or no manufacturing capacities in the pharmaceutical
sector could face difficulties in making effective use of compulsory licensing under the
TRIPS Agreement.
7. The commitment of developed-country members to provide incentives to their enterprises
and
institutions to promote and encourage technology transfer to least-developed country
members pursuant to Article 66.2. The least-developed country members will not be obliged,
with respect to pharmaceutical products, to implement or apply Sections 5 and 7 of Part II of
the TRIPS Agreement or to enforce rights provided for under these Sections until 1 January
2016, without prejudice to the right of least-developed country members to seek other
extensions of the transition periods as provided for in Article 66.1 of the TRIPS Agreement.
The Council for TRIPS should take the necessary action to give effect to this pursuant to
Article 66.1 of the TRIPS Agreement. WTO Members' right to protect public health and, in
particular, to promote access to medicines for all; In line with this, recent resolutions of the
World health Assembly have also urged that national legislation should be adapted in order to
use to the full the flexibilities contained in the TRIPS Agreement (WHA 56.27, May 2003
and 57.14, May 2004). According to the Declaration, least developed countries, need not
even issue patents for pharmaceuticals until 2016. The court also held that any legislation, or
legislative amendments brought in this regard are constitutionally valid and they do not
violate Part III of the Constitution. Similar ruling was given by the IPAB in Bayer v. Natco
which is an exactly similar case on granting compulsory licence to the pharmaceutical
patents. From the perspective of developing countries, Article 31(f) of TRIPS presented a
significant obstacle to their providing treatment for HIV/AIDS, tuberculosis, and malaria, for
example, diseases affecting citizens of developing countries disproportionately: by requiring
that medicines produced under compulsory licence be predominantly for the domestic
market, Article 31(f) renders compulsory licences under Article 31 cold comfort to countries
that are unable to manufacture the patented medicines themselves.
Instances across the world countries
Canada was the first country to pass legislation to implement Waiver Decision, through An
Act to Amend the Patent Act and the Food and Drugs Act - The Jean Chretien Pledge to
Africa, which came into force on 14 May 2005. This regime allows Canadian producers to
acquire compulsory licenses in order to produce patented drugs for countries requesting these
drugs. The compulsory licenses are issued by the Canadian Intellectual Property Office. The
term public interest can either be referred to generally, or it can be stated to relate explicitly
to national security, health, or the development of vital sectors of the economy. This ground
can also be stated defensively - the relevant patent has been implemented by the patentee in a
form and manner that contravenes the public interest. Examples can be found in the patent
laws of Algeria, Argentina, Brazil, Chile, China, Egypt, Ghana,
Japan,Jordan,Malaysia,Morocco,Mozambique, Pakistan,Philippines,Saudi Arabia,South
Africa, Tanzania, and Uruguay.
34

2. MEDIRIPS ACTIONS DO NOT AMOUNT TO INFRINGEMENT OF THE
PATENT GRANTED TO MEDIMAX FOR THE DRUG CANDID
It is humbly submitted that Medirip has a valid defence that the patent given for
Candid is revocable. Therefore, Medirip has not infringed the patent held by the
Petitioner.
2.1 The product in question does not form part of patentable subject matter
According to sec. 2 (1) (j), an invention means a new product or process involving an
inventive step and capable of industrial application. There are three key ingredients
35
in this
Section and if these are present, patent can be granted. They are
a. Novelty
b. Utility
c. Inventive Step
Inventive step as defined in Section 2 (1) (ja) of the Patents Act means a feature of an
invention that involves technical advance as compared to the existing knowledge or having
economic significance or both and that makes the invention not obvious to a person skilled in
the art.

34
Ley N 9.279, del 14 de mayo de 1996, que regula los derechos y obligaciones relativos a la propiedad
industrial, Art. 71.Texto refundido Ley de Propiedad Industrial, 2005, Art. 51. Patents Law, 2000, Art. 49. Law
on the Protection of Intellectual Property Rights (Law No. 82), adopted on 3 June 2002, Art. 23(1) Patent Law,
1992, PNDCL, No. 305A, s. 47 (vital importance to defence, economic, or public health interests). Patent Law
No. 121 of 13 April 1959, as ammended, s. 93. Patents of Invention Law No. 32 of 1999 and its Amendment by
Temporary Law No. 71 of 2001, Art. 22A. Patents Act No. 291 of 1983, as amended, s. 4(1).Loi n 13-99
portant cration de lOffice marocain de la proprit industrielle et commerciale (Dahir n 1-00-71 du 9 kaada
1420 (15 fvrier 2000)), Art. 67.Industrial Property Code (Approved by Decree No. 04/2006 of 12th April
2006), Art. 85 (fundamental importance to public health, national defence, and economic and technological
evelopment).Patents Ordinance No. LXI of 2 December 2000, Art. 58(1)(i). Intellectual Property Code, s. 93(2),
Law of Patents, layout-Designs of Integrated Circuits, Plant Varieties, and Industrial Designs, 2004, Art.
24(a)(2) (especially security, health, nutrition or the development other vital sectors of the national economy).
Patents Act No. 57 of 1978, s. 56(2).Patents Act No. 1 of 1987, s. 54.
35
Farbwork Hoechst Attiongesellschaft Vosmals Meister Leucius & Bruning Corporation etc. v. Unicham
Laboratories and Other, AIR 1969 Bom 255
All these conditions have to be satisfied before the grant of patent. The subject matter should
also pass the test of sec. 3.
Apart from satisfying the above conditions, for the grant of patent, the subject matter should
be patentable.
36
Assuming but not conceding that the above conditions are satisfied, the drug
Candid is not patentable under the Patents Act, 1970. Therefore, it is humbly submitted that
the patent obtained by Medimax in 2009 is invalid.
2.1.1 The product does not pass the test of Section 3(b)
Section 3 (b) was brought by way of the Patent (Amendment) Act, 2003. It is pertinent to
apply the Heydons rule of interpretation to interpret sec. 3(b). In Raipur Development
Authority v Anupam Sakhari Griha Nirman Samiti,
37
the Court took into consideration, the
Heydons Rule of Interpretation that lays down the principle that Courts must see:
i. What was the law before making of the Act
ii. What was the mischief or defect for which the law did not provide a remedy
iii. What is the remedy that the Act has provided
iv. What is the reason for the remedy
The original Patent Act, 1970 did not recognise product patents for drugs. This made drugs
and medicines easily available not only to the poor within the country but also to the other
developing and under developed countries. After the advent of the TRIPS, there was an
obligation on every state party to give patent in every area of technology including for
pharmaceutical drugs. Since this would mean, life saving and essential drugs would be kept
out of the reach of the common man for atleast 20 years, the developing countries pushed for
the Doha Declaration on TRIPS and Public Health which stated that public health cannot be
compromised in the grant of patent.
38

Following this, the Patent (Amendment) Act, 2002 was brought into force to give effect to
TRIPS and to the Doha Declaration. This Amendment introduced Section 3 (b) which states
an invention the primary or intended use or commercial exploitation of which could be
contrary to public order or morality or which causes serious prejudice to human, animal or
plant life or health or to the environment. Interpreting the words commercial exploitation of

36
Michigan State University v. The Assistant Controller, IPAB, 19 March, 2008, para 15,
http://www.indiankanoon.org/doc/918903/
37
(2000) 4 SCC 357
38
TRIPS and Changes in Pharmaceutical Patent Regime in India, Sudip Chaudhari, Working Paper No. 535,
January, 2005; Big Pharma v. Nelson, http://www.who.int/intellectualproperty/topics/ip/tHoen.pdf
which...causes serious prejudice to health in light of the object and historical background
39

in which the amendment came into effect as well as the mischief it sought to remedy, it is
abundantly clear that an application for patenting a life-saving drug would fail on the 3(b)
ground.
40

The phrase commercial exploitation means the normal avowed use indicated in the patents
teaching.
41
The phrase commercial exploitation is qualified by the words causes serious
prejudice to human health.
42
Therefore, commercial exploitation is any use of the patented
product or process that causes serious prejudice to the health of human beings. In Novartis
AG v. Union of India & Ors.,
43
the Supreme Court said that patenting of a life saving drug
would go in contravention of public order as mentioned under sec. 3(b) of the Patents Act,
1970.
In the present instance, taking into account, the health situation in Germ-many and the goal of
the government to reduce healthcare costs, the patent that was granted to Candid causes
serious prejudice to human health. Therefore, the subject matter of the patent is hit by Section
3 (b). Therefore, the patent that was granted is invalid.
2.1.2 The product is not a new chemical entity
In the Novartis case, the "invention" of the beta crystalline form of imatinib mesylate inter
alia was considered as a combination of known substances and therefore not patent eligible.
By Section 3(e) of the Patents Act 1970, a substance obtained by a mere admixture resulting
only in the aggregation of the properties of the components is not patent eligible. In the case
at hand, the "NCE" was called 'dichloro endoclan' and was further refined and there were
additives which were included with this chemical to make the final product. The usage of
"chloro" implies the presence of Chlorine in the chemical which is a known component. The
other chemicals mixed with chlorine, if unknown to the public would amount to a discovery
thereby rendering it non patent eligible per Section 3(c). While, if it was mixed with a
component known to public, would amount to the admixture thereby rendering it non patent
eligible per Section 3(e).

39
Novartis AG v. Union of India & Ors., Civil Appeal No. 2706-2716 of 2013, para. 29; R.S. Nayak vs. A.R.
Antulay reported in AIR (1984) SC 684, p. 686
40
Pharmaceutical patents the curious case in India http://blog.yellowpages.co.in/pharmaceutical-patents-the-
curious-case-in-india/
41
Euthanasia Compositions/Michigan State University, Case number, T 0866/01, para 5.8
42
Sigrid Sterckx, Julian Cockbain Exclusions from Patentability: How far has the European Patent Office
eroded boundaries, Cambridge University Press, 13-Sep-2012, p. 299
43
Civil Appeal No. 2706-2716 of 2013, para 19
2.1.3 Candid is not a pharmaceutical substance as defined under Section 2 (1) (ta)
The Patents (Amendment) Act, 2005 was brought in to ensure TRIPS compliance. However,
the Parliamentary debates show that what the Amendment Act was trying to achieve was a
system where TRIPS was honoured and where pharmaceutical drugs are not made costly, i.e.
a balance whereby it would be hard to get patents for pharmaceutical drugs. Section 2(1) (ta)
of the Patents Act, 1970, after the 2005 amendment, defines pharmaceutical substance as
any new entity involving one or more inventive steps. This again reinforces the fact that the
intention of the drafters was to allow patenting of pharmaceutical drugs on highly cautious
terms. This is also evident from a reading of sec. 3(d) and its subsequent interpretation in the
Novartis case. A statute must be read as whole.
44
Reading the statue as a whole, the Germ-
many Patent system seeks to allow pharmaceutical patenting albeit after passing through a
rigorous series of conditions.
In the present instance, Candid is not a patentable pharmaceutical substance as it does not
involve an inventive step over and above the NCE, i.e., it does not have any technical
advance or economic significance and non obviousness as Section 2 (1) (ja) requires. This is
because Candid possesses a new chemical entity dichloro endoclan with additives that are
already known. This is not sufficient to make it a patentable pharmaceutical substance as
defined in sec. 2 (1) (ta). Therefore, the patent granted for Candid is invalid.
2.2 Medirips actions do not amount to infringement of the Petitioners IP rights
According to sec. 107 of the Patents Act, 1970, in a suit for infringement of patent, every
ground on which the patent may be revoked under sec. 64 shall be available as a ground of
defence. Under sec. 64 (k), where the subject matter of the claim is not patentable, it can be
revoked. Since the patent granted for Candid falls outside the purview of patentable subject
matter, Medirip has not infringed the patent by selling a generic version of Candid.
3. ARGUENDO, MEDIRIP SHOULD BE GRANTED LICENSE WITH REGARD TO
CANDID
Assuming but not conceding that the patent is valid, it is pertinent to look into the Patents
(Amendment) Act, 2012 with regard to compulsory licensing of the drug Candid.
According to the amendment Act, any party may apply for compulsory licensing of the
patented invention on two grounds namely:
a. The patentee does not meet the reasonable requirements of the public
b. The patented invention is not manufactured in the territory of Germ-many

44
Philips India Ltd. v. Labour Court, (1985) 3 SCC 103, p. 112
The word used in the Amending Act of 2012 with regard to who can apply for compulsory
license is party as opposed to person interested under Section 84 of the Patents Act, 1970.
When an Amending statute makes an alteration in the language of the principal statute, such
an alteration should be taken to have been made deliberately.
45
An interpretation of the words
of a principal statute as they existed before the amendment if would make the words added by
the amending act redundant should not be taken.
46
Therefore, it is humbly submitted that any
party can file an application for compulsory licensing.
Party connotes a participant of a lawsuit or legal proceeding who has an interest in the
outcome. Since there are already legal proceedings instituted by Medirip and Medimax
against one another and have an interest in the outcome whether with regard to the
infringement proceedings or the compulsory licensing application, Medirip is a party as
required by the 2012 Amendment Act and can file a compulsory licensing application.
The Amendment Act, 2012 says that compulsory licensing can be granted on the ground that
the patented invention is not manufactured in the territory of Germ-many. Compulsory
licenses are granted to prevent abuse of the monopoly rights that the state gives the patentee.
Meeting the demand for the patented articles solely by importation from abroad and not by
manufacturing the patented articles locally thereby discouraging and prejudicing the
establishment of new trade or industry, or the development of an existing trade or industry
amounts to an abuse of the monopoly rights.
47
The very purpose of granting a patent is
industrial progress of the country.
48
Medimaxs act of manufacturing the patented drug
outside Germ-many is an abuse of its monopoly rights.
The words of a statute are first understood in their natural, ordinary or popular sense and
phrases and sentences are construed according to their grammatical meaning, unless that
leads to some absurdity or unless there is something in the context, or in the object of the
statute to suggest the contrary.
49
The word manufacture therefore should be understood in
its popular sense. Manufacture means make something on a large scale using machinery or
make or produce something abstract in a merely mechanical way. In the present instance, one
has to see whether the patented article was manufactured in Germ-many. Though the end

45
D.R. Fraser & Co. Ltd. v. Minister of National Revenue, AIR 1949 PC 120, p. 123
46
State of U.P. v. Radhey Shyam, AIR 1989 SC 682, 690
47
P. Narayanan, Intellectual Property Law, 3
rd
edition, Eastern Law House, p. 67
48
Bishwanath Prasad v. H.M.Industries, AIR 1982 SC 1444, 1447-8
49
State of Rajasthan v. Babu Ram, (2007) 6 SCC 55, p. 57; Olga Tellis v. Bombay Municipal Corporation,
(1985) 3 SCC 545, p. 581
product was manufactured in Germ-many, it is pertinent to note that the main ingredient and
the major part of the drug were manufactured outside the territory of Germ-many. Therefore,
this is an abuse of the patent rights and compulsory licensing can be granted.