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Judgment
T.S. Thakur, J.—This petition filed in public interest challenges the constitutional validity of Section 4 of the Patents (Amendment) Act, 2005 and seeks a mandamus directing the respondents to restore Section 5 of the Patents Act, 1970 to its original form. The twin prayers made by the petitioner may be extracted for ready reference.
(i) Issue a Writ, order or direction in the nature of Certiorari thereby quashing and setting aside Section 4 of the Patents (Amendment) Act, 2005 being ultra vires of Part III of the Constitution of India; and
(ii) Issue a Writ, order or direction in the nature of Mandamus thereby directing the Respondents to restore Section 5 of the Patents Act, 1970 (39 of 1970) to its original form.
The petitioner society has been registered under the Society Registration Act, 1860 and claims to be espousing various health and social welfare related issues in the country. The petitioner asserts that rights to health and the incidental right to easy and cheap access to medicines and d rugs are judicially recognized as fundamental rights guaranteed by the Constitution to the citizens of this country. These rights, it is alleged are being infringed by the amendment introduced to the Patents Act, 1970 by Patents (Amendment) Act, 2005 whereby "product patents" are being legitimized instead of "process patents" in the field of drugs and medicines. The petitioner''s case is that till recently India had adopted what is called a Process Patent Regime which encouraged competition and resultantly kept the prices of medicines low making them affordable to the people at large. According to the petitioner prices of medicines in India were the least in the world because of such competition promoted by the Process Patent Regime. By the deletion of Section 5 of the Patents Act, 1970, which prohibited grant of product patents in relation to substances intended for use, or capable of being used, as food or as medicine or drug, the Parliament had done away with the Process Patent Regime and introduced a Product Patent Regime not because the latter is more useful or beneficial to the people of this country but because of the pressure from the United States of America and other Western countries in the garb of discharge of the country''s obligation under Trade Related aspects of Intellectual Property Rights (TRIPS). The petition asserts that as a developing country which is home to one of the largest populations in the world, India cannot compromise by what is described as "surreptitious legislative means" the national interest of protecting the rights guaranteed to its citizens under Article 21 of the Constitution, which does not merely encompasses the right to exist but also the right to disease free healthy life that in turn must include the right to access medicines and drugs at an affordable price. According to the petitioner society, the Product Patent Regime could create an unhealthy monopoly in favour of multinational corporations who held patents of drugs abroad and would inevitably raise the prices of the drugs substantially higher than what they ought to be. The writ petition further alleges that even in terms of its binding and solemn international commitments to the World Trade Organization (WTO) under the agreement of Trade Related aspects of Intellectual Property Rights (TRIPS), the Government of India are obliged to take into account public health issues prevailing within the country. No international commitment which has the effect of overriding and superseding a national obligation can according to the petitioner be called in aid to justify departure from the earlier Process Patent Regime. It is alleged that while other countries like South Africa, China, Brazil and Kenya utilizes the flexibility provided by the Doha Declaration to enact provisions which do not grant blanket patentability to all drugs. India has, contrary to the constitutional mandate, introduced a blanket product patentability regime to the prejudice of the people at large. It is further alleged that while product patentability for every product may not be bad, yet keeping in view the constitutional mandate, life saving and essential drugs such as those required for the treatment of Asthma, Diabetes, Aids, Malaria, Tuberculosis, Hypertension, Cancer etc. should be taken out of the product patent regime. The petition also cites what is described as tremendous benefits drawn by the country from the growth of the Indian pharmaceutical industries which employs lacs of people all over the country and generates millions of dollars through export. The petition in the above background prays for striking down of Section 4 of the Patent (Amendments) Act, 2005 whereby Section 5 of the Patents Act, 1970 was amended.
The respondents have contested the petition by filing a detailed counter affidavit to the same. The respondents deny that there is violation of any fundamental right guaranteed to any citizen of this country to call for interference of this Court in public interest. It is asserted that the Patents Law effectively balances and collaborates intellectual property protection with public health, national security and public interest concerns. The counter affidavit cites the following safeguards which are inbuilt in the provisions of the Patents Act to prevent situations where drugs may become unaffordable for the citizens of this country.
(a) Availability of products at reasonable price is ensured through the provision of compulsory license as provided in Section 84.
(b) Compulsory license can be issued to deal with circumstances of national emergency, extreme urgency or public noncommercial use as provided in Section 92.
(c) Parallel import can be allowed to ensure availability of patented drugs at reasonable prices as provided in Section 107A(b).
(d) With a view to making available patented drugs through Government dispensaries, hospitals, etc. Government can import patented drugs without the consent of the patent holder as provided in Section 47.
(e) Government can acquire an invention or a patent for public purpose, as provided in Section 102.
(f) Patent can be revoked on the ground of non-working or patented invention not being made available to the public at reasonably affordable price as provided in Section 85.
(g) Government can revoke a patent in public interest if it is prejudicial to the public or the mode in which it is exercised is mischievous to the State, as provided in Section 66.
(h) No rights accrue to a patent holder for mailbox applications for the period prior to the date of grant of patent as provided in Section 11A.
(i) Manufacturing of products by enterprises having made substantial investment to continue on payment of reasonable royalty, even if patent is granted on a mailbox application as provided in Section 11A.
(j) Those interested in manufacturing generic version of patented product on expiry of the patent can make necessary preparations for production even during the validity of the patent as provided in Section 107A(a). This provision facilitates availability of generic version of the patented product at competitive prices immediately on expiry of the patent.
(k) Patent can be revoked in the interest of security of India as provided in Section 157A.
(l) The patentability criteria as per the Patents Act are quite stringent, as provided in Section 3, which stipulates that the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus is not patentable unless such known process results in a new product or employs at least one new reactant. For the purpose of this provision, salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance are to be considered to be the same substance unless these differ significantly in properties with regard to efficacy.
The counter affidavit further alleges that the amendment to the patents Act for providing patents for medicines has been approved by the Parliament after due consideration taking into account the safeguards available in the Patents Law for protection of public health. It denies the allegation that medicines would not be accessible to the general public at reasonable prices. According to the respondents a very few drugs enter the market every year all over the world and only few of them are commercial success. At the same time each year many patents expire for earlier products with the result that at a particular point of time the percentage of the drugs in the market under Product Patent protection is very low and most of the market would still be in the generic category. The respondents further assert that the Patents (Amendments) Act, 2005, effective from 1st January, 2005, provides certain additional safeguards to ensure availability of medicines. These safeguards are:
(a) Rights to patent in respect of applications for medicines filed in the mail-box (that is, from 1.1.1995 to 31.12.2004) shall accrue only from the date of grant of patent. [Section 11A(7)]. In other cases, patent rights are available from the date of publication of application, i.e. before the actual grant of patents.
(b) In case of mail box applications, even if a patent is granted, manufacturers who have made substantial investment can continue to manufacture the medicine on payment of reasonable royalty. [Section 11A(7)]
(c) In order to prevent ever-greening of patents particularly for medicines, it has also been clarified in the Explanation u/s 3(d) that salts, esters, ethers, polymorphs, metabolites, etc. will not be patentable.
(d) In order to allow parallel import, provision has been made more effective by dispensing with the requirement of importing from a person who is duly authorized by the patentee. The modified requirement is that the import could be from a person who is duly authorized under the law to produce and sell or distribute the produce. [Section 107A(b)]
The counter affidavit goes on to state that the petitioner is trying to mislead this Court by creating an impression that prices of the existing drugs would be affected by the Patents (amendment) Act, 2005. According to the respondents all issues relating to the fact of the change in the old regime were duly considered including all other dimensions of public interest concerns such as a possible increase in the price of essential drugs. It is also asserted that price of a product in any country does not solely depend on the Product Patents, other factors such as cost of living, cost of production or availability of alternatives also infringes the price of the product. It is also asserted that globally, on an average, only 15 to 20 drugs enter the market every year and that at a particular point of time only 5 to 10 percent of the drugs in the market would be under Product Patent Protection leaving the rest of the market free in the generic category. It is asserted that the amendments made in the patents Act are in no way ultra vires of the constitution to call for any interference nor is the grant of patent of medicines is neither absolute nor blanket. The respondents cite grant of patent subject to the fulfillment of the prescribed conditions, necessity for grant of compulsory licenses, classification of patent by the Government and a provision relating to parallel imports as safeguards which will prevent situations where prices of product may go beyond the reach of the common man.
Appearing for the petitioner, Mr. Soli Cooper argued that there was no compelling reason why the process patent regime which had satisfactorily served the interests of the people of this country should have been changed by the Parliament by introducing an amendment providing for product patent regime. He urged that the prices of drugs and medicines in this country were within the reach of the common man only on account of the fact that the products were being made available to them by Indian pharmaceutical companies but once the product patents were guaranteed to multinational companies from outside, there has been a sudden spurt in the prices of the medicinal products taking the same beyond the reach of the common man. He argued that a comparison between the international prices of some selected products with the prices prevalent in India before the introduction of the new regime would show how expensive the drugs were in the countries where the product patent regime was applicable. He contended that the amendments have been introduced not because it was in the interest of the country but because of the pressure which United States of America and other developed European countries had brought on India in the garb of the obligations under the TRIPS. Reliance was also placed by Mr. Cooper on Vincent Panikurlangara v. Union of India and Ors., (1987) 2 SCC 165 .
On behalf of the respondent, it was per contra argued by Ms. Perminder Kaurand that the writ petition had been filed entirely on the basis of an apprehension expressed by the petitioner society for which there was no real basis whatsoever. She argued on the basis of the averments made in the counter affidavit that there were enough inbuilt safeguards in the patents Act to prevent situations where the prices of the drugs and medicines may go beyond the capacity of the common man. She urged that the provisions of the Act referred to earlier sufficiently empower the Government to take steps as and when the need for doing so was felt in public interest.
We have given our careful consideration to the submissions made at the bar and perused the record. A statutory provision can be declared to be ultra vires of the constitution only if; (a) the provision is found to be beyond the legislative competence of the Parliament or the legislature that enacted the same or (b) the provision is found to be violating any fundamental right guaranteed to any citizen of this country. There is, in the instant case, no challenge to the vires of Section 4 of the amendment Act on the ground of legislative competence of the Parliament as indeed there could be no such challenge having regard to the fact that the petitioner society by a mandamus seeks restoration of Section 5 of the Patents Act, 1970. If Section 5 of the Patents Act, 1970 which the petitioner seeks to have restored was within the legislative competence of the Parliament, any amendment to the said Act whether by way of deletion of Section 5 or its modification thereof must also be held to be within the legislative competence of the Parliament. Mr. Cooper, therefore, fairly conceded that the challenge to the provisions of the amendment Act were not founded on the plea that the same were beyond the legislative competence of the Parliament.
The only question that remains to be examined then is whether the impugned legislation by way of Section 4 of the Patents Act violates any fundamental right guaranteed to any citizen. We are assuming at present that the petition is bonafide and seeks to espouse the cause of the less fortunate and disadvantaged sections of the society whose right to life guaranteed under Article 21 of the Constitution is what the petition purports to safeguard. We are also assuming without expressing any opinion that the right to life guaranteed under Article 21 of the Constitution includes the right to access to medicines needed for treatment at affordable prices. The question that, all the same, arises for consideration is whether there is any real and imminent threat or violation of that right. The petitioner, no doubt, paints a gloomy picture of the coming events. According to it, with the introduction of the Product Patent Regime medicines would become so expensive that they would go beyond the reach of the common man. The petitioner believes that since the patents will be claimed only by multinational companies, the manufacture of the patented drugs in this country or imports from outside for sale within the country would unnecessarily be at much higher prices or prices beyond the capacity of the ordinary Indian to afford. There is, in our opinion, no empirical basis for the petitioner to make that assertion leave alone a cogent one for us to accept the petitioners apprehension or theory to be correct. It is true that u/s 5 of the Act, as it then stood in the statute, a product patent in respect of drugs and medicines was not permissible. But that was the state of law before the Parliament introduced the amendment under which the prohibition contained in Section 5 was deleted. Since, the Parliament has in its wisdom considered it beneficial for the people of this country to adopt the Product Patent Regime for drugs and medicinal preparations, a writ Court would be very slow in interfering with any such legislation unless a clear case of violation of any fundamental right of the citizen is established. It is fairly well settled that a legislation is presumed to be constitutionally valid unless the contrary is proved by the person who assails its validity. It is equally well settled that transgression of the constitutional principles must in every case involving a challenge to a legislative enactment be clearly established. Such transgression cannot be inferred or assumed on a mere apprehension which has no demonstrable basis. More importantly it must be presumed that the legislature understands and correctly appreciates the needs of its people and that its laws are directed to problems made manifest by experience. The guiding principles which the Court have to bear in mind are of vintage value and were summarized by their lordships in Ram Krishna Dalmia Vs. Shri Justice S.R. Tendolkar and Others, in the following words:
The decisions of this Court further establish:-
(a) that a law may be constitutional even though it relates to a single individual if, on account of some special circumstances or reasons applicable to him and not applicable to others, that single individual may be treated as a class by himself;
(b) that there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles;
(c) that it must be presumed that the legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds;
(d) that the legislature is free to recognise degrees of harm and may confine its restrictions to those cases where the need is deemed to be the clearest;
(e) that in order to sustain the presumption of constitutionality the court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation; and
(f) that while good faith and knowledge of the existing conditions on the part of a legislature are to be presumed, if there is nothing on the face of the law or the surrounding circumstances brought to the notice of the court on which the classification may reasonably be regarded as based, the presumption of constitutionality cannot be carried to the extent of always holding that there must be some undisclosed and unknown reasons for subjecting certain individuals or corporations to hostile or discriminating legislation.
The above principles will have to be constantly borne in mind by the court when it is called upon to adjudge the constitutionality of any particular law attacked as discriminatory and violative of the equal protection of the laws.
There is, in the instant case, nothing on record except a broad and generalized kind of assertion to the fact that the price of drugs and medicines would go beyond the capacity of the common man in this country on account of the introduction of the new patenting regime. In the absence of any material to substantiate that assertion, the apprehension remains in the realm of imagination and nothing more. We say so particularly when the respondents have on affidavit and by reference to the provisions of the Patents Act, 1970 clearly asserted that not only was the law enacted after due and proper deliberations of all the issues and dimensions which the petitioners has raised but also that the Government is fully equipped with the powers under the provisions of the Act to take proper remedial actions as and when necessary to ensure public interest in the matter of affordability of drugs and medicines of the common man or any other injury on account of the patenting of a medicinal product. All that we need add is that assertion made in the counter affidavits and the provisions to which the respondents have referred, in our opinion, sufficiently equip the Government for taking action as and when any need for doing so is felt in public interest. All told, we do not, for the present, find any justification much less a compelling reason for us to interfere with the provisions of the amendment Act or issue any other direction in relation to the patenting of products in this country. In the result this petition fails and is hereby dismissed with costs assessed at Rs. 5000/- which shall be deposited by the petitioner in the Delhi High Court Advocates Welfare Fund within two months.