Uncle Sam’s Missive to Mother India: "Fair" Patent Consideration at the IPAB?

For those interested, we’ve just uploaded a copy of this letter on the SpicyIP website.

This letter deals with Gilead’s pending patent appeal with the IPAB, where it challenged the rejection of its patent covering Viread, an HIV drug, by the Indian patent office. Secretary Locke asks that Gilead’s case receive “fair” consideration (students of contracts may perhaps interpret “consideration” in other interesting ways).

I extract relevant portions of Unni’s piece:

“The US commerce secretary lobbying his counterpart in another country on behalf of a company is rare, but not unknown, and in early November, just days ahead of US President Barack Obama’s visit to India, Gary Locke did just that, writing to India’s Anand Sharma seeking “fair consideration” of Gilead Sciences Inc.’s patent appeal in India.

In 2009, India’s patent office rejected Gilead’s patent application for HIV/AIDS drug Tenofovir, which is sold under the brand name Viread in some markets, citing “lack of inventiveness”, a key criteria for patent protection under the Indian Patent Act.

Gilead has appealed the Intellectual Property Appellate Board (IPAB), a judicial body, and this is the appeal for which Locke sought fair consideration from India’s commerce minister Sharma.

“Dear Minister, I look forward to meeting with you during my upcoming trip to India with President Obama. As we advance and strengthen the US-India bilateral commercial relationship with this visit, India should fully consider the requisite business climate for spurring innovation, especially with respect to intellectual property protection,” begins the letter, dated 2 November. “Therefore, I am particularly concerned that the US biopharmaceutical firm Gilead’s HIV/AIDS drug Viread receives fair consideration.”

In all fairness, the Secretary only asked that the case receive “fair” consideration. However, as DG Shah rightly notes:

“I doubt any other country, including the US, would entertain if the government of India takes up such corporate issues with their judiciary mechanism. Ideally, our government should have discarded the US plea immediately, saying the patent tribunal here is strong enough to decide such matters independently,” said D.G. Shah, secretary general of IPA.”

Further, the fact that this letter was sent to the Minister for Commerce (who controls the patent office) raises some problematic issues with the “independence” of the Intellectual Property Appellate Board (IPAB), a specialised IP tribunal tasked with dealing with certain kinds of IP disputes.

As some of you may know, the IPAB effectively replaced the functions of the High Court, in so far as a large range of IP disputes were concerned. One would have naturally expected the IPAB to be structured as close as possible to an independent judiciary. Unfortunately, this was not to be …and those that were responsible for drafting IPAB rules and pre-requisites for appointment ensured that they themselves and their brethren (Indian Legal Service [ILS] officers) got selected to these plum posts. Little wonder then that the IPAB is seen as just another wing of the “executive”. And not as an independent tribunal functioning as an organ of the “judiciary”.

Paradoxically enough, our own judiciary (Supreme Court and High Court judges) has been kept out of the process for selecting “judicial” members at the IPAB….this prerogative lies solely with the government (the executive). More problematically, while Article 217 of our Constitution recognises advocates with 10 years of practice as being eligible to be appointed as High Court judges, the IPAB does not consider them fit enough to be appointed as judicial members! Since the inception of the IPAB, only ILS (Indian Legal Service) officers with next to no IP experience have been appointed as “judicial” members, with some of them even being elevated to the exalted status of Chairman and Vice-Chairman.

All of this results in a flagrant violation of norms laid down in the NCLT judgment, where the Supremes came down harshly on tribunals that, far from being set up as “independent” organs capable of rendering impartial justice, ended up being stooges of the Executive.

Given this background, Secretary Locke may perhaps be forgiven for thinking that our Hon’ble Minister, Anand Sharma has the power to influence the working of the IPAB. In fact, the Mint report itself states that Secretary Locke’s letter was forwarded to the DIPP, the executive arm of the government responsible for patent matters.

ps: Prashant Reddy did some wonderful research uncovering the role of prior Law Secretaries in the drafting of IPAB rules ensuring that they themselves got selected as IPAB “judicial” members. We’ll do a more comprehensive post on this problematic historical linkage soon.