Innovation Patent

Comments on the GIPC Index 2015, Part II – Misleading Indian IP


The GIPC Index ranks India second from the last rank, by a margin of ‘.13’ which separates it from Thailand. Due to the inordinate, and entirely unnecessary news value that the Index has despite its fundamental flaws, this fact has garnered quite a lot of note in multiple media outlets. And the reactions seem to be the worst possible – most articles seem to be hailing this as a sign for India needing a stronger IP regime, without even going into the issues with the Index. In my first post in this series, I dealt with the weakness of the GIPC Index 2015 as a whole. In this post, I will be dealing with the specific concerns the Index raises in the Indian context. [Long post ahead]

(Image Source: https://flic.kr/p/2aQCwB)

(Image Source: https://flic.kr/p/2aQCwB)

The Index’s pharmaceutical bias continues even in its discussions of the ‘major concerns’ in India. It lists them as follows: (page 25)

India’s patentability requirements remain outside established international best practices; India’s history and current practices of using compulsory licensing for commercial and non-emergency situations is deeply troubling; there is a lack of specific IP rights for the life sciences sector; a challenging enforcement environment, with corresponding high levels of physical and online piracy, persists; and, finally, India is not a contracting party to any of the international treaties included in the GIPC Index, nor has India concluded an FTA with substantial IP provisions since acceding to the TRIPS Agreement.

The same issues, for the most part, have been echoed on page 73, which lists the ‘Key Strengths and Weaknesses’. The problem is, most of these ‘concerns’ are patently incorrect. Let’s go through them one by one. Wherever the issues listed on page 73 deviate from the issues listed on page 25, they have been clubbed with the point that is the closest.

  1. India’s patentability requirements remain outside established international best practices

Swaraj has detailed the problems with the Index’s ‘Patent protection’ indicators in his post here. Arguably, the established ‘international best practice’, or perhaps, more appropriately, the ‘established baselines’ for intellectual property are laid down by the TRIPS Agreement. The Indian IP regime entirely lives up to the TRIPS standard – and that’s the problem here. The Index’s requirements are not TRIPS, but TRIPS plus,. These conditions, such as patent linkage which the Index notes on multiple occasions, tend to do more harm than good.

  1. India’s history and current practices of using compulsory licensing for commercial and non-emergency situations is deeply troubling
    – Market access barriers

Now, while the Index points out how India’s ‘history and current practices’ on Compulsory Licenses (‘CLs’) are ‘troubling’, what it fails to mention is USA’s own history of CL use. In fact, USA actually leads the world in the usage of compulsory licenses, according to a report by Knowledge Ecology International. These compulsory licensing regimes are actually necessary to ensure a supply of affordable pharmaceuticals, and have actually been used for this very purpose in India.

Furthermore, CLs are actually part of the patent regime itself. You cannot cherry pick parts of the regime that you like, and take away points for the counter-balancing parts of the same regime!

For the ‘barriers to market access’, the Index states that multiple Indian policies create such barriers, taking the example of the ‘Working the Patent’ requirement set in the Nexavar case, the specifics of which are yet to be legally clarified.

  1. “there is a lack of specific IP rights for the life sciences sector

Again, there is no mention of why these ‘specific IP rights for the life sciences sector’ are so concerning, or even needed. India already meets the requirements of TRIPS agreement on in this regard, and does not need to put in further protections.

  1. a challenging enforcement environment, with corresponding high levels of physical and online piracy, persists;
    – Limited framework for addressing online piracy and circumvention devices
    – High levels of software piracy, music piracy, and counterfeit goods
    – Poor application and enforcement of civil remedies and criminal penalties

This is the one and only concern listed here that is worth consideration. But at the same time, it must be noted that such a comparison can only be made in its local context – otherwise, it ends up putting rocks and feathers on the same scale. Thus, while India scores quite low in this regard here, it actually ranks 48 (out of 134) in the OECD GTRIC-e Index which the GIPC Index uses to measure physical piracy. Furthermore, while India scores a 60% on the BSA Software Piracy study, not only has this percentage consistently been dropping since it started with a 69% in 2007, the commercial value of the pirated software in 2013, with its 60%, was a total $2,911 million dollars. This contrasts drastically with the United States, which topped the list with the commercial value of the pirated software in the country being $9,737 million dollars at a paltry 18% rate of piracy.

  1. and, finally, India is not a contracting party to any of the international treaties included in the GIPC Index, nor has India concluded an FTA with substantial IP provisions since acceding to the TRIPS Agreement”.
    – RDP and patent term restoration not available

Again, the Index does not say anywhere how or why any such agreements are required or helpful in anyway. In fact, since most such agreements tend to have terms that go beyond the TRIPS provisions, this would seem to be the Index’s way of penalising all participants for not agreeing to TRIPS plus terms. And in fact, the TRIPS plus terms contained in FTAs make the flexibilities inherent in the TRIPS, and confirmed and even recommended to be used by the Doha Round, agreement difficult to use, and actually lead to adverse impact on public health, specifically on prices and availability of medicines. The same holds true for the Index’s note of RDP and Patent Term Restoration, both being TRIPS plus conditions.

(For more details on this, please refer to Pedro Roffe & Christopher Spennemann, The Impact of FTAs on public health policies and TRIPS flexibilities, International Journal of Intellectual Property Management V. 1, Nos. ½, 2006, available here).

Throughout the Index, whenever it mentions or comments on India, it also at the same time notes that the steps taken by the new administration towards amending IP laws and the statements made by it in this regard as cause for ‘optimism’. But these are the very changes that have raised concerns with multiple sectors of the civil society because of the damage they will cause to the public health sector.

As this series of posts have shown, the GIPC Index is not an Index of Innovation. It is an industry-oriented statement, pointing out all the changes that would need to be made to benefit them. And if the media reaction is to be believed, these statements are actually garnering the effect they wanted. And if the draft IP policy is anything to go by (see critiques here and here), we might unfortunately be finding that this kind of international pressure against India’s IP regime seems to be working – with the draft policy making the types of noises that would get us higher on a GIPC type index, and lower on one that actually focuses on innovation and the public good.

My thanks to Swaraj for his inputs on this post. The first post in this series is available here.

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