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India’s treatment of IP rights means that others won’t listen to its royalty fund proposal

The perennial issue of access to green technology was revisited at the United Nations climate change summit in Doha, Qatar, last week. India’s suggestions for a royalty fund to help developing nations pay patent licence fees fell on deaf ears. Could it be that the developed world is losing some of its trust in the country’s IP credentials?

According to a report from BusinessWeek, India’s delegation in Doha put forward proposals to set up a fund accessible to developing countries that would pay out licence fees to owners of greentech patents. However, the plan was rejected by key players including the United States, Canada and Australia.

IAM has reported before on the green technology transfer debate which has been a major sticking point in climate change negotiations. Some parties – including stakeholders in the developing world – have called for IP rights to be watered down to allow developing countries cheap and easy access to the technologies that they desperately need to counter the environmentally damaging effects of their rapid economic growth.

India’s approach to foreign IP rights recently has raised many concerns. The country issued its first compulsory licence order in March, forcing Bayer to license its patented cancer treatment Nexavar to local generic company Natco. Novartis, Roche and Gilead have all faced problems in protecting their IP in India; and this week, Merck had one of its patents revoked by the country’s IP office. At a World Health Organisation meeting in Buenos Aires, a group of experts calling for the creation of a worldwide treaty to combat the counterfeit drugs trade was barred from attending after India objected to their presence. And, beyond the pharma sphere, concerns remain regarding the protection of IP rights in the country, with 78% of respondents (mostly India-based corporates) to KPMG’s 2012 India Fraud Survey saying that they were “unaware of the risks associated with intellectual property infringement, counterfeiting or piracy”.

All this makes it increasingly difficult for IP owners in developed nations and elsewhere to take India’s suggestions regarding IP seriously. While there are clearly differences between the developed and developing worlds on access to green technology, both sides need to find a common ground if climate change is to be effectively addressed.

Patents do not have to be a barrier to technology transfer. They can be used by their owners to block out competitors and to prevent unauthorised copying of their inventions. But utilised in other ways, patents are the facilitators of open innovation, the transmission of knowhow and cooperation between businesses, wherever in the world they may be. For that to happen, though, patent owners need some guarantee that they will get a return on their investment in research and development, and in obtaining and protecting their IP rights – something which India’s chief climate negotiator at Doha went some way towards acknowledging.

Developed countries must do everything they can to accommodate developing-world partners in terms of making their IP available at prices that are reasonable and not prohibitive. India and other developing economies would also serve their own interests better by remembering that IP owners, wherever they come from, won’t invest resources in developing those vital green technologies were it not for the ROI that patents make possible.


Jack Ellis
IAM Magazine
14 December 2012

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Licensing, IP politics, Patents, IP business, IP finance

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RE: India’s treatment of IP rights means that others won’t listen to its royalty fund proposal

I will be running a panel at the - very large - Global IP Convention in Bangalore in January, which will be the first time I've been to India, and I'm going to be very interested to learn more from the politicians and business leaders who will be talking there about their views on IP....

Stephen Potter, Iprova Sàrl on 19 Dec 2012 @ 16:48

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