Revisting the Bolar Exemption in INDIA
The patent is a legal right that is given to the inventor of a product or service so that he can exclusively produce, use and sell his invention. In India, the act regulating patents is The Patents Act, 1970. The act also prescribes the rights which have been given to the patentees on his/her invention. The Inventor only possesses the right to deal with his product or services and only he can only authorize any person who can on his behalf use his products and services in India. But if a person uses the invention of the inventor without the authorization of the inventor, then it will be considered an infringement of the right of patent, and the person having the patent right over it can sue such a person.
But the Patents Act, of 1970 has also prescribed certain acts which are not considered an infringement of the legal right of patent in the act itself. Such exceptions are called as “Bolar Exemptions”. These exemptions were introduced to the Patents Act, 1970 by an Amendment which took place in the year 2005. The term “Bolar Exemption” has been taken from the Drug Price Competition and Patent Term Restoration Act, 1984 which reversed the court’s decision in the case of Inc. vs. Bolar Pharmaceutical Co., where test data for approval of its generic drug would be an infringement of the patent. The TRIPS Agreement mandates its member countries to prescribe some exemptions to the general rule of patent infringement. India being a signatory to the TRIPS Agreement has included the Bolar Exemption in the Patents Act.
So, when the act of making or constructing including selling and importing is made for an invention which is patentable and used for development and submission of information that is required under any law, then it will not be considered as infringement. In simple words, the first clause protects the acts related to a patented invention which is done for developing and submitting information to the authorities of India. Wide interpretation can be given to the term patented invention as this term can include a variety of aspects like ‘patented product’ ‘patented process’ etc. The second exemption talks about the import of a product which has been patented by a person from a person who has the authorisation to sell and distribute the product. In simple words, the second clause allows the import of a ‘patented product’ from a person who has the patent rights of the product. Thus, the person importing the product should be the patent holder for the product and thus it should be imported in the name of the patent holder. Any person can import the patented product to India in accordance with Section 107 A (b). The second clause is only protecting the patented product and not patented invention.
The Bolar Exemption clause has enabled the drug manufacturing companies to manufacture and formulate their generic drugs even before the patent term of the patent holders of similar products gets expired. Before the 2005’s Amendment, the patent holders of drug manufacturing companies took advantage of the Patents Act, of 1970 to exercise their monopoly and restrict their competitors from launching the generic form of the drugs. But now, Bolar exemption provides full liberty to the drug manufacturers to conduct research and release their generic form of drug without the fear of infringement of patent.
Judicial Pronouncements related to Bolar’s Exemption
In the case of Strix Limited v. Maharaja Appliances the defendant took the defence of Section 107 A (b) and stated that his products were protected by a Chinese patent held by a China-based party. The production of the products was authorized by way of a Chinese patent, thus when the products will be imported then it would not amount to infringement of the legal right of the patent holder. The Delhi High Court did not agree with the submissions given by the Defendants as he was not successful in furnishing the name of the Chinese supplier, and thus he was successful in obtaining the confidence of the court.
The Delhi High Court in the recent cases of Bayer Corporation v. Union of India & ORS and Bayer Corporation v. Alembic Pharmaceuticals Ltd., held that the export of a patented invention for the purpose of the experiment is also covered under Section107 A of the Indian Patents Act and thus it would not amount to patent infringement. In this case, it was further held that Section 107A(a) is a fundamental right protected by the Indian Constitution under Article 19(1)(g) of the Constitution of India and thus cannot be taken away or curtailed from the mere absence of the word "export" in Section 107A(a).
Revisiting the Bolar’s Exemption in India
Bolar’s Exemption has protected the various research and development institutes, drug manufacturing companies, and other entities who have to submit information to the Indian Regulatory Authorities from the cases related to patent infringement. Moreover, it has protected the import of life saving drugs and other innovative and technologically advanced patented products from other countries. Bolar exemption has also attracted importers, as they can easily import their patented products to India without the fear of patent infringement. This clause is beneficial to such small companies who had to previously wait for the period till the expiration of the patent. This exemption clause can also be misused by several companies as they can exploit the actual innovators of the product. This clause is severely harmful and injurious to such innovators and innovator companies who invest their significant time, effort, and money to develop and register the patented product. Thus, it would not be wrong to say that this area of the Patent Law of India is most likely to be advanced and refined in the coming years.
The article first published on Lexology.com and the same can be accessed here.