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PPVFRA Judgment: Death knell for agricultural innovation

The judgment leads to low prospects of patenting agri-innovation, extinguishing the incentive for companies to deliver new and transformative technologies.
Recently, the Honourable Division Bench of the Delhi High Court, while hearing a patent infringement suit filed by Monsanto against Nuziveedu Seeds and group companies, invalidated Monsanto’s patent on Bollgard II technology. It directed Monsanto to seek registration for its donor seeds, containing the technology, and access to the benefit sharing mechanism for these donor seeds under the Protection of Plant Varieties and Farmers Right Act (PPVFRA).
With full respect to the judges and the judgment, we should look at the following aspects contained therein and the far-reaching implications:
“The judgment concludes that the man-made gene is inanimate and without utility unless it is integrated into a plant / plant variety and that Monsanto was, therefore, effectively claiming a patent right over a gene incorporated in a plant /plant variety, which is prohibited by Section 3(j) of the Patent Act. The High Court appears to have completely misunderstood the technology, which is a man-made gene or chemical. It is not a plant, seed or any naturally occurring material. The High Court also appears to have confused the technology with the way it is used by seed companies who have licensed the technology. In brief, it appears that the court has held that the patent for a man-made chemical, or a man-made gene, is invalid not because it is a plant or seed, but merely because it is used within plants.
“Cotton seed is covered under the Essential Commodities Act and hence the access to donor seeds cannot be denied by the technology developer to any seed company that wants it. This means if someone develops a technology, and goes through a process of deregulation, anyone else can seek access and it must be given irrespective of any criteria applicable to the seekers of such technology.
There are other aspects of this judgment that deal with the license, such as royalty dues, which are not relevant to this article.
This judgment has deep implications for agricultural research in general and agricultural biotechnology in particular. It has significant bearing for Indian farmers who could be at a severe disadvantage with a research investment deficit and a lack of access to globally available innovation.
* By the logic in the Court ruling, all patented products which are designed to be incorporated into any plant or animal are at the risk of being invalidated. The Patent Authority of India has granted over 100 patents so far for agri-biotech innovations, genes, and traits. Over 1000 applications are pending. These are from the private industry, public institutions, Indian companies and multinationals. Will all these patents become null and void now? Public and private institutions have invested thousands of crores in this space for the last two decades trusting the Indian Patent Act. Government has invested thousands of crores of tax payers’ money through Department of Biotechnology and other institutions. Do all those research outputs go out of the ambit of patents? A narrow view would suggest this be applied to the single patent under question in this judgment. However, by disallowing patentability, this judgment is equally applicable to agri biotech patents in general and enables those who seek technology without wanting to pay for it by citing farmer interest.
* Practically all crops are covered under the Essential Commodities Act. Does it mean that technology or germplasm developers have to give out genes, traits, and parent material in all crops to anyone who wants them? The concept of technology stewardship becomes irrelevant. What about commercial benefits for technology developers and researchers? It is indeed disheartening that few seed companies want to have their cake and eat it too – gain access to technology, build flourishing businesses, and then follow the path of misinforming stakeholders to an extent where investments suffer. Well intentioned laws of our country such as the Essential Commodities Act are stretched without any regard for eventual adverse impact on farmers – can there be any bigger disservice to our nation?
* The judgment also recommends that the technology developer may instead seek protection of its Intellectual Property Rights in the gene under the PPVFRA by seeking registration of donor seeds containing the gene. The gene does not constitute a plant variety under the PPVFRA. A variety is a combination of genes which makes it unique and suitable for protection under PPVFRA. Donor seeds are not necessarily unique varieties. They are mostly public varieties (as is the case with Coker seed used as donor seed for Bt gene), which in many cases, may not be eligible for protection under PPVFRA. Even if it does, registration for the donor seeds containing the gene would not protect the technology developer’s rights in the gene itself. So, how the technology developer gets protection under the PPVFRA is very nebulous and unprecedented!
* A party may easily misappropriate such donor seeds, and transfer the gene from the donor seeds to its own varieties such that there is nothing in common between the two, except for the presence of the gene. In such an event, the technology provider would have no remedies to restrict the misappropriating party from the unauthorized use of its gene. On the other hand, a party can also use the developer’s gene in his variety and not get that variety registered under PPVFRA. The technology provider would not be able to seek compensation for use of its gene under PPVFRA as the variety is not registered with the authority and benefit sharing does not apply. In fact, many companies have not sought PPVFRA protection for their varieties for various reasons. This will now be an additional reason for not seeking protection.
This judgment can potentially harm research investments in developing agricultural biotechnology. Apart from genetically modified (GM) technology, there are several new non-GM breeding technologies now available. All of them will meet with the same fate as the BGII gene in terms of patent protection. So, why would any research based commercial organization invest further in developing such technologies for Indian farmers, or bring relevant available technologies to India?
Research in multiple crops like cotton, maize, rice, and vegetables, will come to a halt as low prospects of patenting and commercialising novel inventions extinguishes the incentive for companies to deliver new and transformative technologies. This reduces competitiveness for Indian farmers due to lack of access to new technologies, while farmers in other geographies have access to latest technologies ensured by a predictable business environment and respect for IP rights. New and innovative technologies are already skipping India as investments get redirected to other countries with dependable patent laws.
In this background, can we sustain India’s global competitiveness in cotton and the future of 70 lakh cotton farmers at a time when the global dynamics of cotton industry are changing? The huge production, exports, and wealth which Bt cotton has generated for the country and its cotton farmers is under threat. Confederation of Indian Textile Industry (CITI) estimates that demand for cotton in India will double in the next ten years – the textile industry should surely be worried with the developments we have seen over the last 3 years and their implications for cotton availability. Everyone reading this should understand what is happening in Burkina Faso – this country, once a top cotton producer in Africa with 70% area under Bt cotton, phased out GM Cotton in 2015, and is already on the verge of a crisis with high pest infestations, high pesticide use, falling yields and their farmers losing incomes and becoming uncompetitive. Are we headed in the same direction?
I leave it to the pharma biotech industry to look at the implications of this judgment for them because they deal with similar biological processes.
The role of the Courts is to interpret the law. Laws involving science can be complex and exposed to misrepresentation by companies with vested interests who seek to infringe. It is the Government which must look at the laws, look at their suitability to our ambitions in agriculture, look at compliances with various International obligations like TRIPs, and take necessary steps to clarify these laws, and their intent and principles to encourage research, progress, predictability, and prosperity of our farmers. I trust our Government would look at these aspects immediately and take necessary steps. My previous article was titled – To Bt or not to Bt – ‘not to Bt’ is now clear and we are headed for a major crisis.