Wednesday, 23 March 2016

India: Monsanto Served Notice for Revocation of its Bt Cotton Patent
According to The Indian Express, a leading Indian daily, the Department of Industrial Policy and Promotion (DIPP) has recently served a show cause notice to Mahyco Monsanto Biotech (India) Private Limited (MMBL) on March 03, 2016, calling upon it to explain why its patent for the Bt cotton technology should not be revoked under the provisions of the Indian Patents Act, 1970. The reason for this being, that the patented product, which MMBL claims to be resistant to pink bollworms, is allegedly no longer working as claimed.
Brief Background
Monsanto is an American multi-national corporation known for its contribution to the field of genetically modified crops around the world. In India, Monsanto sells a genetically modified version of Cotton seeds known as Bt Cotton and marketed as Bollgard (containing the Cry1Ac protein / Mon-531 gene) and Bollgard-II through their Indian counterpart MMBL. Bt Cotton is claimed to contain an insecticidal protein, whose gene has been derived from a soil bacterium called Bacillus thuringiensis (Bt), making the seed resistant to bollworm attacks. The 2014-2015 Annual Report of the Cotton Association of India has stated that the acreage under Bt cotton in the country has reached to 96% of the total acreage of around 129.71 lakh hectares where Bt cotton is cultivated. This data shows the overwhelming use of Bt Cotton for cultivation with almost the entirety of the seeds used being manufactured by Monsanto.
Patenting History of Bollgard and Bollgard-II
Monsanto was first granted a patent for the first version of their Bt Cotton seed, Bollgard in the United States in 1992, which expired in 2012. In India, Monsanto tied up with Mahyco (which later became Mahyco Monsanto in 1998) to import Bollgard. The Genetic Engineering Appraisal Committee (GEAC) gave Monsanto permission to commercially release Bollgard in 2002 and Bollgard-II in 2006. Interestingly, it appears from a brief research that Monsanto did not file for grant of a patent for Bollgard in India.
In 2008, an indigenous seed containing the Cry1Ac gene was developed by researchers at the University of Agricultural Sciences (UAS), Dharwad, Karnataka in India. However, reportedly, under the assumption that Monsanto had a patent on this gene, UAS was not allowed to sell the seed commercially on the directions of the Ministry of Environment and Forests[1].
Bollgard-II involves the introduction of Cry1Ac and Cry2Ab genes from Bt into cotton plants and Monsanto claimed that it conferred resistance against American bollworm, pink bollworm and spotted bollworm. Through Indian Application no. 1947/CHENP/2003, Monsanto was granted a patent (Patent No. 232681) for the cottonseeds on March 20, 2009 w.e.f. June 05, 2002.
Failure of Bollgard and Bollgard-II
In 2009, Bollgard began to fail as bollworms became resistant to the Cry1Ac gene. According to a press note issued by Monsanto, resistance to Cry1Ac was seen in only four districts in the Indian state of Gujarat i.e. Amreli, Bhavnagar, Junagarh and Rajkot. Further, according to the information provided on the company’s website, no insect resistance has been confirmed outside the four districts in Gujarat[2].
The company recommended that it would be safer for the farmers to adopt Bollgard-II instead.
In 2015, it was first reported by the Central Institute of Cotton Research (CICR) that Bollgard-II has also started to develop pink bollworm[3]. Surveys have indicated that the damage to the cotton crop from pink bollworm attacks are “particularly severe” in Gujarat with an estimated 9 per cent yield loss, and it was found to have spread to wider areas. Monsanto said that while results of the CICR study were awaited, internal studies indicated resistance by pink bollworm in some districts of Gujarat to Cry2Ab protein, a key component of Bollgard II. This has reportedly been proliferated by improper insect resistance management practices, absence of refuge (non-Bt seeds), and spread of illegal seeds[4].
Revocation of Patent?
Revocation of a patent can be done under Section 64 or Section 66 of the Indian Patents Act, 1970. Section 64 provides for revocation of patents, as long as certain grounds as laid down are met. An application for the revocation of a patent can be made by any interested party or the Central Government. The important provision with regard to this situation is Section 64(1)(g) which provides that an application for revocation can be made if the invention is not useful. This raises the question as to what constitutes “not useful” i.e. whether it includes a situation where the invention does not work at all or does not produce the desired result claimed in the patent specification.
In this regard it may be pertinent to note the judgment of the Bombay High Court in Farbewerke Hoechst v. Unichem Labs and Ors. [AIR 1969 Bom 255], where it was observed in paragraph 17 that even if the amount of utility of an invention is very small, if an invention is of some use to the public it is considered sufficiently useful. Further in paragraph 20 of Farbewerke, the Court observed that:
““not useful” in patent law means that… it will not do what the specification promises that it will do. If the invention will give the result promised at all, the objection on the ground of want of utility must fail”.
In view of the above, it appears that if the specification in Monsanto’s patent on Bollgard-II claims that the invention is resistant/ tolerant to pink bollworms but is no longer displaying that resistance and the invention is not giving the result promised, grounds for revocation can be made out.
Other Legal Disputes
Interestingly, Monsanto is also facing legal challenges on the price at which the Bt cotton seeds are sold to the public. Cottonseed is an essential commodity under Section 2(a)(ix) of the Indian Essential Commodities Act, 1955. Under Section 3(2)(c) of the Act, the Central Government can make orders for controlling the price at which cottonseed can be sold. The Central Government issued the Cotton Seed Price Control Order, 2015 on December 07, 2015 [G.S.R. 936(E)] for controlling the price at which Bt cotton seeds can be sold in India. The said Order created a panel which would fix the maximum price of Bt Cotton seeds. On March 08, 2016 vide Standing Order bearing No. S.O. 686(E), the Central Government fixed the Maximum Sale Price of Bollgard-II at INR 800 with the Trait Rate being fixed at INR 49[5].
Monsanto challenged the Order in Mahyco Monsanto Biotech (India) Pvt. Ltd. and Anr. v. Union of India and Ors [W.P. (C) 12069/2015] before the Delhi High Court asking for a stay which was refused by the Court who asked for the Central Government to file a counter affidavit on March 04, 2016. The Court on March 04, 2016 heard in part impleadment applications and ordered that the matter be listed for the end of the board on March 09, 2016[6]. On March 09, 2016, the National Seed Association of India, Bhartiya Janta Kisan Morcha and Indian Kisan Sabha were impleaded as respondents and the matter has been listed for hearing and disposal on March 23, 2016[7].
In a combined judgment dated February 10, 2016 in Re: Department of Agriculture, Cooperation and Family Welfare And M/s Mahyco Monsanto Biotech (India) Limited (MMBL) [Reference Case no. 2 of 2015] and M/s Nuziveedu Seeds Limited & Ors. And M/s Mahyco Monsanto Biotech (India) Limited & Ors. [Case no. 107 of 2015], the Competition Commission of India (CCI) has ordered that the Director General (DG) make a detailed probe into alleged abuse of dominance by MMBL. The CCI was of the view that there exists a prima facie case of contravention of the provisions of Section 3(4) and Section 4 of the Indian Competition Act, 2002. The CCI has also asked the DG to submit his report within 60 days.
Conclusion

The patentability of Monsanto’s Bt cottonseeds, sold as Bollgard-II, is facing challenge at present as the cottonseeds are allegedly no longer functioning as claimed by the company in its specification. The present issue has opened up the possibility that a patent may be revoked under Section 64(1)(g) of the Patents Act for being “not useful”, and may thereby set a precedent where a patent may be revoked if, after a period of time, the product or invention is no longer able to produce the same result as promised due to a build-up of tolerance. The eventual outcome in this matter however is yet to be seen.


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