DOI: 10.4018/IJABIM.2020070106

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Factor Affecting Innovation Performance of Manufacturing Firms:Case EvidencesSanjay Dhir, Department of Management Studies, Indian Institute of Technology Delhi, New Delhi, India

Swati Dhir, International Management Institute New Delhi, New Delhi, India

ABSTRACT

In theknowledge-based economy, creation,management, anddisseminationofknowledge in anorganizedwaywillcertainlyenhancethe innovativepracticesofcompanies inanycountry.Thisarticlehastriedtoexploretheimpactofvariousfactorsoninnovation.Followingaqualitativeresearchmethodology,thearticlehascomeupwith8propositionsandtriedtobuilduptheargumentsintherealcompany’scontextinIndiaby3casestudies.Theresearchhasbeenabletoprovidenecessaryevidenceofparticularcompaniesandtriedtobuildargumentsforthesuggestedpropositions.Thefindingsoftheresearcharticlewillcertainlyhelpacademiciansandpractitionerstoemphasizetheintellectualpropertyrelatedlawsofanycountrytoenhancetheinnovationquotientofanycountry.

KEywoRdSCase Study, Innovation, Intellectual Property Rights, Manufacturing

INTRodUCTIoN

Intoday’sbusinesslandscape,innovationisbeingincreasinglyidentifiedasakeydriverforcreatingcompetitiveadvantage.AccordingtoBanerjee(2015)“Innovationisgainingprominenceinallkindsofeconomicactivityaroundtheworld.Notonlyadvancedeconomiesbutalsodevelopingnationsarefindingthatinnovationisoneofthemaindriversofeconomicgrowth.Thisrenewedunderstandingofthesignificanceofinnovationishavingagrowingimpactonthecourseofpolicyformulationinmanycountries”.Globallyinnovationhasbecomeapriority,innovatingcompaniesarenowabletomakemanyfoldprofitswiththeirproductsandservices.Indiahasalsoawakenedtotheneedofinnovationpostliberalizationwhichcanbeattributedtoexposureofglobalmarketforces.Asaresultofthis,patentableinnovationsareontheriseinIndia.

The purpose of patents according to Olwan (2013) is to provide an inventor exclusivecontroloverhisinventionforacertainperiodoftimetohelphimderiveanincomefromhisinvention.ThetwotheoriesofpatentshavebeendiscussedbyDenicoloandFranzoni(2003),therewardtheorysaysthatthepatentsystemisforrewardinginnovationandsupportR&D,andthecontracttheory,saysthepurposeofpatentisfordisseminationofnewknowledge(Denicolo

Thisarticle,originallypublishedunderIGIGlobal’scopyrightonJuly1,2020willproceedwithpublicationasanOpenAccessarticlestart-ingonFebruary1,2021inthegoldOpenAccessjournal,InternationalJournalofAsianBusinessandInformationManagement(converted

togoldOpenAccessJanuary1,2021),andwillbedistributedunderthetermsoftheCreativeCommonsAttributionLicense(http://cre-ativecommons.org/licenses/by/4.0/)whichpermitsunrestricteduse,distribution,andproductioninanymedium,providedtheauthorofthe

originalworkandoriginalpublicationsourceareproperlycredited.

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&Franzoni2003).According to theeconomic theoryofpatents for invention (ArnoldPlant1934),patentsgiveaninventorthecontrolfordefiniteperiodtoderiveanincomefromit.Theultimateaimofintellectualpropertyrightsistoencourageinvention,whichhasapotentialofeconomic and technological development and for technological advances. In absenceof thisintervention,therewouldprobablyremainlittleincentivetoinnovate.Inareport,PWC(2013)foundthatclearcorrelationexistsbetweeninnovationandbusinesssuccessintermsofincreaseinrevenues,especiallyinmanufacturingcompanies.Thereporthighlightedthatoveraperiodof3yearstherewasa38%increaseinrevenuesofinnovativecompanies,ontheotherhandleastinnovativecompaniesshowedamoderategrowthof10%overasimilartimeframe.Furthermore,inthedevelopedmarketeconomiespatentandtrademark,relatedlawsprovidebarrierstothecompanies to imitateandlaunchsimilarproductsorservicesandhencepromotes innovationandfacilitatetheintellectualpropertyrights(Helpman,1993).

TheproblembeingposedinIndiaisthatwehavebeenseeingcasesregardingpatentingissues since we became Trade-Related Aspects of Intellectual Property Rights (TRIPS)compliant and adopted the new product patent regime. We have seen litigation regardingcompulsory licensing in terms of Bayer v/s Natco Pharma. There are evidences regardingrejectionofpatentinIndiaonissuesasevergreeningofpatent,bymeansofarticle3(d)inIndianPatentActelucidatedincaseofNovartisV/sUnionofIndia.Compulsorylicensingissueandthepatentabilityissuesofknownsubstance(article3d)hasresultedinerodingtheconfidenceofmultinationaldrugmakerstoenterIndianmanufacturingstream.WehavealsorecentlyseenastringoflitigationbetweenmobilephonemanufacturersandEricssonduring2013-2014.Someofthelitigationsare:EricssonvsMicromax;Ericssonvs.Intex;Ericssonvs.Gionee;Ericssonvs.XiaomioninfringementofitsAdaptiveMulti-Rate(AMR)patents(IN213723,IN203034,IN203686,IN203036andIN234157)onwhichEricssonhadsuedlowcostmobilephonemanufacturersinIndia.ThesuitsthatEricssonfiledagainstafewlow-costmobilemanufacturerswerefordamagesforthesupposedinfringementofeightoftheSEPsownedbyEricsson.Also,withallthisinbackgroundthecompetitioncommissionofIndiahasnowallegedthatEricssonhasviolateditsfair,reasonable,andnon-discriminatory(FRAND)termscommitmentbyfixingexcessiveroyaltyratesandalsothatit isusingnon-disclosureagreementstogetawaywithit.TherearegrowingconcernsontheissueofFRANDnegotiationsandroyaltydecisionsbetweentheSEPholderandthemanufacturer.

Suchlengthylitigationprocessnotonlyputsaburdenoflitigationexpenseswhichisexorbitantonthelocalmanufacturerbutsometimes,asincaseofsmartphoneindustry,alsoputsapressureforthepaymentofhigherroyaltytothepatentee.ThepresentstudywillexploretheseaspectsofbusinessintermsofintellectualpropertyrightsasthefactorsaffectinginnovationrelatestheirimpactonthemanufacturingindustryinIndiancontext.

BACKGRoUNd

Indian IP Regulation and EnforcementTiwarietal.(2011)reviewedtheaspectsofIntellectualPropertyRightsingreatdetail,withtheirprotectioncriteriaavailableunderIndianPatentAct.Furthermore,IndiaalongwithmostdevelopingeconomieshasweakIntellectualProperty(IP)enforcement(Kumar,2003).Itfailstoproviderelieffromtheimitators,therebybecominghurdletotrade,investmentinresearchanddevelopmentandalsofortheall-roundgrowthofthecountry’seconomy.Dutta(2017)feelsthattheweakenforcementofIPrightsinIndiaisthecausalfactorforIPrightholders’inabilitytoenjoytheirIPassetsfully.PuriandVarma(2005)reviewedIndianPatentAct2005andfoundthatthestandards(TRIPS)weredefinedwithreferencetoitsdomesticconditions.TherealchallengeaccordingtoPuriandVarma(2005)lieswithfutureamendment.

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LITERATURE REVIEw

AccordingtoareportbyKamphausen(2015)intheNationalBureauofAsianResearch,manysectorsinIndiaarefacingthechallengesofIPprotectionandenforcement.WeakIPlawenforcementinIndiaisactingasadeterrenttoinnovationinIndianindustry(Kumar,2003).AccordingtoCockburn(WIPO,2009)incountrieswherethegenericcompetitionisstrong,theprocessesforchallengingorenforcingpatentsareextremelyimportant.Ontheotherhand,strongerIPprotectionis linkedtotechnologytransferindevelopingworld.YangandMaskus(2008)findthattheconsequenceofgreaterprotectionofIPRinadevelopingcountrywouldbeincreasedtechnologytransferthroughlicensing.Leeetal.(2006)alsofindthatimprovementsinIPRprotectionwouldleadtoincreaseintechnologytransferwithinmultinationalcompanies.AccordingtoPrabhuetal.(2012),thesocietygetsfourbenefitsfromastrongIPregulation:innovationbyprivateagent,useofnewknowledge,greaterdisseminationofnewknowledgeandstimulationofinnovationinotherenterprises(Gollin,2009).Hence,wecomeupwithourfirstpropositionthat:

Proposition 1: Indian IP regulation and enforcement is not strong and has negative impact oninnovationinIndianmanufacturingindustry.

Patents (Pharma/SEPS etc.)TheinvestmentinR&DforaPharmaceuticalcompanycanbeashighasUS$802million(DiMassietal.,2003).GlobalAllianceforTuberculosisDrugDevelopment(2003)hasestimatedthetotalcostforanewtuberculosisdrugdevelopment,takingintoaccountthecostoffailure,somewherebetweenUS$115milliontoUS$240million.ThepatentsofthedrugdevelopedfromtheseR&Deffortsarealsoveryhigh.Morethan95%ofessentialdrugsonWHOlistarenotpatentprotected.However,WHOacknowledges that patent protection encourages innovation inPharmaceutical sector. It issimilarinInformationandCommunicationtechnology(ICT)sector.

Variousstudies(Blindetal.,2006;BlindandThumm,2004)indicatethatgrowingtechnicalsophisticationofstandardsisduetomoreaggressivepatentingstrategiesthatthefirmsadopttoseekbetterincomefromtheirstandardessentialpatents.EmpiricalevidencefromRysmanandSimcoe(2008)undeniablysuggeststhatStandardEssentialPatents(SEP)aremoreimportantthanotherpatentsandfirmswhichhavealargeshareofessentialpatentshaveastrongmarketposition.Beckersetal.(2005)andPohlmannetal.(2014)alsostatethatSEPsmaydirectlyincreaseacompany’sprofits.SEPmaygivemarketpowertotheholderofthetechnologyovertechnologymanufacturerswhowouldneedthetechnologyinputsoastomaketheirproductscompatiblewitheachother(Gingsburgetal.,2014).TheSEPownerenjoysthemonopolypowergaineddueto‘lockedin’networkoverentirenetworkofmanufacturers.Hence,weproposethat:

Proposition 2:PatentsinPharmaceuticalsectorsandinclusionofpatentsinSEPinICTwillprovideincentiveforinnovationinIndianmanufacturingindustry.

Infringement Suits/LitigationKorenandWong-Ervin(2014)findinvestigationsandlitigationinvolvingSEPshavebeguntoemergeacrosstheglobe.KorenandWong-Ervin(2014)furtherfindthatinUSandEuropethelitigationisprimarilyfocusedoninjunctionreliefonFRAND-encumberedSEPs.InChinaandIndia,mostimportantissuesrevolvearoundtheroyaltyratesandnon-disclosureagreements,andlitigationrevolvesaroundtheseissues.AccordingtoCockburn(WIPO,2009)litigationsininfringementareimportantfactorswhichinfluencethereturnonR&Dinpharmaceuticalsector.Thecourtdecisiononlitigationalsohasseriousimpactonthecompany’sstrategytooperateinthecountryornot(Anandetal.,2013).

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Thefactcannotbedeniedthatthecompanywhichownsthepatent,whetherpharmaorstandard,isindominantposition.ThishasalsobeenendorsedbyPohlmannandBlind(2014)butthestandardadopterhasarighttogetlicenseontheFRANDtermsandtheseissuesbecomepointofdefenceforinfringementsleadingtolitigation.AseriesofinfringementsuitswerefiledinIndiabyEricssonagainstMicromax,Intex,Gionee,Xiomi,Lava,etc.,forinfringementofSEPsrelatingtotechnologiesofGSM,AMRandEDGE.MostofthesecasesarestillunderlitigationwithsomeinterimrelieftoEricssononroyaltypaymentsbytheinfringingcompanies.However,allthisinfringementsandlitigationisdivertingattentionfrominnovationinthemanufacturingsector.ThedecisionsofcourtsinfavorofgenericcompaniesforissuesofcompulsorylicenseorFRANDtermsareprovingdetrimentalforinnovationinIndianmanufacturingcompanies.Asitiseasyforthemtogetlicenseonnominalrates,hencetheydon’twanttoinvestinin-houseR&Dtodevelopproprietarytechnology.Hence,weproposethat:

Proposition 3:Thelitigationregardingpatenting(protection/infringement)isleadingtoreductionininnovationinIndianmanufacturingindustry.

Competition/Antitrust RegulationCompetitionCommissionofIndiawasestablishedin2009,undertheCompetitionAct2002whichprovidedforscrapingofrestrictivetradepracticesandmonopolies.TheCommissionwasestablishedwithanaimofpromotionoffairplayinmarketandafunctiontokeepaneyeonanti-competitivepracticesofcompanieswhichmaydistortorstiflecompetition.However,CCIhasnotbeenveryeffectiveinimplementinganyoftheaimswithwhichitwasestablished.Chaudhary(2015)talksaboutthecompetitionlawsofIndiaincontextofstandards.Thenon-disclosureofessentialIPbyenterprisescangivemarketpower tofirmsbyunfairmeans(Lemley,2002).Suchabuseofstandardsettingprocessamountstoanti-competitivebehavior.Todealwithanti-competitiveactivitieseffectively,competitionauthoritycanbecomeaninstitutionalmemberofGlobalICTStandardizationForumforIndia(GISFI).ItwillensureprecompetitivestandardsettinginIndia(Chaudhary,2015).Inthepresentsetup,theCCIisnotabletoregulatetheantitrustissueswhichishavinganegativeimpactoninvestmentinResearchandDevelopment(R&D)andthusontheinnovationinIndianManufacturingsector.Hence,weproposethat:

Proposition 4: Thecompetition/antitrustregulationsarenotabletoresolveissuesregardinglicensing,whichishavinganegativeeffectoninnovationinIndianmanufacturingindustry.

Licensing (Compulsory/FRANd) or Royalty RatesAsstatedbyAndrewUpdegrove (2013), thedefinitionofFRAND is alwaysword forword thesame.InvestigationsandlitigationinvolvingSEPshavebeguntoemergeacrosstheglobe(KorenandWong,2014).FRANDtermsareusuallyfollowedbySSOwhiledeclaringSEPsothattheSEPholderwillnottrytomakeunfairgainsjustbecauseofholdingapatentwhichhasbeenacceptedaspartofSEP(RysmanandSimcoe,2008).Standardsettingisunderstoodaspartofajointinnovationeffortcombiningcompetitionandcollaboration(BesenandFarrell,1994).Casestudiesonrecentstandardizationprojects (Bekkers,2001;DeLaceyetal.,2006)discuss intodetails thestrategiesinducedbytheinclusionofessentialpatents.Lemley(2002)providesadetailedoverviewoftherulesonessentialpatentsinvariousSSOs.Accordingly,oneschoolofthoughtis thataFRANDdeclarationconstitutesacceptanceofathird-partybeneficiarycontractbetweenthestandards,essentialpatenteeandthestandardizationorganization,sothatwhenauserofatechnicalstandardindicatesitsintentiontorequesttherighttousethestandards-essentialpatentunderFRANDterms,alicenseagreementisautomaticallyconcludedbetweentheuserandthepatentee(Lemley2002).IntheUnitedStates,a2012judgmentheldthataFRANDdeclarationconstitutedathird-partybeneficiarycontract

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(MicrosoftCorpvMotorolaInc.,864FSupp2d1023,WDWashington2012).AnotheropinionisthataFRANDdeclarationisonlyamanifestationoftheintentionofthestandards-essentialpatentee,andnocontractbetweentheuserandthepatenteeisconcludedunlesssomeotherformofagreementisexecutedbetweenthem.

TheintroductionofacompulsorylicensinginCanadaduring1970sresultedinaremarkablefallintheamountofpharmaceuticalresearchinCanada.ThistrendreversedandaremarkableincreaseinR&Dwasobservedwhenitwasscrappedin1990s(Padzerka,1999).InIndiaalso,compulsorylicensingishavinganegativeimpactoninnovationinmanufacturingsector.Hence,weproposethat:

Proposition 5: Thelicensingtermscompulsory/FRANDareprovingtobedetrimentalforinnovationinIndianmanufacturingcompanies.

Internal R&d Capacity of Manufacturing CompaniesWorldIntellectualPropertyOrganisation(WIPO)comesoutwithGlobalInnovationIndex(GII)everyyear.Intherecentreport(2015)whichincludes141economiesfromallovertheworldanduse79indicators(WIPO2015),Indiahasfallento81stpositionin2015from76thin2014.In2013itwasat66thposition,64thin2012and62ndrankin2011.Thetrendisdownhill.InIndia,annualscienceandtechnologyexpenditureisaround0.9%ofGDP(Kumar2014).R&DexpenditureinIndiaremainsatabout0.9%ofGDP—comparedtosomeoftheotherBRICScountrieswith1.12%inRussia(downfrom1.25%in2009),1.25%inBraziland1.84%inChina.InIndia,thedecliningimportanceofR&Dactivityisamatterofgraveconcernwhereknowledgeacquisitionismostlythroughimportoftechnologybylocalenterprises(KumarandAgarwal,2000).Oneofthereasonsforthismaybethattheimportedtechnologyismoreattractiveoverthelocally-developedtechnologiesasthesetechnologieshavebeenprovenandthereforetheuncertaintyofavailabilityoffinancingfromsuppliersisless.Also,thereisanaddedadvantagerelatedtouseofknownbrandsandtrademarks.Suchassociationgivesincentiveofmarketpower(Kumar,1990).Katrak(1985),Kumar(1987),DeolalikarandEvenson(1989),Siddharthan(1988)andAggarwal(2000)amongothershavealsoreportedthattechnologyimportsinIndiatakesplacemorefrequentlyandarefollowedupbyadaptationandabsorptionofimportedtechnology.Hence,weproposethat:

Proposition 6:TheinternalR&DcapacityofIndianmanufacturingsectorislowwhichishavingadetrimentaleffectonInnovationinIndianmanufacturingsector.

Technology Transfer (Licensing, Joint Ventures, FdI)InthemanufacturingsetupespeciallyintheR&Dintensivesectors,whereIPprotectionisanimportantfactorforreturnoninvestmentontheR&Dtechnologytransferhappenseitherthroughlicensing,jointventureorFDI.Anexampleofthisisthenon-exclusivelicensingagreementthatGileadSciencesInc.hadwithsevenIndiabasedgenericcompaniesfor“Sofosbuvir(SovaldiTM)fordistributionin91developingcountries.(Gileadpressrelease2014).JointVenturesarealsoasourceoftechnologytransfer.AnexampletothiseffectinIndiancontextmaybequotedfromAutomobilemanufacturingsector-ofRenaultandMahindraandMahindra,HeroandHondaandsoon.Howeverjointventuresareveryfragileecosystemandriddledwithdifficulties.DhirandMittal (2013)havecarriedoutsomestudiesoncharacteristicsandasymmetricmotivesofpartnersinJointventuresofdevelopingnation(Dhiretal,2019,Parmeswaretal,2017).Therearethreesourcestoachievetechnologicaladvancement:technologytransfer,domesticR&D,andforeigndirectinvestment(Huetal.(2003).YangandMaskus(2008)findthatgreaterIntellectualPropertyRights(IPR)protectioninadevelopingcountrywouldresultinincreasedtechnologytransferthroughlicensing.Leeetal.(2006)findthatimprovementsinIPRresultinrealincreaseintechnologytransferwithinmultinationalcompanies.IncreaseinIPwillleadtoincreaseintechnologytransfer(Leeetal.,2004).Hence,weproposethat:

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Proposition 7:AnincreaseintechnologytransferintheformofLicensing,JV’sorFDIcanimproveinnovationinIndianmanufacturingsector.

Indian Representation in Policy-Making Bodies (SSo)ManyStandardSettingOrganizations(SSOs)havesubcommitteesforaparticularsetofstandardsalso.TheprivateorganizationsformedbycongregatingdozensofmembercompaniesformSSO(ETSI,IEEEetc.)whichagreeonformationand/oradoptionofstandardoftensupportedbypublicbodies(Lemley2002).Thestandardsthusformedarethemostsignificantastheyraisethemostimportantissuesintheindustry.Mostcompanieswouldliketoparticipateinstandardsettingprocess,astheygettodiscusstechnicalmeritsofstandardandgettoincludetheirpatentsinstandards,aseveniftheroyaltyrateperunitisminiscule–thenumberofunitssolddecideontheprofitability–whichcouldbehuge–inclusiveofalllicensees.

Indiadoesnothaveanumbrellabodyfocusingontelecomstandards.Allothercountrieswithsizeabletelecommarkethavetheirownnationalstandardsdevelopmentorganisations(SDO)andparticipateintheglobalstandardsprocess.However,thereisnocommoninterfacetorepresentcontextspecificindustryanditsspecificrequirementsinglobalstandards.InIndia,mostofthetechnologicalinnovationshavebeenimportedinsteadofdevelopingthem.TheneedofthehouristoimpelIPRandpromotestandardsparticipationinordertocatalysetechnologydevelopmentandmanufacturinginIndia.ThegovernmentneedstoimmediatelyformanIndiantelecomSDOwithactiveparticipationfromallstakeholders.TheBureauofIndianStandards(BIS)isIndia’snationalSSO.IntheICT(InformationandCommunicationsTechnologies)sectortheTelecomEngineeringCentre(TEC)istheonlyformallyrecognizedtelecomstandards/specification/typeapprovalbodyinIndia.GlobalICT Standardization Forum for India (GISFI) and Telecommunications Standards DevelopmentSociety,India(TSDSI)andDevelopmentOrganizationofStandardsforTelecommunicationsinIndia(DOSTI)areprivateSSOsintheIndianICTsector.Also,competitionauthorityinIndiacanbecomeaninstitutionalmemberofGISFI.ItwillensureprecompetitivestandardsettinginIndia(Chaudhary,2015).Hence,weproposethat:

Proposition 8:AnIndianrepresentation inPolicymakingbodies (SSO)will lead to increase ininnovationinIndianmanufacturingsector.

Conceptual FrameworkFigure1givestheconceptualframeworkdeveloped.

METHodoLoGy

Wehaveusedaqualitativecasestudymethodforelucidatingonthetopicathandasthetopicisverycontemporaryandtheissueathandisverycomplexinnature.Qualitativecasestudymethodprovidestoolsforresearcherstostudycomplexphenomenawithintheircontexts(BaxterandJack,2008).Casestudymethod,accordingtoRowley(2002),hasprovedtobeusefulforpreliminaryexploratorystageofaresearchproject,asabasisforthedevelopmentofthemorestructuredtoolthatarenecessaryinsurveysandexperiments(Eisenhardt,1989).

Thismethodologyisbeingadoptedinthepresentstudyasthecasestakenarereallifesituations,withmanyvariablesandtheboundariesbetweenthephenomenonanditscontextnotbeingverydistinct.Thismethodologyisadoptedfromanotherperspective;whichisforthepurposeofgeneralisingthetheoreticalpropositionaswearenothavinganystatisticaldataonthecurrentresearchtopic.Weshallbereportingtheevidenceinasystematicmannersoastoderiveatthepropositionbeingtestedagainsttheevidenceavailableinthecasesdiscussed.Thecaseswhicharediscussedareallavailableinpublicdomain.

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RESULTS ANd ANALySIS

Threecaseswhichthrowlightondifferentaspectsofissuesrelatedtopatenting,patentinfringementandpatent licensing in India includingcompulsory licensingarechosen for thepresent context.TwoofthecasesthustakenarefromPharmaindustryandonefromICTindustry.Wewilltestourpropositionsbasedonthesecaseswhicharedescribedinverybrief.

Case 1:EricssonhadgoneinforinfringementregardinglitigationforitspatentedtechnologywhichwaspartofSEPsbetween2011and2016.SomeoftheinfringementsuitsarestillinprogressinthecourtoflawregardingtheFRANDissues.

Case 2:NovartishadgotentangledinalegalbattleagainstUnionofIndiaforitsPatentclaiminIndianPatentOfficeforitscancerdrugGlivec.ThispatentwasrejectedbytheIPOundersection3(d)ofIndianPatentAct.

Case 3:AcompulsorylicenseforBayer’scancer-treatmentdrug‘Nexavar’(soldatRs2.8Lakhs)wasgiventoNatcopharmatomanufactureandsellatapriceofRs8800/-witharoyaltyof6%tobepaidtoBayer.ThegroundsofcompulsorylicenseasperIndianpatentactwere(a)reasonablerequirementsofthepublicwithrespecttothepatentedinventionhavenotbeensatisfied;or(b)itisnotavailabletothepublicatareasonablyaffordableprice;and(c)thepatentisnotbeingworked.

Figure 1. Conceptual framework of factors affecting Innovation in Indian manufacturing industry with special reference to Pharma and Telecom Industry

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Ericsson v/s Micromax Informatics LimitedInMarch2013,EricssonfiledacaseagainstMicromaxInformaticsLimited,claimingthatMicromaxhadinfringedeightofitsSEPsonAMR,3GandEDGEtechnologies,andwassellingmobiledevicescompliantwiththesestandardsandthatMicromaxhadavoidedobtaininglicensesFRANDtermsfromEricsson.IthadalsosoughtRs100croresindamagesandaskedMicromaxtoprovideitssalesaccountsofmobiledeviceswiththesaidtechnologyforyears2008-2012.

DelhiHighCourtgrantedinterimrelieftoEricssonanddirectedMicromaxtomakeinterimroyaltypayments.EricssonwasalsoallowedtoinspecteveryconsignmentforMicromaxthatarrivedatcustomswithaninstructiontoreachFRANDlicensingterms.MicromaxfiledacomplaintbeforetheCompetitionCommissionofIndia(CCI)inNovember2013claimingthatEricssonhadabuseditsdominantpositioninthemarketbyimposingexorbitantroyaltyratesforlicensingitsGSMtechnologyunderFRANDterms.Micromax’sclaimwasfoundtobevalidbyCCIandan investigationwasordered.EricssonwenttoDelhiHighCourtquestioningtheCCIauthority.TheCourtdirectedthatCCIshouldnotinterferewithEricsson’snegotiationswiththirdpartiesandsubsequentlyfixednewroyaltyratesasinterimarrangementspendingtrialofthesuit.

Withreferencetothecasementionedabove,Ericssonv/sMicromaxInformaticsLimited,wefindthatthoughIPregulationisnottheissueinthiscasebutenforcementisweakinIndia,sinceEricssonwasgivenreliefonlywhenitapproachedDelhihighcourtfortheinfringementofeightofitsSEPsonAMR,3GandEDGEtechnologiesbyMicromaxInformaticsLimited.DelhiHighCourtgrantedinterimrelieftoEricssonanddirectedMicromaxtomakeinterimroyaltypayments.Also,Ericssonhasapolicyofsigningnon-disclosureagreementsfromdifferentlicenseeswhiledecidingonroyaltyratesbeingcharged.ItisthusabletochargedifferentlyfromdifferentlicenseesasthereisnoregulationagainstsigningNDAinIndia.

Thus,thecaseelucidatesthatIPregulationandenforcementinIndiaisnotatparwiththestandardsindevelopedworld.Alsoasdiscussedearlier,whentheIPregulationisweakthereisnoincentivetoinnovate.Thus,thepropositionthatIndianIPregulationandenforcementisnotstrongandhasnegativeimpactoninnovationinIndianmanufacturingindustryholdstrueandwesupportproposition1.

ItisevidentfromthecasethatEricssongaineddominanceinmarketbecauseofitspatentswhichareincludedinSEP.Thus,thepropositionthatpatentsinPharmaceuticalsectorsandinclusionofpatentsinSEPinICTwillprovideincentiveforinnovationinIndianmanufacturingindustryholdsgoodandwesupportproposition2.

It is evident from the case that Ericsson had gone in for filing infringement suits not onlyagainstMicromaxbutagainstalllow-costmanufacturersinIndiansubcontinentandhadnotmadeagreementsonFRANDratesbeforetheIndianmanufacturersstartedsupplyingthehandset.Onereasonfor thesamemaybe toattainhigher royalty than theFRANDterms.This is resulting inIndianManufacturingsectorspendingmoreinroyaltypaymentsandalsoinfightinginfringementsuits,effectingtheirprofitabilityandsubsequentlyabilitytoinnovate.Thus,theproposition3thatthelitigationregardingpatenting(protection/infringement)isleadingtoreductionininnovationinIndianmanufacturingindustryholdsgood.

With reference to thecasementionedabove,Ericssonv/sMicromaxInformaticsLimited, itwasobservedthatthoughMicromaxfiledacomplaintbeforetheCompetitionCommissionofIndia(CCI)againstEricssonforabusingitsdominantpositionbyimposingexorbitantroyaltyratesforlicensingitsGSMtechnologyunderFRANDtermsandCCIorderedanenquiryagainstEricsson,DelhiHighCourtgavearulingthatCCIshouldnotinterferewithEricsson’snegotiationswiththirdpartiesanddecidedtheinterimroyaltyasameasureofrelieftoEricsson.Theproposition4thatthecompetition/antitrustregulationarenotabletoresolveissuesregardinglicensing,whichishavinganegativeeffectoninnovationinmanufacturingindustryinIndiathusholdstrue.

ItisevidentfromthecasethatEricssonhadnotmadeagreementsonFRANDratesbeforetheIndianmanufacturersstartedsupplyingthehandset.Thereasonforthesamemaybetoattainhigher

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royaltythentheFRANDtermsandthat thecompanyissigningnon-disclosureagreementsfromdifferentlicenseeswhiledecidingonroyaltyrates;thusbeingabletochargedifferentlyfromdifferentlicensees.ThecasehasunfoldedthefactthatEricssonhadfailedtosignagreementsonFRANDratesandhadchosentofileinfringementsuitsnotonlyagainstMicromaxbutalsoagainstalllow-costmanufacturers.OnereasonforthesamemaybetoattainhigherroyaltythentheFRANDterms.Thus,theproposition5thatthecompulsorylicensingterms/FRANDareprovingtobedetrimentalforinnovationinIndianManufacturingcompanies,holdsgood.

ThoughthecasedoesnotdirectlylinktotheR&DcapacityofIndianManufacturingsector,howeverwiththeobliquereferencethatthecaseprovidesaboutthefactthatMicromaxwasimportingthegoodswhichinfringedseveralSEPsonAMR,3GandEDGEtechnologiesownedbyEricsson,itisclearthatIndianICTmanufacturingfirmsdonothaveinternalR&Dcapacity.Theproposition6thattheinternalR&DcapacityofIndianmanufacturingsectorislowwhichhasadetrimentaleffectoninnovationinIndianmanufacturingsectorholdsgood.

The case does not directly link to technology transfer, the low R&D capacity of IndianManufacturingsectorandasaresulttheneedforthesectortodependontechnologytransfer.ThetechnologytransferinthiscaseishappeningwithlicensingbutthisdoesnotaffecttheinnovationintheIndianmanufacturingsector.Thus,theproposition7thatanincreaseintechnologytransferinformofLicensing,JV’sorFDIcanimproveinnovationinIndianmanufacturingsectordoesnotholdtrue.

Ericsson is a large MNC and being part of the most SSOs, it is participating in standarddevelopmentandSEPdeclarationalso.ThisputsEricsson inapositionofadvantagevis-à-visdevelopmentandadoptionofitspatentsinSEP.Thus,theproposition8thatIndianrepresentationinPolicymakingbodies(SSO)will leadtoincreaseininnovationintheIndianmanufacturingsectorholdsgood.

Novartis v/s Union of IndiaThiscasewasalitigationsuitwhichwasfoughtuptotheSupremeCourtofIndia,betweenNovartisandtheUnionofIndia.ThecasestartedwhenNovartisappliedforapatentin2005(undernewpatentregimeofproductpatent)foritsbloodcancerdrugGlivec,andwasdeniedpatentin2007bytheIndianPatentOfficeunderSection3(d)whichintendedtopreventincremental/trivialchangesinexistingcompoundsleadingtoevergreeningofpatents.TheappealfiledbyNovartisinIntellectualPropertyAppellateBoard(IPAB),IndiawasrejectedasthepricingofthedrugmadeitunaffordabletoIndianpatients.However,theIPABdidsaythattheprocesshadnovelty.NovartissubsequentlyapproachedtheSupremeCourtofIndiachallengingthelegalityofSection3(d)ofIndianPatentsAct.Thearticle3(d)ofIndianPatentActprovidesthatmerediscoveryofanewformofaknownsubstancewithoutanyenhancementoftheknownefficacyofthatsubstance,ormerediscoveryofnewproperty,ornewuseforaknownsubstance,orofthemereuseofaknownprocessetc.arenotpatentable.

ThejudgementofSupremeCourtofIndiaonthegroundsofmodificationofknowndrugwhereinnoenhancementinefficacyofthesaiddrugwasdemonstrated,wasmadeonsoundfoundationundertheprovisionofIndianPatentAct.Also,asthepatentwasforadrugsotheincreaseinefficacyhadtobeintermsof“therapeuticefficacy”,astheuseofthedrugwastowardstreatmentofdisease.ItisalsotobekeptinmindthatwhilethepatentforGlivecwasacceptedin40differentpatentjurisdictions,itisnotnecessarytomakeitacceptableinIndiaalso.IthastostandthetestofIndianPatentActtobegrantedapatentinIndia.

Thisdecisionhowevergoesagainstincrementalinnovationandadverselyimpactsinnovationonthewhole,especiallyinPharmaindustrywheredenovodiscoveryofnewchemicalentitiesisveryfewandmostnewdrugscomeundertheambitofderivatives.Asaresultofthis,profitabilityisalsodecreasingandcreatingdisincentiveamongpharmamanufacturersforimprovementofdrugs.WhilethisistrueforMNC,theclause3(d)alsoholdsgoodforIndianPharmamanufacturers-withtheabsenceofpatentprotectionfor incremental improvements, there isnomotivationforIndianmanufacturerstoinvestinR&D.

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Incidentally,USPatentActhasasimilarclauseof“thresholdlimit”whichcheckspatentingonfrivolousgroundandeliminatesrepetitivepatenting.AsimilarjudgementwasgivenbyUSFederalCourtinthematterofAppealsinPfizervsApotexcasein2007.ThecourthadagreedwithApotexthatPfizer’spatentonthecompoundBesylate(asaltformofamlodipine)lackedthe“unexpectedsuperiorresults”fromthebasecompound(amlodipine),andhencecouldnotbepatented.(PfizerInc.v.ApotexInc.2007UnitedStatesCourtofAppeals,FederalCircuit).

With reference to the case mentioned above, Novartis v/s Union of India, it can be safelyconcludedthatIPregulationandenforcementinIndiaisnotatparwiththestandardsadoptedbythedevelopedworld.Whilewedosayso,thefactthatitcannotbecalledweakbyanystandardsadoptedalsoholdstrue.Theenforcementproblemdoesappearatcertaininstancesandtherearecasesofadelayinjudgementduetolongdrawnjudicialmatters.TheIPregulationinfactappearstobemorestringentascanbeseenfromthesection3(d)ofIndianPatentAct.Theproposition1thattheIndianIPregulationandenforcementisnotstrongandhasnegativeimpactoninnovationinIndianmanufacturingindustrydoesnotholdgoodastheregulationinIndiaisstrongerthaninUSandEUvis-a-visarticle3(d)ofIndianPatentact.However,thejudgementinthecaseofNovartisv/sUnionofIndiaisonlinesofsimilarjudgementinUSincaseofPfizerv/sApotex(2007).

ThecasedealswithhighcommercialvaluepatentinPharmaceuticalsectorwhichwouldhavegivencompanycompetitiveadvantageinIndianmarketsalsohaditbeengrantedinIndia.Novartisstill has been able to enforce its patents across 40 countries giving the company market power,providingincentivetoinnovate.Thustheproposition2thatPatentsinPharmaceuticalsectorsandinclusionofpatentsinSEPinICTwillprovideincentiveforinnovationinIndianmanufacturingindustryholdgoodinthiscase.

ThecaseshowsdirectlinkagesthatthelitigationprocessconsumestheprofitabilityofanewproductlaunchedonthebasisofPatentedtechnology.ItmayalsobekeptinmindthatlackofpatentprotectionforincrementalimprovementsisresultinginlackofincentiveforIndianmanufacturerstoinvestinR&D.Thustheproposition3thatthelitigationregardingpatenting(protection/infringement)isleadingtoreductioninInnovationinIndianmanufacturingindustrystandsgood.

With reference to thecasementionedaboveNovartisv/sUnionof India, it iscanbesafelyconcludedthat,astheCompetitionCommissionofIndiawasnotreferredtointhiscaseanditsroleneverwasidentified.Theproposition4thatCompetition/antitrustregulationarenotabletoresolveissuesregardinglicensing,whichishavinganegativeeffectonInnovationinmanufacturingindustryinIndiadoesnotholdgoodvis-a-viscasefactsofthecasebeingdiscussed.

Thecasedoesnotdirectly link to the licensing terms followedby thePatenteeand that thecompaniesarechargingdifferentlyfromdifferentlicensees.ThecasealsodoesnothaveanylinkstoRoyaltyratesforSEPinICTsectororinPharmasectorandforthatmatterdoesnottalkaboutanyroyaltyissues.Thus,theproposition5thatlicensingtermscompulsory/FRANDareprovingtobedetrimentalforinnovationinIndianManufacturingcompaniesisnotbeingprovedwithreferencetothecase.

ThoughthecasedoesnotdirectlylinkstotheR&DcapacityofIndianManufacturingsector,howeverwiththeobliquereferencethatinthecaseNovartisv/sUnionofIndiaprovidesreferencetotheIndianGenericsectorandthatNatcoPharmahadlaunchedagenericproductcalled“Veenat”atthefractionofthepriceofGlivecinIndia.However,Veenatwasagenericproductandnotanoriginalpatentedformulation.ItisthereforeclearthatlackofpatentprotectionforincrementalimprovementsisresultinginlackofincentiveforPharmamanufacturerstoinvestinR&DandthatiswhyIndianfirmshaverelativelylowinternalR&Dcapacity.Theproposition6thattheinternalR&DcapacityofIndianmanufacturingsectorislowwhichishavingadetrimentaleffectonInnovationinIndianmanufacturingsectorholdstrue.

The case does not directly link to the dependence of the Indian Manufacturing sector, ontechnologytransfer.However,weseethattheIndiancompanieslargelydependontechnologytransfer.

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Thus,theproposition7thattheincreaseintechnologytransferinformofLicensing,JV’sorFDIcanimproveinnovationinIndianmanufacturingsectorholdstrue.

ThiscasecoversthelengthylitigationprocesswhichNovartiswasabletotakeupduetoitsstrongfinancialbacking,asitisalargeMNCconglomerate.Thecompanywasabletosecurepatentprotectionin40countriesforitsGlivecdrug,howeverinspiteofitssuperiormarketpositionitwasnotabletogetapatentforitsdrugGlivecinIndia.Thecasehoweverdoesnottalkaboutpolicylevelissues.Thustheproposition8thattheIndianrepresentationinPolicymakingbodies(SSO)willleadtoincreaseininnovationinIndianmanufacturingsectordoesnotholdgood.

Natco Pharma Ltd v/s Bayer AG’s (Compulsory Licensing of “Sorafenib” Cancer drug)NatcoPharmaLtdhadappliedforCompulsoryLicenseformakingthegenericversionofthedrugNexavar,andinararecriteriontopromotecompetition,IndianpatentofficeissuedcompulsorylicenseinMarch2012toNatcoPharma,afterNatco’srequestforacommerciallicensetomanufactureNexavarwasrejectedbyBayer.TheIndianPatentAct(2005)providesprovisionofcompulsorylicensingunderarticle84wherebyanypersonmayseekthecompulsorylicenseonthefollowinggrounds:

1. Thepublicrequirementswithrespecttothepatentedinventionhasnotbeenmet;or2. Thepatentedinventionisnotavailabletothepublicatanaffordableprice;and3. ThepatentisnotbeingworkedinIndia.

Natcowasgiventhelicensetomakeandsell‘Nexavar’acancer-treatmentdrugatRs8800/-.ThelicensefeethatNatcowastopaytoBayerwasfixedat6%ofnetsales.ThedrugwasapatenteddrugofBayer (2008)andwassoldunder thenameof“Sorafenib”atapriceof INR2.8Lakhs.Otherthanthepricebeingexorbitantlyhigh,BayerwasnotmanufacturingthedruginIndiaandwasmarketingitafterimportsinIndiaandhencewasabletomeettherequirementonlyin2%ofcases.Thein-affectpricereductionpostthegrantofcompulsorylicensewasofthetuneof97%.BayerapproachedtheIntellectualPropertyAppellateBoard(IPAB)byfilinganappealagainstthegrantofcompulsorylicensetoNatco,whichwasdismissedbytheIPAB.ItthenwenttocourtandchallengedthedecisionofIPAB,howeverHighcourtupheldthedecisionofIPABinthismatter,thusBayerdidnotgetanyrespite.

This casebrought in focus theweakness of the Intellectual Property Regime in India. ThismoveonpartofIndianPatentofficewastakentotaketheinnovationtothelargestnumberofpeopleandtomaintainabalancebetweentherightsandobligationofpatentholder.However,intermsofincentiveforinnovationforthepatenteetheMNCPharmacompanieswhichwereinvolvedinseriousR&DhadhighsunkR&DcostsastheywouldbeunabletorecouptheirR&Dinvestment.ThisstephadanegativeimpactonR&DofdomesticPharmacompaniesasthismovewasseenaskillingthedomesticpipelineofresearch,andmakingthedomesticpharmacompaniespronetoacquisitionbyMNCastheyarebetterequippedtodealwithpricingandrevenuestrains.

WithreferencetothecasementionedaboveNatcov/sBayerregardingthecompulsorylicensegrantedtoNatcoforBayerAG’spatenteddrug“Sorafenib”.Itcanbeconcludedthat,theIPregulationandenforcementinIndiaisnotatparwiththestandardsadoptedbydevelopedworld.WhiletherewasnoinstanceofextremeurgencyornationalemergencythepleaadoptedbytheIndianPatentOfficewastopromotecompetitionandbuiltdomesticmanufacturingcapability.ThisinitselfpointstowardstheweaknessinregulationandenforcementinIndia.AweakIPsystemisdetrimentalforinnovation.Theproposition1thattheIndianIPregulationandenforcementisnotstrongandhasnegativeimpactonInnovationinIndianmanufacturingindustryholdgood.

ThecasedealswithhighcommercialvaluepatentinPharmaceuticalsectorwhichwouldhavegiventhecompanyacompetitiveadvantageinIndianmarkets,alsoenvisagedbyBayer.Moreover,Bayerhadreceived50%oftheamountspentonR&DfromUSgovernmentasthediseasewasdeclared

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‘Orphan’. Bayer’s patent was of high commercial value and it did provide the company marketpower,providingincentivetoinnovate.Thus,theproposition2ofpatentsinPharmaceuticalsectorsandinclusionofpatentsinSEPinICTprovidingincentiveforinnovationinIndianmanufacturingindustryholdstrueinthiscase.

ThecasedoesmentionthelitigationprocessthatBayerfirstwenttoIPABandthentoHighCourt,spendingtimeeffortandmoneyandeatingintotheprofitabilityofthepatentedtechnology.However,itsappealwasrejectedonbothcourts.Thus,theproposition3thatlitigationregardingpatenting(protection/infringement) is leadingtoreductionininnovationinIndianmanufacturingindustryholdstrue.

Withreferencetothecasementionedabove,Natcov/sBayer,itmaybenotedthatthecompulsorylicensewasgiventoNatcowiththepurposeofpromotingcompetition.AsBayerwasnotgivingvoluntarylicenseandwasunabletomeetthedemand,thepricingofdrugalsowasexorbitant.However,thecasedoesnottalkaboutresolvingissuesregardinglicensingthroughtheantitrustregulation.Theproposition4thatcompetition/antitrustregulationsarenotabletoresolveissuesregardinglicensing,whichishavinganegativeeffectoninnovationinmanufacturingindustryinIndia,doesnotholdgoodvis-a-viscasefacts.

ThecasetalksaboutthelicensingratewhichisbeingfixedbytheIndianPatentofficeinthecaseofcompulsorylicensing,andthisrateisnotundercontrolofthegranteeofthelicense.ThecasedoesreflectthatBayerwasnotsatisfiedwiththegrantofcompulsorylicensetoNatcoanda6%rateoflicensefeetobepaidtoBayer.NatcomayhavegotacompulsorylicensebutagrantofcompulsorylicenseatsuchlowlicensefeeishamperinginnovationinIndianmanufacturingsectors.Thus,theproposition5thatthecompulsorylicensingterms/FRANDareprovingtobedetrimentalforinnovationinIndianManufacturingcompaniesstandsgoodinthiscase.

ThoughthecasedoesnotdirectlylinktotheR&DcapacityofIndianManufacturingsector,ithowevermakesobliquereferencethatwhateverinternalcapacityIndianPharmamanufacturingsectormayhavehadwasalsoadverselyaffectedbythedecisionofIndianPatentOfficetograntCompulsorylicensetoNatco.ItisthereforeclearthatthisisresultinginlackofincentiveforPharmamanufacturerstoinvestinR&DandasaresultIndianfirmshavelowinternalR&Dcapacity.Theproposition6thatinternalR&DcapacityofIndianmanufacturingsectorislowwhichishavingadetrimentaleffectoninnovationinIndianmanufacturingsectorthusholdstrue.

The case brings to light the dependence of Indian Pharmaceutical manufacturing sector ontechnologytransferandlicensingfrommultinationalcompanies,aswhenNatcodidnotgetlicensefromBayeritappliedforcompulsorylicenseunderarticle84ofIndianPatentActwhichprovidesprovisionforthesame.Thus,theproposition7thatincreaseintechnologytransferintheformofLicensing,JV’sorFDIcanimproveinnovationinIndianmanufacturingsectordoesnotholdtrueinthiscase.

ThiscasedoesnotholdanyinclinationtowardsrepresentationinpolicymakingbodiessuchasSSO.Thus,theproposition8thattheIndianrepresentationinpolicymakingbodies(SSO)willleadtoincreaseininnovationinIndianmanufacturingsectordoesnotholdtrueinthiscase.

IMPLICATIoN ANd BRoAdER PERSPECTIVE FoR THE MANAGERS

Thesubjectmatterunderconsiderationisofgreatimportanceforthefutureofmanufacturingsetupinthecountry.Thequestionthatoneneedstoaskwhilewearetryingtoanalyseeachofthesecasesthreadbareisthatdowewantthebenefitsofinventiontoreachthosewhoneeditorthosewhocanpayforit.Frombusinessperspective,itdependsonthestandoneistaking.Theremightbeapossibilitythattheinnovatingcompanyistryingtogetmaximumroyalty/pricefortheirproductwhileontheotherhandtheremightbeapossibilitythatlicenseeistryingtosurviveincompetitiveRedOceanbybettingonlowerprice.Whiletryingtoforcemoralityonbusinessperspective,onemustneverlosesightofthecorebusinesspremise–makeprofit.

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However,fromapolicyperspectivewemustrealisethatthepolicymakershavetotakeaholisticview,andkeepintoconsiderationtheneedofmassesalongwiththeprofitabilityofinnovator,asthesystemofpatentismeantforprovidingincentivesforinnovation.WhiletodaywemayneedthedevelopedworldtomakeFDIinIndiawhichwillresultinsometechnologytransferandabsorption,onemustnotlosesightofthefactthatthisisdefinitelynotaonewayprocess,developednationsarealsogoingtohaveaccesstoourmarketsanditisnotasmallopportunityforthem.Asthemarketsindevelopedworldaregettingmatureandontheurgeofsaturation,theyfindgreatpotentialinAsiancountries.Emergingmarketsmustthereforebecarefulwhilenegotiating,tonotlosesightoflocalneedsbeforeopeningupfortheMNCplayers.

ThepaperhastriedtobuildconsensusthroughvariouscasestudiesthatIndianIPregulationandenforcementisnotstrongandhencehasnegativeimpactoninnovationinIndianmanufacturingindustry.Also,patentsinPharmaceuticalsectorsandinclusionofpatentsinSEPinICTwillprovideincentiveforinnovationinIndianmanufacturingindustry.Ifthereareanylitigationregardingpatenting(protection/infringement),itcertainlydiscouragesthenewinnovationtohappen.However,inIndiathe competition/antitrust regulations are not able to resolve issues regarding licensing, which ishavinganegativeeffectoninnovationinIndianmanufacturingindustry.Also,thelicensingtermscompulsory/FRANDareprovingtobedetrimentalforinnovationinIndianmanufacturingcompanies.

Moreover, companies don’t want to spend much money on the internal R&D capacitymanufacturing sector, which brings a detrimental effect on Innovation. However, an increase intechnologytransferintheformofLicensing,JV’sorFDIwillcertainlyimproveinnovationinIndianmanufacturingsector.Hence,anIndianrepresentationinPolicymakingbodies(SSO)willleadtoincreaseininnovationinIndianmanufacturingsector.

LIMITATIoNS ANd FUTURE SCoPE

Theissuesdealtwithinthepresentstudybroadlyincludedissuesrelatedtoinnovation,itsprotectionandexploitationformaximisingreturnsfortheinnovator.Thestudywasconductedwiththehelpof3caseswhichwerebrieflydiscussed,especiallyincontextofsomecommonfactorswhichwereseeninallthecases.Thoughwewereabletorepresentsomecommonfactors,thescopeofsomeofthefactorshoweverisveryvast.Somefactorsinrealworldintertwineandmaketheprocesscomplicated,especiallywhenwearedealingwithLaw,whetherintermsofthePatentAct,ortheCompetitionactorstillmorewhenitisrelatedtothecivilandcorporatelawdefiningthecompany’sactetc.Thejurisdictionofeachactanditsredressalsystem,e.g.IPABorCCI,attimesappeartobeoverlapping.Therewillalwaysbescopefor interpretation.Also,while thefactors identifiedmaychange, thealignmentofintentwiththatofGovernmentandallparticipatingagencies/stakeholdersmayormaynothappenandthescopeofsuchstudywillchange.Anotherlimitationofpresentstudywasthatwecarriedoutqualitativeanalysis;aquantitativestudyoftheseaspectscanbetakenupinfuture.

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Sanjay Dhir is an Assistant Professor in the area of Strategic Management at Department of Management Studies, IIT Delhi. He is a Fellow (PhD) from the Indian Institute of Management (IIM) Lucknow. He worked at Mahindra and Mahindra Ltd (Automotive), R&D Department, Nasik for three years. He has published several research papers in leading international journals including case studies at Richard Ivey School of Business, Western Ontario jointly distributed by Ivey and Harvard Business School. His research papers were presented and published as conference proceedings at several prestigious academic conferences such as Academy of Management (AoM), Academy of International Business (AIB), Strategic Management Society (SMS), Southern Management Association (SMA), International Simulation Conference of India (ISCI, IIT Mumbai) and Strategic Management Forum (SMF, IIM Lucknow). His major areas of interest are strategic management, joint ventures, innovation management, management of change and transformation, implementation strategy, and international strategy.

Swati Dhir is a Fellow of Indian Institute of Management (IIM) Lucknow and completed the Fellow Program in Management (FPM) in OB/HRM area in 2014. She is currently working as Assistant Professor in OB/HRM area at International Institute of Management New Delhi. Prior to this, she has worked as Assistant Professor at IIM Ranchi for 1.5 years. She is a B.Tech Textile Technology from UPTTI, Kanpur affiliated by Uttar Pradesh Technical University. She has also worked as Assistant Manager in Research and Development department at Abhishek Industries (Trident Group). She has published her research work in many national and international journals (Scopus and ABDC indexed) and attended various national and international conferences. Her teaching interest also includes organization structure and design, international human resource management, HR analytics and research methodology. Her research interests include diversity in organizations, work related attitudes, employee engagement, work role performance and employee loyalty. Her research contribution is also evident in the Editorial Review Board of “Amity Journal of Training & Development “- An International, Biannual, Refereed Journal of Training & Development. She has also been reviewer for various referred International journals and conferences like AOM and IHRM. She can potentially supervise PhD students and contribute towards Doctoral level courses on Advanced Research Methodology. She had contributed in various academic activities, being a member of PGDHRM program committee, admission committee and doctoral program committees at IIM Ranchi. Currently, she is the member of ACC (Academic Curriculum Committee) for PGSHRM program at IMI Delhi. She has guided number of students at post graduate and Doctorate level for Research projects and thesis. On the personal front, she is a happy, responsible and creative person with experience in voluntary social work like community teaching and guidance to students.