INTELLECTUAL PROPERTY RIGHTS

Term paper

TOPIC:

BIO-PIRACY OF TRADITIONAL KNOWLEDGE

SPECIAL EMPHASIS: THE NEEM TREE PATENT
CONTROVERSY

SUBMITTED TO: PROFESSOR R. ANITA RAO

SUBMITTED BY: SRIJIB MISRA

REGN NO. 1226109251

Page 1 of 14
 CONTENTS
TOPIC PAGE
1. OBJECTIVE OF THE PAPER 3

2. WHAT IS BIO-PIRACY 3

3. TRADITIONAL KNOWLEDGE DEFINED 3

4. MISAPPROPRIATIONS OF TRADITIONAL KNOWLEDGE 4

5. PROTECTING CODIFIED TRADITIONAL KNOWLEDGE 4

6. TRADITIONAL KNOWLEDGE DIGITAL LIBRARY 4

7. THE NEEM TREE CASE: PATENTING OF THE 6

AZADIRACHTA INDICA

8. THE NEEM TREE: PROPERTIES AND USES 6

9. FACTS OF THE CASE 9

10. ISSUES 10

11. ANALYSIS 11

12. JUDGMENT 12

13. WHAT CAN BE DONE AGAINST BIO-PIRACY 13

14. REFERENCES 14

BIO-PIRACY OF TRADITIONAL KNOWLEDGE

Page 2 of 14
Objective of the paper: The objective of this paper is to explain the concept of bio-piracy and
traditional knowledge and underline and emphasize the effects of patenting of the same with the
help of the landmark case of the Neem Tree or the Azadirachta Indica.

What is Bio-piracy?

Bio-piracy is a situation where indigenous knowledge of nature is exploited for

commercial gain with no compensation to the indigenous people themselves.
Detractors of utilization of natural knowledge such as Greenpeace claim these
practices contribute to inequality between developing countries rich in biodiversity,
and developed countries hosting companies which engage in bio-piracy.

Bio-prospecting is an umbrella term describing the discovery of new and useful

biological mechanisms, either with or without the help of indigenous knowledge, and
with or without compensation. In this way, bio-prospecting includes bio-piracy and
also includes the search for previously unknown compounds in organisms that have
never been used in traditional medicine.

Traditional Knowledge Defined:

Traditional knowledge has always been an easily accessible treasure and thus has been
susceptible to misappropriation. The traditional knowledge, particularly, related to the
treatment of various diseases has provided leads for development of biologically active
molecules by the technology rich countries. In other words, traditional knowledge is
being exploited for bio-prospecting. Also Traditional knowledge is often
misappropriated, because it is conveniently assumed that since it is in public domain,
communities have given up all claims over it. Traditional Knowledge includes both the
codified (documented) as well as non-codified information (not documented but may
be orally transmitted).

Bio-piracy of codified Indian traditional knowledge continues, since, this information

exists in regional languages, and there exists a language barrier due to which the patent
offices are unable to search this information as prior art, before granting patents.
Formulations used for the treatment of human ailments from traditional knowledge are
time-tested since they have been in practice for centuries. The reliability of the
traditional medicine systems coupled with the absence of such information with patent
Page 3 of 14
offices, provides an easy opportunity for interlopers for getting patents on these
therapeutic formulations derived from traditional medicine systems.

Misappropriations of Traditional Knowledge:

The grant of patents on non-patentable knowledge (related to traditional medicines),

which is either based on the existing traditional knowledge of the developing world, or
a minor variation thereof, has been causing a great concern to the developing world.
The case of the Neem Tree and several similar cases regarding the Basmati Rice and
Turmeric will illustrate the bio-piracy of traditional knowledge and in many of these
cases the country (India) had to fight for revocation of the granted patents, Revocation,
may not be a feasible option possible for all the patents taken on the traditional
knowledge since it involves huge costs and time.

Protecting Codified Traditional Knowledge:

Patent examiners, in the international patent offices, while examining the patentability
of any claimed subject matter, use available resources for searching the appropriate
non-patent literature sources. Patent literature, is usually wholly contained in several
distinctive databases and can be more easily searched and retrieved whereas non-
patent literature prior art is often buried somewhere in the many and diverse sources.
Therefore, a need was felt to create more easily accessible non-patent literature
databases on traditional knowledge of India.

Traditional Knowledge Digital Library (TKDL) - A tool for prevention of

misappropriations of traditional knowledge:

TKDL targets Indian Systems of Medicine, viz., Ayurveda, Unani, Siddha and Yoga
available in public domain. This is being documented by sifting and collating the
information on traditional knowledge from the existing literature existing in local
languages such as Sanskrit, Urdu, Arabic, Persian and Tamil in digitized format,
which will be available in five international languages which are English, German,
Spanish, French and Japanese. Traditional Knowledge Resource Classification (TKRC),
an innovative structured classification system for the purpose of systematic
arrangement, dissemination and retrieval was evolved for about 5,000 subgroups
against few subgroups available in International Patent Classification (IPC), related to
medicinal plants. The information is being structured under section, class, subclass,
group and subgroup as per the International Patent Classification (IPC) for the
convenience of its use by the international patent examiners. Information comprising
Page 4 of 14
about 2 lakh formulations has been transcribed for realizing the objective of TKDL
Project.

Each Sloka is read and converted into a structured language using Traditional
Knowledge Resource Classification by subject (Ayurveda, Unani, Siddha or Yoga)
experts. The codes are then filled into the data entry screen. The Slokas are also saved
in the database. The translated version of all the TKRC codes is ported in the database.
The abstraction is done by the subject experts. The codes once saved in meta data
directory are converted in different languages based on Unicode technology. The
formulations are presently being converted into English, German, French Japanese and
Spanish languages. The converted format of the formulation is readable and can be
understood by a layman though it is targeted towards a patent examiner.

TKDL software with its associated classification system i.e., TKRC converts text in
local languages into multiple languages as mentioned above. It may be noted that the
software does not transliterate, rather it does a knowledge-based conversion, where
data abstracted once is converted into several languages by using Unicode, Metadata
methodology. Software also converts traditional terminology into modern
terminology, for example, Jwar to fever, Turmeric to Curcumalonga, Mussorika to
small pox etc.

TKDL includes a search interface providing full text search and retrieval of traditional
knowledge information on IPC and keywords in multiple languages. The search
features include single or multiple word searches, complex Boolean expression search,
Proximity search, Field search, Phrase search, etc in the form of simple and advance
search options. Simple search lets the user search a combination of keywords.

Advance search lets the user search using Boolean expressions, using the expressions
like “near”, “and”, “and not”. Searches are also available on IPC and TKRC codes.

TKDL acts as a bridge between formulations existing in local languages and a Patent
Examiner at a global level, since the database will provide information on modern as
well as local names in a language and format understandable to Patent Examiners. It is
expected that the issue of the gap on lack of access to prior art traditional knowledge
shall get addressed.

Page 5 of 14
THE NEEM TREE CASE: PATENTING OF THE AZADIRACHTA INDICA

The Neem Tree: Properties and Uses

Azadirachta indica (Neem) is a tree in the mahogany family Meliaceae. It is one of two

species in the genus Azadirachta, and is native to India, Burma, Bangladesh, Sri
Lanka, Malaysia and Pakistan, growing in tropical and semi-tropical regions. Other
vernacular names include Neem (Hindi, Urdu), Nim (Bengali), Nimm (Punjabi), Arya
Veppu (Malayalam), Azad Dirakht (Persian), Nimba (Sanskrit, Oriya), Kadu-Limba
(Marathi), DogonYaro (in some Nigerian languages), Margosa, Neeb (Arabic),
Nimtree, Vepu, Vempu, Vepa (Telugu), Bevu (Kannada), Kohomba (Sinhala), Vembu
(Tamil), Tamar (Burmese), Paraiso (Spanish), and Indian Lilac (English). In East Africa
it is also known as Muarubaini (Swahili), which means the tree of the 40, as it is said to
treat 40 different diseases.

Neem is a fast-growing tree that can reach a height of 15–20 m (about 50–65 feet),

rarely to 35–40 m (115–131 feet). It is evergreen, but in severe drought it may shed
most or nearly all of its leaves. The branches are wide spread. The fairly dense crown
is roundish or oval and may reach the diameter of 15–20 m in old, free-standing
specimens.

In India, the tree is variously known as "Sacred Tree," "Heal All," "Nature's Drugstore,"
"Village Pharmacy" and "Panacea for all diseases." Products made from neem tree have
been used in India for over two millennia for their medicinal properties: Neem
products have been observed to be anthelmintic,
antifungal, antidiabetic, antibacterial, antiviral, contraceptive andsedative. Neem
products are also used in selectively controlling pests in plants. It is considered a major
component in Ayurvedic and Unani medicine and is particularly prescribed for skin
disease.

 All parts of the tree are said to have medicinal properties (seeds, leaves,
flowers and bark) and are used for preparing many different medical
preparations.

 Part of the Neem tree can be used as a spermicide.

 Neem oil is used for preparing cosmetics (soap, shampoo, balms and creams,
for example Margo soap), and is useful for skin care such as acne treatment,
Page 6 of 14
 and keeping skin elasticity. Neem oil has been found to be an effective
mosquito repellent.

 Neem derivatives neutralise nearly 500 pests worldwide, including insects,

mites, ticks, and nematodes, by affecting their behaviour and physiology.
Neem does not normally kill pests right away, rather it repels them and
affects their growth. As neem products are cheap and non-toxic to higher
animals and most beneficial insects, they are well-suited for pest control in
rural areas.

 Besides its use in traditional Indian medicine, the neem tree is of great
importance for its anti-desertification properties and possibly as a good
carbon dioxide sink.

 Practitioners of traditional Indian medicine recommend that patients

suffering from chicken pox sleep on neem leaves.

 Neem gum is used as a bulking agent and for the preparation of special
purpose food (for diabetics).

 Aqueous extracts of neem leaves have demonstrated significant antidiabetic

potential.

 Traditionally, slender neem branches were chewed in order to clean one's

teeth. Neem twigs are still collected and sold in markets for this use, and in
India one often sees youngsters in the streets chewing on neem twigs.

 A decoction prepared from neem roots is ingested to relieve fever in

traditional Indian medicine.

 Neem leaf paste is applied to the skin to treat acne, and in a similar vein is
used for measles and chicken pox sufferers.

 Neem blossoms are used in Andhra Pradesh, Tamil Nadu and Karnataka to

prepare Ugadi pachhadi. "Bevina hoovina gojju" (a type of curry prepared
with neem blossoms) is common in Karnataka throughout the year. Dried
blossoms are used when fresh blossoms are not available. In Tamilnadu,
a rasam (veppam poo rasam) made with neem blossoms is a culinary

Page 7 of 14
 speciality.

 A mixture of neem flowers and bella (jaggery or unrefined brown sugar) is

prepared and offered to friends and relatives, symbolic of sweet and bitter
events in the upcoming new year.

Extract of neem leaves is thought to be helpful as malaria prophylaxis despite the fact

that no comprehensive clinical studies are yet available. In several cases, private
initiatives inSenegal were successful in preventing malaria. However, major NGOs
such as USAID are not supposed to use neem tree extracts unless the medical benefit
has been proved with clinical studies.

Neem is deemed very effective in the treatment of scabies, although only preliminary
scientific proof, which still has to be corroborated, exists, and is recommended for
those who are sensitive to permethrin, a known insecticide which might be an irritant.
Also, the scabies mite has yet to become resistant to neem, so in persistent cases neem
has been shown to be very effective. There is also anecdotal evidence of its
effectiveness in treating infestations of head lice in humans. A tea made of boiled neem
leaves, sometimes combined with other herbs such as ginger, can be ingested to fight
intestinal worms.

The oil is also used in sprays against fleas for cats and dogs.

FACTS OF THE CASE:

For centuries the Western world ignored the neem tree and its properties: the practices
of Indian peasants and doctors were not deemed worthy of attention by the majority of
British, French and Portuguese colonialists. However, in the last few years, growing
opposition to chemical products in the West in particular to pesticides, has led to a
sudden enthusiasm for the pharmaceutical properties of neem.

In 1971, US timber importer Robert Larson observed the tree's usefulness in India and
began importing neem seed to his company headquarters in Wisconsin. Over the next
decade he conducted safety and performance tests upon a pesticidal neem extract
called Margosan-O and in 1985 received clearance for the product from the US
Environmental Protection Agency (EPA). Three years later he sold the patent for the
product to the multinational chemical corporation, W R Grace and Co. Since 1985, over
a dozen US patents have been taken out by US and Japanese firms on formulae for
Page 8 of 14
stable neem-based solutions and emulsions and even for a neem-based toothpaste. At
least four of these are owned by W R Grace, three by another US company, the Native
Plant Institute, and two by the Japanese Terumo Corporation.

Having garnered their patents and with the prospect of a licence from the EPA, Grace
has set about manufacturing and commercialising their product by establishing a base
in India. The company approached several Indian manufacturers with proposals to
buy up their technology or to convince them to stop producing value-added products
and instead supply the company with raw material.

In many cases, Grace met a rebuff. M N Sukhatme, Director of Herringer Bright

Chemicals Pvt. Ltd, which manufactures the neem-based insecticide Indiara, was put
under pressure by Grace to sell the technology for a storage-stable neem extract, which
does not require heating or any chemical change. Sukhatme refused their offers,
stating: 'I am not interested to commercialise the product.'

But Grace eventually managed to arrange a joint venture with a firm called P J Margo
Pvt. Ltd. They are now setting up a plant in India which will process neem seed for
export to the US. Initially, the plant will process 20 tons of seed a day. They are also
setting up a network of neem seed suppliers, to ensure a constant supply of the seeds
and a reliable price. Grace is likely to be followed by other patent-holding companies.
In 1992, the US National Research Council published a report designed to 'open up the
Western world's corporate eyes to the seemingly endless variety of products the tree
might offer'.

During 1994, Indian farmers staged one mass demonstration after another against the
proposed GATT Uruguay Round agreement. In March about 200,000 gathered in Delhi
demanding, among other things, that the draft treaty - known colloquially as 'the
Dunkel draft' after chief negotiator, Arthur Dunkel - should be translated into all
Indian languages. On 2nd October, about half a million converged upon Bangalore to
voice their fears about the impending legislation, aware of the threat that GATT poses
to their livelihoods, by allowing multinational organisations to enter Third World
markets at their expense.

In particular, many of them began to question the Dunkel Draft's call for an
international harmonisation of property rights legislation. In their demonstrations,
protesters carried twigs or branches of neem, a tree found throughout the drier areas of
India.

Page 9 of 14
Several extracts of neem have recently been patented by US companies, and many
farmers are incensed at what they regard as intellectual piracy. The village neem tree
has become a symbol of Indian indigenous knowledge, and of resistance against
companies, which would expropriate this knowledge for their own profit.

ISSUES:

The legal case regarding Grace's patent on extracting and stabilising azadirachta indica
is still pending at the US Commissioner of Patents and Trademarks. The concern is
whether the process patented is sufficiently new and novel. In its Request for Re-
examination, the coalition states that there is enough evidence to the claim of 'prior art'
outside the US (in India).  It also claims prior art inside the US. In its request, the
coalition sums up proof for 'prior art' in an attempt to get the patent revoked. 
Firstly, the coalition claims the patented process has already been used by Indian
farmers for many centuries. However, when Grace states that their method differs
substantially from the method used by Indian farmers, they may have a point.
Traditionally, the farmers have used water as solvent for the extracted oil from the
neem seeds. The protic solvent cannot stabilize the azadirachtin for a long time. This is
not a problem because the product is used within a few days of production. Therefore
there is no immediate need for a process of stabilizing the extract. The need for extract
preservation only arises in case of mass production for broader and distant export
markets. 
Secondly, the coalition claims the knowledge for the process patented was already
available in India and elsewhere. The properties of the neem tree as pesticide and
insecticide were discovered by Indian scientists decades ago. "The treatment of neem
seeds with aprotic solvents has been used since the 1950's, and scientists had prepared neem
seed extracts with the same solvents that W.R. Grace used in its patent, and solvents similar to
those identified by W.R. Grace, years before the company's earliest efforts". The coalition
points out that much of the research and experimentation has been conducted by
smallscale organizations which have no interest in or capability of using foreign
patents. This foreign knowledge as prior art is supported by several letters from
foreign scientists. 
Thirdly, the coalition claims that the process patented was not new and novel from a
domestic point of view. In their request, they presented many scientific publications to
prove that the knowledge of the use of protic solvents in stabilizing organic material
was publicly accessible. They also presented letters from US based scientists who state
Page 10 of 14
that 'no new novel chemistry was discovered' and that the process patented makes
'only trivial changes to known products and processes'. 

ANALYSIS:

The crux of this case lies on the fact that, the company W.R.Grace, tried to patent such
a subject which was widely known in a country for ages. The knowledge was so
common that nobody even thought of patenting the properties of the Neem tree. Now,
granting the patent puts a stoppage to using neem products which have been
developed from generations by the local people of India. This affected many
businesses dealing in neem products. Also, after the patenting, commercial production
began in the US. This resulted in an increased demand for neem seeds, which pushes
the prices of neem seeds from Rs. 300/kg to Rs. 3000-Rs. 4000/kg in India.

These were the adverse effects that occurred in the country to which the tree is a
native.

The company’s arguments were not completely baseless. They argued that they did
not patent the product, but the process, which was true. But there was nothing new in
what they did. They just changed the solvent by replacing water which was the basic
solvent in all earlier Neem products. Hence, the novelty factor for granting patents was
not satisfied.

Further it completely violated the “prior art” or traditional knowledge concept, as it

was proven beyond doubt that neem was known for its medicinal and other properties
for millennia as its record exists in vedic texts and other manuscripts.

Last, but not the least, the granting of the patent adversely affected the livelihood of
thousands of people who were engaged in the business of producing and selling
indigenous neem products.

The decision to overturn and revoke the patent was fair and just, as the patent denied
the basic premise of attaining a patent i.e. fair and equitable distribution of benefits.

JUDGMENT:

Page 11 of 14
The bench took into consideration the defences of both the plaintiff coalition and the
defendant company, and came to the conclusion that the case indeed constitutes bio-
piracy. The patent was not novel as the product was used for ages. Indians knew the
benefits of the neem tree for generations and thus it constituted traditional knowledge.
Furthermore, traditional knowledge is an exclusion to patenting according to
international patent laws as laid down in the Paris Convention of 1883.

Thus, the patent was revoked in the year 2000. Although, the defendants challenged
the decision in 2001, it was overturned once again in 2005.

What can be done against Biopiracy ?

At the community level, to document the traditional knowledge of plant products has
many benefits. This may include traditional consumer protection against false claims
about the so-called 'new' products, processes and uses. 

Secondly, we need new laws to provide adequate protection in the traditional resource
use by people with few resources. There are international organizations that are
working in this direction, such as the World Intellectual Property Organization of the
United Nations. 

Biodiversity is a matter of life or death for plants and animals. Bio-piracy may or may
not harm biodiversity, but it certainly hurt the chances of sharing in a fair and
equitable sharing of the benefits of using natural products. In some cases, bio-piracy
can mean life or death for local communities.

Page 12 of 14
REFERENCES :
1. The benefits of Neem Tree:

http://www.ehow.com/about_5061344_benefits-neem-tree.html

2. http://en.wikipedia.org/wiki/Commercialization_of_traditional_medicines

3. Salient features of the case:

http://www.twnside.org.sg/title/pir-ch.htm

4. Additional Reading Material provided for the subject

Page 13 of 14
Page 14 of 14