Bayer gets rare Monsanto reprieve with cotton seed ruling
Good news for Bayer, bad news for India...
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Bayer gets rare Monsanto reprieve with cotton seed ruling
By Upmanyu Trivedi and Vrishti Beniwal
Bloomberg, 8 January 2019
https://www.bloomberg.com/news/articles/2019-01-08/india-court-rules-monsanto-s-patent-claim-on-cotton-seeds-valid
* India’s Supreme Court rules patent on Bt cotton remains valid
* Ruling overturns a lower court’s verdict on GMO seeds
Bayer AG’s Monsanto unit won a legal battle to own patents on genetically-modified cotton seeds in India, the world’s biggest producer of the fiber, in a rare piece of good news for the German company.
India’s Supreme Court ruled on Tuesday that the company’s patent for Bt cotton seeds is valid, overturning a judgment by the High Court of Delhi saying certain items such as seeds, plants, and animals can’t be patented.
The ruling is a boost for Monsanto, which faced the risk of losing revenues without a claim over exclusive rights in India, as the company faces legal challenges in the U.S. over allegations that its Roundup weed killer can cause cancer as well as a backlash in Europe over genetically modified organisms. The verdict may also boost foreign investors’ confidence about the validity of patents awarded to firms in India.
“Pirates cannot be innovators,” said Ashok Gulati, a professor at the Indian Council for Research on International Economic Relations in New Delhi. “If we are to respect intellectual property only then we can expect to access the best technologies in the world.”
The ruling may prompt some biotech companies to revive expansion plans that were placed on hold amid restrictions imposed by the government and local courts in recent years.
The high court’s ruling “essentially means that the patent is in force”, said a spokesman for Bayer in India. Shares of the German company rose 2.2 percent to 65.39 euros in Frankfurt trading.
Shares of Kaveri Seed Co. erased gains to drop as much as 3.6 percent on Tuesday, while Monsanto India Ltd. jumped as much as 14 percent in high volumes after the verdict.
Seed Fees
The apex court’s two-judge bench, headed by Justice Rohinton F. Nariman, said a lower court will decide if Indian companies infringed Monsanto’s patent on Bt cotton seeds.
The ruling is the result of years of legal battles between Monsanto and domestic seed companies, led by Nuziveedu Seeds Ltd. The Indian firm, one of the licensees of the U.S. company’s seeds in India, had petitioned in the court to cancel Monsanto’s patent. Monsanto had lodged counter cases for patent infringements by Indian companies.
Local seed firms, which get licenses from Monsanto to sell genetically-modified seeds, pay a “trait fee” fixed by the government. They had argued that the U.S. company was not entitled to get any more money from them. India cut the fee on Monsanto’s cotton seeds last year to 39 rupees ($0.56) per 450-gram pack from 49 rupees. About 50 million packs of GM cotton seeds are produced each year in India, according to the National Seed Association of India.
— With assistance by Pratik Parija and Marthe Fourcade