{"id":561,"date":"2026-09-21T08:14:10","date_gmt":"2026-09-21T08:14:10","guid":{"rendered":"https:\/\/billionpreet.com\/blog\/?p=561"},"modified":"2026-09-21T08:14:10","modified_gmt":"2026-09-21T08:14:10","slug":"what-is-compulsory-licensing-in-india-section-84-patents-act-explained","status":"publish","type":"post","link":"https:\/\/billionpreet.com\/blog\/what-is-compulsory-licensing-in-india-section-84-patents-act-explained\/","title":{"rendered":"What Is Compulsory Licensing in India? | Section 84 Patents Act Explained"},"content":{"rendered":"\n

Patent law gives inventors and patent holders exclusive rights over their inventions. However, patent rights in India are not absolute<\/strong>.<\/p>\n\n\n\n

In certain circumstances, Indian patent law allows a third party to use a patented invention without the voluntary consent of the patent holder<\/strong>. This legal mechanism is known as compulsory licensing<\/strong>.<\/p>\n\n\n\n

Compulsory licensing is designed to balance patent protection, innovation and public interest<\/strong>, particularly where a patented invention is not adequately available to the public, is not reasonably affordable, or has not been sufficiently worked in India.<\/p>\n\n\n\n

One of the most important examples of compulsory licensing in India is the Natco Pharma Ltd. v. Bayer Corporation<\/strong> dispute concerning the cancer drug Nexavar.<\/p>\n\n\n\n

This article explains compulsory licensing in India<\/strong>, the relevant provisions of the Patents Act, 1970<\/strong>, the requirements under Section 84<\/strong>, the Bayer-Natco case, government use of patents, and the relationship between Indian patent law and the TRIPS Agreement<\/strong>.<\/p>\n\n\n\n

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What Is Compulsory Licensing?<\/h2>\n\n\n\n

A compulsory licence<\/strong> is a statutory authorisation that permits a person or entity to use or exploit a patented invention without obtaining a voluntary licence from the patent holder.<\/p>\n\n\n\n

The patent itself is not cancelled<\/strong>.<\/p>\n\n\n\n

Instead, the patent continues to remain in force while the authorised person receives a legal right to exploit the patented invention subject to the terms and conditions imposed under the law.<\/p>\n\n\n\n

The principal provisions relating to compulsory licensing are contained in Sections 84 to 92 of the Patents Act, 1970<\/strong>.<\/p>\n\n\n\n

In simple terms:<\/p>\n\n\n\n

Patent remains valid + statutory conditions are satisfied + third party receives permission to use the invention = Compulsory Licence.<\/strong><\/p>\n\n\n\n

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Why Does India Allow Compulsory Licensing?<\/h1>\n\n\n\n

Patent protection is intended to encourage innovation by granting inventors exclusive rights for a limited period.<\/p>\n\n\n\n

At the same time, patent law recognises that inventions can have significant social and economic importance.<\/p>\n\n\n\n

A patented invention may involve:<\/p>\n\n\n\n

    \n
  • Life-saving medicines;<\/li>\n\n\n\n
  • Medical technologies;<\/li>\n\n\n\n
  • Essential technologies;<\/li>\n\n\n\n
  • Industrial products;<\/li>\n\n\n\n
  • Public-health-related inventions; or<\/li>\n\n\n\n
  • Other inventions with substantial public importance.<\/li>\n<\/ul>\n\n\n\n

    If an invention is patented but is not sufficiently available to the public, the law provides mechanisms through which the public interest can potentially be protected.<\/p>\n\n\n\n

    Therefore, compulsory licensing seeks to maintain a balance between:<\/p>\n\n\n\n

    Private Patent Rights \u2194 Public Interest<\/strong><\/p>\n\n\n\n

    \n\n\n\n

    Section 84 of the Patents Act: When Can a Compulsory Licence Be Granted?<\/h1>\n\n\n\n

    Section 84 of the Patents Act, 1970<\/strong> is the principal provision dealing with applications for compulsory licences.<\/p>\n\n\n\n

    A person interested<\/strong> may apply for a compulsory licence after the expiry of three years from the grant of the patent<\/strong>, subject to the statutory requirements.<\/p>\n\n\n\n

    The applicant must establish the relevant statutory grounds.<\/p>\n\n\n\n

    Broadly, a compulsory licence may be considered where:<\/p>\n\n\n\n

      \n
    1. The reasonable requirements of the public have not been satisfied;<\/strong><\/li>\n\n\n\n
    2. The patented invention is not available to the public at a reasonably affordable price; or<\/strong><\/li>\n\n\n\n
    3. The patented invention has not been worked in the territory of India.<\/strong><\/li>\n<\/ol>\n\n\n\n

      These conditions are central to understanding compulsory licensing under Indian patent law.<\/p>\n\n\n\n

      \n\n\n\n

      What Does \u201cReasonably Affordable Price\u201d Mean?<\/h1>\n\n\n\n

      The Patents Act does not simply ask whether a patented product has a high price in absolute terms.<\/p>\n\n\n\n

      The relevant question is whether the patented invention is available to the public at a reasonably affordable price<\/strong>, taking into account the circumstances contemplated by the statute.<\/p>\n\n\n\n

      This issue can become particularly significant in the pharmaceutical sector.<\/p>\n\n\n\n

      For example, where a patented medicine is important for treating a serious disease but its price makes it inaccessible to a substantial section of the population, the affordability requirement may become relevant to a compulsory-licensing application.<\/p>\n\n\n\n

      The objective is not simply to penalise a patent holder for charging a particular price.<\/p>\n\n\n\n

      Rather, the statutory framework requires consideration of public access, affordability and the circumstances surrounding the patented invention.<\/strong><\/p>\n\n\n\n

      \n\n\n\n

      What Does \u201cWorking of a Patent in India\u201d Mean?<\/h1>\n\n\n\n

      Another important ground under Section 84 concerns whether the patented invention has been worked in the territory of India<\/strong>.<\/p>\n\n\n\n

      The concept of working is relevant because patent law is not concerned only with granting exclusive rights.<\/p>\n\n\n\n

      It also considers whether the patented invention is being sufficiently exploited or made available in the Indian market in accordance with the statutory framework.<\/p>\n\n\n\n

      Whether a patent has been adequately worked is a fact-specific legal question<\/strong> and can depend upon the nature of the invention, market circumstances, availability, manufacturing arrangements and other relevant evidence.<\/p>\n\n\n\n

      \n\n\n\n

      Bayer-Natco Compulsory Licensing Case<\/h1>\n\n\n\n

      One of the most significant compulsory licensing cases in India is:<\/p>\n\n\n\n

      Natco Pharma Ltd. v. Bayer Corporation<\/strong><\/h3>\n\n\n\n

      The dispute concerned Bayer’s patented cancer medicine sorafenib tosylate<\/strong>, marketed under the brand name Nexavar<\/strong>.<\/p>\n\n\n\n

      Natco Pharma applied for a compulsory licence under Section 84 of the Patents Act, 1970<\/strong>.<\/p>\n\n\n\n

      The Controller ultimately granted the compulsory licence, and the matter was subsequently considered in appellate and judicial proceedings.<\/p>\n\n\n\n

      The case became a major reference point in Indian patent law because the authorities examined the statutory requirements concerning:<\/p>\n\n\n\n

        \n
      • Reasonable requirements of the public;<\/li>\n\n\n\n
      • Reasonably affordable pricing; and<\/li>\n\n\n\n
      • Working of the patented invention in India.<\/li>\n<\/ul>\n\n\n\n
        \n\n\n\n

        Why Is the Bayer-Natco Case Important?<\/h1>\n\n\n\n

        The Bayer-Natco dispute demonstrated that compulsory licensing is not merely a theoretical provision in the Patents Act<\/strong>.<\/p>\n\n\n\n

        The case showed how Section 84 could operate in practice when an applicant alleged that the statutory requirements for access to a patented invention had not been satisfied.<\/p>\n\n\n\n

        The case also attracted considerable attention because it involved a patented pharmaceutical product and raised broader questions concerning:<\/p>\n\n\n\n

        Patent rights vs. access to essential medicines.<\/strong><\/p>\n\n\n\n

        The case continues to be an important reference point when discussing compulsory licensing in India.<\/p>\n\n\n\n

        \n\n\n\n

        What Is Section 90 of the Patents Act?<\/h1>\n\n\n\n

        Where a compulsory licence is granted, Section 90<\/strong> provides guidance concerning the terms and conditions of the licence.<\/p>\n\n\n\n

        The Controller may consider various factors, including:<\/p>\n\n\n\n

          \n
        • The nature of the invention;<\/li>\n\n\n\n
        • The applicant’s ability to work the invention;<\/li>\n\n\n\n
        • The price of the patented product;<\/li>\n\n\n\n
        • The need to make the patented invention available to the public;<\/li>\n\n\n\n
        • Reasonable remuneration to the patent holder; and<\/li>\n\n\n\n
        • Other statutory considerations.<\/li>\n<\/ul>\n\n\n\n

          Therefore, compulsory licensing does not mean that the patent holder automatically loses all economic rights.<\/p>\n\n\n\n

          The statutory framework seeks to balance:<\/p>\n\n\n\n

          Public Access + Patent Holder’s Remuneration<\/strong><\/p>\n\n\n\n

          \n\n\n\n

          Does a Compulsory Licence Cancel the Patent?<\/h1>\n\n\n\n

          No.<\/strong><\/p>\n\n\n\n

          This is an important distinction.<\/p>\n\n\n\n

          A compulsory licence does not ordinarily cancel or invalidate the patent itself<\/strong>.<\/p>\n\n\n\n

          The patent continues to exist, but another party receives statutory permission to exploit the patented invention under specified conditions.<\/p>\n\n\n\n

          Therefore:<\/p>\n\n\n\n

          Patent Cancellation<\/h3>\n\n\n\n

          The patent itself is removed or invalidated.<\/p>\n\n\n\n

          Compulsory Licensing<\/h3>\n\n\n\n

          The patent remains in force, but another person is legally permitted to use the invention under the terms of the compulsory licence.<\/p>\n\n\n\n

          These are legally different mechanisms.<\/p>\n\n\n\n

          \n\n\n\n

          Compulsory Licensing vs Patent Invalidation<\/h1>\n\n\n\n
          Compulsory Licensing<\/th>Patent Invalidation<\/th><\/tr><\/thead>
          Patent generally continues to exist<\/td>Patent may be cancelled or held invalid<\/td><\/tr>
          Third party receives authorised use<\/td>Patent rights are removed or denied<\/td><\/tr>
          Patent holder may receive remuneration<\/td>Consequences depend on the invalidity proceedings<\/td><\/tr>
          Governed by specific statutory conditions<\/td>Based on grounds challenging patent validity<\/td><\/tr>
          Focus can include public access<\/td>Focuses on validity of the patent<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

          Understanding this distinction is essential when analysing patent disputes.<\/p>\n\n\n\n

          \n\n\n\n

          Section 92: Compulsory Licensing in Public Emergency<\/h1>\n\n\n\n

          The Patents Act also provides a special mechanism under Section 92<\/strong> for compulsory licensing in certain circumstances involving:<\/p>\n\n\n\n

            \n
          • National emergency;<\/li>\n\n\n\n
          • Extreme urgency; or<\/li>\n\n\n\n
          • Public non-commercial use.<\/li>\n<\/ul>\n\n\n\n

            This provision operates differently from the ordinary Section 84 mechanism.<\/p>\n\n\n\n

            The importance of Section 92 becomes particularly apparent where a public-health crisis or other emergency creates an urgent need for access to a patented invention.<\/p>\n\n\n\n

            The provision is therefore part of the broader framework through which Indian patent law addresses exceptional public-interest circumstances<\/strong>.<\/p>\n\n\n\n

            \n\n\n\n

            Government Use of Patents Under Indian Law<\/h1>\n\n\n\n

            Compulsory licensing should also be distinguished from government use or government exploitation of patented inventions<\/strong>.<\/p>\n\n\n\n

            The Patents Act contains separate provisions dealing with government use, including Sections 100 to 102<\/strong>.<\/p>\n\n\n\n

            These provisions provide mechanisms under which the government may use or acquire rights concerning patented inventions in circumstances recognised by the statute.<\/p>\n\n\n\n

            Therefore, the following concepts should not be treated as identical:<\/p>\n\n\n\n

              \n
            • Section 84 compulsory licensing;<\/li>\n\n\n\n
            • Section 92 emergency compulsory licensing; and<\/li>\n\n\n\n
            • Government use under Sections 100\u2013102.<\/li>\n<\/ul>\n\n\n\n

              Each operates within its own statutory framework.<\/p>\n\n\n\n

              \n\n\n\n

              Compulsory Licensing and International Patent Law<\/h1>\n\n\n\n

              India’s compulsory licensing framework also operates within the international intellectual-property system.<\/p>\n\n\n\n

              The TRIPS Agreement<\/strong>, particularly Article 31<\/strong>, permits WTO member countries to authorise the use of patented inventions without the authorisation of the patent holder, subject to specified conditions.<\/p>\n\n\n\n

              This is an important principle because international patent law recognises that patent protection can coexist with legitimate public-interest measures.<\/p>\n\n\n\n

              \n\n\n\n

              Doha Declaration on TRIPS and Public Health<\/h1>\n\n\n\n

              The Doha Declaration on the TRIPS Agreement and Public Health<\/strong>, adopted in 2001, further addressed the relationship between intellectual property rights and public health.<\/p>\n\n\n\n

              The Declaration affirmed the ability of WTO members to take measures to protect public health and promote access to medicines while implementing their obligations under the TRIPS framework.<\/p>\n\n\n\n

              This international context is particularly relevant when discussing compulsory licensing of pharmaceutical patents.<\/p>\n\n\n\n

              \n\n\n\n

              Is Compulsory Licensing Against Patent Rights?<\/h1>\n\n\n\n

              Not necessarily.<\/p>\n\n\n\n

              Compulsory licensing does not eliminate the patent system or automatically remove the rights of patent holders.<\/p>\n\n\n\n

              Instead, it operates as a statutory exception to exclusive patent rights<\/strong> in circumstances specifically recognised by law.<\/p>\n\n\n\n

              A compulsory licence is not automatically granted merely because:<\/p>\n\n\n\n

                \n
              • A product is expensive;<\/li>\n\n\n\n
              • A person wants to use the invention;<\/li>\n\n\n\n
              • The patent is commercially successful; or<\/li>\n\n\n\n
              • There is public demand.<\/li>\n<\/ul>\n\n\n\n

                The applicant must satisfy the applicable statutory requirements and the competent authority must consider the relevant circumstances.<\/p>\n\n\n\n

                \n\n\n\n

                What Are the Key Requirements for Compulsory Licensing in India?<\/h1>\n\n\n\n

                For an ordinary application under Section 84<\/strong>, the following points are particularly important:<\/p>\n\n\n\n

                1. Three-Year Requirement<\/h3>\n\n\n\n

                The application generally becomes available after three years from the grant of the patent<\/strong>.<\/p>\n\n\n\n

                2. Applicant Must Be a Person Interested<\/h3>\n\n\n\n

                The applicant must fall within the statutory framework governing who can apply.<\/p>\n\n\n\n

                3. Statutory Ground Must Be Established<\/h3>\n\n\n\n

                The applicant must establish one or more of the relevant grounds under Section 84.<\/p>\n\n\n\n

                4. Evidence Is Important<\/h3>\n\n\n\n

                The applicant should support the allegations concerning availability, affordability, public requirements or working of the patent with appropriate evidence.<\/p>\n\n\n\n

                5. Terms of Licence Matter<\/h3>\n\n\n\n

                If a licence is granted, the Controller may impose appropriate terms and conditions under the statutory framework.<\/p>\n\n\n\n

                \n\n\n\n

                Compulsory Licensing in Pharmaceutical Patents<\/h1>\n\n\n\n

                Compulsory licensing is particularly important in discussions concerning pharmaceutical patents and access to medicines<\/strong>.<\/p>\n\n\n\n

                A patented medicine may involve substantial research and development expenditure. At the same time, medicines can be essential to public health.<\/p>\n\n\n\n

                This creates a complex legal and policy balance between:<\/p>\n\n\n\n

                Innovation + Investment + Patent Protection<\/strong><\/p>\n\n\n\n

                and<\/p>\n\n\n\n

                Affordability + Availability + Public Health<\/strong><\/p>\n\n\n\n

                The Indian compulsory licensing framework attempts to address this balance through statutory requirements rather than treating either patent rights or public access as absolute.<\/p>\n\n\n\n

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