India should aim for patent box regime: Industry
Hyderabad: India is labelled as the preeminent pharmacy of the world, but the nation also should be known as the innovator of the world. When you want to create value, it starts with a patent and IP culture should be incentivised, and that’s why India should create a patent box regime, point out experts. A […]
Hyderabad: India is labelled as the preeminent pharmacy of the world, but the nation also should be known as the innovator of the world. When you want to create value, it starts with a patent and IP culture should be incentivised, and that’s why India should create a patent box regime, point out experts.
A patent box regime, also referred to as intellectual property (IP) regime, basically taxes business income earned from IP at a rate below the statutory corporate income tax rate, aiming to encourage research and development.
Speaking at a BioAsia panel session on Friday, Kiran Mazumdar Shaw, executive chairperson, Biocon Group, said, “We need to come up with patent box policies. A patent box tax regime ought to allow any income derived out of those patents to have some kind of tax benefits. Many countries in the world offer a ten-year 10 per cent patent box tax regime. If that can be done, India would heavily invest in patent culture and patent-led innovation which is really the need of the hour.”
“The second option is how to make the academia-industry linkage happen. For this, if you were to give a weighted tax deduction on the industry in establishing a tangible presence within an academic centre where the scientists of an academic centre work, where the costs are borne in that research lab and if that can be captured as a weighted tax deduction, you will start creating linkages with academia,” she added.
Also, because of the lack of a patent regime, a number of Indian companies park their IPs in other patent-friendly countries where they get the patent regime box benefits. Shaw noted, “If we had an attractive patent box benefit in India, other countries would also come to India and take it to the next level.”
Sharvil Patel, MD, Zydus Cadila, said, “We need to reward innovation through some form of fiscal measure such as an IP. We need to build an ecosystem to speed up innovation and remove the layers of repetitive tasks. And the game is moving from small molecule to large molecule to gene therapies where we are again talking about requiring a larger investment.”
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