Globally, foreign investors are increasingly making use of the investor-State dispute settlement (ISDS) mechanism to challenge host State’s regulatory measures pertaining to intellectual property rights (IPR).Against this global backdrop, this chapter examines whether regulatory measures, in particular the compulsory licensing of pharmaceutical patents - an important public health flexibility measure - amounts to indirect expropriation under India’s bilateral investment treaties (BITs) and investment chapters in India’s free trade agreements (FTAs).The chapter finds that there is no one answer that can be given to this question.The outcome will depend on the language of the treaty.Those BITs and FTA investment chapters that specifically exempt issuance of compulsory licenses from the ambit of expropriation subject to some conditions provide more regulatory space to India.In case of other BITs that are silent on this, the outcome will depend on the approach adopted by the ISDS tribunals that is whether the tribunals relies upon the "sole effects" test or the "police powers" test to determine indirect expropriation.The chapter also discusses the 2016 Indian Model BIT that puts issuance of compulsory licensing outside the ambit of the BIT provided such issuance is consistent with the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement.

The use of patents in relation to public health is especially important in relation to the needs of developing countries to ensure equitable access to “life-saving” patented drugs. Since the USA has been pursuing a stringent protection regime for drugs marketed by US patentees, however, it becomes all the more essential to highlight such concerns among developing countries. Recently Brazil, China, and India have individually been at the forefront of challenges to US patent policy; other countries such as Pakistan, Bangladesh, and Singapore are bound together in such campaigns by colonial after-effects of the British Empire. This chapter considers implications of the pricing of patented drugs for AIDS/HIV and cancer patients in developing countries, specifically India and argues that these should be considered in a distinct category of “positive discrimination.” Looking at the role of the relevant stakeholders – governments, civil society, and pharmaceutical companies – it explores how India and Brazil have seamlessly taken the lead in determining the optimum use of compulsory licensing measures to ensure that patented drugs are available to all.